Overview of Reform Effort

In May, 2005, Governor Sonny Perdue submitted a concept paper requesting a Section 1115a Waiver to the Centers for Medicaid and Medicare Services (CMS) . The purpose of the Waiver is to assist the State in addressing the growing costs of Medicaid services. The Waiver proposes capping federal spending for Medicaid services, initiatives, and administrative costs in exchange for increased state flexibility in determining eligibility and services offered to Medicaid recipients. It is expected that CMS will approve and allow implementation to begin in 2006.

It is proposed that the State’s new Medicaid program is based on the relationship between the individual and the physician. Medicaid reform is based on four guiding principles:

· Predictable Growth: By capitating federal funding for 3-5 years with growth factors for enrollment and inflation, the State can better determine annually the cost of Medicaid. This would be based on the expected expenditures and growth projections for enrollment.

· Personal Choice and Responsibility: The relationship between the individual and physician is strengthened in making decisions about health care needs. Services will be better tailored to meet the needs of the individual. Individuals can chose to either self-direct their own services or become part of a managed care program. Individuals would have financial options to assist with Medicaid including co-pays and health savings accounts.

· Marketplace Transparency: Individuals will have the opportunity to select providers and health care services based upon cost and quality of service. This means that individuals will know the total cost of treatment and the quality measures to make decisions about who provides services based on cost and quality. If the individual chooses health care that is cost effective and high quality, they will reduce their obligation for cost sharing.

· Quality Health Care Outcomes: Health care indicators will be developed to monitor the success of the implemented reforms.

Over the next few months, several workgroups will meet to develop recommendations around eligibility, services, finance health care outcomes and long term care. One of the recommendations discussed by the Long Term Care Work Group is the creation of HomeFirst Georgia. HomeFirst Georgia proposes moving all long term care services, planning, administration and finance into the Division of Aging Services within the Department of Human Resources. For people with disabilities, this means that services currently provided through the Division of Mental Health, Developmental Disabilities, Addictive Diseases and the Department of Community Health would fall under the auspices of the Division of Aging Services. This new Division of Long Term Care would provide an array of health and supportive services to individuals in their homes, community and “when necessary, institutional settings.” Services would be organized around an individual’s needs and preferences. Individuals would access services through single points of entry currently offered by the Division of Aging Services through the Area Agencies on Aging and systems of information such as the Gateway System.

Issues of Concern

The Governor’s Council on Developmental Disabilities philosophically agrees with the following components of the Medicaid reform proposal:

1. Eliminating the nursing home level of care requirement for home and community-based services is an important step in making sure that people get the support they need. In addition, this would make nursing home care the last resort rather than the primary option for services. Advocates have been working for years to change the bias in funding from facility based to home and community-based services. This is a step in the right direction. However, the State needs to examine how any change in determining eligibility will impact individuals based on income and the levels of support needed. The Departments should continue to work on defining most in need as a criterion for moving people off the waiting lists for services as new funding becomes available.

2. We believe in families and individuals being responsible for their own care and support the move toward self-determination or self-direction. This includes having control and access to the dollars through individualized budgets and fiscal intermediaries. Individuals and families should make decisions about how the dollars allocated for services and supports are spent. However, it is important to remember that not everyone is willing or able to be completely in control of their services. While in healthcare self-direction is related to the purchase of services or products, in long-term care it is more related to hiring and firing of personal care staff and making decisions about the kinds of services provided. Self-determination in long term care is a philosophy that goes beyond just provision of services but instead is about people having the freedom and authority over all life decisions and recognizes that people have to take responsibility for their actions.

3. Creating opportunities like flexible spending accounts or LIFE accounts may assist families with higher incomes to prepare for the long-term care of family members. Many families save for children to go to college, but there is no mechanism to save for a child with a disability to pay for services throughout the lifetime. A mechanism that will allow families to save and earn incentives for saving to provide for care without penalizing SSI or Medicaid benefits is an option that needs to be explored.

4. Many families have told the Council for years that Medicaid should send them an invoice before paying for services. Families often wonder what providers are being paid for and if they are being paid for services actually rendered. Marketplace transparency that provides families with this kind of information could save the State dollars by making sure that Medicaid is paying for services provided. In order for this kind of accountability mechanism to work families need a user-friendly place to report discrepancies. A family member recently shared that she kept detailed records of services provided based on the budget developed for her daughter. She was able to show the provider that there should have been more money available in the budget than what the provider was able to detail.

The Governor’s Council on Developmental Disabilities has identified several issues of concern that must be addressed as part of the discussions leading to this reform of the Medicaid system:

1. The State of Georgia is currently ranked 44^th in the country in the amount of money spent on home and community based services for people with developmental disabilities. Any attempt to limit long term care expenditures will only result in keeping us near the bottom and growing the waiting list of those in need of services.

2. For children with disabilities, the Early and Periodic Screening, Diagnosis and Treatment (EPSDT) program means an early determination of disability and the provision of services and therapies that often reduce the effect of the disability as the child ages. Limiting services to only those that promote children’s health may result in important therapies being excluded which will result in the need for increased service requirements later in life. Allowing a child to receive these important services may reduce the cost of services in the long term.

3. Requiring cost sharing through co-payments or premiums needs to take into the account the entire costs to a family or individual for healthcare. Many families or individuals who have disabilities pay for services and supports not covered by Medicaid. This can result in substantial out of pocket costs that must be taken into account when determining co-payments and premiums. In addition, co-payments on over-utilized services such as emergency room care must take into account the availability of service providers and service provider knowledge of issues concerning disability.

4. Most of the references in the Medicaid reform are to the healthcare needs of an individual. For persons with disabilities and their families, supports may not be limited to healthcare and it does not seem these supports are taken into account. In addition, it may be difficult to determine the outcome indicators and if they are met because the outcome for persons with disabilities is often not to get better or cure the disability, but instead around quality of life issues like getting a job or having personal supports that allow a person to get up, out of the house and have a meaningful day. A Provider Council and Georgia Health Decisions may not have the knowledge necessary to determine outcomes for individuals with disabilities.

5. There is an assumption throughout this proposal that people will make sound healthcare decisions because they have the choice to choose another provider. However, in long term care, cost effective decisions are often difficult to make when there are limited choices of providers. This means that either there must be a concerted effort to increase the number of providers, including the use of non-traditional providers or there must be provider development efforts especially in rural areas. Individuals and families should not be penalized when they have limited control over who is available in their area to provide services.

6. There is a potential conflict of interest with merging aging and disability into one service system. There are significantly more older adults in Georgia than there are persons with physical or developmental disabilities. However, the resources spent per person are significantly more for individuals with physical or developmental disabilities than they are for older adults. The concern is how to make sure that financial resources already seen as limited in their ability to meet the needs of individuals are not used to meet the growing needs of the elderly. It is expected that the number of older adults in Georgia will grow at a pace that far exceeds the financial ability of Georgia. This could result in limited programs to persons with disabilities who may not be viewed as a priority in an administrative structure developed, operated and lead by those who advocate for older adults.

7. In 2002, the Council commissioned a study that examined the placement of services to individuals with developmental disabilities in state government and made a recommendation to then DHR Commissioner Jim Martin to create the Office of Developmental Disabilities. One of the alternatives examined was the creation of a Division of Long Term Care. The primary reason this alternative was not recommended was the continued reliance of the Division of Aging Services on the use of nursing homes as part of the continuum of care. For individuals with physical and developmental disabilities, there is general agreement that congregate facilities including personal care homes and nursing homes should not be part of the continuum of care. These facilities are viewed as in opposition to the Olmstead decision. The mention of congregate facilities as an alternative as part of HomeFirst only reinforces the Councils reason for not recommending a Division of Long Term Care two years ago.

Conclusion

The Governor’s Council on Developmental Disabilities recognizes the need to reform the Medicaid system to keep up with continued growth. The waiting lists for home and community-based services continues to grow even while the Governor and Department of Human Resources makes significant efforts to address the lists. The move toward self-determination for people with developmental disabilities and physical disabilities will allow people to make decisions about their life and have responsibility for what happens daily in terms of services and supports. This is a move away from a provider driven system to one based on an individual and his/her needs.

The Council spent the better part of a year studying possible bureaucratic structures because advocates were concerned that developmental disabilities was not seen as a priority and there was no leadership or vision for what was happening for people with developmental disabilities. Even after the Council recommended a separate Office of Developmental Disabilities there were many that were critical, suggesting that only a Department or separate Division of Developmental Disabilities would achieve the goals of making developmental disabilities a priority. Combining developmental disabilities with physical disabilities and aging will only reshuffle the populations and cause concern about how to protect the funds that are appropriated for developmental disabilities. In addition, there is concern that the leadership of this new Division still believes that nursing homes and other congregate facilities are a part of the continuum for individuals. In the Division of Mental Health, Developmental Disabilities and Addictive Diseases there is a concerted move toward the closure of these facilities and recognition that congregate facilities, including personal care or assisted living facilities should not be an option for people with developmental disabilities.

Georgia continues to rank near the bottom in almost every category that relates to providing home and community-based services to people with developmental disabilities and physical disabilities. A recent study ranked Georgia as one of the ten worst states when it comes to providing home and community-based services to people with developmental disabilities and physical disabilities. That same study showed that less than 25% of resources were spent on the community as opposed to institutions. Any effort to reform Medicaid must take this into account and result in more money, not less available to support individuals in the community.