Cost-Utility Analysis of High- vs. Low-Intensity Home- and Community-Based Service Interventions

Home- and community-based services (HCBS) have been advocated as a mechanism to delay institutionalization and reduce health care costs for the growing senior population. Studies of costs to date have found little evidence of cost savings from HCBS. However, HCBS can be thought to have two main benefits: delaying institutionalization and improving quality of life. Since cost and quality of life can be considered simultaneously in a cost-effectiveness analysis, an exploratory study was conducted to examine the relative cost-effectiveness of a high-dosage (i.e., high-intensity) HCBS intervention (i.e., 1915c Medicaid waiver) compared to a lower-dosage HCBS intervention (i.e., in-home aide service) using quality-adjusted life years as the measure of effectiveness. Findings indicated that high-dosage HCBS is not a cost-effective alternative. The low-dosage alternative allows for greater equity through provision of service to a larger pool of individuals in need.