Generating cost savings for Medicaid through use of community health workers to improve access to community-based long-term care

State Medicaid programs are increasing their use of home and community-based services (HCBS) as alternatives to institutional long-term care (LTC) to respond to consumer preference, court rulings, and to lower LTC costs. However, past research has failed to show that HCBS generate savings due in part to increases in HCBS spending on individuals who would not have otherwise entered institutional care in absence of the HCBS. Improved targeting of HCBS to individuals at greatest risk for nursing home entry is needed. This presentation will report on the Arkansas Community Connector Program (CCP), an innovative Medicaid demonstration program that uses community health workers to identify community-dwelling adults with unmet LTC needs and link them to needed HCBS. A quasi-experimental design was to examine CCP participants before and after CCP participation and to compare CCP participants with a similar group of Medicaid residents residing in five non-intervention counties. Results indicate that the CCP reduced Medicaid spending 23.8% per participant over the three-year demonstration period (p<0.01), with most of this reduction occurring in the second and third years following participation, and that the program generated a net savings of $2.6 million for the state Medicaid program, or a return on investment of $2.92 per dollar invested in the program. Findings suggest that the community health worker model may be an efficient mechanism for targeting home and community-based services to persons at risk for nursing home entry, particularly in rural and underserved areas.