We at the Minnesota Department of Human Services (DHS) recognize that all of us—individuals, families, providers, lead agencies, state workers, other stakeholders—are in the midst of significant change with many reform initiatives underway simultaneously. An opinion piece titled “Actions create the Perfect Storm” in the May issue of Access Press provides an opportunity to remind people of the benefits of two reform projects the article mentions: the new Disability Waiver Rate System (DWRS) and Rule 245D. These are critical system improvements intended to help individuals and ensure ongoing access to necessary services.
Regarding DWRS, in 2007 the federal Centers for Medicare and Medicaid Services directed Minnesota to replace its county-negotiated rate system with a statewide rate methodology. Failure to do so would risk access to nearly $3 billion in the home- and community-based services for about 30,000 Minnesotans.
Before implementation of the DWRS, lead agencies and service providers contracted for home- and community-based services for people with disabilities. These contracts resulted in disparities across the state. Often, providers received the same negotiated rate for all individuals regardless of service needs, or, in other cases, wide variation in rates for services for people with similar needs. Contracts frequently contained varying guidelines for provider qualifications and standards.
With the implementation of DWRS in 2014, DHS established consistent, transparent statewide rate methodologies based on the needs of individuals. Implementation of DWRS also satisfied federal requirements and assured continued access to critical home- and community-based waiver supports for Minnesotans.
Some themes in the May article call for additional background and clarification:
• DWRS provides assurance that rates will keep pace with inflation. Updates will be based on values from the Bureau of Labor Statistics and the Consumer Price Index. Price rate updates will keep
pace with inflation on a transparent schedule. The first adjustment is expected to take place on January 1, 2017.
• DWRS implementation will not reduce total spending on disability waiver services. Rather, we project that full implementation will result in a modest increase in statewide expenditures. Implementation was to be cost neutral overall, which was why a transition period to give providers time to plan and adjust to future rate was authorized by the legislature.
• We have worked intensively with provider agencies since 2009 to document cost drivers that affect spending. We’ve used that information to establish standard cost framework publicly in the statute. Overall the rate changes must balance each other, so that the net changes are financially cost neutral. For some services and providers, the cost-driver documentation results in rate increases. For others, including many day training and habilitation (DTH) providers, the documentation does not support historical standards. Despite the overall reduction for DTH as a service category, rate increases are projected for about 33 percent of DTH providers whose rates were low historically.
• We welcome input on these methodologies. We have committed extraordinary resources over the past seven years to identify and refine the values that make up the framework. Beginning in 2009 work groups of service providers, advocates and lead agency representatives were actively engaged in this process, resulting in passage of enabling legislation in 2013. We continue to meet monthly with a stakeholder advisory committee to identify improvements and address concerns. We continue to conduct intensive research and analysis to assure that DWRS methodologies are sound, valid, and that changes proposed to the legislature where needed. We have expanded evaluation to provide a regional rate variance adjustment introduced earlier this year and to analyze “non-wage costs” to further inform and refine DWRS.
• DHS shares concerns about a workforce crisis and recognizes that the labor force is not growing at the rate needed to meet rising demand. We are working with our partners and stakeholders on a Direct Care/Support Workforce Summit this summer to explore innovative solutions and inform strategies moving forward.
• Gov. Mark Dayton proposed, but the 2016 legislature did not adopt provisions to address providers’ additional expenses resulting from the federal Department of Labor new regulation on staff compensation for overtime and travel costs.
• Legislation regarding licensing fees was proposed this year but not adopted. Licensing costs are a considerationin ongoing research we will conduct as part of the DWRS system analysis.
We are actively seeking and welcome any suggestions from any of our stakeholders during this time when many changes are converging. However, we may not be able to support ideas that jeopardize federal funding for home- and community-based services. DHS has an extensive analysis and reporting process outlined in the statute to ensure individuals continue to receive services. We also continue to be committed to a transparent process, sharing information and working with stakeholders throughout the implementation of initiatives and legislative changes.
-Alexandra Bartolic is director of the Disability Services Division, Minnesota Department of Human Service