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MHI CLOSURES, MEDICAID MANAGED CARE & MORE

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As always, legislators that work on health and human services issues face many challenges. There is never enough money to pay for the ever-growing demands for services.  The money that is appropriated is never enough to pay the providers of those services adequately.  And the state is always so busy paying for the services it does fund, that it can never seem to reserve enough money to pay for new and innovative services.  It's a very tough job to work in this area, and you can be sure the legislators that volunteer for these committees do so because they want to help people live happy, healthy, independent lives.

This year, legislators are dealing with the Governor's proposal to close the doors at two of Iowa's mental health institutes (MHIs for short).  Both are located in Southern Iowa communities - Clarinda and Mt. Pleasant.  The Department of Human Services is calling these closures an "Institutional Realignment" because some beds will be added to the remaining two MHIs (Independence and Cherokee) and others will be sent to community-based residential programs if appropriate. 

Here are a few facts about the two MHIs that will be closed (they are currently no longer accepting new patients):

  • Mt. Pleasant has 9 beds, which are nearly always full (89%).  The cost of those beds is the lowest of all MHIs, at $714/day.  Mt. Pleasant also operates a specialized substance abuse unit with 50 beds and a dual diagnosis unit with 19 beds, which will also be closed. About 65% of those beds are filled on any given day. Mt. Pleasant currently does not have a psychiatrist on staff and recruitment has been difficult, which is one reason cited for closing this facility. 

  • Clarinda has 15 beds, but only 40% (6 beds) are being used regularly. These beds cost a little over $850/day.  Clarinda also has a special 20-bed unit for older Iowans with special mental health needs (called a "psychogeriatric unit").  Nearly all of these beds (90%) are filled on a daily basis.  The psychiatrist on staff at this MHI is retiring this year, and challeges in recruiting a replacement is another reason for the closure.

The Health/Human Services Budget Subcommittee discussed the plans to close these facilities at a recent meeting.  You can see the Department of Human Services' presentation on the MHI Closures here.

Managed care for Medicaid continues to be the elephant in the budget subcommittee room.  The Department of Human Services says they are working on a plan to be released in March, but will not discuss details of that plan.  Legislators from both House and Senate, Democrat and Republican, are clearly frustrated by the lack of information available to them.  Legislators also do not feel they will have much say in the design of the final plan, but hope that once an RFP is released and the state begins the process of asking for federal approval, their concerns and suggestions will be heard.  The only thing we know for sure is that the Federal government requires a public comment period when states make bold moves like this, and takes those comments very serously when deciding whether to approve changes to the state's Medicaid plans.  With 70% of the nation's Medicaid population in some type of managed care system, the Federal government will not stop the state from pursuing managed care, but may require certain things of those plans.  That's why public input will be very important.  So stay tuned for breaking news on this (www.infonetiowa.org or follow us on Facebook).

We do not have much new to report on the managed care front.  Given the "silence" on this issue from the department and Governor, the Health and Human Services Budget Subcommittee has invited national experts from the National Conference on State Legislatures (NCSL) to present on February 19.  Legislators hope to learn from the experiences other states have had with managed care, and find out more about best practices.  Our last issue of INFONET included a similar list of best practices put together by the National Council on Disabilities. You can find these, and other resources on managed care, in our Policy Tools section of the website.  We have recently added information from NCSL and other resources to help you understand the opportunities managed care could bring, and the potential impacts if not done carefully.

Finally, we are on the watch for legislation that is going to be filed to implement the ABLE Act.  In December, President Obama signed the Achieving a Better Life Experience (ABLE) Act, which when fully implemented will allow people with disabilities to open tax-free savings accounts where they can save up to $100,000 without risking eligibility for Social Security and other government programs. What’s more, individuals can keep their Medicaid coverage no matter how much money is in the account.  These savings accounts are modeled after 529 college savings plans, so interest earned on these accounts is not taxable.  Money saved can be used to pay for education, health care, transportation, housing and other living expenses.

States need to set up their own ABLE Account plans, but they cannot do that until Federal rules are written (which probably won't be done until September).  After Federal guidelines are complete, states will be able to design their own plans.  So even if legislation is passed this session requiring our State Treasurer to get started, you probably won't be able to start saving until later this year.  Watch Facebook and our Breaking News for updates on this.  You can read more about the ABLE Act here (including a video on the "10 Things You Need to Know about the ABLE Act").