A daunting array of state law changes and funding cuts

Minnesota State house chamber completely empty of Legislators
Minnesota State house chamber completely empty of Legislators

Minnesota’s enormous budget deficit dominated and defined the 2009 legislative session. The fiscal chasm of $6.4 billion was reduced by federal stimulus money, resulting in a $4.6 billion gaping hole for the Legislature to fix. State spending is projected at more than $35 billion for the coming biennium (two years). After adopting cuts, shifts, and tax increases to balance the budget, the Legislature adjourned on the required date, May 18. Governor Tim Pawlenty then vetoed the tax increases and other aspects of the Legislature’s appropriations, vowing not to call a special session but to use his unallotment powers to make further cuts of $2.7 billion on his own and balance the budget for the next biennium beginning July 1, 2009. Despite the overall budget standoff, the Legislature passed and Governor Pawlenty signed many substantial cuts in health and human services programs affecting persons with disabilities.

PCA Cuts and Changes

The personal care assistant (PCA) program cuts will affect more than 8,000 Minnesotans of all ages and types of disabilities who now use PCA services. In addition to the cuts made due to the budget crisis, the recommendations from the Office of the Legislative Auditor for more than 25 specific changes to improve the integrity of the program and prevent identified problems were adopted.

The PCA cuts which will have a major impact on people with disabilities who use PCA services include: 1) a change in the way PCA hours are authorized resulting in an average cut of two hours per day for about 6,500 persons, effective January 1, 2010; 2) a cut in eligibility phased in over two years resulting in 500 persons cut from PCA service eligibility beginning January 1, 2010 and another 1,600 people cut off PCA services July 1, 2011; 3) a limit of 310 hours per month for which a PCA can be paid, effective July 1, 2009. The funding of PCA services which will be cut for the coming two-year period, beginning July 1, 2009, totals $58.6 million in state and federal Medicaid dollars.

As part of the PCA cuts, the Legislature reserved nearly $8 million, beginning July 1, 2011 to be used as match for alternative services for those cut off PCA services with mental health diagnoses or behavioral issues who need some assistance to remain independent in the community. A stakeholders’ group will work to develop alternative services and report to the Legislature by January 15, 2011.

In addition to the cuts made to meet Minnesota’s budget crisis, major changes were made in the way PCA agencies will have to do business, the assessment process and the operation of the program, such as specific definitions of the tasks a PCA is allowed to perform, training requirements and required documentation. Many of these changes are consistent with recommendations made by the Office of the Legislative Auditor to improve the integrity of the PCA program. Other changes were made in the name of simplification, which will mean PCA services in the future will be far less individually designed to meet a person’s specific needs in their home environment. Because of changes in the way PCA hours will be provided to eligible recipients beginning in January 2010, people will be divided into 10 categories and given the same amount of basic time which can be increased by 30-minute increments based on a person’s need for complex medical procedures or allowed behavioral monitoring. The PCA program will be much diminished in its capacity to meet the individual needs of a wide variety of persons in the community.

While the PCA cuts enacted will be devastating to many, the Legislature didn’t adopt all the PCA cuts proposed by Pawlenty. A requirement for persons who have a responsible party designated to oversee their care, to live with that responsible party was defeated. This cut would have eliminated more than 500 more people from PCA services, some with very complex needs. Also, the cut in eligibility for 1,600 people was delayed for 18 months, until July 2011. PCA cuts of more than $14 million in state dollars ($32 million in state and federal Medicaid funds) proposed by Pawlenty weren’t adopted by the Legislature. The efforts of the disability community were crucial in the Legislature’s decision not to adopt over 20% of the Governor’s PCA cuts.

GAMC Funding Vetoed for July 1, 2010

Gov. Pawlenty used his line item veto to eliminate funding for the state-funded General Assistance Medical Care (GAMC), beginning July 2010. The elimination of funding for GAMC will have significant negative consequences for hospitals and have an adverse impact on mental health services, since about 70 percent of GAMC recipients, low income adults without children, use mental health services.

Disability Waiver Cuts

The Legislature adopted Gov. Pawlenty’s proposal to limit disability waiver growth by cutting funding for the Community Alternatives for Disabled Individuals (CADI), the Developmental Disabilities (DD) and the Traumatic Brain Injury (TBI) waivers, eliminating funding for at least 530 people who would have become eligible for these services over the next two years. The disability waiver programs were cut in an unallotment action at the end of 2008, but this funding had to be restored due to the federal stimulus maintenance of efforts (MOE) requirements.

Provider Rate Cut and Adult Foster Group Homes

Community supports and long-term service providers will be cut 2.58 percent beginning July 1, 2009. These services include all disability waivers, including consumer-directed options, intermediate care facilities for persons with mental retardation (ICF/MR) services, semi-independent living services (SILS), aging and disability continuing care grants. Most mental health services were spared the rate cut.

The Legislature also cut more than 900 adult foster homes funded through the disability waivers by requiring that homes with a higher rate be reduced to the 95th percentile for all homes’ rates. This is in addition to the 2.58 percent provider rate cut which will mean that a significant number of four-person group homes will experience a significant reduction in funding in the coming biennium. This cut will remove $7.8 million (state and federal Medicaid funds) from about 900 four-bed waiver group homes for persons with disabilities in the next biennium. Also, a moratorium on additional adult foster group homes will be in effect.

Hospitals received a 1% rate cut and other reductions, payment delays and shifts. Health care providers’ rates were cut 3%, except dental, mental health services and primary care physicians and medical specialists’ rates were cut 5%, raising concerns about whether specialists will continue to serve persons with disabilities who have Medical Assistance coverage.

Personal Needs Allowance Cut

More than 16,000 people who live in Group Residential Housing (GRH) will have their personal needs allowance (PNA) reduced to $89 a month, with no additional funding. This is meant to cover all clothing, hygiene items, individual transportation and any other personal needs. This cut to very low-income persons with disabilities and seniors in group residential housing will save the state $7 million for the next biennium.

Region 10 Quality Assurance Funding Eliminated

The Region 10 Quality Assurance Program which began in southeastern Minnesota was eliminated in the Health and Human Services Omnibus Bill. The elimination of an important quality assurance program comes just as the state is under increased scrutiny from the federal oversight agency, CMS, to increase quality assurance measures for disability services. A last minute provision allowing federal matching dollars for quality assurance activities was adopted, leaving some possible options for continuation, depending upon efforts at DHS.

Tightened Eligibility for Disability Waivers, the Elderly Waiver and Nursing Facilities

Also included in the Health and Human Services Omnibus Bill are major changes to the eligibility threshold for home and community waiver services and nursing-facility-level-of-care. Because of the federal stimulus maintenance of effort requirements, these changes were delayed until January 2011. Nonetheless, it is important for disability advocates and others concerned to focus on these significant changes which will tighten eligibility criteria for the CADI, TBI and Elderly Waiver (EW) waivers as well as for nursing facility care. These changes are projected to result in the elimination of eligibility for over 900 persons who would have been eligible for CADI and TBI services. In addition, these changes are tied to Minne-sota’s adoption of a new comprehensive assessment for all long-term and community support services.

New Assessment — MNCOMPASS

A new assessment, entitled Minnesota COMPASS, will be implemented beginning in January 2011. Before then, DHS will develop training to begin in January 2010, for lead agencies, including counties, managed care plans and tribes, for assessment staff to be trained and certified to use the new assessment process. The Minnesota COMPASS assessment will be required for anyone who wants to access home and community-based waiver services, personal care assistant services or institutional-level-of-care including nursing facilities beginning January 1, 2011.

Dental Services for Adults Reduced, Therapies Not Cut

Gov. Pawlenty’s proposals to eliminate rehabilitative services (occupational therapy, physical therapy, speech and language services and audiology), dental services, chiropractic and podiatry services for adults weren’t adopted by the Legislature. However, substantial limitations for dental services which will adversely impact persons with disabilities were adopted, resulting in a savings of over $7 million in state funds and $17.6 million in state and federal Medicaid for dental services for adults with Medical Assistance. Also, funding for state-operated dental clinics was increased.

MNDHO Reduction

The Minnesota Disability Health Options integrated managed care program operating in the seven-county metro area had its funding cut by $4.6 million in state funds for the next biennium with a much greater cut for the following biennium, 2012-13.

MA-EPD Premiums Not Increased

Gov. Pawlenty’s proposal to increase premiums and unearned income payments from those using Medical Assistance for Employed Persons with Disabilities (MA-EPD) were not adopted.

Policy Changes

While the major focus of this session was the catastrophic budget deficit, a number of important policy changes affecting persons with disabilities were adopted. Minnes-ota’s private guardianship statute was changed to require a bill of rights for persons placed under guardianship, improved reporting by guardians, increased court oversight and registration of guardian and conservators beginning in July, 2013. The Vulnerable Adults Act was strengthened to protect individuals from financial exploitation which has been reported at an alarming rate. Numerous changes have been made to licensing and other regulations affecting residential services. Increased use of technology to assure safety for individuals who want to be more independent in their residential programs will be more available under new provisions adopted. Also, important new legislation to create standards for technology accessibility was adopted.

Finally, a bill to require that private insurance cover services for children diagnosed with autism was not included in the final Health and Human Services Omnibus Bill. A provision establishing the Autism Task Force was adopted, as well as authorization of a joint proposal to obtain federal stimulus funds for research on autism spectrum disorder by the commissioner of health and a Minnesota research institution.

Impact for Years to Come

The cuts and many of the changes described will mean that many persons with disabilities will not be able to obtain the services they need. It is clear that our state is on a path to tighten eligibility criteria for support services for persons with disabilities to remain as independent as possible in their homes and communities. Over the next few weeks the threat of unallotment continues the fear and uncertainty for persons with disabilities who rely upon Medical Assistance and other publicly funded health care and community support services. A major challenge for disability advocates will be to work to develop appropriate alternative services for those eliminated from home and community waiver services, PCA services and even health coverage (GAMC). Specific information about legislation is available on the legislative website www.leg.mn.state.us and through various disability advocacy groups and the Minnesota Consortium for Citizens with Disabilities, www.mn-ccd.org

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