The Dallas Morning News reports
on Texas’ implementation of a Medicaid reform initiative that’s been the subject of an ongoing, low-level battle in Arkansas: the Community First Choice Option, a program that would allow people in need of long-term care to get services at home or in their communities, rather than being institutionalized. 

CFC will allow thousands of Texans with developmental disabilities to access services they’ve previously been denied. (Texas has dropped the word “option” from the name, so in this post I’ll refer to both the Texas program and the hypothetical Arkansas program with the “CFC” abbreviation.) Although CFC is part of the Affordable Care Act, conservative legislators in Texas have apparently embraced the program because of promised cost savings. In Arkansas, as we reported in 2014, the association with Obamacare helped to sink CFC among state legislators. Pressure from the nursing home lobby likely didn’t help, either.


In the past, both Texas Medicaid and Arkansas Medicaid generally have steered people with disabilities into institutions, even if it’s cheaper to care for them in a less-restrictive setting, such as a group home. And it almost always is cheaper, as the Dallas Morning News reports:

Texas … operates more institutions for people with disabilities than any other state: 13 centers for 3,362 people.

In 2012, Texas spent $166,643 per person to keep them in a state institution, compared with $39,947 per person it pays for people with disabilities to live in a community. The funding for community-based programs went down 5.8 percent in two years, according to the Texas Council for Developmental Disabilities.

This is why Texas has consistently ranked almost last in the U.S. in providing services for people with disabilities, said Kyle Piccola, government affairs director for the disability rights group ARC of Texas. He and other groups say the root cause is legislators’ general aversion to funding social programs like Medicaid.

Medicaid is supposed to provide adults with services to live in their own homes or apartments, but the waiting lists for it are so backlogged that tens of thousands are left waiting a long time.

We’ve got the same problem here in Arkansas. There are about 3,000 developmentally disabled Arkansans on a waiting list to receive “waiver services,” meaning Medicaid dollars normally used to pay for the exorbitant cost of institutionalization would instead be used to pay for at-home care or a group home or some other “community-based” option. But there’s a cap on how many people can receive waivers, and many of the families on have been on a waiting list for seven or eight years, during which time they’re simply foregoing many Medicaid services altogether. 


Texas’ waiting list problem is even worse than Arkansas’s on a per-capita basis: There are an incredible 102,000 people on the waiting list there. (Texas’ population is nine times as large as ours, but its waiting list is 34 times as large.)

However, Texas is now addressing the problem. CFC will help it move people off its swollen waiting list, with some $116 million in additional funding approved for the next two fiscal years alone. That’s made possible in large part by extra federal money provided to states that agree to implement CFC (the money comes in the form of an enhanced match rate, which is explained here).


This all has relevance for Arkansas because a big overhaul of the state’s Medicaid system is in the works. As David Ramsey reported last week, the discussion in the legislature has shifted from empty threats of dismantling the private option — the Medicaid expansion for low-income, non-disabled adults implemented in 2013 — to talk of cost-savings in other Medicaid programs, including developmental disabilities. One big piece of that picture is the fact that institutional care simply costs much more than community-based services. In fact, even without CFC and its extra federal dollars, Arkansas could cut costs dramatically by a shift away from institutionalization.

That’s been among the most significant conclusions of the Stephen Group, the consultant hired by the legislature to investigate options for Medicaid reform. CFC or no CFC, said the consultants, the state needs to shift towards home- and community-based care.

This would help save money. More importantly, it would help thousands of disabled people and their families live better, more independent lives. However, there are big hurdles ahead — namely that providers such as nursing homes want to preserve the old model of institutionalization-as-the-norm. And while shifting towards home- and community-based services is in itself a good idea, the debate may get tangled in larger, thornier questions about “managed care” in the Medicaid program writ large.

It’s very good news that Texas is finally trying to correct its deficiencies in the way it treats its disabled residents. Of course, let’s not get carried away — there are still around 750,000 low-income citizens in Texas without insurance simply because the state wants to thumb its nose at the Obama administration by refusing the ACA’s expansion of Medicaid for the poor. Arkansas had the good sense to accept that money — but then that was in a different political universe, in 2013.