A Medicaid reform side effect

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From the Department of Unintended Consequences: New York’s Medicaid reform initiative, now coming up on its seventh anniversary, has led to long waiting lists for children needing speech, occupational or physical therapy. 

Due to a shortage of therapists, Cynthia Toleman knows of at least 148 children in need of one or more of those therapies who are languishing on waiting lists in Monroe County. That number does not include scores of preschoolers on waiting lists at local school districts, she adds. 

The shortage is not because there are too few therapists to do the job but because not enough are willing to do it under current conditions. Children who need such therapies include those with language delays, learning disabilities and physical handicaps; those who are deaf and hard of hearing; and children on the autism spectrum. 

Research shows that therapy administered as early as possible heads off or greatly reduces later difficulties with reading and math, says Toleman, a therapist who heads Clinical Associates of the Finger Lakes, a Victor-based practice group that provides speech, occupational and physical therapy services to children identified as needing the help by schools in Monroe and 10 other area counties.

“These children (on waiting lists) are being denied their rights,” Toleman contends, citing state laws calling for therapies to be administered to children identified as eligible for such services. 

Those who don’t get intervention now cannot make up for lost time, she adds. 

“Young brains are flexible,” Toleman says. “It’s like learning a new language. The older you are, the harder it is.” 

Depending on the age of the child receiving services, reimbursements to therapists can come from either the state or county governments. Counties pay for preschool services; the state reimburses services for school-age children. The ultimate payer in either case is the state’s Medicaid program, which is jointly funded by the state and federal governments with each shouldering approximately half the cost. 

Neither Monroe County nor New York has raised therapy reimbursement rates for more than two decades, Toleman says. But while therapists would have been glad to see the rates go up in previous years, the current squeeze began in 2013, the year the state’s Medicaid reform initiative started to go into effect.

At a current cost of some $60 billion, New York’s Medicaid program is second in cost only to California, which spends about $65 billion on its Medicaid program.

Unlike most other states, New York splits its half of the Medicaid bill with counties, charging each for its share of money Medicaid lays out for a host of services including long-term care and health insurance for the poor as well as Medicaid-funded speech, occupational and physical therapy for children.

New York’s Medicaid reform , introduced by Gov. Andrew Cuomo and approved by the Legislature in 2012, proposes to cut expenses partly by shifting administration of Medicaid programs from agencies like county departments of social service to managed-care programs run by private insurers including Excellus, MVP, United Healthcare and Aetna. 

Also as part of the reform, New York obtained an approximately $8 billion waiver from the federal Centers for Medicare and Medicaid Services to set up an initiative called the Delivery System Reform Incentive Program, which is working with hospitals and other health care organizations with the goal of improving efficiency and care quality. 

A 2015 evaluation of the reform initiative by state Comptroller Thomas DiNapoli found that it had reduced expenditures but that the program’s bottom-line costs, which at that time totaled approximately $53 billion, had increased by $700 million. 

For therapists, meanwhile, Medicaid reform has brought a slew of new paperwork, which, Toleman says, lies at the heart of the waiting-list problem. The new paperwork comes in the form of documentation required by the private insurers that now administer the state’s Medicaid payouts.

Therapists don’t send the paperwork directly to the insurance companies. They send it to the state Department of Health, which forwards it to insurers. Toleman says therapists and practice groups see the hours of extra work needed to satisfy insurers as an uncompensated burden that eats up more than its share of hours.

Her agency and some others have added staff to manage the newly required documentation. Other local providers are having therapists or existing administrative staff do the work. Either way, it comes to a lot of hours, Toleman says. 

“The state is asking us to do their administrative work for them and it’s not paying for it,” she complains. 

Added work with no increase in the reimbursement rates, a virtual pay cut, has led a number of therapists to vote with their feet, turning to private work rather than continue to provide Medicaid-funded services, Toleman says.   

Cuomo’s budget calls for a 5 percent hike in the state’s therapist-reimbursement rates, she says. Whether the increase will survive negotiations with the Legislature remains to be seen. Even if the full 5 percent increase goes through, indications are that it will not begin to cover the extra cost. 

study done by Pete Nabozny, the Children’s Agenda director of policy, found that a 30 percent hike in reimbursement rates would be needed to cover the cost, Toleman says. 

In the meantime, Monroe County could raise rates for the therapies it pays for, which are services provided to preschoolers, without seeking the state’s approval. Toleman says she has pleaded the case for a hike to county lawmakers. Several have said they would urge the state to enact the proposed 5 percent increase, but no lawmaker she knows of has approached the administration of County Executive Cheryl Dinolfo about a county rate hike. 

Last week, Toleman and several other therapists attended a Monroe County Legislature meeting to plead their case to the full body. There was no response. The other 10 counties Clinical Associates serves have upped reimbursements, she says. 

Monroe County spokesman Jesse Sleezer did not respond to an email asking if the county was considering a rate hike or investigating the therapists’ pleas. 

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