Florida’s Medicaid program for people with disabilities facing budget cuts

State health officials recommended limited cuts to a Medicaid program for people with disabilities Monday, after months of deliberating on potential changes that could affect more than 34,500 clients who depend on the program for services.

The recommended cuts were much lower than advocates for clients with developmental disabilities had feared. But the decision will be up to the Legislature, which ordered a redesign of the program and will consider the recommendations in its 2020 session.

The recommendations include some caps on services like companion care, supported employment and adult day training, which could affect about 1,500 Floridians. They also suggest moving some costs to the state’s main healthcare agency to lower costs for the state’s Agency for Persons with Disabilities.

Both the Agency for Persons with Disabilities and the Agency for Health Care Administration submitted a report to legislative leaders Monday afternoon with the proposed redesign of the program, also known as “iBudget.” Lawmakers had ordered the agencies to come up with the redesign earlier this year to curb the program’s costs.

Lawmakers had not set a specific dollar figure for the program to meet their standard of “budget predictability.” But they did direct the two agencies to “identify core services” as part of the redesign, which some had construed to include eliminating unnecessary ones.

Despite draft reports that suggested administrators might consider implementing managed care or eliminating services to lower the budget, neither of those suggestions was recommended in the agencies’ plan, easing some advocates’ fears.

“I think they did listen to what we had to say,” said Ven Sequenzia Jr., who had argued against managed care with hundreds of other advocates at a public comment meeting in July. Noting that the 105-page plan would still need more review, he said he was “cautiously optimistic.”

But the proposed caps on some services had others concerned that the recommended changes could curtail the access some people with disabilities have to their communities.

Some clients depend heavily on programs like supported employment to work outside their homes, said advocate Karen Clay.

“It’s not even about the money,” she said. “It’s about the fact they can go out into the community and do that and be wage-earning, tax-paying citizens.”

More than 34,500 people with developmental disabilities — such as mental disabilities, cerebral palsy, autism and Down syndrome — rely on the program, with 21,900 others on the waiting list.

AHCA Secretary Mary Mayhew and APD Director Barbara Palmer also held a meeting Tuesday with advocacy groups and providers to discuss the proposed redesign.

“We did not put any rate cuts in. We really didn’t cut services,” Palmer said at the meeting. “There’s a lot of good in here.”

Lawmakers ordered the two agencies this spring to work on restructuring the program, which operates under a federal “waiver” that gives it more flexibility to provide services. But the program was criticized for years for overspending its allotted budget, though its costs are not included in a state review by economists to project the upcoming year’s expenditures and lawmakers are the ones who dictate its budget.

In the last two years alone, the Agency for Persons with Disabilities overspent its appropriations by more than $150 million and had to go back to lawmakers for more money. The agency, which had blamed rising costs on aging clients and the additional services they need, is required to pay for clients’ services even if they exceed the program’s budget.

When lawmakers ordered the redesign, they ordered both agencies to restructure the program for more “budget predictability.” Monday’s report, among several other suggestions, called for lawmakers to include the Medicaid program in that annual review, which would inform a budget that more closely matches its actual expenses.

“I’m happy that they recognize that the Legislature needs to plan for a budget for these services with their eyes wide open,” said Jim DeBeaugrine, a former director of the Agency for Persons with Disabilities.

The report also recommended shifting some costs to the Agency for Health Care Administration, such as by expanding the number of group homes that would qualify for Medicaid payments through that agency. It also suggests increasing accountability and training for coordinators who help the program’s clients secure services.

The report studied the possible impact of shifting the waiver’s healthcare delivery to a system of managed care, where private contractors manage patients’ care and control what clients get. But advocates had argued strongly that managed care would be ill-suited for people with disabilities who have lifelong conditions.

Almost all of the state’s Medicaid services are now run through a statewide managed care program, and advocates had feared that moving people with disabilities into a similar system would limit their access to services like in-home nursing care, speech and physical therapy and behavioral support to manage difficult behaviors.

But the report did recommend some limits, including the one on life services — companion care, employment services and adult day training — that would cap that care at 30 hours a week for 48 weeks a year. The report projected the caps would potentially save the state more than $2.6 million a year, affecting 1,557 clients.

The report also recommended placing a $205,000 annual individual cap on services for every client in the program. About 85 clients, according to data from the 2017-18 year, exceed those costs, according to the report. Implementing the change would require either lowering those clients’ services or moving them into institutions like nursing homes.

The report also calls on lawmakers to “appropriate funding sufficient to provide medically necessary services in the most appropriate setting for all enrolled waiver clients,” though it did not include a cost.

Lawmakers will have to decide how to proceed on the recommendations during the 2020 legislative session that begins in January. Advocates are still closely eyeing the changes that might be made, they said.

“At first glance, we believe the proposed recommendations are very reasonable,” Valerie Breen, executive director of the Florida Developmental Disabilities Council, said. “However we’ll be studying them more closely to ensure they align with the council’s priorities to improve the iBudget.”

This story has been updated.