Supported employment integrated_110504

Commonwealth of MassachusettsExecutive Office of Health and Human Services

Chapter 257 of the Acts of 2008

Provider Information and Dialogue Session:

Supported Employment Service Class

May 4, 2011

www.mass.gov/hhs/chapter257 [email protected]

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Agenda

• Chapter 257 Implementation and Status Update

• Impact of Governor’s FY12 Supplemental Budget Filing

• Updated Implementation Strategy

• Setting Rational Rates

• Overview of Supported Employment Services

• Definition and Overview of Programs

• Procurement Approach

• Review of Cost Analysis and Methodologies

• Timeline and Key Milestones

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Impact of Governor’s FY12 Supplemental Budget Filing

• Governor’s supplemental budget Signed on 4/11/2011 as Chapter 9 of the Acts of 2011 establishes new deadlines for implementation as well as require that related procurements not go forward until after the rate setting process.

• EOHHS is developing communication to be posted on the Chapter 257 website and disseminated to departments and providers regarding the legislation, implementation plan, and activities that will be undertaken.

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How will this legislation impact planned implementation?

• New implementation dates require meeting the current work schedule so that 40% of the POS system will have rates adopted by January 1, 2012.

• Delay reflects the amount of time needed to not only develop rate proposals, but to also plan for effective implementation.

• Allows for better alignment with the Commonwealth’s budget cycle; fiscal and client impact of proposed rates will be incorporated into Department spending plans and Governor’s budget proposal.

• Subsection (E) requires that departments not procure services prior to rate setting.

• New procurements may only be issued with the written approval of the Secretary based on a documented finding that the procurement is necessary to assure:

• Continuity of consumer health, safety, or access,

• Program integrity, where a new contract is necessary to replace an existing contract that terminated early due to unanticipated circumstances, or

• Compliance with a court order, settlement agreement, or statutory requirement.

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Chapter 257 of the Acts of 2008 Regulates Pricing for the POS System

• Chapter 257 places authority for determination of Purchase of Service reimbursement rates with the Secretary Of Health and Human Services under MGL 118G. The Division of Health Care Finance and Policy provides staffing and support to EOHHS for the development of Chapter 257 Pricing.

• Chapter 257 requires that the following criteria be considered when setting and reviewing human service reimbursement rates:

• Reasonable costs incurred by efficiently and economically operated providers

• Reasonable costs to providers of any existing or new governmental mandate

• Changes in costs associated with the delivery of services (e.g. inflation)

• Substantial geographical differences in the costs of service delivery

• Some current rates within the POS system may not reflect consideration of these factors.

• Additional funding was not appropriated to finance any potential cost increases associated with the law.

• The statute specifies a four year implementation timeframe.

Year 1 Year 2 Year 3 Year 4

Statutory Requirement: Percent of POS System with Regulated Rates 10% 30% 30% 30%

Spending Base Associated with Statutory Percentage (based on current projection of $2.1B POS Baseline to be implemented) ~ $215M ~ $645M ~ $645M ~ $645M

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Supported Employment Service Class

Service Class Definition: Programs that provide individual and group supported employment in the community and center-based, sheltered work programs for individuals that require provider support and/or supervision.

Department Activity Code Program Name Projected FY11 Spending

DDS

3168 Supported Employment Services $19,991,000

3181 Group Supported Employment $10,545,431

3169 Center-Based Work Services $38,795,000

MCB 2109 PERSONAL VOC ADJ $547,354

Total Projected FY11 Spending $70,034,785

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Individual Supported Employment (3168)

• Individual Supported Employment has been provided for individuals with the goal of, or currently working less than 20 hours per week.

• Individual Supported Employment service is believed to be very comparable to Competitive Integrated Employment Services that DDS currently purchases for individuals with the goal of, or currently working more than 20 hours per week.

• Current recommendation is to use the CIES Level B hourly rate for Individual Supported Employment.

• Rate is currently $34.24 per hour.

• The CIES rates are under review.

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Calculated Per Hour Costs: Center-basedand Group Supported Employment

• The calculated per hour costs range from $3.84 to $21.69 for Center-based programs and $6.64 to $29.61 for Group programs at 100% utilization.

• These rates were calculated from FY2011 contract budget data.

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Cost Category Percentages: Center-basedand Group Supported Employment

• Total staffing related expenses accounts for the largest percentage – around 55% - of program expenses, while tax & fringe, occupancy and M & G are all around 10% of program expenses.

Cost Category Percentages: Center-based and Group Supported Employment

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Center-based Programs Group Programs

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All Staffing Related Costs:Center-based Supported Employment

• These expenses include salaries for all direct care positions, as well as tax and fringe.

• Staffing costs explain about 68% of the overall variation in total costs per hour.

All Staffing Related Costs Per Hour By Total Costs Per Hour

R2 = 0.6821

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All Staffing Related Costs Per Hour

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All Staffing Related Costs:Group Supported Employment

• These expenses include salaries for all direct care positions, as well as tax and fringe.

• Staffing costs explain about 75% of the overall variation in total costs per hour.

All Staffing Related Costs Per Hour By Total Costs Per Hour

R2 = 0.7458

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$5.00

$10.00

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$- $2.00 $4.00 $6.00 $8.00 $10.00 $12.00 $14.00All Staffing Related Costs Per Hour

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Staffing Ratios

• The Group Supported Employment programs show a distribution of staff to client ratios that fall into three major groups: High, Mid and Low Intensity.

High

Mid

Low

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Model Budgets Summary

• Center-based Supported Employment: One program model.• Group Supported Employment: Three program models,

based on direct care staffing ratios.

• The service unit is one hour and the average number of hours per client per day is as follows:

– Center-based Supported Employment: 4 hours– Group Supported Employment: 3.5 hours

• The model budget reflects measures of central tendency within FY11 budget data, with statistical outliers removed.

ProgramIntensity

Level

Individuals per Direct Care Staff

Group Supported EmploymentHigh 3.25 Mid 5.03 Low 6.84

Center-based Supported Employment All 8.39

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Sample Model Budget showing Cost Category %:Center-Based Supported Employment

• The average hours per client per day in a Center-Based program is 4.

• The average staff to client ratio for direct care staff is 1 : 8.39.

• Occupancy is a sizable portion of the overall budget, while transportation is a very small portion of the overall budget.

• A cost adjustment factor will be applied to account for inflation between the base year and when the rates are scheduled to be reviewed.

• A utilization factor will also be included.

Center-Based Supported Employment (3169)

SAMPLE Number of Slots: 23 Hours: 4

Clients : FTE FTE Expense

Direct Mgmt Staffing 61.13 0.38 11%

Non-Specialized Direct Care Staffing 8.39 2.77 40%

Support Staffing 88.72 0.26 4%

Sub-total Direct Care Staff 3.4 54%

Factor

Taxes & Fringe 23.27% 13%

Total Staffing Costs 67%

Occupancy 14%

Transportation 2%

Other Program Exp. 7%

Total Reimbursable Exp. Excl. Admin. 90%

Admin. Alloc. (M & G) 11.70% 10%

Total 100%

Proposed Rate TBD

CAF Rate TBD TBD

Utilization Rate TBD TBD

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Sample Model Budget Showing Cost Category %:Group Supported Employment

• The average hours per client day in a Group program is 3.5.

• The average staff to client ratio for direct care staff at the higher intensity level is 1 : 3.25.

• Occupancy is slightly smaller portion of the overall budget, while transportation is a slightly larger portion of the overall budget than Center-based.

• A cost adjustment factor will be applied to account for inflation between the base year and when the rates are scheduled to be reviewed.

• A utilization factor will also be included.

Group Supported Employment (3181)

Higher Intensity Level (1: 3.9)

SAMPLE Number of Slots: 12 Hours: 3.5






Factor



Occupancy 5%

Transportation 3%



Admin. Alloc. (M & G) 11.70% 10%

Total 100%

Proposed Rate TBD

CAF Rate TBD TBD


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• The average staff to client ratio for direct care staff at the mid-intensity level is 1 : 5.03.


Mid Intensity Level (1: 4 - 5.9)







Factor



Occupancy 7%

Transportation 5%



Admin. Alloc. (M & G) 11.70% 10%

Total 100%

Proposed Rate TBD

CAF Rate TBD TBD


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• The average staff to client ratio for direct care staff at the lower intensity level is 1 : 6.84.


Lower Intensity Level (1: 6 - 8)







Factor



Occupancy 9%

Transportation 6%



Admin. Alloc. (M & G) 11.70% 10%

Total 100%

Proposed Rate TBD

CAF Rate TBD TBD


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Fall 2011 Summer 2012Winter 2012Summer 2011Spring 2011

Department Service Design Finalized and Rate Development

Executive Sign-Off EO 485 to ANF Public Hearing

Rates Adopted Rates Effective

Provider Sessions and Feedback

• Department Service Design Finalized: All service components, staffing ratios, staff qualifications, other program inputs have been decided by the purchasing department.

• Executive Sign-Off: Commissioner and C257 Executive Committee sign-off on draft rates and implementation plan.

• EO485 Submitted to ANF: Draft rate regulation to ANF; Will better align the rate regulation proposal with budget planning.

• Procurement Issuance: Where a procurement is warranted, the procurement will be issued after the rates have been adopted.

• Rates Effective: Where possible, reimbursement under regulated rates will align with beginning of SFY to minimize mid-year contract amendments for both purchasing Departments and providers.

Updated Implementation Timeline and Key Milestones for Supported Employment

July 1

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Questions/Feedback

[email protected]

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Supported employment integrated_110504

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