As detailed in our first cover story, the governor’s budget proposal includes numerous cuts to long-term care providers. Here is the specific impact for providers of Elderly, CADI and TBI Waivers:

Elderly Waiver Providers

1) A 10% reduction in payment rates for Customized Living and 24-hour Customized Living services. These cuts account for $12 million in cost savings projected by the Department of Human Services (DHS), which estimates that 415 people are expected to enter nursing facilities because providers of home care delivered in a housing with services establishment will simply not be able to afford these new payment rates. At the February 16 meeting of the Housing and Community-Based Services (HCBS) Cabinet, Jean Wood of the Aging and Adult Services Division of DHS presented the Governor’s budget proposals. Members expressed dismay to Ms. Wood that this type of budget cut represented a dramatic departure from at least ten years of policy direction to encourage the right care, at the right place, at the right time.

2) Audits of EW Customized Living Rate Setting Tools are expected to save $2 million.

3) 1,600 participants would be moved from Case Mix A to Case Mix L because the number of non-critical Activities of Daily Living (ADLs) needed to qualify for Case Mix A would be increased from 1 to 2. This change would also create a lower service rate limit for Customized Living. This would impact 233 individuals. For a refresher on Case Mix L, which was implemented July 1, 2009, please review DHS Bulletin #09-25-07C.

4) The community budget for elderly waiver participants, customized living and other services would be reduced for Case Mix L individuals from $2,200 to $1,750. This would affect 436 individuals.

5) The criteria to qualify for the 24-hour Customized Living would increase the number of dependencies from 2 to 3, in addition to the need for medication management and at least 50 hours per month of planned component services. Therefore, Case Mix L individuals would no longer qualify for 24-hour Customized Living. This proposal would impact 34 individuals.

6) The case mix cap for Elderly Waiver is separated from Nursing Facility rates, which they had been tied to. Therefore, case mix caps for elderly waiver would only be adjusted by a specific legislative adoption of a home and community-based services rate adjustment. This proposal is projected to save $238,000 in Fiscal Year 2012.

If you would like to refresh your knowledge about the service rate limits for Elderly Waiver Customized Living and 24-hour Customized Living, please review DHS Bulletin 10-25-04.

CADI and TBI Waiver Providers

1) A 4.5% rate reduction. DHS acknowledges that the “proposed reductions are expected to stress provider networks and some providers may leave the Medical Assistance program as a result.”

2) For 2,100 individuals on the CADI waiver, “the dollars available for service for individuals with lower needs living in congregate living arrangements will be reduced on average by 10% in FY 2012 and FY 2013 and 15% in FY 2014 and 2015. If you are an adult foster care or housing with services establishment, then you are a congregate living setting or arrangement. The definition of Low Need is minimal needs in medicated management, behavior management and instrumental activities of daily living such as meal preparation, laundry and shopping.

We have requested a clarification from DHS on how the two provisions above would intersect for providers who are serving individuals with lower needs.

3) Growth limits on the CADI, DD and TBI waivers are continued.

If you have questions on these proposals, please contact Phil Manz at pmanz@careproviders.org or 952-851-2484.

Phil Manz
952.851.2484
pmanz@careproviders.org

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