Lawmakers explore financial strains on West Virginia human services

Lawmakers asked a range of questions about the state’s level of funding for human services, building their cases for financial decisions that could come to a head during special session as soon as next month.

Gov. Jim Justice

Gov. Jim Justice, a Republican, has said he’ll soon call a special session over state financial matters, especially over human services priorities. Justice referred to “a dog’s mess, saying a budget that passed during the regular legislative session left the state’s human services funding short of where it needs to be.

As delegates considered the state budget in the final hours of the legislative session, several questioned why spending on human services items seemed far lower than they had anticipated. Democrats in the House of Delegates, during a press conference earlier this month, underscored their position that funding needs to be addressed.

The progressive West Virginia Center on Budget & Policy think tank, in a budget analysis, described deep cuts to the state’s Medicaid funding. The budget for the coming fiscal year leaves Medicaid with a shortfall of about $147 million, according to the center’s analysis.

A major part of that puzzle has been what level of funding is necessary to support people with waivers for intellectual and developmental disabilities.

A large crowd of families gathered at the Capitol on Sunday to push lawmakers to revisit a 10% cut to the program that was approved during the legislative session.

The Joint Standing Committee on Health explored those issues during a two and a half hour session Monday afternoon during legislative interim meetings.

“What are the implications on services and providers, reimbursements, if lawmakers do not fund the governor’s requested Medicaid allocation or make the necessary increases? What’s going to happen?” asked Delegate Ric Griffith, D-Wayne.

Cynthia Persily

Cynthia Persily, secretary for the West Virginia Department of Human Services, responded with a few options.

“Whenever there’s a shortage in Medicaid dollars, there are several things that we can do,” Persily said. “We can decrease enrollment in Medicaid. We can decrease services. Or we can decrease the reimbursement rate.

“So there would have to be some sort of combination of those three pieces for us to make Medicaid whole if that increased amount is not available. Now we are looking very carefully at every service that we provide, looking at where we can realize cost savings in Medicaid, and there are some that we have already identified.”

Griffith responded, “I guess what we’re looking at is less services, and for providers the possibility to keep employees — because they’re already losing them and now they’re not going to be able to keep them.”

Ray Ratke, chief executive of the health services provider enCircle, told the committee that low reimbursement rates have resulted in uncompetitive wages for workers — and then an extremely challenging environment to retain them.

David Kelly

Delegate David Kelly, R-Tyler, said he was alarmed by the $13.66 an hour pay rate for those employees.

“Can you consider that a living wage? Are people going to have a hard time making it out there?” Kelly asked. He later commented, “I’m having a hard time shaking that they’re making $13.66 an hour. That’s amazing.”

Kelly continued by asking how those wages could be raised to $19 an hour. “Where’s that money going to come from?” he asked Ratke. “I know the answer. You know the answer. Where’s it going to come from?”

The answer, Ratke said, would be higher reimbursement rates from the state.

Amy Summers

House Health Chairwoman Amy Summers, R-Taylor, asked if financial strain could prompt enCircle to stop operating in West Virginia.

“If you don’t get an increase in the rate study will you be closing your other six homes in West Virginia?” she asked.

Ratke acknowledged that is under consideration.

“We’re trying to evaluate that. I’m under oath, so I have to tell the truth,” Ratke said. “We are evaluating. We have a board meeting this week, later this week, where this is the only agenda item we have.

“For us, without any indication that there’s a long-term interest in providing sustainable — financially as well as programmatically sustainable — services, I don’t know. I think it’s going to be hard for us.”

Senate Finance Chairman Eric Tarr, speaking today on “The Dave Allen Show” on 580 WCHS radio, defended this year’s allocations for health and human services, describing greater attempts at transparency than before.

The Legislature broke apart the $7 billion Department of Health and Human Resources last year into three agencies. Tarr said the budgeting process is now more specific too.

In the past, he said, agency leaders were able to transfer funding within the big department — and it was unclear from the outside where the money was going.

Eric Tarr

Now, Tarr said, the appropriation lines in the state budget are more specific allowing lawmakers to more clearly see how money is being spent.

Among the affected areas are the waivers for intellectual and developmental disabilities as well as medical services.

“The IDD line is the fourth largest expenditure within Medicaid. When you go right down and look at it, how much we’ve spent there, it’s hundreds of millions that goes out to that. The state appropriation for that over the past few years has been about $108 million a year,” said Tarr, R-Putnam.

“One of the things that we discovered when we broke it up is that Medicaid had been moving money by lots, by hundreds of millions, to other items that we appropriated for.”

He said that essentially took the allocation responsibility from elected legislators and moved the financial power to agency leaders.

Tarr said one of the questions that he wants to explore is, “If this money was not spent for IDD waivers, where was it spent?

“So there’s answers to those questions somewhere out there. I don’t know if they’ll be satisfactory answers, but it’s the only reason we can get to this point for actually having this discussion in a very honest level, is because of that reduction we did.”

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