SAMHSA222s Weekly Financing News Pulse: State and Local Edition July 28, 2010 7/28/2010 1 SAMHSA222s Weekly Financing News Pulse: State and Local Edition Arizona California Connecticut Georgia Kansas M aryland M ichigan N ebraska New Jersey New Mexico New York North Carolina O hio O klahoma O regon W est Virginia To Subscribe to SAMHSA222s Weekly Financing News Pulse, please go to the following link and choose 223Health Care Financing224: https://service.govdelivery.com/service/multi_subscribe.html?code=USSAMHSA&origin=http://www.samhsa.go v/enetwork/success.aspx For quest ions or comments, please contac t Kevin Henness y ( kevin.hennessy@samhsa.hhs.gov ). SAMHSA222s Weekly Financing News Pulse: State and Local Edition July 28, 2010 7/28/2010 2 Around the States: State and Local Behavioral Health Financing New s Arizona HUD Awards $446,000 Grant to CPSA Funding Housing for Homeless Young Adults with Behavioral Health Disorders : The U.S. Department of Housing and Urban Development (HUD) awarded the Community Partnership of Southern Arizona (CPSA) a two - year $446,000 grant to provide supportive housing for up to 22 homeless young adults with serious mental illnesses (SMI) or substance abuse disorders. CPSA is the Regional Behavioral Health Authority for Cochise, Graham, Greenlee, Pima, and Santa Cruz Counties. CPSA222s contractors will provide behavioral health treatment. In addition, as part of the program , a non - profit organization will conduct outreach, help individuals obtain housing, and offer support services ( Inside Tucson Business, 7/23 ) . California Update: Judge Issues Preliminary Injunction Barring Sacramento County from Shifting Mental Health Services to County Clinics : On July 22, U.S. District Co urt Judge John Mendez issued a preliminary injunction barring Sacramento County from implementing a plan to shift mental health services from private non - profit clinics to county clinics. The Sacramento County Department of Behavioral Health Services (DBH S) originally proposed eliminating four contracts with non - profit clinics providing outpatient services and replacing them with four outpatient mental health 223wellness centers 224, staffed by county workers. On May 6, Disability Rights California, the Western Center on Law and Poverty, and Cooley LLP filed a class - action suit against Sacramento County, alleging that the cuts could leave thousands of mentally ill residents 223exposed to increased harm or injury and death224 and that the cuts violate state and federal law. In response, county officials proposed a 223hybrid plan224 under which county employees would provide clinical services at the new centers, w ith the four regional contractors providing psychiatric , medical and support services. In issuing the injunction, Judge Mendez said th at transferring the services to county operated facilities would violate the Americans with Disabilities Act (ADA) and result in 223catastrophic harm224 to patients. DBHS officials had planned to implement the change on August 1 but now cannot do so until the court case is resolved ( California Healthline, 7/22 ; The Sacramento Bee, 7/22 ). Connecticut DSS to Use $50 Million in Federal Funds to Administer High- Risk Pool , Begin s Accepting Applications August 1 : The Connecticut Department of Social Services (DSS) will use $50 million in federal funds to administer the state222s temporary high - risk health insurance pool. Connecticut 222s high - risk pool will begin accepting applications on August 1 and begin coverage on September 1. State officials estimate monthly premiums in the pool will range from $285 to $893 ( AP via The Boston Globe, 7/24 ). Georgia Governor Orders 4 Percent Spending Cut to Offset Stalled ARRA FMAP Fu nding : To offset the currently unapproved extension of American Recovery and Reinvestment Act (ARRA) Federal Medical Assistance Percentage (FMAP) funding, Governor Sonny Perdue (R) ordered a 4 percent state wide spending cut to begin August 1 . The 4 percent cut will affect health care programs. T he state222s $17.9 billion FY2011 SAMHSA222s Weekly Financing News Pulse: State and Local Edition July 28, 2010 7/28/2010 3 budget assumes Congress will approve the additional FMAP funding, providing Georgia with approximately $375 million . However, federal l egislation to extend the funding h as stalled, leading the governor to call for the spending reduction as a contingency plan. State officials estimate that the spending reduction will save the state $25.5 million monthly ( The Atlanta Journal - Constitution, 7/23 ). HUD Awards Two Macon Non- Profits Over $2 Million to Build Housing for Individuals with Mental Ill ness and Developmental Disabilities : The U.S. Department of Housing and Urban Development (HUD) issued a $1.2 million grant to River Edge Behavioral Health Center to build a 10 - unit apart ment complex and a n $800,000 grant to Advocacy Resource Center - Macon to build two group homes. Officials from the non - profits expect to complete construction by the end of 2011 ( Macon Telegraph, 7/24 ). Kansas CMS Approves Cost Settlement Agreement Allowing Medicaid to Reimburse Schools for Psychologists, Social Workers, and Attendant Care : On July 19, Kansas Health Policy Authority (KHPA) officials announced that the Centers for Medicare & Medicaid Services (CMS) approved a cost settlement agreement that will allow schools to receive Medicaid reimbursements for services provided by psychologists and social workers . In addition, the agreement will allow reimbursements for attendant care for special education students. S ervices provided by p sychologists and social workers were not previously eligible for reimbursements and attendant care services became ineligible on July 1 . The cost settlement agreement also allows schools to receive reimbursements for attendant care based on actual cost , i n contrast to the previous model, which reimbursed schools below cost . State officials estimate that psychologist and social worker reimbursements will yield an additional $5 to $10 million annually in Medicaid funding. The agreement is retroactive to Ju ly 1 , 2009 ( Kaiser Health News, 7/27 ; Kansas Health Institute, 7/26 ; The Topeka Capital - Journal, 7/19 ). Maryland HCRCC Interim Report Projects $829 Million Savings through 2019 Under National Health Care Reform : On July 26, the Maryland Health Care Reform Coordinating Council (HCRCC) released an interim report projecting that Maryland will save $829 million through FY2019 under national health care reform. However, the report projects that those savings will end in FY2020, when the state will spend $46 million more than it would have spent if health care reform had not been enacted. HCRCC222s report also projects that , once fully implemented, t he reform law will reduce the number of uninsured Maryland residents by 50 percent . The council based the projections on research conducted by The Hilton Institute of the University of Maryland, Baltimore County and will submit a final report to Governor Martin O222Malley (D) by January 1 ( The Washington Post, 7/26 ; The Baltimore Sun, 7/26 ). State Recovers Over $26 Million in Medicaid Waste, Fraud, and Abuse in FY2010 : On July 22, Lieutenant Governor Anthony Brown (D) announced that the Maryland Department of Health and Mental Hygiene222s (DHMH) Program Integrity Unity recovered approximately $26.5 million in Medicaid waste, fraud, and abuse in FY2010 . DHMH officials say they have identified or recovered over $100 SAMHSA222s Weekly Financing News Pulse: State and Local Edition July 28, 2010 7/28/2010 4 million in waste and fraud since 2006 ( Washington Examiner, 7/23 ; The Baltimore Sun, 7/22 ; Kaiser Health News, 7/23 ). Michigan Auditor General222s Report Finds $489 Million in Questionable DCH Spending : A report by the O ffice of the Michigan Auditor General identified $489 million in questionable spending by the Michigan Department of Community Health (DCH) from 2007 to 2009. The audit also found over $4 billion in 223likely224 questionable co sts for DCH over the same period. The report recommends that DCH improve its internal control processes, noting that many of the issues raised by the audit were found in previous audits but had not been addressed ( Chicago Tribune, 7/22 ). DMB Selects Priority Health and Physicians Health Plan of Mid- Michigan to Administer High- Risk Pool : On July 26, Michigan Department of Management and Budget (DMB) officials announced that they selected Priority Health and Physicians Health Plan of Mid - Michigan to administer the state222s high - risk insurance pool. Priority Health is a subsidiary of Spectrum Health and Physicians Health Plan of M id - Michigan is a subsidiary of Sparrow Health . Under DMB222s plan, Priority Health would receive $103.6 million in federal funds to offer coverage in 61 counties and Physicians Health Plan of Mid - Michigan would receive $37.3 million to offer coverage in the remaining 22 counties. The insurers would start accepting applications for coverage through the high - risk pool on September 15 and begin coverage on October 1. Before implementation, t he Michigan Legislature must approve the appropriations for the pool ( Detroit Free Press, 7/26 ). Nebraska Supreme Court Rules D HHS Cannot Withhold Medicaid Under Welfare- to - Work Program : On July 23, the Nebraska Supreme Court ruled that the Nebraska Department of Health and Human Services (D HHS) does not have the authority to impose work requirements for Medicaid eligibility . The ruling upholds an earlier finding that DHHS had exceeded its authority in imposing the requirement. To be Medicaid - eligible u nder the work requirements, single parents with children older than six had to work a minimum of 30 hours per - week while two - parent families needed to work a combined minimum of 35 to 55 hours per - week, depending on wh ether or not their children received federally - funded child care ( AP via Business Week, 7/23 ) . New Jersey Governor Vetoes Supplemental Spending Bill to Restore $24 Million for CHIP : On July 23, Governor Chris Christie (R) vetoed a supplemental spending bill that would have restored $24 million in funding to the state222s Children222s Health Insurance Program (CHIP), FamilyCare. The funding would have opened the program to an additional 39,000 children ( Philadelphia Inquirer, 7/24 ; News Record, 7/26 ). New Mexico Governor Announces Spending Cuts, Exempts Medicaid and Services for the Developmentally Disabled: On July 21, Governor Bill Richardson222s (D) administration announced that it will seek a 3.2 percent reduction in state spending on programs and services ; however, Medicaid and certain services SAMHSA222s Weekly Financing News Pulse: State and Local Edition July 28, 2010 7/28/2010 5 for the developmentally disabled will be exempt under state law. The New Mexico Board of Finance must approve the cuts before the New Mexico Department of Finance and Administration (DFA) may reduce monthly funding allocations. The board will discuss the cuts in August and the DFA intend s to begin the reductions in September ( KOAT, 7/24 ; AP via Business Week, 7/21 ). New York Oneida County Delays Medicaid Payments to State O ver Unpaid Bills : On July 20, Oneida County Executive Anthony Picente sent a letter to Governor David Paterson (D) stating that the county would not make its required weekly Medicaid payments to the state because New York owe s the county $30 million in other payments . In New York , the state and counties fund roughly half of Medicaid and the federal government provides the other half . Oneida County withheld its $800,000 Medicaid payment for the week of July 19 and plans to continue to withhold payments until the state pays at least one third of the $30 million it owes to the county . Governor Paterson says the state will pay its backlog of unpaid bills to all counties by the end of August ( The Wall Street Journal, 7/26 ; Kaiser Health News, 7/26 ; The Wall Street Journal, 7/27 ). North Carolina Crisis Services Center in Onslow County Begins Offering Overnight Detoxification Services: On July 23, the Crisis Services Center in Onslow County began offering overnight detoxification services. The center opened on March 1 for out patient mental health and substance abuse services as well as services for those with developmental disabilit ies . For two years, Onslow County has not had a facility offering overnight detoxification services. The new center treats all patients regardless of their ability to pay, using state funding to cover costs for patients that cannot afford their care ( Jacksonville Daily News, 7/24 ). Ohio Update: State to Begin Enrollment in High- Risk Insurance Pool August 1: The Ohio Department of Insurance announced that enrollment in the state222s high - risk insurance pool will begin o n August 1 and coverage will begin on September 1. Ohio222s high - risk pool, run by Medical Mutual of Ohio , will cover approximately 5,000 individuals and operate on $152 million in federal funds. Medical Mutual will offer two benefit plans with deductibles of $1,500 and $2,500 ( Business Week, 7/22 ; Kaiser Health News, 7/23 ) . Oklahoma Insurance Commissioner Files Petition to Overturn Law Raising Medicaid Funds Through Insurer Fee : On July 20, Oklahoma Insurance Commissioner Kim Holland filed a petition with the Oklahoma Supreme Court requesting that the court declare a new fee on health insurers unconstitutional . The law ( HB 2437) requires health insurers to pay a 1 percent fee on all paid claims until January 1, 2015, which the Oklahoma Insurance Department will use to fund the state222s Medicaid program. Insurance Commissioner Holland alleges that the law is unconstitutional because the Oklahoma Legislature passed the law during the last five days of the legislative session without a supermajority . State officials project SAMHSA222s Weekly Financing News Pulse: State and Local Edition July 28, 2010 7/28/2010 6 the fee would raise $78 million annually, drawing down $190 million in federal matching funds in FY2011 a nd $140 million in subsequent fiscal yea rs ( AP via Business Week, 7/20 ). Oregon Update: Legislative Emergency Board Restores $17.1 Million in Funding for DHS, Includes Mental Health Program Funding : On July 22, the Oregon Legislative Emergency Board restored $17.1 million for the Oregon Department of Human Services (DHS) to fund services for seniors and the disabled. The Legislative Emergency Board can change individual agency budge ts between legislative sessions. DHS originally eliminated the funding when Governor Ted Kulongoski (D) ordered a 9 percent cut in spending for all state agencies to close a $577 million deficit . The services impacted by the restored funding include Med icaid in - home care, non - Medicaid community mental health programming, and family support programming for individuals with developmental disabilit ies . State officials estimate that the programs collectively serve 16,000 individuals ( Portland Business Journal, 7/22 ). West Virginia Legislature Fails to Approve Me asure Establishing High - Risk Pool, Defer s Administration to HHS : Because the West Virginia Legislature failed to approve legislation establishing a state - run high - risk insurance pool before the end of its special legislative session, the state will not ope rate its own high - risk insurance pool under federal health care reform. Governor Joe Manchin (D) originally indicated to the U.S. Department of Health and Human Services (HHS) that West Virginia would run the federally - funded pool. West Virginia would ha ve received approximately $27 million in federal funds to oversee the program but will instead become one of 22 states in which HHS operates the pools ( The Charleston Gazette, 7/22 ).