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COLUMBUS — Ohio ranks 49th in the nation when it comes to funding home care for the disabled and elderly, losing hundreds of millions of dollars a year in potential savings, according to a report released Monday.

Every state in the nation except Mississippi spends a higher percentage of Medicaid long-term care funding for home care as opposed to nursing home care than Ohio, according to An Economic Study of Long-Term Care Costs in Ohio, a report prepared by the Columbus firm Levin, Driscoll & Fleeter for The Ohio Council for Home Care.

The study states that nursing home residency costs five times more than home care, and that Ohio could save as much as $600 million to $1.4 billion a year by steering more Medicaid clients into home care instead of nursing home care.

"What we're saying is we don't think Ohio can afford to keep doing what we've been doing," co-author Howard Fleeter said.

Pete Van Runkle, president of the Ohio Health Care Association, which represents nursing homes, said he agreed with the study. "There should be more home care available. There are people on waiting lists (nearly 3,000, according to the report). Those people should have the opportunity to get served," Van Runkle said.

Key findings include:

• In 2003, Ohio's annual nursing home Medicaid spending per patient was about $56,000, while spending on home care per patient was less than $12,000.

• The vast majority of Ohioans prefer to receive care in their homes, but Ohio's current long-term care funding system favors clients entering a nursing home.

• Ohio's population is aging while the supply of available workers is declining. Ohio will need about 13,000 additional home health aides and personal care aides by 2012.

"This is a major demographic shift that is going to present a huge challenge for the state of Ohio," Fleeter said.

The report's authors argue the state needs to rebalance its $12.5 billion-a-year Medicaid budget to reflect preferences for home care. It should also boost reimbursement rates to home care agencies by 19 percent so they can continue to operate. Potential savings would "dwarf" the increase, they said.

Holly Hall, administrator for the Dayton-based home care agency Assured Health Care, called the report "accurate" and "past due."

"Due to the fact we haven't had a wage increase (from Medicaid) since 1998, it's difficult to recruit staff to care for the most vulnerable," said Hall, whose agency serves 333 Medicaid recipients in the Dayton region.

Contact Anthony Gottschlich at (937) 225-7408 or agottschlich@DaytonDailyNews.com. Contact William Hershey at (614) 224-1608 or whershey@DaytonDailyNews.com.

By the numbers

In 2005, states across the nation spent an average of 39.1 percent of their Medicaid long-term care funds on home care for the elderly and disabled, the balance on nursing home and intermediate care facilities. Ohio spent 23.6 percent.

Oregon spent the greatest amount of its Medicaid long-term care funds on home care, 76.8 percent.

Source: "An Economic Study of Long-Term Care Costs in Ohio" by Levin, Driscoll & Fleeter for The Ohio Council for Home Care