Ark. Developmental Disabilities Nonprofits Worry about Medicaid Restructuring

March 11, 2012; Source: New England Cable News (AP)

State officials in Arkansas are planning to restructure Medicaid, moving from the current fee-for-service model to an “episode of care” system that bundles the continuum of services for beneficiaries. While actively involved in the planning process, nonprofits serving individuals with developmental disabilities are alarmed that they will be saddled with new reporting requirements but decreased funding, which some say could lead to disruption of care for their consumers. Out of a current state Medicaid budget of $4.4 billion, Arkansas Medicaid pays upwards of $550 million to nonprofits that provide comprehensive care to 20,000 individuals with developmental disabilities. The state projects a Medicaid budget shortfall of $200 to $400 million for Fiscal Year 2014.

Nonprofits recognize that federal support has maxed out. “Nationwide, we’ve reached the limit to what Congress is willing to put into Medicaid,” according to Rita Taunton, CEO of the South Arkansas Developmental Center for Children and Families, Inc. Taunton and other nonprofit leaders support restructuring for cost savings and consolidated care in theory, but as Taunton says, “There are just so many unknowns. It’s happening so fast.” Developmental Disability Providers Association (DDPA) Executive Director Sara Israel worries that the “vulnerable individuals” her organization serves may experience a “disruption of service delivery,” and many in the field question how such a wholesale change will yield cost savings anytime in the near future.

John Buck, executive director of the Elizabeth Richardson Center in Springdale, Ark., fears that bundled-service payments may not be suited for conditions such as developmental disability, where costs are ongoing and open ended. State officials tout the need for quality care and fiscal responsibility. “We’re trying to make it more responsive to people and more effective,” according to Charlie Green, director of Developmental Disabilities Services for the Arkansas Department of Human Services. The centerpiece of the state’s proposed solution for those with developmental disabilities is the “health home,” which is intended to provide close-knit coordination of care, from medication management to preventive treatment. According to Sara Israel, whose association is researching the idea, “Where we see cost savings is a reduction of hospital admissions and visits to the emergency room.”

Kent Jones, executive director of Bost, a Fort Smith, Ark. nonprofit serving individuals with developmental disabilities, hopes that episode of care payments will wring out excess administrative inefficiencies, streamline services and reduce costs. The new system intends to incorporate a universal assessment tool to standardize need determinations and reporting requirements. The change over to the episode of care model is embryonic, and all proposed changes to Medicaid require approval from the federal Centers for Medicare and Medicaid Services and from the Arkansas General Assembly. –Louis Altman