6
Adequacy of Resources

As discussed in several previous chapters, the full intent of Congress with respect to the state long-term care (LTC) ombudsman program has not been met in all—indeed, perhaps not in any—state of the union. Some states fall short in not having expanded to board and care (B&C) homes, other states do not have adequate cycles of visiting all LTC facilities, some states operate fragmented programs and individual advocacy efforts that have no link to preventive or educational system efforts, and still others lack appropriate access to legal services. In short, as the material in Chapter 3 makes clear, many states are not in compliance with the expectations and requirements of the program.

Many factors compromise the fulfillment of congressional—and public—expectations. States have the flexibility, through control of program implementation, to enhance or impede ombudsman performance. The absence of standards for program compliance is notable. Ombudsmen are clearly tasked in law with specific responsibilities, but they are given little guidance on how to interpret or fulfill those requirements. A final significant factor is the overriding realities of budget shortfalls and inequitable resource allocations.

At the heart of many of these problems lie deficiencies of financial resources rather than any lack of interest or basic commitment to the LTC ombudsman program or LTC facilities. Recognizing that resources are directly linked to the productivity of the program (e.g., the numbers of complaints that can be fully investigated and completely resolved) and, thus, at least indirectly to its effectiveness (e.g., how satisfied program clients are with the handling of their complaints), Congress called on the Administration on Aging (AoA) to examine the adequacy of resources for the program.



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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act 6 Adequacy of Resources As discussed in several previous chapters, the full intent of Congress with respect to the state long-term care (LTC) ombudsman program has not been met in all—indeed, perhaps not in any—state of the union. Some states fall short in not having expanded to board and care (B&C) homes, other states do not have adequate cycles of visiting all LTC facilities, some states operate fragmented programs and individual advocacy efforts that have no link to preventive or educational system efforts, and still others lack appropriate access to legal services. In short, as the material in Chapter 3 makes clear, many states are not in compliance with the expectations and requirements of the program. Many factors compromise the fulfillment of congressional—and public—expectations. States have the flexibility, through control of program implementation, to enhance or impede ombudsman performance. The absence of standards for program compliance is notable. Ombudsmen are clearly tasked in law with specific responsibilities, but they are given little guidance on how to interpret or fulfill those requirements. A final significant factor is the overriding realities of budget shortfalls and inequitable resource allocations. At the heart of many of these problems lie deficiencies of financial resources rather than any lack of interest or basic commitment to the LTC ombudsman program or LTC facilities. Recognizing that resources are directly linked to the productivity of the program (e.g., the numbers of complaints that can be fully investigated and completely resolved) and, thus, at least indirectly to its effectiveness (e.g., how satisfied program clients are with the handling of their complaints), Congress called on the Administration on Aging (AoA) to examine the adequacy of resources for the program.

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act One element of the charge to the Institute of Medicine study committee, therefore, involved the issue of resources, and this chapter reports on the committee’s examination of this question. In this, the committee confined its discussion to resources for bringing the program into full implementation and compliance with today’s statutory mandate for nursing facilities and B&C homes. It did not attempt to forecast the level or type of resources that might be needed to fulfill any possible expansion of the program (with respect to LTC, to the elderly, or to the nation as a whole secondary to comprehensive health care reform) —matters taken up in Chapter 7. ADEQUATE PROGRAM PERFORMANCE The committee has been impressed by the extent to which states vary in the effectiveness or productivity of their ombudsman programs and in the availability and utilization of resources. Clearly, a judgment about the adequacy of program funding and resources cannot be made without some reference to indices of program output and performance. Furthermore, Congress intended the ombudsman program, if the specifications in the Older Americans Act (OAA) are to be taken at face value, to be more than simply a program that responds to LTC residents’ complaints. It has other mandated functions, such as staff and volunteer training and systemic advocacy. As discussed in Chapter 5, however, performance measures can be difficult to define conceptually and even more challenging to measure in any systematic, quantifiable way. In view of the paucity of accurate data for assessing compliance, the committee developed a list of elements of infrastructure and function that must be present for any state program to achieve effective output (see Tables 5.2–5.9). Relatively crude indicators of program quality are available, however. Some reflect so-called structural measures (numbers of full-time equivalent [FTE] staff), others relate to the processes and activities of the program (paid staff per numbers of LTC beds), and others pertain to outcomes of those processes (the percentage of complaints registered that are fully resolved or peer nominations of “successful” programs). These measures of program adequacy must be set against existing program dollars to determine whether present levels of funding can reasonably be expected to produce the desired levels of program activity and outcomes. Possibly the most detailed use of such measures is contained in a recent federal review of the ombudsman program. In 1991 the Office of the Inspector General (OIG) of the Department of Health and Human Services (DHHS) issued three reports (1991a,b,c) based on a national inspection of the programs of all states, the District of Columbia, and Puerto Rico. Using

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act interviews with state ombudsmen, the OIG investigators attempted to determine the characteristics of successful programs and to identify highly successful programs; the highly successful programs were then examined in greater depth. The OIG analysts developed a multidimensional index to serve as the basis for rating the activities of all state programs. This index comprised a series of measures grouped into three main categories—visibility, complaint resolution, and peer recommendations. Measures included frequency of visits to LTC facilities, ratio of professional staff to beds, ratio of volunteers to beds, incidence of complaints received and resolved in a timely manner, and a rating of state program reputations based on peer appraisals. The OIG staff scored these measures and then translated them into a final, global score for each state and the District of Columbia that ranged empirically from a high of 27 (out of a possible 28) to a low of 11; the modal score was 19. Table 6.1 reproduces portions of the OIG data for three groups of states (the six highest-ranked on the aggregate OIG index [scores 23–27], the seven middle-ranked [score of 19], and the seven lowest-ranked [scores 11–13]). In addition, the table shows the total nursing home and B&C beds, dollar expenditure per LTC bed for FY 1993, and ratio of FTE paid staffing to beds. The variation within these three groups in, for example, ratios of paid staff to volunteers (see Table 2.3) and program expenditures per LTC bed is striking. However, the differences among the groups on certain measures is also striking, particularly for the highest- and lowest-ranked states in terms of ratio of staff to volunteers, schedule of visits (see Table 2.5), number of complaints per 1,000 LTC beds,1 and, of course, program expenditures per LTC bed. Some use of these data (or group-specific calculations) will be made below in discussing overall levels of funding for the ombudsman pro 1   The volume of complaints received is a difficult measure to interpret, absent detailed knowledge of each state’s LTC sector and ombudsman program. High complaint rates may reflect poor nursing facility or B&C services and an “average” level of activity by the ombudsman program, or it may reflect “average” LTC services and a very active ombudsman program and clientele; conversely, low rates may suggest very good LTC facilities overall in a state or an extremely unproductive and ineffective ombudsman program. Some limited evidence suggests an impressive association between complaint volumes (on the one hand) and levels of staffing and frequency of visits (on the other) (see, for example, OIG, 1991a,b,c; Huber et al., 1993). Reports from site visits made by the committee underscored this view.

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act TABLE 6.1 Fiscal, Staffing, and Long-Term Care Bed Data, Selected States State OIG Rating Number of LTC Beds Total Expenditures (FY 1993 $) Expenditures per LTC Bed (FY 1993 $) Ratios of FTE Paid Staff to LTC Beds Highest-Ranked States Massachusetts 27 58,509 2,000,321 34.19 1:1,950 District of Columbia 27 4,966 244,767 49.29 1:1,655 California 25 269,149 6,007,226 22.32 1:1,759 Michigan 23 95,052 892,311 9.39 1:4,526 Oregon 23 27,744 349,378 12.59 1:9,248 New Mexico 23 9,397 278,740 29.66 1:1,342 Middle-Ranked States Connecticut 19 33,294 769,273 23.11 1:3,329 Maryland 19 32,766 186,631 5.70 1:1,927 West Virginia 19 12,778 431,356 33.76 1:1,420 Rhode Island 19 11,147 89,814 8.06 1:11,147 South Dakota 19 8,955 107,830 12.04 1:128 Vermont 19 5,845 224,829 38.47 1:1,169 Wyoming 19 4,127 171,404 41.53 1:1,032 Lowest-Ranked States Pennsylvania 13 133,002 1,752,924 13.18 1:4,290 South Carolina 13 24,449 146,224 5.98 1:4,890 Nebraska 13 24,181 90,497 3.74 1:24,181 Indiana 12 68,582 403,712 5.89 1:5,276 Iowa 12 42,286 205,496 4.86 1:5,286 Hawaii 12 6,047 101,571 16.80 1:3,024 Kansas 11 29,358 195,880 6.67 1:7,340 NOTE: States are listed in order by OIG index score and then number of LTC beds (nursing home and B&C beds) as a proxy for demand for ombudsman services. Middle-ranked states, with scores of 19, are the modal states in the OIG ranking. SOURCES: OIG, 1991b; DuNah et al., 1993; Harrington et al., 1993; AARP, 1994a; AoA, 1994c.

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act gram, but it should be clear that the OIG index does not relate in any straightforward way to some of the crude measures of program performance adequacy noted above. FINANCIAL RESOURCES Resources, for the purposes of this study, are taken to mean dollars available to the states to operate the program as it is mandated today. Some regard staff as a form of “resources,” but as the acquisition and deployment of paid staff or even of unpaid volunteers presupposes adequate financing, staffing levels are regarded here as a structural measure of program quality or performance. Financial support to the states and their localities for their ombudsman activities is available through several channels: the federal funds that flow to the states, state “matching” funds, state general revenues that may exceed funds used as matching funds, local host agency matching funds, and other monies raised at the state or local level through various fund-raising activities in public and private sectors. Data on these critical parts of the ombudsman program were presented in Chapter 2, as was the description of how the program is funded; some key figures are repeated in this chapter for convenience (Table 6.2). In monetary terms, the ombudsman program is very small as federal programs go. The main figures show that total expenditures (summing across all sources) for fiscal year (FY) 1993 were more than $37 million; of that amount, federal expenditures were more than $23.6 million and state and other local expenditures more than $13.5 million. Federal dollars flow each year to the states through Title III-B and Title VII, Chapters 2 and 3 of the OAA. Title III-B (Supportive Services) and Title VII-3 (Elder Abuse Prevention) may be used for ombudsman as well as other programs, Title VII-2 only for ombudsman purposes. In FY 1993 Congress appropriated under Title VII $3.87 million for ombudsman activities (Chapter 2) and, of the total $4.35 million appropriated for Elder Abuse Prevention, states elected to use $2.1 million in conjunction with the ombudsman program (see Table 2.4). As Table 6.2 documents, the states vary widely in their direct financial support for ombudsman programs and in the proportions of those expenditures that can be attributed to federal, state, and other sources. In 1993, for example, states reported total expenditures for their ombudsman programs between about $61,000 (North Dakota) and $6,000,000 (California). States vary even more in the extent to which they (or their localities) generate other monies for these purposes; probably only 60 percent of the states commit nongovernmental money to the program. In 1993, some states reported that

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act TABLE 6.2 Summary of Total Funding for the State Long-Term Care Ombudsman Programs by State, FY 1993 State Federala State Otherb Total Alabama $155,791 $12,461 $190,707 $358,959 Alaska 107,743     107,743 Arizona 110,465 116,000   226,465 Arkansas 375,181 12,497   387,678 California 2,245,032 2,019,256 1,742,938 6,007,226 Colorado 455,360 26,222 43,896 525,478 Connecticut 204,605 559,559 5,109 769,273 Delaware 148,081 33,441   181,522 District of Columbia 116,789 127,978   244,767 Florida 872,150 19,733 470,045 1,361,928 Georgia 776,251 401,385 63,708 1,241,344 Hawaii 54,943 46,628   101,571 Idaho 312,182 24,653   336,835 Illinois 1,274,897   342,950 1,617,847 Indiana 348,821 13,372 41,519 403,712 Iowa 205,496     205,496 Kansas 167,023 28,857   195,880 Kentucky 485,798 110,125 191,713 787,636 Louisiana 570,240 90,910 98,607 759,757 Maine 75,291 48,465 3,246 127,002 Maryland 186,631     186,631 Massachusetts 1,903,341 97,980   2,001,321 Michigan 235,138 448,167 209,006 892,311 Minnesota 664,721 152,149 193,115 1,009,985 Mississippi 403,205 29,147 30,525 462,877 Missouri 509,346 107,322 153,818 770,486 Montana 67,147 8,050   75,197 Nebraska 80,962 9,535   90,497 Nevada 78,937 52,068   131,005 New Hampshire 207,768 50,358   258,126 New Jersey 136,069 797,945   934,014 New Mexico 189,231 76,042 13,467 278,740 New York 2,231,708 215,163 242,918 2,689,789 North Carolina 818,390 105,091 82,669 1,006,150 North Dakota 61,088     61,088 Ohio 1,396,036 484,286 618,044 2,498,366

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act State Federala State Otherb Total Oklahoma $516,096 $102,697 $30,808 $649,601 Oregon 175,599 173,779   349,378 Pennsylvania 1,321,596 182,327 249,001 1,752,924 Puerto Rico 242,629   21,723 264,352 Rhode Island 69,814 20,000   89,814 South Carolina 124,741 7,161 14,322 146,224 South Dakota 94,603 13,227   107,830 Tennessee 611,786   75,615 687,401 Texas 1,244,121 55,935 181,460 1,481,516 Utah 95,189 21,095 30,586 146,870 Vermont 218,100 3,921 2,808 224,829 Virginia 209,756 78,407 177,004 465,167 Washington 143,953 352,364 144,869 641,186 West Virginia 195,963 233,659 1,734 431,356 Wisconsin 117,900 353,100   471,000 Wyoming 63,230 22,472 85,702 171,404 Total $23,676,933 $7,944,989 $5,753,632 $37,375,554 NOTE: Blank entries indicate that no funds were reported as expended in that state from that source. aIncludes both Title III (Part B and ombudsman sources), Title VII (Chapter 2 and Chapter 3), and other federal funds. bIncludes all sources other than federal and state appropriations. SOURCE: AoA, 1994c. their ombudsman program relied totally on federal monies (e.g., Alaska, Iowa, North Dakota). Many relied only on federal and state funding (and no local funding), but three (Illinois, Puerto Rico, Tennessee) used federal and local (but no state) funding.2 The majority of states used funding from all three 2   States vary in their interpretation of what constitutes state and other nonfederal funding for the ombudsman program, and thus some variation among states in expenditures reported to AoA may in fact be influenced more by interpretation of terminology than actual resources expended.

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act sources, but even so they varied in terms of the proportion of total spending derived from these different sources. In some states, for example, local expenditures are a very small fraction of overall spending (Maine and West Virginia are cases in point), whereas in other states local expenditures exceed what the state itself makes available from its own revenues. In short, the pattern of sources of financial support for the ombudsman program can easily be termed a crazy quilt. Federal OAA Title III-B appropriations are allotted to the states according to a formula based primarily on the relative number of persons above age 60; the federal dollars are subsequently allocated within each state according to a variety of mechanisms (see Chapter 2). The same basic formula (relative number of persons aged 60 and over) is used to distribute Title VII appropriations to the states. Also states are not presently required to “match” federal funding under Title VII in any formal way—a circumstance quite unlike many federal-state programs such major block grants for maternal and child health, Medicaid, and others. Through the 1992 OAA amendments, states are required to maintain a minimum expenditure level for the ombudsman program and are subject to a non-supplantation provision. Thus, decisions on levels of financial resources currently expended on the programs depend to some extent on the total number of dollars available for all aging programs in a state, and much of that depends on the state’s economy. Not surprisingly, then, the overall spending on this program varies wildly by state, by virtue of both the distribution formula used and the level of state and local resources made available to the program. FINANCIAL RESOURCES AND PROGRAM PERFORMANCE Ideally, adequacy of resources would be measured in terms of ratios of dollars to reliable and valid measures of program quality, efficiency, and productivity. As discussed elsewhere, data are not available to produce these types of ratios. Thus, the committee has elected to make some judgments about this question on the basis of a resource-related ratio—FTE paid staff to LTC beds. The committee’s judgment was influenced, in part, by the median values for states rated high, middle, and low on the OIG index cited earlier (see Table 6.1). By “triangulating” on data from these sources, therefore, the committee has arrived at some conclusions about approximate levels of appropriate funding that lead it to recommend a desirable target for future funding for this program and some changes in the ways that federal, state, and local support should be generated and allocated. These issues are elaborated in the remainder of this chapter. Three questions are of particular importance:

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act What can be considered adequate funding to enable all state ombudsman programs to achieve reasonable compliance with the existing program as mandated by the OAA and to accomplish at least an “average” level of program effectiveness and efficiency? An answer to this question would suggest levels of federal appropriations, state matching funds, and other (e.g., local) resources needed for the program as it exists today, but would leave no real margin for any appreciable further expansion into LTC settings or populations not currently included in the mandate. What is an appropriate split of budgetary responsibility between the federal government and the states? For fiscal solidarity of the ombudsman program at the state level, are modifications indicated in budget formulation, resource allocation, financial management, or other administrative practices? If so, what are they? CONCLUSIONS AND RECOMMENDATIONS Adequacy of Resources for the Currently Mandated Program Monetary Resources To gain a better appreciation of the spending levels in relationship to some indicator of program quality, the committee reviewed program funding levels in terms of expenditures per FTE paid staff in the context of (a) size of populations to be served (LTC beds are used as a proxy), and (b) rough measures of performance (ratings on output measures as reported by OIG [1991b] are used as proxy). This analysis led to a rough estimate of the shortfall that committee members agree presently exists in funding for the ombudsman program. Overall, the committee concluded both that funding levels for the ombudsman program as currently called for in the OAA are inadequate and that a formal recommendation calling for a reasonable increase in federal funding for the program was warranted. Accordingly: 6.1. The committee recommends that by fiscal year 1998 Congress increase the appropriations through Title VII, Chapter 2 of the Older Americans Act for the state long-term care ombudsman programs to an amount that ensures that all state Offices of the Long-Term Care Ombudsman program are funded at a level that would permit them to perform their current functions adequately. The committee further recommends that the factor of 1 full-time equivalent paid staff working as an authorized, designated ombudsman per 2,000 long-term care beds be used as a base indicator of performance and a unit of effort to determine the amount of additional resources needed.

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act Funding Needs Based on Spending per Paid FTE Staff. To arrive at a measure of adequacy of resources, the committee examined spending per paid staff person in the various states and the level of paid staffing in relation to number of LTC beds. The reason for doing this is that the sine qua non of a minimally effective state-based ombudsman program is the acquisition and deployment of adequate staff. The available data, however, does not indicate that a straightforward relationship exists between staffing relative to LTC beds and the fulfillment of the duties of the ombudsman program. No complete, verified data are available on the exact numbers of FTE paid staff associated with each state’s ombudsman program.3 For purposes of this analysis, one good estimate of staff working directly in the program (AARP, 1994a) puts the national number at 865, which yields a ratio of 1 FTE staff per 2,700 beds (in round numbers) for the nation as a whole. Not surprisingly, this figure masks a considerable variation across the states (see Table 2.3), from meager rates in the range of 1 FTE paid staff per 24,000–28,000 LTC beds to remarkably robust rates in the range of 1 FTE per 100–500 beds. A review of the ratios for the three OIG-ranked state groupings (as proxy indicators of performance) indicates the following ranges. For the six highest-ranked states, per-bed staffing ranged from 1 FTE per 1,342 beds (New Mexico) to 1 per 9,248 beds (Oregon), and the median staffing for this group was 1 per 1,855. The range for the seven middle-ranked states was 1 FTE per 128 beds (South Dakota) to 1 per 11,147 beds (Rhode Island), and the median staffing for this group was 1 per 1,420. Within the seven lowest-ranked states, Hawaii staffs at 1 FTE per 3,024 beds and Nebraska is at the least generous point with 1 per 24,181 beds; the median staffing is 1 per 5,276 beds. These ratios would differ if staffing counts were adjusted to include the FTE of volunteers designated as representatives, but these data are even more illusive to verify. Based on these figures and its judgment on the level of staffing needed to manage the ombudsman program effectively, the committee concluded that states need a minimum of 1 FTE paid staff per 2,000 LTC beds if they are to function at a satisfactory baseline level. This target implies an increase in the ratio of staff per bed units of nearly 26 percent (from 1:2,700 today to 1:2,000 in the near future), if viewed from a national perspective. In reality, some states need more than a 26 percent increase in paid staffing to bring them up to a baseline ratio of 1:2,000; indeed, some would need increases of more than 200 percent. 3   Some state ombudsmen, particularly those working in programs with decentralized systems, do not know how much time paid ombudsmen are spending on ombudsman work.

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act Although the committee acknowledges that by no means all funding for the ombudsman program ($37.4 million in FY 1993) goes for paid staff, it did believe that a rough proxy indicator of necessary program spending could be developed from these figures. Thus, it calculated that, on average, national spending per FTE staff might be said to approximate $43,240. Using this figure, then, to calculate needed program funding levels to reach its goal of 1 FTE staff to 2,000 LTC beds (assuming no increase in beds beyond the nearly 2,334,000 nursing facility and B&C beds now in use and assuming for purposes of this discussion that all resources currently supporting the program were redistributed across the states), the committee determined that total paid staff would need to rise to nearly 1,170 FTEs, an increase of about 300 FTEs (in round numbers). Using the “average” per-FTE spending level given just above, this increase in paid staff would translate into a total of approximately $50,600,000, or nearly $13.2 million beyond today’s total spending. As noted elsewhere, about two-thirds of the ombudsman program budget presently comes from federal monies. Thus, if the current distribution of resources remains the same, then federal sources would have to supply approximately $8.8 million in new dollars, and state and local sources would have to supply $4.4 million. In the committee’s view, therefore, a federal appropriation within five years of about $32.5 million ($23.7 million plus $8.8 million) is a defensible target. This $32.5 million figure does not take inflation into account. Doing so (at an assumed inflation rate of 4 percent per year) would yield a figure for FY 1998 of approximately $39.5 million in federal funds. This figure also does not make any allowance for possible changes in the relative proportions of overall funding that might come from the states and local sources; it assumes that the current pattern (two-thirds federal, one-third other public or private funds) would remain in force. The committee also holds that states should be required to match federal funding at some meaningful level. However, the committee does not believe that a change in the direction of requiring more nonfederal monies ought to be used as an argument for reducing the total federal appropriation for this program. The above “target” of roughly $32.5 million (today’s dollars) or $39.5 million (adjusting for anticipated inflation) is needed simply to bring the program up to a minimum level of adequate funding for the tasks Congress has assigned it to date, assuming for purposes of this analysis that all funds were distributed according to a state’s proportion of LTC beds. The increase in appropriations would not enable the program to take on any new responsibilities, initiate innovative activities, or carry out the additional data collection, analysis, and evaluation efforts that the committee believes are warranted. The committee recognizes that further analysis is needed to determine more accurately the level of additional funding needed at the national level to bring each state up to a minimum level of resources. Whether $32.5 million of federal appropriations could be allocated among all states in a manner that

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act achieves the goal of providing adequate resources to support 1 FTE paid staff per 2,000 LTC beds depends on several factors, such as the formula used for distribution and whether and at what level states are required to match. In later sections of this chapter, the committee comments on both of these. Sources of Federal Funding. The sources of federal funding for the ombudsman program are not straightforward. Monies can be appropriated under two different titles of the OAA; one title directs monies specifically for support of the ombudsman program and the other only permits monies to be used for this purpose. The committee gave serious consideration to recommending that all congressional appropriations for the ombudsman program be handled in Chapter 2 of Title VII of the OAA—that is, the title under which funding is to be used solely for the ombudsman program. Ultimately, the committee decided that the flexibility offered to the state units on aging (SUAs) and area agencies on aging (AAAs) by the funding options within Title III-B are worth preserving at this time. However, increases to ensure an adequate funding level for every state should be directed expressly to the ombudsman program in appropriations through Title VII-2, and federal fiscal policy should continue to require SUAs and AAAs to maintain the level of expenditures for the ombudsman programs achieved in FY 1991. The potential shift of some OAA appropriations in Title III-B to Title VII-2 deserves to be revisited in the future. Funding Allocation Formula The formula for allocating federal funds under Title VII-2 of the OAA is based on total numbers of persons aged 60 and older. This formula has several drawbacks from the perspective of need and equity in the context of the ombudsman program’s mission. For example, states vary in the ratio of LTC beds to population 60 years of age and older, and some states with a high percentage of the nation’s 60-plus population have a low percentage of the nation’s LTC beds. In addition, if some states have large numbers of the “younger elderly” (assuming age 60 as the starting point) who are still employed or at least in active retirement, those states may enjoy a windfall in terms of federal dollars for their ombudsman programs, relative to states with different sociodemographic and economic circumstances. Another difficulty with the current formula relates to the nature of one of the ombudsman’s principal tasks—namely, to be a presence in LTC facilities (both nursing facilities and B&C homes). The number of individuals above a certain age does not say anything specific about the demand for ombudsman services as a function of the number and distribution of LTC facilities and

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act beds in the state. Geographic proximity of facilities to ombudsmen directly affects the cost of the program, but is most likely unrelated to the number of elderly residents of a state. Finally, the number of persons over age 60 bears little, if any, relationship to other factors—social and economic—that may make it possible for a state to sponsor an adequate ombudsman program; for example, the population figure probably has little if any correlation with wage and labor costs that help determine salary figures for paid FTE staff. States vary in the stages of implementing the 1981 mandate to serve B&C residents. Some data suggest that the ombudsman best serves residents of these facilities through an approach somewhat modified from that traditionally used to advocate for nursing facility residents. The cost incurred for a program to serve residents of B&C facilities may not necessarily be the same as that incurred for an equal number of nursing facility residents. It is logical to assume that states incur some initial extra cost to train staff and volunteers to serve B&C residents. Thus, in addition to arguing for a meaningful increase in federal appropriations for the ombudsman program, the committee has concluded that the major drawbacks of the current state-by-state allocation strategy must be addressed. Accordingly: 6.2. The committee recommends that Congress revise the interstate formula for allocating funds under Title VII, Chapter 2 of the Older Americans Act and further recommends that Congress give consideration to equitably distributing funds on the basis of such factors as the number, size, and type of long-term care facilities in each state and wage and cost-of-living indices. Distribution to the states of federally appropriated ombudsman dollars deserves a more imaginative formula that is based on more than age-related demographic data. Factors covering the numbers of facilities, beds, residents, geographic considerations, and state economy would provide more equitable resource allocations—equitable in this case meaning funding relative to demonstrated need. The committee believes that some states do now and will continue to require more federal subsidy than others to achieve minimum staffing levels and other prerequisites for effective program output. Arguably, the states with the greatest need for basic program funding will be those least likely to muster adequate public sector revenues within their own borders and, possibly, also least likely to be able to raise nonfederal, private sector funding. To the extent that “equity” for all elderly persons residing in LTC facilities across the nation demands a basic minimum of ombudsman program funding, the committee argues that baseline support should come from federal sources in a manner calculated to reflect more correctly the true level of need for ombudsman services in all states.

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act State Match of Federal Funding In the discussion to this point, the committee has been concerned chiefly with total and with federal funding levels for the ombudsman program. However, funds that states themselves muster play a significant part in the overall fiscal picture for the program. The states’ commitment to and funding for ombudsman programs varies considerably. Levels of funding by any given state do not appear to be related in any consistent way to the size of the LTC sector within its borders, the state’s economy, or any other variable likely to predict the need for ombudsman services. At present state monetary matching is not required for federal dollars appropriated under Title VII of the OAA, as it is under Title III-B. This is a major inconsistency even within this single program, and one that may permit states to avoid giving the program its intended level of support, in particular if increases are made in federal appropriations through Title VII, Chapter 2, as is recommended by the committee. Moreover, it is inconsistent with the philosophy of most federal-state programs and revenue-sharing efforts, such as the major block grants.4 It is also out of line with current regulations for the Medicaid program. Under Medicaid a variable rate for state matching is adjusted annually and is inversely related to the state’s per capita income; in FY 1993 the matching rate ranged from 50 to 78 percent. Territories match federal dollars 50/50, with a cap on total state dollar contributions. In the committee’s judgment, states should be required to match all federal ombudsman appropriations, not just those of Title III-B, at a level not unlike that required for the Medicaid program. The reasons are twofold: the commitment to the program that such a match demonstrates, and the existing austerity of the federal budget. The first reflects the philosophy of the ombudsman program itself—that it is a program to be run for the benefit of and by the states and their citizens. The second reflects the view that the federal government may be the sponsor of last resort—the stimulant to ensure that all states have a program that addresses the needs of the individual resident—but that it cannot be the source of all revenues needed for this program. The committee did not examine the details of exactly what a required percentage match might be, in either theoretical or practical terms. It did, however, converge on the view that a match of no less than 20 percent of federal funds would be a defensible minimum. Its reasoning was based on two 4   For example, the Maternal and Child Health block grant program requires a three-to-four, state-to-federal dollar match (i.e., a state investment that is 75 percent of the federal investment).

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act factors. The first factor is the current patterns of matches for other federal programs (which tend to be in the 50-percent to 75-percent range, although the OAA Title III-B match is no less than 15 percent); The second, and more important, factor is the Administration’s proposals concerning a broader ombudsman program as apart of health care reform (Health Security Act, H.R. 3600), which calls for a sharing of ombudsman support of 75 percent federal revenues and 25 percent state revenues. Thus: 6.3. The committee recommends that Congress require that states match the federal funding they receive under Title VII, Chapter 2 of the Older Americans Act appropriations for the long-term care ombudsman program and that the state match should be no less than 20 percent. The committee concurs that this state match can be accomplished in several ways—state revenues, private sector monies, or local public sector support—and that it has no fundamental interest in how the states achieve this goal. It does, however, believe that all states should be encouraged to exploit the potential for nongovernmental support through various community fund-raising activities. Fiscal Accountability for Ombudsman Program Budgets at the State and Local Levels Reform of ombudsman budgetary practices should not end in Washington. Two major problems emerged during the study. The first has to do with the actual management of ombudsman program monies once they are earmarked as resources for the program within states and localities—it seems that not all ombudsman program funds are, ultimately, managed by the Office of the State Long-Term Care Ombudsman program and its local representatives. The second involves allocations of ombudsman funds for administrative purposes. These problems led the committee to agree on two additional recommendations, as discussed below. 6.4. The committee recommends that the Assistant Secretary for Aging issue program guidance to states that stresses the importance of delegating to the Office of the State Long-Term Care Ombudsman responsibility for managing all the human and fiscal resources earmarked for the state ombudsman program within the boundaries of what is permitted by state budget policy and procedures and required by federal mandates for compliance. The Office of the State Long-Term Care Ombudsman program should in turn work with local ombudsman pro-

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act grams and their host agencies to assign fiscal management responsibility to appropriate managers. 6.5. The committee recommends that Congress direct the Office of the Inspector General, Department of Health and Human Services, to conduct an audit across the states of expenditure practices in the ombudsman programs to determine the extent of diversion of ombudsman program funds for administration and indirect costs and its relation to multiple sponsoring agencies. Congress should subsequently review the audit’s findings to determine whether congressional or administrative action is needed to prevent excessive use of ombudsman program resources for host agencies’ administrative costs. The committee encountered instances, during its site visits and interviews, of situations in which ombudsmen were unaware of the total amount of funds (federal, state, and/or other nonfederal) committed for ombudsman activities in a budget period and were limited in their decision making on how funds were spent. This is particularly burdensome at a time when the trend is to hold the Office of the State LTC Ombudsman program accountable for program performance. Effective administrators must be able to direct resources to meet needs as they deem best. For example, decisions about whether funds should be used to train staff or to increase the number of copies of the states’ annual report printed and distributed should be made by the state ombudsman. In sum, the committee believes that state ombudsman offices should have unrestricted knowledge of their own budgets and decision-making authority among line-item expenditures, within the boundaries of what is permitted by state budget policy and procedures and required by federal mandates for compliance. In its delineation of essential financial resource practices (see Table 5.5a), the committee recognizes that contracting and host agencies may need to use ombudsman program funds to offset some administrative costs. For the most part, according to information available, local host agencies tend to provide additional resources to the ombudsman programs rather than to take action that makes money flow in the opposite direction. However, during this study, the committee became concerned about the possibility that in some locales a series of host agencies is assessing administrative charges against the earmarked ombudsman program budget to a degree that severely limits the ability of the ombudsman and designated representatives to deliver services. This practice becomes especially burdensome when the budget of a local ombudsman program administratively moves through two or more levels of host or contracting agencies, each of which assesses a fee against the ombudsman’s budget. Although the frequency of such practices may be low, the committee

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act places high priority on acceptable financial resource management practices and, accordingly, draws attention to an unacceptable pattern of excessive taps on the ombudsman program budgets for overhead costs. In sum, the committee agrees that a reasonable level of support for indirect, overhead, or general and administrative costs must be made available in order for the program to function at all. The committee’s concern is with excessive diversion of scarce resources into overhead budgets, leaving too few “real dollars” to pay for actual program components such as labor, travel, communications, and publications. Unmet Need and Unfunded Responsibilities This report has discussed the question of “unmet need” —that is, the expectations that Congress, the elderly community, and others have for the ombudsman program, expectations that go beyond the tasks presently assigned through the OAA. In fact, unmet need is not confined to possible or future program mandates; needs are unmet today in the majority of states with respect to noncompliance in serving residents of B&C homes. Thus, if the ombudsman program is to comply with the implied, as well as stated, mandate of Congress, then it must do far more than simply respond to residents’ complaints. The real responsibilities lie in managing the complaint-response task while undertaking both (a) to empower elderly LTC residents to look after their own concerns and (b) to advocate for systemic change and improvement in the LTC system generally. In other words, Congress clearly intends the ombudsman to be a change agent on a national scale. Inherent in the ombudsman’s advocacy role are a plethora of strategies not consistently addressed, including interagency rapport, involvement with other community LTC and advocacy programs, administrative advocacy, and legislative lobbying—all for the purpose of influencing the care and well-being of LTC residents aged 60 and older. With respect to adequacy of funding, the committee concludes that the present level of support for the ombudsman program is completely insufficient to enable it to expand to satisfy these unmet needs. It asserts unequivocally that the first priority is that the program be provided with resources commensurate with meeting all current mandates, including those that have existed, but have been neglected, since 1981. That position underlies the thrust of earlier recommendations in this chapter about federal funding, the allocation formula for that funding, and the state match. If, however, Congress or others determine that expansion of the program beyond its present mandates is desirable, then the committee wishes to go on record with respect to the fiscal realities of that movement. Specifically:

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act 6.6. The committee recommends that, if Congress mandates additional responsibilities for the ombudsman programs, then Congress should also provide adequate additional appropriations to the ombudsman program. Calculations not unlike that the committee used to determine its suggestions about additional federal funding for the present program should be considered to help determine the fiscal implications of additional responsibilities. Cost estimates should take into consideration such relevant factors as the settings in which the program expands, the types of advocacy models most suitable for individuals and systems that an expansion proposes to serve, and start-up activities such as recruitment and training. Chapter 7 discusses some of the issues pertinent to expansion of the program. SUMMARY The committee approached the question of whether the federal and other resources supporting the LTC ombudsman programs were adequate by identifying first some proxy measures of performance and, second, some levels of effort that link to resources. Its analysis included a review of such factors as the numbers of FTE paid staff per numbers of LTC beds, peer nominations of successful programs, and visibility. Through triangulating on data from several sources, the committee arrived at the conclusion that resources are not adequate for each state LTC ombudsman program to perform at a level that ensures compliance with even the basic, decade-old mandates of the OAA ombudsman program. In the committee’s judgment, 1 FTE paid staff per 2,000 LTC beds is an essential resource standard and it provides a measure against which the adequacy of resources can be determined. Thus, the committee concludes that, at a minimum, additional resources are needed to support an increase of about 300 FTE paid staff. Using FY 1993 average national program expenditures of approximately $43,240 per FTE paid staff supports the argument for an increase of $13.2 million beyond FY 1993 total spending. Taking inflation into account (at an assumed rate of 4 percent per year) yields a figure of total national expenditure for FY 1998 of approximately $39.5 million. The committee recognizes the need to distribute federal funds to states in a manner that more rationally considers the “beneficiaries” of the ombudsman programs—that is, the elderly residents of LTC facilities—and, to that purpose, the committee recommends that the distribution formula for Title VII-2 funds be changed. State and local governments and entities have a responsibility to provide significant financial support to the program. To that purpose, the committee recommends a mandated state match of no less than 20 percent for

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Real People Real Problems: An Evaluation of the Long-Term Care Ombudsman Programs of the Older Americans Act Title VII-2 appropriations. The committee makes two recommendations to enhance the management of fiscal resources—calling for more opportunities for ombudsmen to make decisions on expenditures and calling for more prudent decisions of host agencies regarding the use of ombudsman service monies to support administrative costs. Finally, the committee cautions Congress against adding responsibilities to the LTC ombudsman programs without providing additional appropriations.

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