You asked for a summary of 2005 legislation and appropriations affecting people with psychiatric disabilities.

SUMMARY

The 2005 General Assembly enacted several significant initiatives that affect adults and children with psychiatric disabilities. These include:

• Creating 500 new units of supportive housing for individuals and families

• For adults

o Requiring the Department of Social Service (DSS) to amend the state Medicaid plan to include Department of Mental Health and Addiction Services (DMHAS) assertive community treatment teams under the adult rehabilitation services option

o Requiring DMHAS to develop a website that provides access to mental health care information and assistance for children and adults

o Studying the feasibility of creating (1) a pilot program to keep people with psychiatric disabilities out of nursing homes and (2) enhanced care clinics for adults, both financed through Medicaid

o Increasing benefits for State Supplement Program beneficiaries

o Adjusting state prescription drug coverage to conform to new federal Medicare laws

• For children

o Establishing a behavioral health partnership between DSS and the Department of Children and Families (DCF) to develop and implement an integrated behavioral health system for children and families receiving services under HUSKY A and B; DCF’s voluntary services program; and, potentially, other children DCF serves

o Studying whether there are enough inpatient psychiatric beds for children

o Creating a pilot program to help young adults with mental illness and other chronic conditions

• Requiring towns to treat DMHAS-operated or -supported community residences like single-family homes for zoning purposes

• Increasing rates by 4% for private agencies that contract with DMHAS and DCF to provide services for children and adults with psychiatric disabilities

HB 7000, An Act Concerning the Expenditures of the Department of Social Services, contains most of these initiatives; sHB 6490 contains the appropriations for them. These are listed at the end of each entry for which funding was specifically included in the budget.

SUPPORTIVE HOUSING

HB 7000 requires the DMHAS commissioner to provide for up to 500 additional affordable, supportive housing units for people with mental illness. These units are a second, "Next Steps," phase of the Supportive Housing Initiative, which was instituted in 2001 to create 650 units.

Like the first phase, the Next Steps Initiative is funded through mortgages, tax credits, and grants from the Connecticut Housing Finance Authority (CHFA) and the Department of Economic and Community Development (DECD); DSS rent subsidies; and grants from various state agencies for support services. The act permits the state to pay debt service on tax-exempt bonds CHFA issues for the program.

Eligible Individuals And Housing

Next Steps housing is for:

1. people or families affected by psychiatric disabilities, chemical dependency, or both who are homeless or at risk of homelessness (including people living on the streets, in shelters, or in unsafe, abusive, or overcrowded environments; paying more than 50% of their income for rent; leaving homeless programs or transitional housing with no permanent housing; or needing supportive services to maintain permanent housing);

2. families who are eligible for Temporary Family Assistance;

3. 18- to 23-year olds who are homeless or at risk of homelessness because they are transitioning out of foster care or other residential programs; and

4. community-supervised offenders with serious mental health needs who are under Judicial Branch or Correction Department jurisdiction.

All of the new units must be permanent and can house individuals and families with or without special needs.

Financing Plan

The bill requires the DMHAS commissioner and Office of Policy and Management (OPM) secretary to enter into a memorandum of understanding (MOU) with DCF, DSS, DECD, and CHFA by October 1, 2005 that establishes (1) the various agencies’ financing responsibilities and (2) a plan for private and federal predevelopment financing and for grants and loans from nonstate sources generated by federal and state tax credits and federal project-based rent subsidies. It requires CHFA, by January 1, 2006, to issue a request for proposals for participation in the initiative.

Debt Service Agreement

The bill permits the treasurer and OPM secretary to contract with CHFA on behalf of the state to pay principal and interest and reasonable operating and replacement reserves on CHFA mortgages issued under both phases of the Supportive Housing Initiative. It makes any such contract a state contract with bondholders, appropriates all amounts needed to pay promptly, and requires the treasurer to make payments when due. It allows CHFA to pledge the state's payment as security for the bonds and issue refunding bonds at any time.

DSS Rent Certificates

The bill allows DSS to set aside some of its rent assistance certificates for tenant- and project-based supportive housing units. Tenant-based certificates go to individuals who secure private housing; project-based certificates go to property owners who participate in government housing development programs. The bill requires, to the extent practicable, calculating the tenant's share of rent under a certificate for supportive housing based on federal Housing Choice Voucher Program regulations. These call for a tenant to pay 30% of the family's adjusted monthly income for a unit that rents for up to the fair market price set by the U. S. Department of Housing and Urban Development.

Additional DMHAS Services

The bill permits the DMHAS commissioner, before January 1, 2006 and within available appropriations, to provide additional supportive or supervised housing for adults with severe and persistent psychiatric disabilities.

Funding

sHB 6940 provides the following funding for this initiative.

INITIATIVES FOR ADULTS WITH PSYCHIATRIC DISABILITIES

Assertive Community Treatment (ACT) Teams

HB 7000 requires the DSS commissioner, by December 31, 2006 and in consultation with the DMHAS commissioner and the Community Mental Health Strategy Board, to amend the state's Medicaid plan to include assertive community treatment teams and community support services in the definition of optional adult rehabilitation services, thereby making them eligible for federal reimbursement. ACT teams provide intensive, integrated multidisciplinary services to adults with severe psychiatric disabilities, including people who are homeless; diverted or discharged from hospitals and nursing homes; or diverted or released from, or at risk of going to, prison. They provide intensive community care management through case managers, nurses, and physicians and must include vocational, peer, and substance abuse specialists.

The bill requires the DSS and DMHAS commissioners to enter into an MOU delegating DMHAS to clinically manage the adult rehabilitation services it provides its clients. It defines "clinical management" as the process of evaluating and determining appropriate use of mental health services and providing assistance to clinicians or beneficiaries to ensure the appropriate use of resources. Assistance can include prior authorization, concurrent and retrospective review, discharge review, quality management, and provider certification.

The bill allows the commissioners jointly to adopt clinical management policies and procedures. It allows the DSS commissioner to implement these, which can include changes to existing policies and procedures governing utilization management, while in the process of adopting them as regulations.

Funding. sHB 6940 includes $ 475,000 in FY 06 and $ 3. 7 million in FY 07 to expand Community Mental Health Strategy Board initiatives, including ACT teams

DMHAS Website

HB 7000 requires the DMHAS commissioner, by June 30, 2006, to begin to develop, implement, promote, and maintain a website that provides timely access to mental health care information and assistance for children, adolescents, and adults. The website must contain, at a minimum:

1. directory information on available federal, state, regional, and local assistance, programs, services, and providers;

2. current mental health diagnosis and treatment options;

3. links to national and state advocacy organizations, including legal assistance;

4. summaries of state and federal mental health laws, including those concerning private insurance; and

5. an optional, secure personal folder for people to manage information about their own mental health care and assistance.

Funding. sHB 6940 includes $ 217,500 in FY 07 to implement the website.

Expanding Services to Young Adults

The bill permits the DMHAS commissioner, within available appropriations, to expand services for young adults with psychiatric disabilities to cover additional catchment areas. It requires him to identify service gaps for this population and report by January 1, 2007 to the Public Health and Human Services committees on services that should be added.

Feasibility Studies

Nursing Home Diversion. HB 7000 requires the DSS and DMHAS commissioners to convene a task force by July 1, 2005 to develop a feasibility plan to obtain a federal waiver to create a Medicaid-financed home and community-based pilot program to help adults with severe and persistent psychiatric disabilities who are diverted or discharged from nursing homes. The program can include housing assistance.

Enhanced Care Clinics for Adults. HB 7000 requires the DSS commissioner, in consultation with the DMHAS commissioner and OPM secretary, to determine the feasibility of creating enhanced care clinics for adults and establishing Medicaid rates for them by July 1, 2006. These clinics could include those based in hospitals. The commissioner must report to the governor and General Assembly by January 1, 2006.

Insurance Practices

HB 7000 requires the managed care ombudsman, by October 1, 2005, to establish a process for mental health care providers, patients, business organizations, and managed care organizations to communicate about and ensure:

1. compliance with state insurance laws governing (a) compliance with federal laws governing guaranteed coverage availability and renewability, mental health parity, and discrimination based on health status, (b) standards for psychotropic drug coverage, (c) mental health parity, and (d) coverage continuation for children with mental disabilities;

2. best practices in mental health treatment and recovery; and

3. the relative costs and benefits of providing effective mental health coverage to employees and their families.

The ombudsman must report annually to the Public Health and Insurance committees, beginning January 1, 2006.

STATE SUPPLEMENT BENEFIT INCREASE

sHB 5290 effectively increases the benefit available through the State Supplement Program (SSP). It requires the DSS commissioner, annually beginning January 1, 2006, to increase the amount of unearned income she disregards when determining SSP eligibility and benefits. She must increase the disregard by the amount of the cost-of-living adjustment, if any, provided to federal Supplemental Security Income (SSI) recipients for the corresponding calendar year.

To calculate the SSP benefit, DSS takes an individual’s income, subtracts applicable disregards, and compares the difference to the program's benefit level. If the net income figure is less than the benefit, the person qualifies and the benefit equals the difference. Since 1991, DSS has disregarded $ 183 in unearned income from applicants or recipients who are living alone in the community. These disregards, as well as program benefit levels, have not increased in many years. But SSI benefits (considered unearned income) have risen each year, which has effectively reduced the amount of SSP benefits people receive, if not eliminated their eligibility for the program altogether.

Funding

It is estimated that this change will cost $ 1,525,000 in FY 06 and $ 3,033,000 in FY 07.

Prescription Drugs for Medicare-Medicaid Dually Eligible Population

Many DMHAS clients and many other people with psychiatric disabilities are eligible for both Medicare and Medicaid. Under the new federal Medicare prescription drug law, these “dually eligible” people will no longer receive prescription coverage through Medicaid for drugs designated as "Medicare Part D covered drugs. " Federal law allows them to choose a Medicare Part D plan and provides them with varying levels of extra subsidies compared to the "standard" Part D plan.

Under HB 7000, dually eligible people will have to pay $ 1 to $ 3 for drugs that are on their chosen plan's formulary, depending on their income and whether the drug is generic or brand name. They will get no Medicaid benefits for drugs that could be covered under Medicare Part D, even if these drugs are not on their plan's formulary. But Medicaid will still pay for drugs that are not covered by Part D.

The bill allows DMHAS to represent its clients for purpose of applying to obtain the Medicare Part D low-income subsidy and appealing Medicare Part D denials. It requires the department to enroll its clients in a plan if they do not choose one.

ZONING FOR COMMUNITY RESIDENCES

HB 7000 requires local zoning regulations to treat as single family homes community residences housing six or fewer people receiving mental health or addiction services and necessary staff. To receive this treatment, DMHAS must pay for or provide the services and staff and DPH must license the home, if licensure is required. The law permits any resident of a town hosting such a home to petition the DMHAS commissioner to withdraw the home's funding on the grounds that it is not complying with the statutes or regulations governing its operation. The town's legislative body must approve the resident's action.

CHILDREN’S MENTAL HEALTH INITIATIVES

Behavioral Health Partnership

HB 7000 establishes the Behavioral Health Partnership (BHP) between DCF and DSS to develop and implement an integrated behavioral health system for children and families receiving services under HUSKY A and B; children enrolled in DCF's voluntary services program; and, at the DCF commissioner's discretion, other children and families the department serves. The partnership reflects the agencies’ previous work to implement the Connecticut Community KidCare program, including a Medicaid managed care waiver they recently submitted for legislative approval.

The BHP’s aim is to increase access to quality behavioral health services through (1) expanding individualized, family centered, community-based services and reducing use of unnecessary institutional and residential services; (2) maximizing federal revenue and reinvesting any derived from reducing residential and increasing community-based services; (3) improving administrative oversight and efficiency; and (4) monitoring overall performance, individual outcomes, and provider performance.

Agency Direction. The bill requires DSS and DCF to designate a partnership director in each agency to coordinate the agency's planning, development, administration, and evaluation responsibilities. The departments must jointly direct the administrative services organization (ASO, see below) they select to develop a community system of care to (1) alleviate hospital emergency room overcrowding, (2) reduce unnecessary admissions to hospitals and residential treatment facilities and the length of time people stay there, and (3) increase the availability of outpatient services.

ASO Contract. HB 7000 requires DCF and DSS to contract jointly with one ASO to perform the following functions: eligibility verification; utilization, intensive care, and quality management; coordination of medical and behavioral health services; provider network development and management; recipient and provider services; and reporting. The contract must call for the ASO to begin by October 1, 2005.

The bill prohibits the ASO from having any financial incentive to approve, deny, or reduce services. The ASO must base its decisions to authorize services solely on the clinical management guidelines set by the committee the bill establishes (see below). But, the ASO can make exceptions to these guidelines when a member, a member's legal guardian, or a service provider asks and the ASO determines an exception is in the member's best interest. The ASO must ensure that service providers and people seeking services have timely (1) access to program information and (2) responses to inquiries, including those concerning clinical guidelines.

The ASO must provide or arrange for on-site service in hospitals to (1) help place children in appropriate settings as soon as practicable when it knows they have been in an emergency room for over 48 hours or (2) arrange discharge or appropriate placement as soon as practicable for children who have been hospital inpatients for more than five days longer than the ASO and hospital agree is medically necessary.

The bill requires the BHP to establish policies to coordinate benefits for people who are covered by both the partnership and Medicaid managed care organizations. The policies must require coordinated delivery of behavioral and physical health care. They must be reviewed by the oversight council (see below).

Clinical Management Responsibility. Prior law governing the KidCare program permitted the DSS commissioner to delegate to DCF responsibility for the clinical management of services for children under the agencies' contract with an ASO. HB 7000 removes the limitation that DCF's responsibility is solely for children, apparently giving DCF clinical management responsibility for any adults the partnership serves. It also allows DSS to contract with an ASO to develop a provider network.

The bill establishes a seven-member committee to develop clinical management guidelines the partnership and the ASO must use. It consists of two members each from DCF, DSS, and the oversight council and one member the DMHAS commissioner selects. All members must be expert or experienced in behavioral health services.

BHP Oversight Council. The bill creates a 38-member council to advise DSS and DCF on planning and implementing the BHP. The council must also review (1) the agencies' contract with the ASO to assure that its decisions are based solely on the criteria the clinical management committee develops; (2) behavioral health services provided under HUSKY A and HUSKY B to assure that federal fund revenues are maximized; (3) periodic reports on program activities, finances, and outcomes, including reports from the partnership director on achieving the system's goals; (4) consumer grievance procedures (see below), and (5) proposed provider-specific rates for certain services (see below).

The council can conduct an external, independent evaluation of the partnership or can have one done. Beginning by March 1, 2006, it must report annually on its activities and progress to the Appropriations, Human Services, and Public Health committees.

Rate Setting. The bill permits DSS and DCF to establish provider specific rates for inpatient, partial hospitalization, intensive outpatient, and other intensive services. Each provider's initial rates must at least equal its blend of rates under HUSKY A and B. The departments may provide grants, where necessary, to address the financial effects this new system may have on providers. The initial rate changes and grants must be made within available appropriations.

The departments can establish uniform outpatient rates that contain a differential payment for adult and child services. These cannot exceed the Medicare rates for these services.

The departments must submit initial rates, rate reductions, and changes in the methodology they use to establish rates to the oversight council for review. If the council does not accept the rates, it can send its recommendations to the Appropriations, Human Services, and Public Health committees, which must hold a public hearing. The committees must make recommendations to the departments within 90 days after the changes were submitted to the council. DSS and DCF must make every effort to incorporate the council's and the committees' recommendations when setting rates.

Before the BHP can convert any grant-funded services (the method DCF currently uses to pay service providers) to a rate-based, fee-for-service payment system, DCF and DSS must submit documentation to the council verifying that the proposed rates seek to cover the reasonable cost of providing the services.

The new law’s rate setting provisions supersede other laws governing DSS rate setting for hospitals, residential mental health and substance abuse facilities, and freestanding detoxification centers.

Consumer Grievance Procedures. The bill requires DCF and DSS to develop consumer grievance procedures. They must establish time frames, including an expedited review in emergencies, for people to appeal the ASO's decisions. The procedure must require hearing appeals within 30 days after they are filed and deciding them within 45 days of filing. The oversight council must review and comment on the proposed procedures.

Certifying Providers. The bill authorizes the DCF commissioner to certify providers of early periodic screening, detection, and treatment services and rehabilitation service for purposes of Medicaid coverage.

Evaluation. HB 7000 requires DCF and DSS to evaluate the BHP annually beginning October 1, 2006. The evaluation must examine the BHP's provision of services, including the status of the ASO implementation and the departments’ collaboration, the services provided, the number of people served, and program outcomes and spending for children and adults. The bill also requires DCF to report annually on any estimated cost savings that result from the BHP’s implementation. Both reports go to the Appropriations, Human Services, and Public Health committees.

Funding. DSS currently spends approximately $ 55 million annually on behavioral health services for children and youth under its Medicaid managed care contracts and over $ 13 million for psychiatric reinsurance payments.

DCF Flexible Funds

HB 7000 requires the DCF commissioner, within available appropriations and in consultation with the DMHAS commissioner, to maintain the availability of flexible emergency funds for children with psychiatric disabilities who are not under DCF supervision.

Funding. sHB 6940 includes $ 1 million in FY 06 and $ 1. 5 million in FY 07 for this purpose.

Psychiatric Inpatient Bed Capacity Study

HB 7000 requires the Office of Health Care Access (OHCA) commissioner to establish a committee to study whether there are enough inpatient psychiatric beds for children in the state and make recommendations to expand capacity. The committee consists of the DSS and DCF commissioners or their designees, the child advocate or her designee, and representatives of private children's hospitals and children's mental health advocacy groups. OHCA must report the committee's findings and recommendations to the General Assembly by January 1, 2006.

Pilot Program for Young Adults with Mental Disorders and Other Conditions

HB 7000 requires the DSS commissioner to implement a two-year pilot program for up to 100 people ages 19 to 21 who (1) live with a parent or relative caregiver, (2) have been diagnosed with one or more mental disorders and a chronic health condition, (3) have a substantial functional impairment as a result of the mental disorder or chronic health condition, and (4) are ineligible for State Administered General Assistance because their parents' or relative's income is too high. Individuals who are eligible for the pilot program’s benefits must cooperate in establishing eligibility for Medicaid based on disability.

Funding. sHB 6940 contains $ 500,000 in both FYs 06 and 07 for this pilot.

PRIVATE PROVIDER RATE INCREASE

sHB 6940 gives a 4% rate increase to private agencies with which DMHAS and DCF contract for services to children and adults with psychiatric disabilities. It contains $ 4. 8 million in FY 06 and $ 6. 4 million in FY 07 for DMHAS contracts and $ 8 million in FY 06 and $ 10. 7 million in FY 07 for DCF. DCF’s funding covers all its private providers, not just those providing behavioral health services.

SS/NA/JS: ro