If there's one point that Gov. Pat Quinn's Taxpayer Action Board drove home with the report it delivered yesterday, it's that cash-starved Illinois isn't the big spender (PDF) conservatives would have you believe -- especially with regards to health care, education, and other core services. Of course, there is always room for improvement. And the board points to one big source of potential savings in the Medicaid program: "reverse the bias" toward costly institutional care by investing in one area that is currently facing potential cuts: home health care for seniors.

If Illinois were to expand initiatives like the Community Care Program (CCP), which keeps the elderly under their own roofs and out of nursing homes, TAB estimates that the state would save $70 million in of Medicaid costs in the next year. But the savings wouldn't stop there. Between 2012 and 2014, the state's obligation could be reduced by as much as $635 million. More from the report:

CCP provides home-based services for over 55,000 adults each month and nearly 70,000 during the course of a year. The average cost per CCP beneficiary is $8,400 per year, while the average annual cost of nursing home placement is close to three times that amount. The CCP has been very successful in reducing nursing home utilization, and the program should be expanded. We believe that a goal of reducing nursing home placements by 10% per year, over the next five years, is desirable and achievable.

AARP has long pointed out (PDF) that three people could be served by home health care providers for the same amount it costs to house a single person in a nursing home. Considering that most seniors and the disabled prefer the first option, expanding home care makes perfect sense.

But here's the catch. As we've reported before, federal Medicaid policies are stacked in favor of institutions. Last year, a mere 13 percent of Medicaid's long-term care budget went towards home care. Many states have tried to pick up the slack, but with revenues shrinking, Quinn has said that Illinois can't afford to do so any longer. Indeed, the governor's budget proposal cuts the Community Care Program by 50 percent next year, affecting an estimated 26,000 seniors.

To address this issue, AARP and other health care advocates are ramping up efforts at the national level to ensure that community care is a key piece of any health care reform package. Back in March, Rep. Danny Davis reintroduced a House version of the Community Choice Act (HR 1670), which would make it easier to submit Medicaid home care reimbursements. (Iowa Democrat Tom Harkin introduced a companion bill in the Senate.)

Another concern is preparedness.  From the minority opinion appended to the TAB report by the Woodstock Institute's Dory Rand:

Illinois currently lacks adequate community resources (e.g., quality, affordable housing, adequate number of quality home health aides) to absorb a large exodus of elderly and disabled into the communities. Illinois needs to be responsible to these vulnerable populations and invest in short-term expenditures in order to capture these longer-term cost savings.

Indeed, expanded care needs to be coupled with an expanded pool of caregivers.  To wit: Rep. Jan Schakowsky is sponsoring the Retooling the Health Care Workforce for an Aging America Act (HR 468), which aims to train more medical professionals to meet the demands of a swelling elderly population. 

The objections to the home care cuts are in many ways similar to the argument against Quinn's proposed pension voodoo.  In both cases, policymakers need to ensure that their efforts to plug the immediate deficit don't end up putting an unnecessary burden on the state coffers in the long-term.