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Worries Run High As State Outsources Disability Services

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WICHITA, Kan. — Aldona and Pat Carney call their son, Neil, “a 24-7 kid.” He has profound autism, severe intellectual disability and attends a special school. He has tried to eat light bulbs and charcoal briquettes and can be aggressive, sometimes scratching people near him.

Neil, 18, who walks with a limp and carries around a grey sock that calms him, lives in a beige single-family home with a professional caregiver who’s known him for years. The house is equipped with cameras to track his movements and a backyard swing he loves to ride.

Come January, the Carneys — and thousands of parents and relatives of Kansans with developmental disabilities — fear that the world their loved ones have become accustomed to may turn topsy-turvy.

That’s when Kansas’ Medicaid managed care system — called KanCare — will take charge of all home and community-based services for about 8,500 people with developmental disabilities, most of them adults. What concerns families and advocates the most is that the three for-profit national insurance companies that run KanCare will be responsible for a statewide program that they’ve never managed in Kansas or elsewhere. They’re also worried that the need to make a profit ultimately will destroy a system families and advocates think works well.

While Kansas will become the first state to make such a leap, it is being watched closely elsewhere, as at least two other states — Louisiana and New Hampshire — are considering moving in the same direction.

“This is an unprecedented model. No state has ever taken a developmental disability population and placed it in an arrangement like this, with an out-of-state managed care system, all at once,” said Rocky Nichols, executive director of the Disability Rights Center of Kansas, a legal advocacy group. “It’s almost like throwing everyone into the deep end of the pool.”

Aldona Carney said her family and others are “extremely concerned” because these services, such as in-home care and daytime activities, affect people’s day-to-day lives.

“This type of model has not been done in any other state,” Carney said. “We’re worried that the managed care companies don’t have a clue about what it takes to keep developmentally disabled people healthy and safe in their home.”

Kansas officials have assured parents and advocates that services will remain unchanged and that payment rates to agencies that provide care won’t be cut. But many are skeptical. They fear that the managed care companies will seek to boost profits by reducing services or driving some small providers out of business because of payment delays or denials. The companies say these concerns are unfounded and insist that services will be maintained and providers paid promptly.

Many states are scrambling to place large numbers of people on Medicaid — the state-federal program for the poor and those with disabilities — into managed care in hopes of cutting costs and improving quality. Nearly 30 million Americans on Medicaid are in private managed care plans.

And millions more will become eligible for Medicaid in January under the federal health law. Many will be placed in managed care.

People with disabilities often need extensive care

By next year, more than two dozen states are expected to have set up programs to transfer frail elderly, mentally ill or individuals with physically disabilities into managed care for home and community-based services. But in most states, those with developmental disabilities — people with impairments such as cerebral palsy, Down syndrome and autism — have been excluded from managed care for these services because their needs are so specialized.

They live with their families or in apartments, single-family homes or group homes. Some need round-the-clock supervision and many require assistance with dressing, bathing and preparing meals, as well as transportation. Some need help finding a job or volunteer work, and many attend daytime activity centers.

In Kansas, where a network of community-based nonprofit organizations and county agencies oversee these services, individuals can choose a case manager, who visits them at home and coordinates their care. In some cases, those relationships go back decades. While these organizations will continue to determine what services clients are eligible for and case managers will work with families to arrange that care, ultimately the health plans will be responsible.

“There is a great deal of fear in the community that these big private health plans don’t know much about this population,” said Maureen Fitzgerald, disability rights director for The Arc, a national advocacy organization for those with developmentally disabilities. “These are such vulnerable people. Mistakes that are just inconvenient to some can be devastating to them. If the home care person doesn’t show up, you could be lying in your bed all day. It’s kind of scary.”

Only a handful of states, including Michigan and Vermont, have moved individuals with developmental disabilities into managed care for long-term services. They’ve mostly relied on existing networks of community-based nonprofits or county agencies or have made themselves the managed care organization. None has turned exclusively to national managed care companies.

But that’s exactly what Kansas Gov. Sam Brownback had in mind when his administration decided to transfer virtually all of the nearly 380,000 people on Medicaid into KanCare, starting in January 2013.

Kansas contracts with three companies — Amerigroup, UnitedHealthcare Community Plan and Sunflower State Health Plan, a subsidiary of Centene. It gives them a fixed amount per member each month. As of Sept. 30, it had paid them a total of $1.3 billion for this year.

The companies provide medical, pharmaceutical and mental health care to KanCare members, including those with developmental disabilities.

Brownback, a Republican, has said that KanCare will improve care coordination and reduce growth in Medicaid spending for the state and federal government by $1 billion over five years.

Although the frail elderly and those with physical disabilities and mental illness are now getting long-term services through KanCare, inclusion of people with developmental disabilities was delayed until 2014 by the legislature following bitter protests from parents, advocates and providers. Lawmakers wouldn’t yield again, even as more than 1,000 people rallied outside the Capitol in Topeka in May, many wearing red T-shirts that read: “Not Worth the Gamble.”

Kansas State Rep. Nancy Lusk, a Democrat from Overland Park, said she received so many “passionate e-mails” opposing the state’s plan that she put together a video highlighting the stories of families who would be affected, posted it online and sent a message to her colleagues.

Shawn Sullivan, Secretary of the Kansas Department for Aging and Disability Services, said in an interview that providers who are fearful of change had gotten families riled up unnecessarily. He said families and advocates need not be worried because clients will be able to keep their case managers and agencies that provide services won’t have reimbursements slashed. The major difference, Sullivan said, is that the insurance companies will hire care coordinators who will work in conjunction with case managers and providers.

Sullivan, a former nursing home administrator, conceded that state officials should have done a better job interacting with families and providers from the start.

“I think there are a lot of lessons learned,” he said. “I would have gone and worked with families and guardians and all the providers to address their concerns and do a better job of communicating the protections we have in the system.”

Sullivan said the upcoming changes, which still have to be approved by federal health officials, won’t produce cost savings initially. But they will improve outcomes for clients who will receive more employment opportunities and better coordination of their medical and mental health care, he said. Ultimately, that will save money because of fewer hospitalizations and medical costs.

Companies say they won’t cut services

Kansas currently spends about $349 million a year on home and community-based care for those with developmental disabilities — about 10 percent of its Medicaid budget. A study by the University of Minnesota’s Institute on Community Integration found that Kansas paid on average $40,464 a person in fiscal 2011, which was mid-range in national rankings.

Jean Rumbaugh, president of Sunflower State Health Plan, said money can be saved by reducing inefficient care and better coordinating services. “We want to provide solutions to states and have a holistic approach to this population,” she said. “It is a new opportunity and one that I think Centene is very interested in.”

Rumbaugh said Sunflower’s goals — which are similar to the other two plans’ — are to support families, meet individuals’ needs, focus on competitive employment and make sure clients have access to medical and mental health care.

Amerigroup Kansas President Laura Hopkins said her plan wants to protect the array of services for clients. “There’s no incentive for us to cut services, from a contract perspective or from a human perspective,” she said.

Debra Lipson, a senior researcher for Mathematica Policy Research, a nonpartisan think tank, cautioned that Kansas’ blueprint presents “huge challenges.”

“They’re entering into virgin territory,” she said. “They don’t have a lot of models to follow, and it’s a highly vulnerable population, and therefore you can’t skimp on oversight. And there’s a risk when you’ve got national companies that don’t bring a tremendous amount of experience in this area.”

The health plans say that while they may not have much experience with this particular type of program, they have been handling similar services for individuals with physical disabilities and elderly members. They also have been hiring workers and managers with expertise in developmental disabilities in Kansas.

Kansas official Sullivan dismissed criticism about the companies’ lack of experience, noting that the state will maintain a high level of oversight and stringent contractual requirements, such as withholding 3 to 5 percent of payments to the plans to ensure performance requirements are met.

But some family members say they’re not optimistic because they’ve already experienced problems with KanCare on the medical side.

Kay Soltz, of Wichita, said her 32-year-old son, Zachary, was initially assigned to a pediatrician as his primary care doctor when KanCare launched. After she complained, the health plan assigned him to a doctor located 20 miles away, and Soltz said she jumped through more hoops to get it changed.

Zachary, who is in constant motion, has autism and intellectual disability. He spends much of his time watching 30-second snippets of old TV game shows from his childhood and listening to TV theme songs on his Walkman over and over. He attends a day program and, like Neil Carney, lives in a single-family home with a caregiver.

Soltz, 63, said she has “no confidence” in the health plans taking over management of long-term care for Zachary.

“At my age, I’d like to think my son has something stable, something that will protect him if I’m not here,” she said. “Boy, I don’t feel that way at all.”

In recent months, KanCare has also come under attack from hospitals and some providers, who have charged that the health plans have improperly denied or delayed reimbursements and created serious financial and bureaucratic obstacles for them. The companies say they have been meeting with providers to work out the bugs and have been trying to resolve any systemic problems on their end. But they note that providers also need to become more familiar with the billing and claims process.

Many long-term services agencies for those with developmental disabilities fear the same thing will happen to them in 2014 — and that some smaller providers and mom-and-pop operations won’t be able to stay in business if they can’t pay their bills. They say this would leave clients with fewer choices and could result in them losing their case managers and caregivers.

“It’s very personal and intimate direct care — and home care workers are not paid very much. For small providers, if they don’t get paid, they don’t stay,” said Tom Laing, executive director of InterHab, an association of Kansas providers. “The system was running very well, and now it will be operating on flat tires and worn-out spark plugs.”

In Hutchinson, Ginger Zyskowski worries that the nonprofit agency that cares for her brother, Kyle Hulet, could suffer financial instability under KanCare if the health plans don’t pay on time and in full.

Hulet, a cheerful 63-year-old quadriplegic with cerebral palsy who loves watching wrestling and singing at church, lives in an apartment. He works next door at the agency’s front desk, earning about $29 a week for four hours’ work, answering phones in tandem with another client. He also uses a computer to type up banners and notices by pushing a button with his head.

“Right now, my brother is in a pretty safe place. I’m not sure what the future’s going to hold,” said Zyskowski, 67. “There is a fear among older caretakers like me that if this thing with KanCare goes wrong, what’s going to happen? He could outlive me, and what’s in place for him?”

Aldona and Pat Carney share similar thoughts about their son, Neil. He lived with them for years, but it no longer was safe for him — or them — in his family home. He didn’t do well in a group home, so, with the help of two of Pat’s brothers, they purchased and renovated the house he now lives in with his caregiver, who teaches him about tasks such as brushing his teeth and dressing himself. Aldona Carney said the state pays a nonprofit agency about $71,000 a year for his residential services — the maximum rate because of his extreme disabilities, which is cheaper than if he were institutionalized.

Carney, 51, said she envisions the house as a place for Neil to live the rest of his life. But she fears that at some point with KanCare, that could change because of the cost.

“There’s a definite lack of trust among parents and families in this state,” she said. “We had a system that worked really well, so why are they trying to fix something that’s not broken?”

Kaiser Health News is an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communication organization not affiliated with Kaiser Permanente.

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Comments (10 Responses)

  1. Kathy says:

    Sounds exactly like what they did to the DD population in Wisconsin except the managed care organizations are non -profit. But it is still the same, managed care. There have been cuts in daily living skills programs, work programs and other needed services for our DD population.

  2. Cathy says:

    And what is to stop this type of managed care providers from saying it is cheaper to institutionalize the DD/ID population and stop providing for inhome care? I can’t believe this is for real. Frightful!

  3. Veronica says:

    Managed care is a euphemism for reduced care.

  4. David P. Rundle says:

    Neither Brownback nor Sullivan has ever taken concerns about KanCare to heart. They don’t care. Further, they said savings from KabCare would be used to reduce the PD and DD waiting lists. But the numbe will increase in FY 2015 by 300. I’m on the PD waiver and it’s a mixed bag. But we haven’t heard Brownbiack admit that.

  5. Hankus says:

    This will inevitably lead to higher costs and a reduction in services as the private companies will be taking their cut for overhead and profit directly out of the money that the state provides. The very reason we have state-run institutions and care provision is because the private sector did such an appalling job at it when they did it at all!

  6. TJ says:

    The system may not be broken for those lucky few who currently have adequate care, like Neil. The problem is the growing tsunami of disabled growing in to adulthood with autism, fetal alcohol and other brain health issues. There is not enough money to provide these services to everyone. Those who had it should be happy they did. Those of us who don’t (and never have) don’t feel much sympathy. Either everyone gets the care they need (and those working get taxed to the max) or the care standard diminishes. Tough choices.

  7. Aldyth says:

    It’s all about the money. For profit means that they have to make a profit – which means keeping costs down. They’ll steal services from your family member in order to make that profit. Congratulations, Kansas. Your state government is stealing from the least able among us in order to make profits for the rich.

  8. VMGILLEN says:

    New York State – New York, home of the infamous Willowbrook State School! is doing this nonsense also – with capitated costs per individual. So, if a person has a major health event, do they get kicked out of their housing?

    More troubling: when these operators want to cut costs, the FIRST to take the hit are employees. And god only knows you get what you pay for! The/re not being paid enough now – there comes a point where altruism and humanism alone don’t cut it We saw an immediate deterioration in services when the NYC Department of Ed privatized and out-sourced therapy…

  9. Rosella A Alm says:

    At present in California, the state has been working on what they call “Cal Duals”. This is a program that will REQUIRE everyone who receives Medicaid (called MediCal in California) to be enrolled in a managed care program.

    The state is devising a scheme to enroll everyone who has both MediCal and Medicare, (as most people with developmental disabilities who are offspring of older or deceased workers have) as well as others who are disabled workers themselves, to enroll in a managed care plan.

    The date when this will happen has been pushed back many times as further complications are uncovered. So far people with developmental disabilities are not included in the plan. But the question is sort of left open for the future.

    The state will initiate “passive” enrollment, however it is still an opt out ability. Passive enrollment will be done in blocks.

    We as people with disabilities, parents and conservators must remain on top of this issue in order to make an informed decision if and when it should come down to us.

  10. jackie says:

    so it’s been 2 months now with the proposed changes- how is it going ? sounds like both Neil & Zachary are in a situation that is not readily available to many people, with or without a disability – the luxury of a single family home, with a dedicated caregiver- when that caregiver needs a break, who provides it ? in Neil’s case, family has helped provide the housing, something i wish more families ( that are able ) would be willing to do- too many expect government to take over 100% care of their family member, when it should be a shared responsibility- having children- it is a responsibility. in CT, there are wealthy people who still expect handouts, when they could certainly afford to contribute to their child’s cost of care; on the other hand, there are families struggling who don’t ask for help when they could benefit from it.

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