Medicaid Cost Trajectories for Children With Serious Emotional Disturbance: The HCBS Waiver Program Versus Targeted Case Management

Objective:

The study compared Medicaid cost-effectiveness for children with serious emotional disturbance receiving services from two programs operated by the New York State Office of Mental Health: the Home and Community-Based Services (HCBS) Waiver program and targeted case management (TCM).

Methods:

Children ages four to 18 who received services from the HCBS Waiver program (N=1,602) or TCM (N=2,740) during 2009–2012 were selected. A quasi-experimental study design with propensity score–matched comparison groups was used to examine Medicaid costs (per member per month [PMPM] total cost) before admission to and after discharge from the HCBS Waiver and TCM programs. Exponential smoothing models were used to examine Medicaid cost trends before and after each program. Difference-in-difference techniques were used to estimate the average annual difference in PMPM Medicaid cost.

Results:

Trends for PMPM total Medicaid cost for HCBS Waiver–enrolled children after discharge decreased by 25%, whereas postdischarge costs for TCM-enrolled children increased by 15%. The adjusted pre-to-post difference in PMPM total Medicaid cost for HCBS Waiver children decreased by $498 and increased for TCM children by $448—a statistically significant decline of $946 (range $927–$963) in average PMPM Medicaid cost for HCBS Waiver children compared with TCM children.

Conclusions:

The PMPM Medicaid cost for children during HCBS Waiver enrollment was higher than for similar children enrolled in TCM. However, Medicaid cost savings for the HCBS Waiver group after the program may support investment in the more intensive HCBS Waiver program for children with comparable psychiatric needs.