This Mathematica Policy Research Inc. brief examines avenues for reducing the fragmentation of care for dual eligibles in nursing homes.  The brief suggest shifting the responsibility for such care from Medicaid to Medicare and examines the implications of such a switch on prescription drug use, hospitalization, home- and community-based services, and federal and state financial and administrative responsibilities.  The authors contend that such a change would improve quality of care but note that it would constitute a large change in health care policy.  

From the report:

The fragmentation of health care for dual eligibles―people who qualify for both Medicare and Medicaid―has been an ongoing concern in both acute and long-term care settings. Medicare covers hospital, physician, and post-acute skilled nursing facility care and―since 2006―pre­scription drugs. Medicaid covers most long-term nursing facility care and home- and communi­ty-based services (HCBS), and both programs cover home health care.

Full report: Coordinating and Improving Care for Dual Eligibles in Nursing Facilities (PDF | 1.2 MB) 

Mathematica Policy Research Incorporated. (2010). Coordinating and improving care for dual eligibles in nursing facilities: current obstacles and pathways to improvement. Verdier, J.