First, the ongoing fiscal crisis and fiscal decentralization poses major challenges. The new funding model needs to fit within the new social service financing structure. Fourth, the transition issues need to be evaluated and a mechanism developed to cope with financing the current stock of inmates. Fifth, change needs to take place within an overall structure to reduce the number of institutions. If not excess capacity will increase unit costs, leading to a decline in the quality of care or inflation in the costs providers charge, or more admissions, or all three.
Governments typically have several goals in trying to change the financing model.
In many cases, the goal is to save money. However, this is not always possible, as developing alternatives cost money. Reliance on a menu of community options requires time and funding to develop these options, and meanwhile the institutions remain. Even if they are restructured, most residents can not return to the community. For example, in the case of the elderly, they often have no home to return to.