nation among providers who concurrently care for older adults in different settings, exemplifying the failure of the health care system to meet the standards of quality (most notably safety, efficiency, and patient-centeredness) as described in the IOM’s Crossing the Quality Chasm (IOM, 2001). Coordination of care and the use of interdisciplinary teams, is discussed in more detail later in this report.

Long-term care services include health and personal services provided to chronically disabled persons over an extended period of time. Estimating the total amount of long-term care services received by older adults is difficult because utilization data are not often collected in a consistent manner across settings or care providers. Just over 60 percent of disabled older adults living in the community obtain some long-term care services, most commonly basic personal-care services and help with household chores, averaging about 177 hours per month (Johnson and Wiener, 2006). Informal caregivers provide the vast majority of these services. Approximately 5.7 million older adults received some unpaid services in 2000 (Johnson et al., 2007). Only about 18 percent of long-term care services provided to disabled older adults in their homes are delivered by formal paid sources. Medicaid accounts for about 41 percent of total long-term care expenditures (including non-elderly persons), while Medicare and out-of-pocket costs each account for 22 percent of expenditures (Kaiser Commission on Medicaid Facts, 2007).

As noted earlier, while approximately 1.45 million older adults live in nursing homes, another 750,000 older adults live in alternative residential care facilities, which provide housing and services outside nursing homes for those unable to live independently (Spillman and Black, 2006). In fact, assisted-living facilities have been the most rapidly expanding form of residential care for older adults (Maas and Buckwalter, 2006). At the same time, the percentage of older adults living in nursing homes declined from 21 percent to 14 percent between 1985 and 2004, consistent with the preferences of older adults to live in the community (Alecxih, 2006b). While the Veterans Health Administration (VHA) allots 90 percent of its long-term care resources toward nursing homes, about 56 percent of formal long-term care service recipients receive community-based care (Kinosian et al., 2007).

In 2005 about 870,000 Medicare beneficiaries received hospice care, accounting for $7.92 billion in total Medicare payments (OIG, 2007). Twenty-eight percent of these beneficiaries received some hospice care in a nursing facility.

In addition to their increased needs for assisted housing and other types of care, older adults account for a disproportionate share of prescription and over-the-counter medications (ACCP, 2005). They consume 34 percent of all prescriptions dispensed and account for about 40 percent

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