Service providers say funding Medicaid rates, mental health ‘historic,’ ‘unprecedented’

By: - May 4, 2023 5:59 pm

The Montana State Flag and tribal flags fly in front of the Montana State Capitol in Helena on Wednesday, April 26, 2023. (Photo by Mike Clark for the Daily Montanan)

Before the Montana Legislature met, nursing homes and group homes were closing, but this week, service providers said they are more hopeful about the future.

Certainly, no one is promising a total stop on closures.

But Patrick Maddison, president of the Montana Association of Community Disability Services and CEO of Flathead Industries, already brought one young person in an out-of-state group home back to Montana.

He and Mary Windecker, executive director of the Behavioral Health Alliance of Montana, described the work done by the legislature as historic. Windecker said she can’t promise Montana won’t see more group home closures, but she’s optimistic.

“We’re down to the wire,” Windecker said. “We won’t see any of the money until late summer, and a lot of the facilities are currently struggling. (But) we’re optimistic that it will give us the ability to stay open until the money starts flowing.”

She said her organizations aren’t over the goal line when it comes to rates, but they’re close, and she said they’re “ecstatic” and “thrilled.”

Rose Hughes, executive director of the Montana Health Care Association, said higher rates are good for providers, but even better for people on Medicaid because their access to care was affected. She said legislators worked on rates until the last minute.

“We really appreciate the strides that the legislature and the administration made in setting Medicaid rates that come closer to the cost of care,” Hughes said. “When you think back, this wouldn’t have been possible if we didn’t have the rate studies, and that was the idea of the administration.

“They were brave enough to try to figure out the cost, which when you look back, really set the stage for everything else.”

The higher rates don’t necessarily mean smooth sailing for nursing homes, though; Hughes noted the cost of care still outpaces the reimbursement.

“We totally agree that the type of investment that was made was unprecedented,” Hughes said. “But are we there? For the nursing homes in particular, I hesitate to say that we’re out of the woods.”

The legislature ended its 68th session Tuesday, and Medicaid reimbursement rates were a key topic of debate.

Rep. Bob Keenan, R-Bigfork, handed out an analysis at the end of the session that showed the work the legislature did pushed rates in the second year of the biennium to more than 100% of a national consultant’s recommendation for all providers.

They are 90% to 100% of the recommendation in the first year, depending on the type of provider.

The higher rates don’t include automatic cost of living increases in the future, so the conversation about rates may continue in some fashion next session.

But Maddison with Flathead Industries said with the cash influx this time, excluding inflationary increases, was probably the responsible decision for taxpayers. And going forward, he said new rates mean programs that started shrinking because they couldn’t afford to pay staff might be able to accept new clients again.

“There was some really amazing work done for people with developmental disabilities,” Maddison said. “For many years, we’ve always felt not heard or not valued, and this session totally changed the script.”

Maddison also pointed to the rate study as the game changer; the legislature appropriated $2.75 million for the study last session. He attributed success this year to the longtime advocacy of Keenan, Sen. John Esp, R-Big Timber, and Rep. Mary Caferro, D-Helena, too.

At the close of the session, however, the increase in rates wasn’t the only thing professionals in the field highlighted.

They also pointed to Keenan’s House Bill 872, which sets aside $300 million during the biennium to infuse into the system so people don’t fall through the cracks and sets up a commission to recommend where to put the dollars.

Money will go to fix problems in the current system and to capital projects, such as opening a new crisis stabilization facility. It will support community investments, systemwide improvements, operation and contract expenses, and acquiring new or remodeling existing infrastructure.

“The combined investment in both Medicaid provider rates and the continuum of care in behavioral health is truly historic,” Windecker said.

Windecker said it’s the first time the Montana Department of Public Health and Human Services, the Governor’s Office and the legislature have looked at continuum of care funding.

Looking at the entire continuum is important because it doesn’t do any good to fix the state hospital for patients, for example, without also paying attention to community-based providers, she said — and the chain continues.

“We’ve been preaching that message for years now, that they can no longer fund in silos, that they have to fund the continuum of care,” she said.

Maddison offered an example of how one of his clients with developmental disabilities might experience the change.

Someone who needs a psychiatric medication adjustment might not have the cognitive or speech ability to explain their situation well, he said.

Currently, a client who needs help with their medication would go to a short-term acute psychiatric unit in a community, if a spot is available.

“They’re pretty far and few between,” he said.

The person is usually discharged after 72 hours with only a change in dosage, and without therapy or an assessment of how the change is working.

Sometimes, there’s no assessment, so the person continues to need help, and they might be in crisis for weeks or months, Maddison said.

In the future, one idea the newly forming commission might recommend is a short-term treatment site, Maddison said. There, a client could get help for 60 or 90 days, be under psychiatric supervision, be monitored, and slowly have medications added or subtracted until they’re stabilized.

“That just doesn’t happen in 72 hours,” Maddison. People in general are complex, and not all medical providers are trained to work with people who have developmental disabilities, so it can be even tougher for them to get the right treatment.

Keenan said he had a conversation with the chief justice of the Montana Supreme Court, who was excited about HB 872 too: “It made me feel good that this was recognized as a turning point for Montana by all three branches of government.”

He’s talking with people about commission membership, which will be comprised of him, three gubernatorial appointments, and five legislators. Keenan said he’s heard people say it’s the opportunity of a lifetime, but he said he views it as an opportunity of geologic proportions, “an opportunity beyond belief.”

The first step will be a statewide assessment of the current landscape, he said. It will identify current gaps, and money is available for pilot projects to fill in some.

“Now, I’m kind of cautioning myself that we can’t get too broad in scope,” Keenan said. “We need to keep the vision manageable on what we can do in behavioral health and developmental disabilities.”

He said Montana needs to recognize gaps and not rely on law enforcement and jail as acceptable ways to treat mental health. He said opportunities exist to offer more support in developmental disabilities, especially to families of children with disabilities.

Hughes said she needs to study HB 872 more closely, but it could also support older Montanans with dementia or Alzheimer’s, for example. She said some nursing homes across the country are becoming more active in behavioral health and trying to become part of the solution.

Generally, she said she believes this next year will be tougher for nursing homes than the second year of the biennium. The rates that were set for providers were generally the average cost of providing care for studied providers, she said, but the exception was nursing homes.

Guidehouse found the cost of care to be, on average, $349 per day, but it set the benchmark at $278, she said. So in the first year of the biennium, a gap of $85 still exists between the reimbursement and the cost.

“Can that work?” Hughes asked. “I think the only way it works is if we are able to actually bring our costs down or at least significantly stabilize the cost.”

She said if the rates are sufficient, the nursing homes may be able to make progress on staffing, on hiring more employed staff versus pricey contract workers, and on paying people more. She said reducing the reliance on contract staff would make “a huge difference.”

As the dust settles following the legislature, she said Montana could see additional closures: “I do think there are facilities teetering at the edge.”

She said she anticipates some ownership changes as well, and potentially new operators in the state. She also noted forces beyond the legislature’s and administration’s control are at play, such as inflation and changes in the workforce.

On the whole, though, Hughes said she saw more discussion on rates this session than in possibly all others she’s seen put together, and no one tried to sweep the problem under the rug.

“It’s good news,” Hughes said. “You can’t deny that they made quite a contribution and quite an investment in these rates and talked about it and were interested in it. They gave it an effort.”

This session, nursing homes were where a lot of the conflict was, Keenan said. Society is transitioning away from those facilities, he said, and while there’s a need for them, there’s also a question about whether that’s really where people want to be.

In the meantime, he said provider rates are hitting over 100%: “What’s wrong with that?”

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Keila Szpaller
Keila Szpaller

Keila Szpaller is deputy editor of the Daily Montanan and covers education. Before joining States Newsroom Montana, she served as city editor of the Missoulian, the largest news outlet in western Montana.