Late last week Montana’s state health department announced that it’s severing contracts with four non-profit companies that help people with developmental disabilities. That’s due to the reduced state budget enacted by Governor Steve Bullock because of the state bringing in lower than expected revenue.
The health department says the 2,700 clients of those companies who will lose services due to the severed contracts will be taken care of by the department starting this spring.
To learn more about what the cuts mean, MTPR News Director Eric Whitney talked to the CEO of one of the four non-profits.
Josh Kendrick, CEO, Opportunity Resources, Inc: We exist to support individuals in enhancing the quality of their lives. We serve both developmentally disabled adults, and we also serve physically disabled adults, from vocational services, job training, to residential, to arts, to recreation. We serve them in the whole gamut of their lives.
Eric Whitney: Is there a typical kind of client?
JK: There is not. We serve the full spectrum, from individuals who are highly high functioning, folks that are working in the community, own their own homes, paying taxes, to individuals who are lower functioning that need 24-hour assistance.
EW: So, we heard about Opportunity Resources losing your state contract, for targeted case management. What does that mean?
JK: A targeted case manager works with an individual to help them get benefits, such as SNAP benefits, to help them get Medicaid eligible. To help them get more involved in the community.
We provided our targeted case management from Hamilton to Havre, so lots of times we're working with other providers across the state to get individuals with disabilities services such as we provide here in Missoula.
There is no typical day as a case manager. I mean, one day you could be working with a client because they've lost their Medicaid funding and they need help with the paperwork, the next day you could be working with them on getting more involved in the community. So you work with that individual on what their goals and dreams are for the year, things such as getting jobs in the community. Maybe getting a house of their own, going on vacations. They just sit down and talk about their hopes and dreams, and help people work on those.
EW: How many clients for those services did you have?
JK: Opportunity Resources served over 800 adults with disabilities in our targeted case management program.
EW: How many targeted case managers did you have?
JK: We still have 27, but as of April 1, all 27 of those positions will have to be laid off.
The sad part is, we have a really dedicated staff. We've had the contract for 26 years, we've had staff that have been with us for 26 years. We have adults with disabilities across the state who've worked with that same case manager, some for 20 years, some for 10 years. So you build up a rapport with that case manager, obviously. They're going to lose that connection, and it's one that really can't be replicated.
It was devastating for case managers. Their biggest concern is their clients. They're obviously concerned because they just lost their job, but it was amazing to hear clients come first with every phone call, every case manager I've talked to.
EW: What's going to happen to those clients? The state health department told us, well, we'll just shift them from the companies like yours to the state health department. We'll provide these case management services. Does the state health department have the capacity to do that?
JK: What we've been told so far to date is they're working on the transition plan. We have not seen the transition plan, and we're not working with them on it, they haven't asked us to. We'd love to, because we worry about the clients first.
Caseloads are going to go from 30 to 35 people to 60-plus people. It's going to be a very different service when you double the size of the caseload.
EW: It sounds like they provide these services to some people, and others get them through companies like yours. Why did it make sense for the state to contract with companies like yours to do something the health department is already doing?
JK: If you go back 26 years ago, when this program was started, the state came to providers such as us because they felt we could provide a better service, and a cheaper service. We're kind of taking, in my opinion, a step backwards. Twenty-six years ago the state came to us and said, 'you guys can save us money, provide a quality service,' and now we're being told, 'We can do it, and save money.' Somewhat confusing.
EW: The families of these people -- shouldn't it be their responsibility to take care of them? Why do taxpayers need to spend millions of dollars every year helping these people?
JK: Years ago individuals with disabilities were put in institutions. The big change has been to not have individuals in institutions, and have them in their communities they were born and raised in, and to keep them in the communities.
The other thing organizations such as us work to do is to make individuals with disabilities as independent as possible. We find jobs for individuals. Lots of times you hear the staff saying their goal is to turn people into taxpayers, find them jobs, help them buy a house so they're then paying taxes.
So a big part of what we do is make people as independent as possible.
It's been proven that you can serve individuals with disabilities in the communities for less money than in institutions. So it's a money saver.
It also enriches peoples' lives. It's why I've been there 20 years, it's why as CEO of Opportunity I feel like I have my dream job, even in times like this.
EW: Do you think there's any danger that if your clients can no longer work with their case managers, that they'll end up in institutions?
JK: There's a danger that without case management, and with caseloads so big that clients won't get served the way they need it. It could become a burden on the police departments in town, it's going to become a burden on mental health. It's going to become a burden on emergency rooms, because those case managers were the first line of defense for when crises happened.
EW: But again, do you think there's danger that some of your clients will end up having to go to institutions because they can't get the services they need from overburdened state case managers?
JK: It's tough to answer right now, in the state of Montana because [the Montana Developmental Center in] Boulder is actually closed. So there is no institution for individuals with disabilities to go into. Probably the danger is for individuals maybe going to [the Montana State Hospital in] Warm Springs. And, to answer your question, yes, I think there's a huge danger that Warm Springs could see an increase in referrals.
EW: We've been talking about targeted case management specifically, because the state health department is severing your contract for those services, but you also provide other services that are paid for by Medicaid, and you just learned this week that payments from Medicaid are being cut by about three percent, right? What does that mean for your organization?
JK: Pretty much every service we provide at Opportunity Resources is looking at a 2.99 percent cut this fiscal year, which runs through July. What we're being told is that next year there'll be a 1.5 percent cut. We are doing everything we can to make it so those impacts are felt as little as possible. What we do know is that some individuals will lose some hours of service from our staff.
EW: Help me understand how big a slice of the pie it is for you to lose that $2 million state contract, and then this additional three percent Medicaid cut?
JK: So, we're looking at close to $3 million between the two: $1.8 million and then the 2.99 [percent] is going to be just under a million dollars. So we're looking to fill those gaps with vacancies.
The vacancies in staffing that we look at is that we can't not hire our direct support professionals, so we're really having to look at our administrative. Our administrative burden seems to grow every year with state and federal regulations and mandates. So it's a challenge.
EW: You're losing about $3 million out of how big a total budget?
JK: We're a $15 million a year company.
EW: So, about 20 percent?
JK: Yes. It's been an interesting week.
EW: Has your organization ever had to deal with a 20 percent across the board budget cut or anything of that magnitude in the past?
JK: I've been with Opportunity for 20 years. I've also spoken with other CEOs of organizations such as us across the state. I also spoke with our former CEO who'd been there for 30 years, and these are unprecedented times is what I'm being told by everybody I talk to.
About 80 percent of our budget is Medicaid dollars, through the federal government, through the state. The other 20 percent is a combination of fundraising, which we're obviously ramping up right now, and sales. Lots of our services are work contracts. We're trying to provide jobs for adults with disabilities, but we're also trying to make a little money.
EW: What are you going to do going forward?
JK: The next few weeks looks like me meeting with my management team, which I've already started on an individual basis, and we're trying to look, meeting with our finance people, at exact dollar amounts of how this is going to impact us. It's July 1 that we're most concerned with, because that's when we're going to feel all these impacts the most. Unfortunately, we're not going to be as big an employer as we used to be. I used to be proud to say Opportunity's one of the top 10 biggest employers in Missoula. I'm not real sure where we'll be at next year at this time.
EW: Do you think there's any potential for your state contract to be restored, or for the other Medicaid budget cut to be restored, and for you guys to get back to where you were before all this happened?
JK: Probably the best answer to that is the next legislative session. We're going to be even more active next session. We had great support last session, and we came out of the session feeling we did really well. And then the budget fell apart, as everybody in Montana knows. So, no, we ended last session feeling really good, we had great momentum, we're going to use that momentum to build on the next session, to help educate legislators on how important our services are, and how our services can save the state money instead of being a burden.
EW: Josh Kendrick, thanks very much for joining us at Montana Public Radio.
JK: Thank you so much for your time, and I'd like to thank the community. In these hard times we really have had community members reaching out and supporting us, and that means a lot to all our staff. It means a lot to all those we serve.