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FY 07-08 Budget Presentation

Stakeholder Briefing

March 1, 2007

Office of Mental Health and Substance Abuse Services

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The Rendell Administration’s Major Budget Initiatives

• Increase in total state education funding for PreK–12 by 6%• Accelerate property tax relief• Address the transportation funding crisis for Pennsylvania’s roads,

bridges, and public transit systems• Continue investments to make appropriate options available for long-

term living• Propose the Energy Independence Initiative to invest in alternative

energy production in Pennsylvania• Jonas Salk Legacy Fund ($500 M for bioscience research,

commercialization, and early-stage capital investments)• Additional funding to address the continuing offender population

growth and new resources to reduce the rate of prison re-entry

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Prescription for Pennsylvania

• Increases access to affordable health care coverage for all Pennsylvanians, improves the quality of care delivered throughout the Commonwealth, and helps bring health care costs under control for employers and employees. FY 07-08 budget recommends a total of $255.3 million in state and federal funds to implement this initiative.

• The Prescription for Pennsylvania initiatives are being paid for by levying a tax on other tobacco products. Every other state except Pennsylvania already taxes these products.

• Expands access in underserved rural areas ($5.4 M investment)• Increases the number of health professionals equipped to address the

needs of racial and ethnic minorities ($1 M)• Includes a Behavioral Health Services component

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Pennsylvania’s FY 2007-2008 General Fund Expenditures

Spending on Education, Medical Assistance, other Public Welfare Programs, Corrections, and Debt Service comprises 86% of total General Fund expenditures.

$27.3 Billion

Other Welfare17%

Higher Education7%

Debt Service3%

Corrections6%

Medical Assistance

19%

Pre K-12 Education

34%

All Other14%

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National Medicaid Spending Growth MA Spending Growth is Down from 2002 Peak but Costs are Still Rising

1996 – 2007

12.4%

3.0%2.7%

6.1%

7.1%8.2%

10.3%

8.3%7.4%

6.3%

2.8%

5.0%

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007Projected

Strong Economy, Welfare Reform, Enrollment

Declines, Managed Care 1995 - 1998

Health Care Cost Growth, 1998 -

2000

Economic Downturn, Enrollment & Cost

Growth, 2000 - 2003

Start of Economic Recovery, Slower

Enrollment Growth 2004 - 2006

Note: Estimates in State Fiscal Year. Preliminary estimate for 2007. SOURCE: Kaiser Commission on Medicaid and the Uninsured. “Results from a 50-State Medicaid Budget Survey, State Fiscal Years 2006 and 2007” October 2006.

MA Eligibles Expected to Increase by 64,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

2,000,000

2,200,000

*Projected

Average Monthly Enrollment

+10

.5% +

7.0% +4.

3% +4.

9%

-0.2

%

-3.6

%

-8.2

%

-1.7

% +2.

8% +4.

5%

+4.

8%

+7.

8%

+3.

9% +3.

4%

Source: DPW Budget Office

-2.9

%

+1.

4%

+4.

9%

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A common misconception

The claim that “Pennsylvania has 1.9 million welfare recipients” is wrong and confuses health care and cash assistance

235,000

1,900,000

0 500,000 1,000,000 1,500,000 2,000,000

TANF Cash Grant

Medical Assistance

Children and Adults Enrolled

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Eligibility Category Dec-05 Dec-06 % Change

Chronically Ill Adults 99,831 99,897 0.07

Elderly/Healthy Horizons 243,403 257,063 5.6

Disabled 376,428 383,769 2.0

Adults/Parents 281,532 265,497 (5.7)

Children 821,528 865,338 5.3

Elderly & Disabled Are Driving Eligibility Increase

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Department of Public Welfare

• Provides for a $56.154 M increase for County Child Welfare needs-based budgets as mandated by Act 30 of 1991. BH transition fund for ICSI (Integrated Children’s System Integration) maintained at $8M

• Deputy Secretary for Early Childhood; dual reporting structure to Education and Department of Public Welfare; expansion of day care; mental health consultation

• Office of Developmental Programs– Office of Mental Retardation is now the Office of Developmental

Programs– $28.902 M increase to expand community mental retardation and

autism services – Will work to coordinate both autism services and community

mental retardation services

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Office of Medical Assistance Programs: FY 07/08 Budget Initiatives

• MCO Pay for Performance (P4P)• MCO Capitation Payment Change (PH Only)• Pharmacy Carve-Out• Transition Clients from Voluntary to ACCESS Plus• Hospital Pay for Performance

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Other Departments and Funds

• PA Dept of Corrections was provided an increase of $792,000 for reintegration programs to enhance skills and treatment for inmates to reduce recidivism rates

• Board of Probation and Parole was provided $3.167 M to provide additional resources to enhance community re-entry preparation and offender management

• Department of Health was provided a 3% COLA ($1.229 M) for drug and alcohol abuse prevention and treatment services

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DPW: OMHSAS Administered Behavioral Health Funding • Community Mental Health Services

– Base Funds– CHIPPS– BHSI- Mental Health– MH Block Grant/SSBG/Other Federal– Other Categoricals– State Mental Hospitals

• DPW Administered Drug and Alcohol– Act 152– BHSI- Drug & Alcohol

• Medicaid– BH FFS– HealthChoices Behavioral Health

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OMHSAS: Administered Behavioral Health

• County government legislatively grounded and uniquely positioned to manage local systems of care; primary objective to integrate program and fiscal accountability– 48 County MH/MR Programs

• 1966 MH/MR Act

– 49 Single County Authorities

• DOH Bureau of Drug & Alcohol Programs as Single State Agency

• DOH Primary Licensing entity for D&A

– 8 State Mental Hospitals; 1 Long Term Nursing Care Restoration Center

• Closed or Consolidated 5 (five) state hospitals since 1994-1995

• Eliminated State Hospital capacity for children & adolescents

• Discharged 2,539 individuals through the Community Hospital Integration Projects Program (CHIPP)

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• 67 HealthChoices Counties – 28 counties accepted right of first opportunity– 1 direct state contract with BH-MCO (Greene County)– Direct state contract with 23 counties

– 15 counties accepted right of first opportunity for 7/01/07 implementation

– Incorporates broad behavioral mandates

– Variety of models including full risk county contracts, subcontracts with Administrative Services Organization and full risk subcontracts

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OMHSAS: Unified Systems Strategy• County Based Medicaid state plan services utilizing county base funding for

state match: 1990-91• CHIPP dollars follow person from State Hospital to community: 1991• Streamline appropriation Community/Hospital Appropriation: 1993-94• Act 152 Dollars administered by OMHSAS: 1996-97• BHSI funds mental health and drug and alcohol established and administered

by OMHSAS: 1997• HealthChoices Behavioral Health Program Administered by OMHSAS:

1997(Southeast)• OMH changes name to OMHSAS: 1998• HealthChoices expansion to Southwest 1999; Lehigh/Capital 2001• Service Area Planning Initiatives; County Planning (2003-04)• Children’s Integrated Planning Initiative (ICSI) (2004-05)• Expansion of Health Choices: Northeast Counties (2005-06)• BH FFS Transfer (2006-07)• Health Choices Expansion–23 counties (2006-07)• HealthChoices Expansion to all 67 counties by 7/01/07

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Movement of Funding from State Administration to County Movement of Funding from State Administration to County AdministrationAdministration

Community Grant Program HealthChoices

66%HealthChoices

16%Community Grant

28%Community Grant

72%State

18%State

Percentage of OMHSAS Funding Under County Admin.

Dollars Under County Admin. $2,906,576,139

Percentage of OMHSAS Funding Under State Admin.

Note: State Mental Hospital and Medicaid Fee-For-Service Funding are under State Administration.

1994-1995 2007-2008

Dollars Under State Admin. $626,228,510

Dollars Under County Admin. $354,355,067

Dollars Under State Admin. $914,662,672

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OMHSAS: Guiding Principles

• The Mental Health and Substance Abuse Service system will provide quality services that:– Facilitate recovery and resiliency for adults and children– Are responsive to individuals’ unique strengths and needs throughout

their lives– Focus on prevention and early intervention– Recognize, respect, and accommodate differences as they relate to

culture/ethnicity/race, religion, gender identity and sexual orientation– Ensure individual human rights and eliminate discrimination and stigma– Are provided in a comprehensive array by unifying programs and

funding building on natural and community supports unique to each individual and family

– Are developed, monitored and evaluated in partnership with consumers, families and advocates

– Represent true collaboration with other agencies & service systems

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OMHSAS: Objectives

• Policy implementation of a “Call for Change” to recovery and resiliency

• Transform the Children’s Behavioral Health System to a system that is family driven and youth guided

• Assure that behavioral health services and supports recognize and accommodate the unique needs of older adults

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Fiscal Year 2004-2005 Unified Mental Health and Substance Abuse Services System

• County Allocations – Persons Served: 200,004– Expenditures: $401,610,444*– Ave. Expend. $2,008

• MA FFS (03/04)– Persons Served: 88,141– Expenditures: $377,941,134– Ave. Expend. $4,288

• HealthChoices– Persons Served: 227,087– Expenditures; $1,111,910,124– Ave. Expend. $4,896

* incomplete county data

BHSI (D&A)Persons Served: 39,325Expenditures: $40,408,520Ave. Expend. $1,028

Act 152 (D&A)Persons Served: 5,690 Expenditures: $18,431,321Ave. Expend. $3,239

State Mental HospitalPersons Served: 3,582Expenditures: $404,429,485

Ave. Expend. $112,906

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OMHSAS FY 2007-2008 BUDGET SUMMARY

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Community MH Services• $991.24M total state and federal funds, net increase of $10.359M;

State funds increase $30.097• $15.977 M provided for three (3) percent cost of living adjustment,

including Base, CHIPPS and BHSI • CHIPP funding of $18.9M included for the discharge of 200

individuals from the State Hospitals• $500,000 to support respite care services for 2,000 families• Transfer of $12.7M for Behavioral Health HealthChoices Expansion• Transfer of $8.7M matching funds for Structured Treatment Services• Elimination of funding for Psychiatric Services in Eastern PA

OMHSAS: FY 2007-2008 Budget Unified System Strategy

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Presidents Proposed Budget Federal Funding Update• Reflects a slight decrease in the Community Mental Health Services

Block Grant

• Reflects a $4.442 M decrease in the Social Services Block Grant; FY 2006-07 funding restored to prior year funding level of $14.808 M

• Changes to the Medicaid Rehabilitative Services Option are projected to yield a federal savings of over $2.3 billion over the next 5 years

OMHSAS: FY 2007-2008 Budget Unified System Strategy

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Drug and Alcohol Services•$1.238 M in Act 152 funding transferred to MA Capitation as a result of HealthChoices expansion; FY 2007-08 Act 152 budget is $16.2 M•BHSI IGT funding of $12.107* million•BHSI funding is $45.300 million (MH: $20.130, D&A: $25.170), which includes a 3% COLA

Sexual Responsibility and Treatment Program (Act 21)•Implemented in April 2004 on the grounds of Torrance State Hospital•Ten men are now being served•SRTP program operation was transferred to the Commonwealth and operated by Torrance State Hospital (July 1, 2006)

*$3 million in additional funding was provided in FY 06-07; additional funding will not be available in FY 07-08

OMHSAS: FY 2007-2008 Budget Unified System Strategy

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• As of January 1, 2007, there are 1.375 M people enrolled in HealthChoices. Projected enrollment for SFY 2007-08 is 1.74 M.

• Funding for Fiscal Year 2007-08 is projected to be $2.3 Billion in the Southeast, Southwest, Lehigh/Capital, Northeast Zone, 23 county expansion zone and 15 county expansion zone:

– Southeast Zone total $939.7 million– Southwest Zone total $435.4 million– Lehigh/Capital Zone total $408.4 million– Northeast Zone total $119.5 million– 23 county expansion zone $186.4 million– 15 county expansion zone $244.5 million– Mental Health portion* $2,051.0 billion– Substance Abuse portion* $283.1 million

*(includes admin.)

OMHSAS: HealthChoices

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Clinton

Armstrong

Indiana

Washington

Greene Fayette

Allegheny

Beaver

Westmoreland

BedfordSomerset FranklinFulton

CambriaHuntingdonBlair

ForestVenango

Mercer

LawrenceButler

Clarion

Crawford

Erie

Warren

JeffersonClearfield

Centre

McKean

Elk Cameron

Potter

Northampton

Lebanon

Cumberland

YorkAdams

Lancaster

PerryJuniata

Mifflin

Dauphin

Schuylkill

Montgomery

ChesterDelaware

Philadelphia

BerksBucks

Lehigh

ColumbiaMontour

Snyder

UnionNorthumberland

Lycoming

Tioga

Sullivan

Bradford

Pike

Carbon

Luzerne

Monroe

Susquehanna

WyomingWayne

SOUTHEASTImplemented Feb. 1997

SOUTHWEST LEHIGH/CAPITALImplemented Oct. 2001

Implemented Jan. 1999

BH ImplementationJuly 1, 2007January 1,

2007

NORTH/CENTRAL STATE OPTION

NORTH CENTRAL COUNTY OPTION

BH Implementation

NORTHEASTBH ImplementationJuly 1, 2006

Lackawanna

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• Currently OMHSAS has 8 state hospitals and 1 long term nursing care facility

• Since FY 1994-95 there has been a reduction of 60% in the census of the individuals being served in our state hospitals through June 30, 2008

• During the same period, staff complement will have decreased by 48%

• Through the CHIPP funding opportunity, 2,539 individuals will have been discharged and 12,387 individuals will have received diversionary services as a result of these discharges through June 30, 2007, and supported in the community with funding of $190,337,062

• Service area planning work will continue through Fiscal Year 2007-2008

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ERIE

CRAWFORD

WARREN

FOREST

McKEANPOTTER

CAMERONELKVENANGO

MERCER

BEDFORD

BLAIR

SOMERSET

CAMBRIAINDIANA

JEFFERSON

CLINTON

LYCOMING

SULLIVAN

TIOGA BRADFORD

WAYNE

WYOMING

PIKE

LUZERNE

SCHUYLKILL

CARBON

LEHIGH

COLUMBIA

BUCKS

BERKS

CHESTER

LANCASTER

MONTGOMERY

YORK

LEBANON PERRY

CUMBERLAND

DAUPHINJUNIATAMIFFLI

N

UNION

SNYDER

CENTRE

ADAMSFRANKLIN

FULTON

HUNTINGDON

CLEARFIELD

CLARION

LACKAWANNA

MONTOUR

NORTHUMBERLAND

PHILADELPHIA

DELAWARE

SUSQUEHANNA

LAWRENCE

BUTLER

ARMSTRONG

FAYETTE

WESTMORELAND

ALLEGHENY

BEAVER

WASHINGTON

Warren Staff 494 Patients 180

GREENE

Warren

NORTHAMPTON

MONROE

Mayview Torrance

Danville

South Mountain

Wernersville

Norristown

Allentown

Clarks Summit

Mayview Staff 677 Patients 303

Torrance Staff 477 Patients 237

Danville Staff 405 Patients 182

Clarks Summit Staff 513 Patients 219

Allentown Staff 377 Patients 170

Wernersville Staff 461 Patients 219

NorristownStaff 793Patients 403

South Mountain serving all counties

Staff 311Patients 130

As of February 09, 2007

OMHSAS State Mental Health Facilities and Service Areas

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CHIPP FUNDING HISTORY (CUMULATIVE)

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MH/D&A MA FFS$133.7

4%

BHSI/Act 152$73.6 2%

Comm Based Grants$572.4 16%

SM Hospitals$418.9 12%

HealthChoices$2,334.2

66%

MENTAL HEALTH AND DRUG AND ALCOHOL SERVICE SYSTEM

Total Funding$3,532,804,649

FY 2007-2008FY 2007-2008

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Program Updates

OMHSAS Fee-For-Service Transfer

• Transfer of 41 staff from OMAP to OMHSAS on 8/15/06• BH FFS Staff provide prior authorization for the following services:

– Inpatient Psychiatric Services

– Inpatient Drug and Alcohol Services

– Residential Treatment for Children

– Behavioral Health Rehabilitation Services (BHRS) for Children

• Working to replace outdated HUP manual for initial authorizations• Reviewing cases individually to determine cases incorrectly identified

as FFS which should be HealthChoices• Refined process for automated site to correct errors in eligibility• Streamlined process to resolve eligibility issues through Field Office

contact with BHMCOs

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HealthChoices• CMS approved waiver for the HC BH Expansion • Implementation began on January 1, 2007• County Human Services Staff including MH/MR/SCA’s will co-

monitor state contract• HC County Option: 15 counties

– Technical and Cost Proposals finalized• Recommendations made to the Secretary of Welfare to support all

of the proposals– Final Rates have been issued; all but three counties have

accepted rates• Readiness Review: Spring, 2007• Implementation will begin on July 1, 2007

Program Updates

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Objectives• State Plan Services approved by CMS

– Certified Peer Specialists– Mobile Mental Health Treatment

• HC Expansion • Older Adult Priorities and Supporting Projects

– MFP resubmission– Regional Forums

• Adult Priorities and Supporting Projects– Housing TA identified– Integrated Treatment Standards Completed

• Children’s Priorities and Supporting Projects– Response to the BH Taskforce Report– School Based Intensive and Partial Hospital Bulletins/Subcomm

Program Updates

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