– JULY 28, 2011POSTED IN: COMMUNITY
The following analysis of the State of Minnesota budget compromise was originally produced by Courage Center’s Public Affairs and Research Department. It gives a good summary of how the state budget deal impacts people with disabilities in general, and Courage Center clients in particular. This edited version is posted with permission:What was in the final deal?
The approved state budget spends more in the next two years than the state did in the last two years, but significantly less than the projected growth of programs. That’s why both sides in this budget fight could claim victory: spending is growing, but there are big cuts in what would have been spent had changes not been made. The approved Health and Human Services budget for the biennium is $11.3 billion. This is a billion dollars more than the last biennium we just finished (at $10.2 billion), but also a billion less than DHS had projected would have been needed to provide the same level of services to a growing population. In this respect, people with disabilities and the organizations that serve them, including Courage Center, were hit hard.
So if the final budget agreement spends more, where did the revenue come from?
The added spending over the last biennium was funded solely through borrowed funds, not permanent increases in the revenues coming in to the state budget. Shifting school payments and borrowing money from future tobacco bonds brought in an extra $1.4 billion to prevent deeper spending reductions.
Does this framework build a foundation for future stability?
Unfortunately, the fundamental cost drivers – primarily health spending – were not addressed head on. Unless the state and national economic outlook brightens beyond the expectations of most experts, this deficit scenario will repeat itself in 18-24 months. The core issue – not enough funding for service levels either needed or provided – remains.
What are the immediate impacts of the budget agreement for Courage Center?
The biggest impacts affect our payments for people on Medical Assistance (MA):
– For physician services and therapies, rates will drop 3%;
– For community-based services like Independent Living Skills and Behavior Services, payments will shrink by 1.5%;
– Daily per diem payments for inpatient care in our Transitional Rehabilitation Program (TRP) are not cut, but other payments made to TRP will decline;
– Payments for any services provided to complex clients who have Medicare and MA coverage will drop significantly;
– While most rehab services (PT, OT, speech) were preserved, specialized maintenance therapy for adults was eliminated;
– Additional prior authorization requirements will be required before most rehab therapies can begin;
– Despite being passed by the state House and Senate earlier this year, a change sought by Courage Center to give us more flexibility to manage our MA population was not included in the final deal.
– For community-based services like Independent Living Skills and Behavior Services, payments will shrink by 1.5%;
– Daily per diem payments for inpatient care in our Transitional Rehabilitation Program (TRP) are not cut, but other payments made to TRP will decline;
– Payments for any services provided to complex clients who have Medicare and MA coverage will drop significantly;
– While most rehab services (PT, OT, speech) were preserved, specialized maintenance therapy for adults was eliminated;
– Additional prior authorization requirements will be required before most rehab therapies can begin;
– Despite being passed by the state House and Senate earlier this year, a change sought by Courage Center to give us more flexibility to manage our MA population was not included in the final deal.
Are reform and policy changes addressed in this deal?
Both the Governor and legislature want significant health reform, and will be seeking permission from the federal government to adjust the way health care works in Minnesota. The good news is that Courage Center is very much on the forefront with our Primary Care Clinic (a health care home), supported by our strong measurement and data efforts perfectly positioned to capitalize on the reforms below:
– Assessing the needs of people with disabilities more often to better target (and limit) services;
– Pay specialists and hospitals less and primary care providers more;
– Focus on time-limited, low-cost services to avoid more expensive long-term care services; and
– Pay more to providers who achieve better health for their clients, and pay less to those who don’t.
– Pay specialists and hospitals less and primary care providers more;
– Focus on time-limited, low-cost services to avoid more expensive long-term care services; and
– Pay more to providers who achieve better health for their clients, and pay less to those who don’t.
What other changes will impact the disability community?
A big change will see people with disabilities automatically enrolled in managed care plans unless they “opt out.” This is a very big policy change. Other cuts that will affect Courage Center clients include:
– Co-payments for drugs and medical services will be higher;
– Less access to personal care attendant (PCA) services for those with mental health conditions.
– Less access to personal care attendant (PCA) services for those with mental health conditions.
What will the future bring?
The end of the longest shutdown in state history and the conclusion to the 2011 legislative session brings some relief, and will mean many things return to business as usual. However, we have difficult work ahead to provide our clients with the services they need while balancing our own organization’s budget in a continuously challenging economic environment.
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