How Much Do Informal Care Supports Affect the Nursing Home Population?

Informal care, care provided by family and friends, is a known substitute for formal long-term care in institutions. (Van Houtven & Norton, 2004) As states adopt Medicaid policies, such as payment for family caregivers, associated with Home and Community Based Services, fewer people will be placed in long-term institutional care. (Kane et al, 2013) In response to smaller numbers with more acute cases for their Medicaid patients, nursing homes have few options: increase the number of post-acute care beds to maximize Medicare payments or accept patients historically less likely to use institutional care, such as racial minorities or young patients newly insured through Medicaid expansion. Using data from the Minimum Data Set, we exploit the choice and variation in the timing of adoption as well as family caregiver pay differentials between states to examine the mechanisms in which nursing home populations change.

References:

Kane, R. L., Lum, T. Y., Kane, R. A., Homyak, P., Parashuram, S., & Wysocki, A. (2013). Does home-and community-based care affect nursing home use?. Journal of aging & social policy, 25(2), 146-160.

Van Houtven, C. H., & Norton, E. C. (2004). Informal care and health care use of older adults. Journal of health economics, 23(6), 1159-1180.