"Replacing the Nursing Home" by Peter Uhlenberg, in The Public Interest (Summer 1997), 1112 16th St. N.W., Ste. 530, Washington, D.C. 20036.

Nursing homes, which now house 1.7 million elderly Americans, cost too much (more than $45,000 a year for a middle-range one) and provide poor care in a dehumanized environment. The indictment is familiar, but Uhlenberg, a sociologist at the University of North Carolina at Chapel Hill, argues that something can be done: phase out the government’s $50 billion annual subsidy, and channel it instead to "cost-effective, noninstitutional alternatives," including home care, "assisted living," group homes, hospices, and rehabilitation programs.

The $80-billion-a-year nursing-home industry developed after World War II largely as a result of government support, Uhlenberg points out. Fewer than 200,000 people lived in nursing homes in the mid-1940s. The Hill-Burton Act of 1946 provided money to build nonprofit nursing homes, while the Federal Housing Administration guaranteed mortgage loans to for-profit ones. After Medicaid was established in 1965, the government would pay the full cost of long-term care for poor older persons in nursing homes—but not in other settings. The "deinstitutionalization" of mental hospitals, starting in the 1960s, provided another boost to nursing homes. By the early 1970s, more than one million elderly folk were living in such institutions.

Today, Uhlenberg writes, "all but the very wealthy face the threat in old age of having to transfer their life savings to a nursing home and becoming wards of the state." In return, they usually receive "unloving care" from low-paid, unskilled aides. The quality of care could be improved by raising salaries, reducing workloads, and providing more training, he says, but that would only make care even more outrageously expensive.

Some extremely disabled individuals must be institutionalized, the author concedes. But roughly 80 percent of the older persons who are dependent on others for help in dressing, eating, and other routine daily activities live in their own home, he points out, and even more could remain at home if government policies were reoriented. Spending on home health care has been growing rapidly in recent years, in part because Medicare and Medicaid requirements have been eased. Medicare expenditures increased from $1.9 billion in 1986 to $9.7 billion in 1994. The regulations should be revised, Uhlenberg says, to encourage much greater use of home health care.

Studies indicate that the cost of providing shelter, food, personal assistance, and medical care at home is generally less than at a nursing facility, Uhlenberg says. And the quality of the care is superior, in part because the individuals or their family members "have greater control over who provides the care and how well [it] is provided"—not to mention the fact that family and friends can continue to help care for the person. Institutionalizing someone puts an end to all these advantages, Uhlenberg writes.