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Group Home Funding Runs Dry


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Without adequate funds, group homes for people with mental health and developmental disabilities are at risk of closure.

By Rose Hoban

Hundreds of people with developmental and mental health disabilities around North Carolina are faced with losing their homes – again – as state funding to support them is running out.

The people at risk are those who live in group homes with six or fewer residents who have part of their living expenses paid for by state dollars. They’re people who lost Medicaid-funded personal care services in 2012 when the General Assembly tightened guidelines on who could receive those dollars.

Group home residents and their advocates have been asking the Legislature for group home funding. They rallied in front of the General Assembly last month. Photo credit: Rose Hoban.

Group home residents and their advocates at a rally for funding in front of the Legislature in 2013. They may need to return this spring as funds that support the homes runs out. Photo credit: Rose Hoban.

And they’re people who faced a similar crisis in 2013 when lawmakers failed to create a long-term solution to care for residents who can’t get Medicaid dollars but still need help. Instead, the legislature created “bridge” funding to tide the group homes over temporarily.

Now that bridge funding is drying up, with little hope for more dollars to flow.

“I’ve been in panic mode for the last two months,” said Tonia Donnell, who runs two group homes – one for men with developmental disabilities, the other for mental health issues – in Morganton. “I just got an email from the [regional mental health agency] that there’s some money from the bridge funding. It’s not enough for the rest of the fiscal year.”

Donnell said she was scrambling to resubmit invoices totaling about $5,500 for several months of services that had been previously denied because of lack of funds.

“They said it’s first-come, first-served,” she said. “I’m getting mine in as soon as I can.”

Same problem, new year

“It’s like Groundhog Day,” said Julia Adams, the governmental affairs liaison for The Arc of North Carolina, which provides services and support for people with developmental and intellectual disabilities. “We’re right back to where we were at the beginning of the 2013 budget cycle.

That year, the General Assembly allocated $2 million to tide the group homes over for the year, but administrative red tape led to a delay of close to four months before the money was released to providers. That meant lawmakers didn’t have a solid handle on how much money the group homes would need for an entire year.

In the 2014 budget, lawmakers again allocated $2 million and released the funds at the start of the fiscal year on July 1. Now that money is exhausted, about four months before the end of the fiscal year.

“To ask these individuals to go through yet another crisis is heartbreaking for those of us who work on this issue,” Adams said. “We’re looking toward leadership at [the state Department of Health and Human Services] to create a short-term fix while we wait for a long-term solution.”

Dave Richard, DHHS’ assistant secretary for mental health, developmental disabilities and substance abuse services, said he’s aware of the issue. He’s been aware of it since his days as Adams’ boss at The Arc, prior to entering state government.

For years, in order to receive Medicaid “personal care services” and remain in their own homes, people with mental health disabilities were required to need assistance with two or more so-called activities of daily living – such as bathing, dressing, toileting or eating. But if that same person lived in an institution, like a group home, they were only required to need assistance with one activity in order for Medicaid to pay for the help. For many living in group homes, that essential activity was help managing their many medications.
The federal Centers for Medicare and Medicaid Services warned North Carolina repeatedly that this “institutional bias” was illegal under the 1992 Americans with Disabilities Act. CMS pressed the state to resolve the problem, but meanwhile kept paying the bills.
But in 2011, CMS finally ran out of patience. The agency told North Carolina to resolve the problem.
When the legislature worked on this in 2012, the discussion centered around a possible “woodwork effect,” by which state officials estimated that thousands living in their own homes could become eligible for the entitlement if the level of assistance required remained at one activity of daily living. That could have cost the state tens of millions annually.
Instead, in order to discourage a flood of new recipients and save state dollars, lawmakers fixed the issue by requiring everyone, no matter where they lived, to have greater needs in order to get reimbursed for the help. The legislature also disqualified payment for medication management. That meant many group home residents – who need help with their complicated medication regimens – were disqualified from receiving personal care services.

And many group homes were depended on those dollars in order to keep people housed.

Since 2013, group home residents, operators and their advocates have been waiting for a long-term funding solution from the General Assembly.

Richard has convened a workgroup of providers, advocates and state officials to address the issues. He’s required to get a report to the General Assembly by April 1.

“The legislature recognizes that there are significant issues in how we’re funded,” he said. “This is a product of years of a patchwork system of fixes to the system.”

Richard noted that not all of the state’s mental health managed care organizations are out of money for group homes. In part, it’s a problem of population distribution, he said. Some MCOs have more group homes in their regions than others, and thus spent their allocations more quickly.

“We’re surprised about how fast some of the [managed care organizations] had gone through the money,” he said.

But Richard didn’t hold out much hope for additional funding for the rest of the fiscal year.

“Whatever recommendations come out of this workgroup, nothing is an immediate fix,” he said.

When pressed about legislative moves, or even an executive order, that might free up money to solve the problem, Richard was pessimistic.

“I don’t have a magic wand,” he said.

Perhaps, he said, some MCOs have money they can allocate to the problem, but they’re limited in how much they can move from one program to another. And with the current budget year winding down, there aren’t a lot of unallocated state dollars remaining.

“There maybe are small things to do that can relieve pressure,” Richard said.

Roller coaster

Service providers say their frustration is that they’ve been in this position before and feel like the state’s uncertain funding stream leaves them lurching from crisis to crisis, with policymakers slow to find a permanent resolution. They say they’re stretching their dollars where they can, but several said they’re at a breaking point.

Jenny Gadd displays the medication cabinet in the staff office at the group home. Between them, the three residents have dozens of medications that they take for mental illness and other conditions.

Jenny Gadd displays the medication cabinet at one of Alberta’s group homes in Chapel Hill. Between them, three residents in that facility have dozens of medications that they take for mental illness and other conditions. Photo credit: Rose Hoban

“Food is a real issue,” said Jenny Gadd, the group home manager for Alberta Professional Services, which runs several group homes for people with mental health issues. “We buy more stuff that’s canned and frozen, not many things that are fresh. You make sure you hit all the sales.”

Gadd bemoaned the lack of stimulating activities for her residents; for example, trips to museums, drives, time at the YMCA. “Those things have gotten whittled away at until you never go on a drive to Jordan Lake because you can’t afford the gas,” she said.

Gadd also noted that salaries haven’t increased in years, even for staff who have a lot of experience.

“We keep paying those folks $10 an hour for the care of human beings. And then we wonder why sometimes bad things happen in group homes,” she said. “Maybe because you don’t give people the tools they need to provide good services.”

“The clients I have at one home are mentally ill,” Donnell explained. “They do fine if they have medications, if they have staff redirection, assistance in getting their meds, making sure they eat good and healthy.”

The residents at her other home, she said, are lower functioning. “They can still dress and feed themselves, but they need someone who’ll get them to doctor appointments and get their medications ready and provide them the security they need.”

When asked if her clients could live independently, Donnell said that it would be “like putting an 8-year-old in an apartment by themselves.”

Money to pay for residents’ care comes from their own monthly Social Security disability payments, plus some from county dollars. State dollars make up the rest, to a maximum of $1,238 per resident per month.

Donnell explained that when her six beds are filled, she receives a total of $89,856 to feed and house her clients in each facility. Of that money, she is required to employ an administrator, for which she pays around $40,000 per year, and provide round-the-clock staffing, for which she pays about $8 an hour. All told, it comes to just over $90,000 per year to staff each of the facilities, not to mention food, insurance, utilities and other costs of keeping the places going.

One year, Donnell said, she paid herself the equivalent of $1.25 an hour.

“It is always something,” wrote a frustrated Donnell in an email to Dave Richard that she shared. “I am left to explain to the bill collectors why the bills are late again. Then as always I am forced to pay late fee and penalties which has been in the thousand (sic) of dollars over the past several years.”

“It has been a real roller coaster ride,” Donnell said.

 

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