Friday, February 04, 2011

Things DDS (or LAO) should be thinking about, Part I

While DDS plays with service standards and administration costs and other proposals from which the unforeseen consequences will outnumber the planned reforms by 1,000 to one, there are some foreseeable scenarios for which planning could mitigate harm and reduce costs. Here is my list:

Consolidation is inevitable. The cuts the governor has proposed are more than the system can bear, but even without further cuts, many agencies are now unsustainable and there will be further cuts. What's more, there is no likelihood that the cuts as proposed will be the cuts as experienced. Things intended no longer to be compensated will be paid for and things left protected will be cut. Agencies will reach the point that they are no longer large enough to justify management and those agencies will start to close. The clients served by those agencies will in most cases receive new supports from different agencies.

Barriers to sale or merger of existing agencies can be removed, allowing the clients to avoid interruption of important relationships and lowering the administrative burden on both regional centers and vendors from the reallocation of those clients. The alternative is the existing process which is needlessly traumatic for clients and staff and needlessly costly for agencies and the state.

The savings in the Bureau of State Audit reports are between the headlines: So far, trailer bill language coming from DDS seems focussed on the most lurid offenses the BSA found in its work. I can certainly agree that IRC's budget-padding ought to be cut off and extra funding for relatives of regional center employees ought to be cut off. But booking savings seems foolish. It strikes me unlikely that any new statute will prevent miscreants and thieves employed by regional centers from spending any new money in ways that their colleagues have been caught.

But between the headlines were examples of how regional centers may waste money in small ways every day. To someone working in this system, a family member of someone who is a client in this system, the anecdote of the regional center employees explaining a contracting decision with an undocumented, unexplained preference resonated with countless experiences repeated so regularly I'd stopped noticing until I saw it in print. The new trailer bill language regarding large contracts might have prevented one $950,000 absurdity but perhaps never another. Reviewing vendor selection by regional centers by sampling the tens of thousands of opportunities that arise each year to be unintentionally inefficient holds much more promise.

As someone who has encountered both wild bears and domestic termites, I assure my friends in Sacramento that common, small pests do much more damage than big rare ones.

Look differently at rates: One way this system was meant to be efficient was competition. The problem is that there has never been a good tool for regional centers to use to reliably (or semi-reliably) judge quality and rates are opaque, so whatever providers compete on the basis of, it isn't quality and it isn't cost.

This has a couple implications. First, rates should be public so that agencies can compete on that basis. Second, it means that for the most part, the state is paying whatever rate was given to whatever agency was chosen on whatever basis. In the short term, if further rate cuts are anticipated, given that the rates are close to random, it would be better to cap rates than to continue hurting the low cost providers by the same percentage as the expensive ones. The usual justification why the rate system is so irrational has always been that to rationalize it would cost some agencies and they'll fight the change. That's still true, but seems pretty important in the present circumstances.

But rates ought to public and regional centers and/or DDS ought to publish them. That will make it a little harder for regional centers to neglect that consideration and a little harder for high-cost vendors to hype their own costs. Furthermore, it would help in negotiations as the fear of being cheated could be as completely allayed as it is possible to allay that particular phobia.

Query to readers: What do you think DDS should be considering while they write the trailer bill language? (Leave a comment and then go tell them.)

5 comments:

stanley seigler said...

doug say] Query to readers: What do you think DDS should be considering while they write the trailer bill language? (Leave a comment and then go tell them.)

DDS should consider/submit a budget based on needs (not historical data) and i have told them...NO response from DDS...what did you expect...

further DDS should consider their mandate in Lanterman: (Lanterman 4434b) The department [DDS] shall take ALL necessary actions to support regional centers to successfully achieve compliance with this section and provide high quality services and supports

stanley seigler

stanley seigler said...

Testimony of Art Bolton: California Assembly Subcommittee #1 - Health and Human Services - February 3, 2011

Hello members of the committee. My name is Art Bolton. It*s a pleasure to be here in this room again. I see Jess Unruh*s picture looking down on us. He hired me in 1963 to staff the Assembly committee selected to look at our programs for people w/ developmental disabilities.

At that time the governor, the recipient of bad advice, had a plan to expand the state hospitals. He had appropriated 47 million dollars in his budget to go ahead and start building more hospitals, because they were terribly over crowded and the conditions were bad; something had to be done. He turned to his department, he turned to Dept of finance. *What shall we do?* They came in with a number, 47 million. Why not that number? Go ahead.

Well the families who would be affected, who had children in the state institutions and who were on a waiting list, those families were upset. They didn*t want more state hospitals. So they went to Speaker Unruh and they said: *Can the legislature do something?,* and he said: *Well I don*t know, we*ll investigate it.*

He put together a bipartisan committee. Frank Lanterman was on that committee and they quickly decided that what was needed was not more state hospitals, but some sort of alternative in the community and there wasn*t anything, so they invented the California system for people with developmental disability, which now serves 240,000 people, employs over 100,000 workers and is a model for the nation. Great thing.

Well now, all these years later, here comes the son and he*s the governor, and he*s got a problem. He turns to his department, he turns to finance and says: *What should we do?* They come up with a number of 750 million dollars. That sounds like a fair, reasonable number, and the poor dears, they don*t know, but they don*t look at the larger picture.

The governor didn*t ask the right questions. For example: *How many people will get laid off?* My estimate is that with this kind of size of a cut, you*re going to loose roughly 15,000 workers. Who are these workers? These are not jobs that can be shipped to China. These are American jobs in the private sector. Keep in mind Frank Lanterman was a conservative republican and he helped to engineer this system from the beginning and stayed with it.

It doesn*t make sense to dismantle this system andput 20,000 people out of work. They*ll all be eligible for food stamps, unemployment insurance, welfare. What*s that cost and does that offset that 750 million or maybe what portion of it? Does anybody know? Has that question been asked? I think its important because you can*t just look at the small details and have meetings on how to distribute the cuts, you have to look at the larger picture. What*s the social impact? What*s the economic impact? That*s part of the work needs to be done.

I urge this committee to take the lead in drawing the line saying *We*re not necessarily going to play this game. We*re going to take our time. We*re going to ask the right questions. We*re going to investigate.* If some cuts are warranted, fine, but this sort of a wholesale, pie-in-the-sky cut is going to solve the state*s economic problems - that*s foolishness and is going to hurt a lot of people.

A PDF file of this above approximation of Art Bolton's testimony is attached. To see the testimony as it was delivered, please use the following link and then move the slider to 3:26:40. <>

[NOTE this link is the complete 3 Feb hearing]

Re: Testimony of Art Bolton
It [arts testimony] ranks right up there with some of my [lisa] favorite examples of advocacy of all time....

COMMENT
art bolton*s comments should be posted far and wide...he is the lone ranger here to save lil nell...thundering hoof beats out of the past...

again, lisa thanks for posting art*s testimony...he is a (my) hero...

stanley seigler

Doug said...

Thanks, Stanley. That's good testimony.

stanley seeigler said...

either my computer or doug is playing games...the link to art's testimony didn't post...so trying one more time:

http://www.calchannel.com/channel/viewvideo/2012

actually it's the entire 3Feb hearing...art is at the 3:26:46 mark.

assume the 10Feb hearing will be at the same site...

stanley seigler

Doug said...

Thanks, Stanley;

I got a chance to talk to Art at the 2/10 hearing. It was good to see him.