NCGA: MH/DD/SAS Legislative Oversight Meeting Report

Yesterday the Mental Health, Developmental Disabilities, Substance Abuse Services Joint Legislative Oversight Committee met for their first meeting during the legislative break.
The meeting opened with a review of bills, budget cuts, and special provisions that were included in the last budget.

For the first time it was made clear to all members of the committee and to the public that the cut to state funded services for MH/DD/SAS was not $60 million. The $60 million cut was what was presented in the budget prior to Governor Perdue’s executive directive stating that an additional 5% cut needed to be made by all departments. The actual cut to state funding is $75 million dollars.

Here is the break down of this cut:

• State Funded Services $40 million for fiscal year 2009-2010 and 2010-2011. (This is the appropriation that goes to LMEs)
  
• CAP MR/DD Funds $16 million for fiscal year 2009-2010 and 2010-2011.
  
• Non-core Community Services Reduction $4 million for fiscal year 2009-2010 and 2010-2011.
  
• Governor’s Reduction of $15 million.
  
• Total Reductions: $75 million
  

It was also clear that members of the legislative oversight are just now feeling the reality of these draconian cuts.

During the introduction of Secretary Cansler, Senator Nesbitt stated that we may be hearing about more than just MH/DD/SAS in the secretary’s comments. Nesbitt stated that “we made so many changes that interact with each other and we need to hear that.”
Secretary Cansler’s comments encompassed the cuts to state funded dollars, the consolidation of case management, and community support.

These topics also received the majority of questions and concerns from members of the oversight committee. There was also a sense of what the legislators intended to do did not necessarily match up to what was happening, especially with community support.
Lets take a look at the cuts to state funds. Secretary Cansler stated that “if you look at all the cuts, the $40 million state dollar cut, and then the Medicaid cuts, the cuts to community support, case management consolidation and the provider rate cuts you are looking at a $350 to $400 million dollar impact on the system. We are challenged on how to achieve the savings without a major impact to the system.”

LME State Funded Cuts:
The main questions related to the way the cuts were distributed to LMEs. There were many questions regarding the allocation formula and the equity of that formula. Expect this to be a hot topic in all of the meeting of this committees.

In an interesting moment at the meeting, Senator Nesbitt went through the politics of this cut. He stated correctly that the $40 million cut was included in the House budget not the Senate budget and that during conferee discussions this $40 million dollar cut was restored. The final budget that was presented to the Full Appropriation Chairs from the HHS Conference Committee did not include this cut. In the last hours of budget debates the Full Appropriation Chairs reinstated the $40 million dollar cut without consultation of the HHS Conference Chairs.

Regardless of where the cut came or the politics of the final cut, this cut coupled with the additional $15 million will destroy many of the community services currently being received by people we advocate with.

Community Support:
This service has been much maligned in the press but for people receiving community support, this service has kept people out of emergency rooms and state institutions.

The budget cut to Community Support is $65 million for fiscal year 2009-2010 and $97.5 million for fiscal year 2010-2011. The understanding of members of the legislative oversight committee was that there would be appropriations remaining in the continuation budget that would be used to create an underlying service that would then emerge and replace community support.

The budget did clearly state that DHHS would submit a new service definition for the case management and peer support components of community support. In peer support it would emerge as a Medicaid billable program.

There was a lot of discussion regarding this service. Part of the discussion was that there was confusion over how this service transitions. We heard in the presentations that there is no underlying service at this time and that new enrollment was stopping. Members wanted to ensure that there would be a new service coming on line in January of 2010. There was also confusion on the remaining appropriation in the continuation budget.

Expect to see this topic come up frequently during the next few months.

Consolidated Case Management:
The budget that passed this session included at $41 million dollar cut in fiscal year 2009-2010 and a $72.9 million dollar cut in fiscal year 2010-2011 to case management. This cut represents for this fiscal year a 50% cut in funds to case management. There has been strong push back from public health departments regarding this cut. So strong that Secretary Cansler mentioned them specifically in his remarks to committee members.

During session advocates for MH/DD/SAS spoke strongly against this consolidation and stated that the cut was severe enough that it would upend the system of case management that is currently in the field.

Throughout the presentations yesterday, it was clear that there was concern on how to make this transition from members of the committee, Secretary Cansler, DMA and the Division of MH/DD/SAS.

There has been a workgroup working on a plan and they are set to release a “plan” today regarding this consolidation. We will comment more on this pending receipt of information from this workgroup later today.

This budget as it stands today will significantly impact people, families, and providers in North Carolina. There will be services lost, jobs lost, and people sent into crisis. There is no silver lining to these cuts. The idea that we will emerge into a better system has yet to be shown to advocates across this state. In the meantime, we will continue to track the cuts and report that information to the leaders in our General Assembly who made these decisions in the hope that we can work with them to ensure that funding is restored in the next budget.