funding Archives - Woods Services

The AHCA would devastate the most vulnerable: people with intellectual disabilities and complex medical needs

June 7, 2017

*This blog post originally appeared on www.philly.com.

By: Tine Hansen-Turton, CEO of Woods, Dr. Scott Spreat, Chief of Research of Woods, Kristen Erway, Director of Government Affairs of Woods

The American Health Care Act, which was passed by the House of Representatives on May 4, would have a devastating impact on the lives of individuals with intellectual and developmental disabilities. They are some of our nation’s most vulnerable citizens.

While most discussion around the AHCA has focused on insurance access and pre-existing conditions, little attention is paid to how the bill would make the most significant and dramatic changes to the Medicaid program since its inception. Instead of paying the cost of all needed care, the bill would impose per capita caps on federal funding. A per capita cap means that the federal government would determine an amount paid to each state each year for each person enrolled in Medicaid. The same amount would be paid to the state for each individual enrolled; however, the costs associated with each individual vary greatly as a function of that individual’s needs and the services they require.

These caps would create a dangerous and unstable situation for individuals with intellectual and developmental disabilities who receive supports and services via Medicaid funding. Caps would not increase to reflect rising health care costs or to reflect increases from people aging into needing more long-term supports and services. Per capita caps will reduce amounts and quality of services and increase the size of the service waiting list. States would be forced to find funding to make up for reduced federal support, a concerning prospect in a state currently facing a $1.2 billion deficit where fiscal year General Fund collections are currently $1.2 billion below estimate. And if funding cannot be found, the inevitable cut will occur – and many of the most vulnerable could die.

Pennsylvania’s intellectual and developmental disability service system is already suffering chronic underfunding, with approximately one-third of agencies losing money each year. Over the past 20 years, growth in the Pennsylvania budget for these services has lagged about 65% behind the general Pennsylvania budget. The result is high workforce turnover, excessive vacancy rates, and most importantly, a significant waiting list for services. The ACHA would tip the scales and make surviving in this environment impossible for many of those currently serving these individuals.

Intellectual and developmental disabilities services are dangerously underfunded

November 18, 2016

*This blog originally appeared on philly.com

By: Tine Hansen-Turton, President and CEO of Woods Services, and Scott Spreat, President and Chief of Research, Woods Services, guest blogger

People with Intellectual and Developmental Disabilities (I/DD), an umbrella term that includes severe chronic disabilities that can be physical, cognitive, or both, consume half of all Medicaid spending in the U.S. Yet this fact is rarely brought up in debates over health care costs and ways to innovate within the health and human services system.

Government agencies have grown comfortable with a systematic underfunding of human services. This may be because they do not understand the true costs of providing care to people with complex medical and social service needs. Supplemental funding from foundations and other private sources on which they have relied to meet some of their needs is drying up, and state budget are barely growing. A recent study of funding trends in Pennsylvania found that between FY1993-1994 and FY2013-2014, the general state budget increased by about 90%, but funding for intellectual disability services increased by only 23-24% (study available by request made to www.par.net).

A group of I/DD private provider agencies recently reported that for the years 2012, 2013, and 2014, roughly one-third of them had expenses that exceeded revenues. An agency that experiences such losses must subsidize the inadequate funding in some manner. Some agencies have dipped into their reserves. This is not a sustainable way of conducting business, and it puts needy people — the I/DD population–at risk.

The I/DD industry is not a healthy one for providers. It operates with a 1.6% margin on an annual basis, and it has no control over its prices. It can’t raise taxes like a school district, and it can’t increase prices like a hospital. It has to rely on the kindness of governmental entities, which has been notably lacking over the past 20 years.

A free market approach and an alignment of the I/DD sector with health and human services programs that permit providers set their own prices may be the only innovation that will sustain the field. Unless providers are able to gain some control over the pricing of their services and unless governmental funders recognize the health issues that affect individuals with intellectual disability, providers will not succeed, and individuals with intellectual disability will lose supports and services. While the industry is not yet dead, it may be in the throes of a terminal condition, which could put thousands of the most vulnerable people at risk in the U.S.