HCBS Presentation to AFA

One of the struggles in this legislative session is to find the balance between making the cuts necessary to balance the budget without undermining the safety and health of Maine's citizens and particularly our most vulnerable citizens. The Health and Human Services (HHS) Committee, which I sit on, has been grappling with these issues almost daily since Governor Baldacci unveiled his budget proposal on December 18th. I have been working consistently on approaches in the area of long term care -- and particularly home care for Maine seniors and people with a disability -- to find targeted cuts that will book savings without adversely impacting our neighbors.

Last Thursday I made a presentation to the Appropriations and Financial Affairs Committee on an alternative approach to booking savings that will produce precisely those targeted cuts. Below is a copy of my remarks to the Committee:

I am pleased to transmit a letter to my colleagues on the Appropriations and Financial Affairs Committee, signed by a majority of my colleagues on the Health and Human Services Committee, which outlines some possible approaches to targeted budget cuts in the home and community based services system. I apologize if I left an impression of some mystery about this initiative the last time that we met, but at that point there will still significant discussions taking place with my fellow Committee members as well as the esteemed Chairs, and I wanted to continue that dialogue rather than end it arbitrarily.

Let me begin by reaffirming what has been the consistent position of this Committee and one with which I concur completely -- long term care services are vital and should receive the highest priority of consideration if additional resources are available for the coming fiscal year. The early signals from the Administration are that institutional settings are a priority in terms of budget restoration. If that is the decision of this Committee -- you must also restore the funds for home and community based services as an integral part of the long term care system. Failure to do so would make the system fall even father out of balance and deny people the services they really want -- because by an overwhelming majority, Maine people want to stay independent and in their own homes. We have an unacceptably large number of people, already on waiting lists for home based services, we cannot afford to cut these services unless those cuts are proportionate with reductions to institutional services (both nursing facilities and residential care). If cuts must be made, however, they should be targeted to have the least impact on the direct services that keep people independent and in their own homes.

My goal has been simple. Find the budget savings, but do so through targeted cuts rather than across the board reductions that we are sure will produce unintended consequences. We should make these targeted cuts in order to preserve the present level of service hours for consumers, as well as create a wage floor to insure that the system is not balanced on the back of already underpaid direct support workers. If we create systems savings through such a redesign and consolidation -- those resources should be reinvested in the system in order to move the 1200 people on waiting lists into services. After all, waiting lists are a euphemism for denial of service.

To achieve these targeted cuts, I am proposing two things. First, that we reduce the external administrative contract costs of the present home based care system from over 10% (the number seems to be somewhere between 11% and 13% depending upon what you count) to something on the order of 7%. This can be accomplished by consolidating a variety of eligibility determination elements, case management, skills training and service brokerage now carried out by multiple separate agencies into a more consolidated and transparent navigation system. More than 40 other states have such consolidated intake systems -- in various different configurations. Only Maine and New Mexico have intake systems with as many discrete contractors. I am not suggesting that I have all the answers about how to implement such a consolidation, although I do have a number of ideas based on my examination of best practices nationally. Rather, I propose that if we must make cuts, we reduce the external contract budget, suggest elimination of the existing contracts and charge the Department with the task of redesigning a consolidated intake system and bid out the contracts as necessary to manage that system.

The second element is to follow the consensus recommendation of the stakeholder group that met as part of the legislatively directed and Department managed LEAN process. That group recommended that the existing 7 home care programs (4 state funded and 3 MaineCare funded) be consolidated into just 3 new programs -- 1 state funded, 1 MaineCare state plan program, and 1 MaineCare waiver. Consolidating these programs will also necessitate transforming the provider delivery network, since current providers are largely configured to deliver a particular type of program or serve a particular population. This consolidation of programs and the provider network can also create opportunities for administrative economies, especially if the budget reflects a standard provider rate of $14 per service unit with a $9 wage floor for the direct care workers.

One esteemed colleague on the HHS Committee said to me “I want systems change, just not this much systems change.” I understand that the timeframes are tight, and the Department has resisted this approach. However, there are many good models, all of which have been approved by CMS, which could be easily adapted to our situation. Asking the Department to undertake this administrative task on a short time frame is surely demanding, but no more demanding than the burden that will be placed on providers who will be forced to do more with less, or consumers who will need to maintain their health and independence with significantly reduced support resources. No matter what, Maine people will have to dig deep. I think it is reasonable to ask the Department to go the extra mile here in order to preserve the health and independence of Maine seniors and people with a disability, as well as the economic viability of thousands of struggling families who depend upon direct care worker paychecks.

These or even more radical changes are inevitable given the budget projections we are already hearing about for the next biennium. Not only is it good policy to get underway sooner rather than later, but I think these proposals may actually improve the performance of the system from the perspective of those who receive these services. Given the inevitable change in administration after the November elections, I think that the Legislature should become more directly involved in overseeing this redesign process, through a subcommittee or other mechanism that we should discuss and explore together. Whether we use this system redesign process to book budget savings in the upcoming fiscal year, or to move people who are being denied services off of waiting lists, the Legislature must increase its involvement and oversight of this systems redesign process as we face a transition of Administrations. We must prepare for the future which will include more budget pressures.

My position on this matter grows from direct experience as a consumer in this system, as well as my work for the last several years looking at best practices in home and community based services. This initiative will take an enormous effort and a will on the part of many to embrace change. Frankly, it’s intimidating. Every existing provider or element of the system will face redefinition of roles under this proposal. Yet, I believe that this approach is in the best interest of our seniors and people with a disability who receive these services, as well as the dedicated direct care workers who provide the essential hands on support that keeps those citizens as healthy and independent as possible. It is also another way that we demonstrate our commitment to Maine taxpayers to insure the most efficient use of their hard-earned money, even as we serve some of our most vulnerable citizens.

The attached spreadsheet is for illustrative purposes only -- to give you a feel for how this initiative would work. The budget numbers provided by the Department during our deliberations frequently diverged as different elements were included or excluded, so I determined the best way forward was to lay out the concept and approach and work with your more experienced staff in getting the numbers exact. I look forward to working with you and your Committee staff to perfect this approach, should it be needed. Thanks for your patience as we developed this approach.