Tuesday, July 14, 2009

Serving Stanley for Free

In the comments for the previous post, Stanley asked:
"Thanks for providing specific provider details...hate to push one so willing to provide such information...butbut wondering how do rates compare with actual cost of providing quality programs...do rates paid by RC cover all cost of providing quality support...are all IPP needs/goals covered by rates.

Questions arise based on process used to determine cost of providing support for my daughter...eg/ie, agency gave RC cost to provide support...RC either approved or denied these cost...I do not recall any mention of what rate would apply...there was no discussion of an agency who could provide same support for less...did such an agency exist...how does one quantify/equate lower rate and program quality.

And among many things I have not seen is a list of state-set rates...there seems to be a disconnect between rates, cuts and cost...also

How do cuts effect Lanterman entitlements...ie/eg, Though DDS wrote that it will maintain the entitlement of the Lanterman Act, it simultaneously wrote that it would mitigate the expenses associated with the growth in population?"
Here are some thoughts, I invite readers to add their own:

1) I am absolutely certain that rates and quality are not perfectly or even well correlated. There are a lot of things that cost money to do badly and are free if you do them well. Just as a quick example, with individualized services, there is always a tension between management's idea of how those services should be provided and the end user's. There is always a fiduciary concern that the client's money be spent appropriately pitted against the client's interest in having their money spent according to their wishes in a timely fashion. An agency can spend a lot of money imposing the management's interest while many clients provide their own vision for free. This is just a theory, but I have long suspected that leaner individualized supports are probably much more person-centered supports.

To agencies like ¡Arriba!, fairly lean individualized providers, the most important benefit from better funding is staff retention. But if management is injudicious or unwise in who gets retained, as I confess to having been on a few occasions, then quality doesn't benefit. Good funding can allow management to be too comfortable trusting staff and allow people who could more productively do something else stick around longer. So better rates can improve or erode quality, depending on the willingness of managers, staff and clients to make difficult decisions before making payroll becomes a maybe thing.

A few cautions, though: A lean, quality-focused, person-centered agency most likely will see quality go up and down as rates do. I guess my answer to that part of the question is that the impact of budget cuts on accessibility is more obvious than the impact on quality. Another caution is I know even less than DDS and the regional centers what the factors of quality in a congregate support are. It may be that as services become more intentionally programmatic, standardized and institutional that funding per unit of service has a simpler and more positive correlation with quality.

2) The connection between rates and the IPP is obvious if you are talking about SLS or the total Regional Center POS budget. Otherwise, the IPP is purchased by buying units of service that may not be through the same vendor code or agency. At ¡Arriba!, for example, we can support every part of a client's IPP at our new, lower rate but the cost goes up because we have to add hours of service for each goal we work on with a client. I understand that for SLS clients and SDS clients the "rate" is a composite of costs pursuing different parts of the IPP so it would surprise me if an SLS provider could say yes in answer to your question. I can, though, provided I am given enough authorized hours to juggle it all.

Obviously, if the POS budget is capped this year (but exists) then some IPPs will have to get less ambitious. That might even be a good thing if we could trust people to prioritize wisely and thoughtfully. If anyone reads this and trust that IPPs will diminish wisely and thoughtfully, please let me know in the comments. I'd sure like to hear it.

As to your comment about the disconnect you perceive between rates, costs and cuts- I can only agree. It's madness. A herd of cows would design a more rational system. A pack of wolves would design a more honest one. A cabal of cannibals would design a more defensible one.

**Update** Through the good offices of a good friend, Stanley, here is the list of rates and rate-setting mechanisms:

Tuesday, July 07, 2009

Dreaming with the Governor

While we're waiting for work to be done by the legislature, and since I haven't posted here in a month, I have some thoughts about one plank in the Governor's proposed cuts to DDS. One of the elements of the cost-cutting plan calls for Regional Centers to refer clients to the lowest cost provider of the desired service who is able to meet the requirements of the client. My agency seems to be the current low cost provider of individualized supports serving the SGPRC catchment area and, perhaps, the ELARC catchment area as well.

In a way, this is a better bad policy than most, at least from the provider perspective, particularly where agencies with state-set rates are concerned. The biggest budgetary risk from the rate cut implemented February 1 will be that vendors with already low rates close and are replaced with agencies whose rates remain higher than those charged by the low-cost providers before the cut. In fact, when the rate cut went through, ¡Arriba! was the second lowest-cost provider and remained so until our better closed in April. The risk is that unit costs rise or, at least, the overall affect becomes uncertain.

One smart way to avoid that trouble would be to cap rates rather than lower them proportionally. In that case, high-cost providers would be forced to charge less and if they failed to restructure their costs, they would be more likely replaced by lower-cost vendors.

But the proposal makes some sense, too. Under it, lower cost providers are to be strengthened after the proportional cuts through higher volume. This should help preserve the lower-cost providers. Setting aside for the moment my usual bitterness that the system should be so vendor-centered, at least the budgetary intent has a better shot with this proposal implemented.

Except it probably won't be implemented. I have very little hope that this agency will see more referrals. Regional centers are already incented to and expected to use the low-cost provider able to meet the clients' needs. When the previous low-cost provider closed, how many of their former clients were referred to us for service? Exactly. Even in the middle of a financial crisis that forced the regional center to cut hours, the lowest-cost alternative wasn't used.

So worry not, my friends, about this particular piece of trailer bill. Should it pass, your friends and loved ones will not be herded into low-cost programs but will continue to enjoy the higher-cost services of whatever quality they now receive. Hopefully, the cut was scored conservatively.