COFAR blog

There is no question that Massachusetts is facing budget problems that are making it increasingly difficult to fund services for our most vulnerable citizens, particularly those with intellectual and other disabilities. 

One thing we shouldn’t do in this situation, though, is try to help one group at the expense of another.  That, in our view, is what two pieces of proposed legislation now before the Children, Families, and Persons with Disabilities Committee would do. 

Both bills were the subject of a public hearing last week before the committee.  I wanted to testify about both of them, but they were way down on the committee’s hearing list.  After waiting two and a half hours to testify and then realizing by that time that almost all of the legislators on the committee had left, I left the hearing without testifying publicly and submitted my remarks in writing to the committee staff the next day. 

I’ve already written several times about one of these two bills – the ‘Real Lives’ bill (H. 151), though not specifically about how it would potentially divert funding from intellectually disabled people living in state-operated group homes to corporate providers that contract with the Department of Developmental Services.  I’ll get to that in a bit.

Early on in last week’s hearing, I first found out about the other bill, which was filed by state Representative Tom Stanley at the behest of the Association of Developmental Disabilities Providers (ADDP), the lobbying organization for those same state-funded, corporate providers. 

Stanley personally appeared before the Children and Families Committee to promote the ADDP bill (H. 156), which would require that at least half of the “savings” in closing state-run DDS developmental centers be used to fund programs run by corporate providers.  (Legislators don’t have to wait to testify at committee hearings, but are given the floor when they show up.)

Specifically, Stanley’s bill would require that “not less than 50 percent” of those developmental center closure “savings” be used to “fund and implement Chapter 257 of the Acts of 2008.” 

What is Chapter 257 of the Acts of 2008?  As the ADDP notes, it is a statute that provides for “standardization and adjustment for rates to contracted human and social service providers.”  In other words, it’s intended to adjust state payments to the group home providers upwards.  Last January, the ADDP was anticipating that the administration would provide up to $175 million in funding in the current-year budget to implement Chapter 257.

As the ADDP put it on their website:

After waiting for nearly 25 years, developmental disability programs (read “the providers”) may finally see their prayers answered with Governor Deval Patrick’s FY 14 House One Budget….

An administration document posted by the Providers’ Council, another provider lobbying group, last January indicated that the governor had proposed that at least $53 million in Chapter 257 funding go directly to the provider residential line item in the DDS budget in the current fiscal year.

The ADDP’s and the Providers’ Council’s prayers, however, were apparently not fully  answered.  The total proposed Chapter 257 funding apparently did not materialize in the final budget for the current fiscal year.   The provider residential line item in the final budget, as approved by the Legislature,  is $13.1 million less than what the governor proposed in January.

In a July 2 recap of the final FY 14 budget, the Arc of Massachusetts, a close ally of the ADDP and the Providers’ Council,  stated that the organization was hoping for passage of a supplemental budget this year “to fully implement Chapter 257 in Residential Services for 2014.”  

But what if such a supplemental budget is not forthcoming?  Maybe that explains the need for Rep. Stanley’s bill.  Because the Legislature was apparently not willing to put the amount of additional money into the provider group home line item that the ADDP, the Providers’ Council, and the Arc were seeking, the ADDP figured they could get it from somewhere else.  That somewhere else is apparently the developmental center closure “savings.”

While we would dispute that there has actually been any savings in closing the developmental centers, what has occurred is that the developmental center line item in the DDS budget has been cut by some $80 million since FY ’09, when the administration first announced it planned to close four of the centers.

It seems the funding cut from the developmental center line item has gone in the past five years to the state’s General Fund, rather than being plowed back into the provider-run, community-based system, as the administration had originally promised.   However, at least some of that money has been transferred back from the General Fund to both the state-operated and provider-run group home accounts.

As the developmental centers have been closed, a large percentage of the former residents has been moved primarily to one of two remaining developmental centers and to state-operated group homes.  The state-operated group home line item has thus been increased by about $41 million since FY ’09, largely to accommodate that influx of residents.  The provider-run group home line item has been increased by some $230 million in that time.

So, now we have Rep. Stanley’s bill, which says, as we understand it, that at least 50 percent of the funds cut from the developmental centers must be directed to fund Chapter 257.   Given that passage of this bill would result in a significant increase in funding for the providers (or else why would the ADDP want this bill filed?), what does that mean for the state-operated group homes?  There is only a finite pot of money involved.  Funding for the state-operated group homes would potentially have to be cut.

We know that the state-operated residential facilities are struggling in Massachusetts.  These facilities are required under court order to provide care for most former developmental center residents that is equal or better to the care they previously received.  Although funding has been increased to the state-operated group homes, the increase this year was significantly less than what the administration projected was needed.

These are among the questions I posed in a phone call on Thursday to Rep. Stanley.  In filing his bill on behalf of the ADDP, did he understand the full implications for the state-operated group homes, in particular, and the level of services the residents in them would continue to receive?

Stanley responded that he believed his bill would “help both the state-operated and provider-operated group homes.”  He said it was his understanding that Chapter 257 would boost funding to most, if not all, DDS line items and that he would get back to me to confirm that.  I’m waiting for his follow-up call.

As I noted to Stanley in an email following our Thursday phone call, there are many documents online about Chapter 257, and they indicate, as I’ve  noted above, that Chapter 257 was intended and drafted to fund purchase-of-service programs only, not state-operated programs.

For example, there is that administration document posted by the Providers’ Council, linked above, which shows the proposed $53 million in Chapter 257 funding going into the provider residential line item in the DDS budget.   While some of the Chapter 257 funding would go to other agencies in the Executive Office of Health and Human Services, nothing in the document indicates that any of the Chapter 257 funding would go toward the DDS state-operated group homes.  Chapter 257 is clearly targeted toward contracted services obtained from corporate providers to DDS and other EOHHS agencies.

So, how much money are we talking about in diverting 50 percent of the funding cut from the developmental centers to the providers?  In the current fiscal year, it appears the developmental center line item has been cut by $10.8 million from the previous fiscal year.  Fifty percent of that figure would be $5.4 million.

As noted above, the final FY 14 budget provided $13.1 million less in funding for the provider residential line item than did the governor’s budget proposal.  Thus, if Rep.  Stanley’s bill is passed, it would seem the providers would get back some $5.4 million – or about 41 percent – of the amount the Legislature had cut from the governor’s proposal in the current fiscal year.  Not the whole ball of wax, but it would reduce the amount that would be needed in that hoped-for supplemental budget to satisfy the providers.

It turns out, though, that Rep. Stanley’s bill was not the only piece of legislation heard by the Children and Families Committee last week that would divert funding from the developmental centers to the providers.   There’s also the Real Lives bill, proposed by Rep. Tom Sannicandro.  While I was there, a long line of legislators testified in favor of that measure, which is intended to give all DDS clients more choice in services.  The Real Lives bill happens to state  that 40 percent of the “savings” in closing at least three of the developmental centers must be directed to a fund that would support “self-directed services,” presumably for all DDS clients.

As I’ve previously pointed out, the Real Lives bill specifies a large role for the providers in establishing that self-directed services fund.  And one of the purposes of the fund would be to subsidize providers who lose funding when their clients leave their facilities for facilities run by other providers.

So, between these two bills (proposed by Reps. Sannicandro and Stanley), it would seem that at least 90 percent of the funding cut from the developmental centers would be earmarked for specific funds or line items that would help the providers, in potential competition with the state-operated group homes and other DDS accounts.  Ninety percent of the $10.8 million cut from the developmental center line item in the current fiscal year totals roughly $9.7 million.  Now, we’re talking about the providers getting back $9.7 million – or almost three quarters – of the amount the Legislature had cut from the governor’s proposed funding for provider-run group homes.

To be clear, we support adequate funding of provider-run group homes and thus we support  full funding of Chapter 257.  But we don’t support that funding increase coming at the expense of the state-operated group homes or other DDS line items.  Robbing Peter to pay Paul should not be the solution to the problems the administration is facing in providing care to everyone who needs it.