By 2040, the number of residents needing long-term care will double, and the added cost to the Medicaid program, which pays for many of those services with state and federal money, threatens to crush Ohio's budget.

Unless the system is altered, Medicaid could consume half the state budget by 2020, according to researchers at the Scripps Gerontology Center at Miami University in Oxford.

"The only way to serve more people is to increase the number in lower-cost services," said Robert Applebaum, a professor and director of the center's long-term care research project.

In testimony before the Senate Finance Committee yesterday, Applebaum said Ohio has made progress but has a long way to go to create an efficient and effective system of long-term care.

The Republican-controlled Senate is expected to slash $1 billion from a $54 billion two-year budget passed by the House to help deal with a projected shortfall that could reach $3 billion. Democratic leaders in the House will assist in making the rest of the cuts when the budget goes to a joint conference committee for a final review.

The looming long-term care crisis presents another fiscal challenge for lawmakers.

A new Gerontology Center report recommends expanding the services available to Ohioans in need of long-term care. They should include in-home services, in which individuals hire and supervise their own care providers, and assisted living.

The array of services would allow more elderly people to continue living in their homes, which is generally preferred. It's also cheaper and will save the state money by reducing the use of higher-cost nursing homes.

Medicaid pays $136 a day for a nursing-home stay and $38 a day to provide home care under Ohio's popular PASSPORT program.

But Ohio's elderly aren't the only ones running up the state's long-term care bills. The number of Ohioans younger than 60 in nursing homes is growing.

Over the past decade, there has been a 9 percent reduction in the number of Medicaid recipients older than 60 in nursing homes. But during the same time span, there has been a 17 percent increase in the Medicaid recipients younger than 60 who use nursing homes, the report found.

Between April and June of 2008, nearly 15 percent of the 54,045 Medicaid patients in nursing homes were younger than 60.

Applebaum said many of those younger nursing-home residents, some with mild impairments and others suffering from mental illness, apparently have nowhere else to turn.

State officials have pushed for years to expand the long-term care options under Medicaid, with some success.

Currently, 72 percent of Ohio's long-term care budget is spent on institutional care and 28 percent on community-based services. That ranks it 43rd in the nation for margin of institutional versus community care; however, it's an improvement from 47th place in 2004.

Applebaum said Ohio's goal should be a 50-50 split.

ccandisky@dispatch.com