Wyoming Department of Health officials painted a stark picture to lawmakers Monday of long-term care spending in a state with an aging population and a Medicaid deficit that’s likely to grow in the coming years.
“They were taken aback,” department director Tom Forslund said of lawmakers on the Labor, Health and Social Services Committee.
Even in the short term, the numbers are bleak: Medicaid currently faces a more than $20 million deficit, a number that’s almost certain to grow in the coming years as Wyoming’s population continues to age and require more long-term care. According to the report Forslund’s staff prepared for the legislative meeting, “the cost to Wyoming Medicaid for long-term care could increase from $130 million in 2017 to between $184 million and $312 million in 2030.”
“Those numbers don’t lie, and we as a state of Wyoming are going to face significantly higher costs over the next 13 years, and the question is, what are we going to do about it?” Forslund said.
The overall problem is compounded further by the fact that as Wyoming ages, the population of people capable of working and paying taxes — and working in health care to treat the elderly — will diminish.
“(W)hile Wyoming’s population is expected to grow to a total of 665,672 persons in 2030, most of this population growth will be in the two older demographics (65+),” the health department wrote.
On top of that, costs will continue to rise and people are increasingly unprepared for retirement, the department found.
Then there’s the matter of cuts the health department has absorbed in recent years. As Wyoming has labored under a struggling economy, agencies across state government have been slashed. Forslund said his department has lost around $100 million in recent years, and he expects more cuts in the coming months.
That’s a problem not only because the department is losing funding, but because it also means Forslund has fewer options to absorb the Medicaid shortfall. There are less places to turn to within the department from which he can draw money.
Forslund said that the purpose of the presentation to lawmakers wasn’t to offer solutions; it was to raise awareness. He said the path forward will become clearer over the coming months and that he will likely meet with the committee again after the coming legislative session, which will end in mid-March 2018.
But generally, he said, the state can save Medicaid dollars by keeping the elderly in their homes and out of long-term care facilities for as long as possible. He added that’s also the patients’ general preference, to remain in their home.
“We said we’re going to look at what some of the other states are doing to promote in-home care versus institutional care because that runs almost half the care of institutional care,” Forslund said. “The longer you can keep them in the home, it’s cheaper for the state and people are happy.”
Still, there’s no magic bullet or singular solution, he stressed, but the state can help the situation by providing resources for people living at home and making Wyoming an attractive destination for the private sector, who can provide health workers to treat the elderly who need care in their home.
“There are going to be less people working in the next 13 years in terms of people working versus people over 80 compared to today,” Forslund said.
Long-term care is expensive, especially in Wyoming. Between 60 and 70 percent of nursing home patients receive Medicaid funding, according to the department. Nursing home rates have risen from more than $55,000 a year in 2006 to roughly $90,000 last year, according to department data.
The department concluded that “for the average retiree, accumulated personal assets will not provide sufficient cash flow to pay for the annual costs of long-term care, even in the least expensive settings.”
In those situations, the state often picks up the slack.
For now, the state faces that $20 million-plus deficit in Medicaid spending. Asked how the state would fill that, Forslund said it’s just a projection and there’s hope that it won’t be as “bleak” in reality.
He added that he’s frozen spending throughout the health department, and between the two — frozen spending and a hopefully smaller deficit — the state can fill much of the shortfall.
“The Legislature might fill that gap, a special appropriation, I mean, there’s a variety of options,” he said. “Right now, it’s the middle of October.”