UNCOVERING THE COST OF CARE: AN EXAMINATION OF EXTRA BILLING IN BC'S LONG-TERM CARE FACILITIES

This paper examines three aspects of out-of-pocket charges to residents in BC long-term care facilities.Prior studies documenting variability in extra billing and unintended adverse effects from charging patients for medically necessary items and services provided impetus for this research.Caregiver surveys of staff from eight facilities, family expense diaries from four case studies, and a three-year resident billing history from one facility are employed to test methodology for collecting out-of-pocket cost information, and to test for variability in charges ' Ti Problem Context Accurate information is essential to inform government's policies on delivery of longterm care in a residential setting.A number of factors have contributed to the dearth of information regarding extra billing in BC's long-term care facilities.Because community and long-term care are not subject to the Canada Health Act, and because facilities in BC are governed by two different provincial laws (The Hospital Act and the Community Care and Assisted Living Act), variability exists in billing practices amongst comparably funded facilities serving similar clients.Lacking reporting requirements and accountability/monitoring systems, the province is operating in an information vacuum regarding extra billing practices in government-funded facilities.This information gap was acknowledged by Health Services Ministry and Vancouver Coastal Health managers in the study interviews.Another contributing factor to the information gap is the difficulty of gathering meaningful data in the absence of a government reporting mechanism.The study found serious weaknesses in the methodologies available to gather information on out-of-pocket costs.The information below summarizes the financial situation for most residents in long-term care, and points to potentially serious affordability problems due to the small amount of residual income available to residents after payment of facility per diems.Resident per diems cover only a portion of the total cost of facility care, the larger share of which is funded by the province through reimbursement payments to the facilities.Seventytwo percent of residents fall into the lowest income category used to calculate facility per diems, and contribute eighteen percent of the cost of their care in the form of per diem payments.Those with the highest incomes (four percent of residents) pay per diems covering forty-three percent of the total cost.October 2003 saw the first increase in per diem rates in BC since 1997, and beginning January 2004, residential care rates have been tied to the consumer price index.Effective January 2005, the per diem for the lowest income residents is $28.10, or $854.71 per month, while monthly income of the poorest residents -those who receive only Old Age Security (OAS) and Guaranteed Income Supplement (GIs) -is $1,032.45.Residual income after payment of the $854.71 per diem is only $177.74.Residents pay standardized per diem charges based on a sliding scale according to their incomes; however the situation is far fiom standardized when it comes to additional out-of-pocket charges to residents.The current study focuses on this issue. ConclusionsThe study concludes that:1.There is currently no efficient and effective method of gathering information on out-of-pocket charges in BC's government-funded long-term care facilities.2. A wide variety of items and services are billed to residents over-and-above per diems, and there is great variability amongst facilities in the application of outof-pocket charges.3.More information is required before any conclusion can be reached regarding differences in extra billing practices or amounts of extra charges based on ownership type (for-profit versus not-for-profit).4. Out-of-pocket charges are creating hardship for residents and their families, and may result in decreased quality of life and negative health outcomes for residents.5. Out-of-pocket costs are unaffordable for low-income residents.More study is required to determine the ef'ficacy of free-public provision of select items and services to lower overall healthcare costs. RecommendationsThree recommendations flow from the study conclusions.They are put forward to address issues of gaps in information, accountability and consistency in long-term care delivery.Recommendation # 1: that contractual reporting and accountability requirements for extra billing be written into funding agreements between health authorities and service providers, and that a monitoring system be designed and implemented.Recommendation # 2: that the Ministry of Health Services standardize items and services provided without extra charge to residents of all government-funded long-term care facilities in BC.Recommendation # 3: that the Ministry of Health Services commence controlled research trials in the form of pilot projects to inform policy on which items and services should be provided to long-term care residents without charge.(Two priority research areas/pilot studies should be: a) the efficacy of providing free hip-protectors as a method of reducing hip fractures, and b) a benefitlcost analysis of providing free dental care.vii Dedication This work is dedicated to Ethel Wait, Margaret Barclay, Maisie Shiell, Maureen Lehman, and Ella McDonald.I could always trust these five extraordinary "older" women to help and to inspire me.Throughout my life they variously filled the roles of playmates, colleagues, surrogate mothers, and teachers.Even in times of adversity, advanced age and failing health, their wisdom, dignity, grace, generosity, energy, humility and Joie de Vivre remained constant.I greatly love and admire these women, and my life's challenge is to follow their example.

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