Senate Committee Chair: Medicaid cuts for supported living services will be postponed

Actions are being taken in regard to the recent announcement that the state of Idaho will be making cuts to Medicaid provider reimbursement rates for supported living and residential habilitation services.

On Wednesday, representatives of the Idaho Association of Community Providers met with Medicaid Director Lisa Hettinger, Idaho Department of Health and Welfare staff, Myers and Stauffer accountants (IDHW's accounting contractor) and advocacy representatives to initiate negotiations about conducting a cost study and allowing temporary rates for supported living services. Drafts of proposals for the process were presented.

Idaho Sen. Lee Heider, R-Twin Falls, chairman of the Senate Health and Welfare Committee, was in attendance.

"I thought it was a very productive meeting," Heider said Friday. "They're going to hold off on changing that reimbursement rate and see what the feds are going to do."

On Dec. 18, IDHW issued a letter telling provider agencies that due to a 2015 Supreme Court Decision that overturned a 2012 lawsuit — Inclusion Inc, et al v. Armstrong et al — that had raised Medicaid provider reimbursement rates for these services, the rates would revert to where they were in 2012. IDHW then issued a notice that the changes would take place Feb. 1 to give agencies more time to reconfigure their programs and make adjustments. The rates would be reduced by 9-12 percent for disabled individuals receiving high support, 46 percent for those who receive intense support and hourly supports would decrease by about 36 percent.

The announcement came as a surprise to many families and service providers who would be affected by these rate reductions. They encouraged people to rally for a cost study with the hopes the rate cuts would be delayed and current rates would stay in place until a new financial examination could be conducted.

Just days after IDHW's letter was issued, James Piotrowski, Boise attorney and general counsel of the Idaho Disability and Education Fund who is representing eight service care providers and two patients, filed a lawsuit against Idaho to delay the rate cuts.

Piotrowski filed another lawsuit Thursday against IDHW director Richard Armstrong as well as IDHW deputy director of Medicaid, behavioral health and managed care services Denise Chuckovich. Piotrowski is representing several guardians in the second lawsuit which alleges the Medicaid service reductions "are all in violation of their rights to due process of law, pursuant to the Medicaid act, and under the Americans with Disabilities Act" and the plaintiffs are participants who "will be subjected to Medicaid service reductions as a result of such reductions, but who have not received notice of the reductions, have not been provided an opportunity to appeal the decision to reduce services, have been denied their choice of service providers, and face imminent institutionalization as a result of Defendants’ conduct."

"It's quite a complex program," Heider said. "They don’t want to close any of the homes, they don't want to put anybody out on the street ... they've got to be able to care for those people."

Heider said the discussions in Wednesday's meeting between IDHW and IACP placed everyone on the same page. He described it as a truce, but "it's an uneasy truce right now."

"I do think there's a spirit of cooperation there," he said. "The providers have been really happy when the rates have been high, but if there has to be a cut ... they may reduce the rate and the providers will have to decide if they can live with that."

One of the fears is whether service agencies will have to reimburse any differences between the temporary rates and the rates set after the rate study, which could take up to nine months to complete.

Heider said he doesn't think that's the case.

"People are paranoid about it, but they don't need to be paranoid about it because the Department is not going to do that to people," he said. "They appreciate the providers. What would we do without them?"