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Depressed Americans Are Not Seeking Treatment
January 25, 2010

It's a dangerous reality. A new study suggests that half of all depressed Americans are not getting treated for it.

When sadness interferes with everyday life, that's when depression sets in. Left untreated depression at worse can lead to suicide. Dr. Debra Wentz, CEO of the New Jersey Association of Mental Health Agencies, says one big reason for people not getting tretment has to do with stigma and discrimination.

"Other reasons though has to do with lack of access o healthcare, and for undocumented people, it has to do with fear of being caught." says Wentz.

Of those surveyed, 8.3 percent had major depression, and about 50 percent of those with the condition received at least one type of treatment. However, only about 21 percent had therapies that followed accepted treatment guidelines from the American Psychiatric Association.

The study also showed that Mexican Americans and African Americans were least likely to get treatment. 

Omnibus Passes Funding Federal Agencies

On Sunday, December 13, the Senate approved a $447 billion omnibus bill – a package of six appropriations bills funding dozens of federal agencies for the federal fiscal year that began October 1, 2009.  The House of Representatives passed the omnibus measure on December 10.

The package also contains about $650 billion in payments for programs including Medicare Medicaid, and Social Security, funding based on formula that cannot be changed by Congress. 

The bill now goes to President Obama for his signature into law.

The omnibus measure includes Labor-HHS-Education.  The only remaining appropriations measure is the defense bill.

MHA reported the following funding increases to the Center for Mental Health Services (CMHS) at the Substance Abuse and Mental Health Services Administration (SAMHSA):
· Children's Mental Health ($13 million increase)
· State homelessness grants to provide homeless and seriously mentally ill individuals with community-based support services (PATH; $5 million increase)
· Expanded initiative to integrate primary and behavioral health care for Americans with severe mental illnesses ($7 million increase)
· Project Launch, designed to promote wellness in young children ($5 million increase)
· Suicide prevention efforts ($1.5 million increase)
· Addressing the needs of children with Post-Traumatic Stress Disorder ($2.8 million increase).

Other SAMHSA increases include:
· $20 million increase for the Substance Abuse Block Gran
· $40.3 million increase in substance abuse treatment, mainly for drug treatment courts
· $1.2 million increase for substance abuse prevention.

Other Crucial Programs:
· Housing:  $50 million increase for Section 811 Supportive Housing (from $250 million to $300 million).
· Juvenile Justice:  Nearly a $45 million increase for juvenile justice programs (from nearly $300 million to slightly over $345 million).
· Mentally Ill Offender Treatment and Crime Reduction Act:  $2 million increase (from $10 million to $12 million).

U.S. Senate Health Care Bill Moves to Floor Debate

Senate Majority Leader Harry Reid unveiled his health care proposal, "The Patient Protection and Affordable Care Act" (H.R. 3590) on November 18th.   On November 21, the Senate voted by a 60 to 39 to move the bill to the floor for debate.  

Senate Majority Leader Harry Reid is aiming for final passage by Christmas
The Congressional Budget Office (CBO) estimates that the Senate bill would cost $848 billion dollars over 10 years and would reduce the deficit by $130 billion.  It would extend coverage to 94 percent of eligible Americans. 

The House health care reform version, "The Affordable Health Care for America Act (H.R. 3962), was approved November 7th. 

Parliamentary procedural hurdles must be cleared in order to begin debate on the Senate bill.  What happens next:  The Senate brings its bill to the floor for debate and vote; assuming the bill passes the Senate, both the House and Senate will meet in conference to resolve the differences between the two versions.  A conference report will be produced, and it must be approved by both the House and Senate.  The bill then must pass the Senate and the House.  If passed by both chambers, it goes to the president for signing.

Reuters reports that Senate Majority Leader Harry Reid said the Senate will vote Saturday, November 21, on a procedural move to begin debate on the Senate's health care reform bill. "If the Senate agrees to take up the bill, the debate is expected to begin on Nov. 30, after the U.S. Thanksgiving holiday next week, and last for at least three weeks."

Among the key provisions, based on only a preliminary review at this time, the Senate proposal includes:

Creation of a public option, a government health insurance plan, which would compete with private insurers. However, states would be able to opt-out.  The House version contains a public option, but does not include an opt-out provision.

Establishment of Health Insurance Exchanges where individuals and small businesses could purchase health care coverage.  These exchanges include mental health and substance abuse services and apply parity to the benefit packages.

Prohibition of insurers refusing coverage based on pre-existing conditions.

Expansion of the Medicaid program, for adults and children, from 100 percent of the federal poverty level (FPL) up to 133 percent of FPL.  In contrast, the House version would expand Medicaid to those up to 150 percent of FPL.

Health Homes for chronic conditions, including mental illnesses and substance abuse. (Also included in House version)

Co-location of primary and specialty care in community-based mental health settings. (Also included in House version)

Extension of Federal Medical Assistance Percentages (FMAP) for an additional six months.

Not included in Senate bill, based on a preliminary review at this time:

Federally Qualified Behavioral Health Centers (FQBHCs), which would provide treatment and support services such as:  screening and assessment, outpatient clinic mental health services, medication anagement, integrated treatment for menal illness and substance abuse, and crisis mental health services.  FQBHCs are included in the House health reform bill.

Medicaid funding of Therapeutic Foster Care services.  In contrast, the House bill does allow states to fund Therapeutic Foster Care under Medicaid.

Coverage of Licensed Professional Counselors (LPCs) and Licensed Marriage and Family Therapists (LMFTs) under Medicare, but the House bill does.

Extension of 340B discount pricing to community mental health services.  The House bill does.

The Senate bill exceeds 2000 pages and was just released, so NJAMHA is still in the process of analysis, along with other advocacy organizations.  As more details emerge, NJAMHA will advise.  This initial report on the content of the bill may also need to be modified as more details become available.


Health Care Reform: Behavioral Health

NJAMHA CEO, Debra Wentz, along with NJAMHA consultant Carolyn Bray, attended the National Council of Community Behavioral Healthcare's Public Policy Committee meeting Thursday, October 29.   Not surprisingly, chief among the topics was Health Care Reform.

Almost impeccably timed with the Council’s Public Policy Committee meeting, on the status of health care reform, was news that the U.S. House of Representatives had just released its health reform bill, the Affordable Health Care for America Act (H.R. 3962), sponsored by Rep. John D. Dingell [D-MI] with two New Jersey representatives among the six cosponsors – Congressmen Frank Pallone, Jr. [NJ-District 6] and Rob Andrews [NJ-District 1]. 

At the time of the House announcement, the National Council elatedly announced that the House bill maintained the establishment of Federally Qualified Behavioral Health Centers (FQBHCs) nationwide to provide coordinated and affordable care that was in earlier House versions.  The National Council was instrumental in assuring the inclusion of this provision.

The National Council has successfully advocated for the inclusion of behavioral health care in several health care reform provisions, within both the House and the Senate.  The inclusion in the final House reform bill of FQBHCs is but one example of the National Council’s influence, which has been bolstered by the strong legislative support and active participation of the Council’s provider association members, including NJAMHA. 

In addition to FQBHCs, other prime examples of the community’s successful advocacy include urging lawmakers to mandate the application of behavioral health parity to all plans offered in healthcare reform/insurance exchanges - that would begin in 2013 and be open to individuals and small employers; to modify a Medicaid Medical Home State Plan Option to include persons with diagnoses of serious mental illness and extend eligibility to participate to behavioral health organizations; and to assure that behavioral health coverage to single, childless adults would be covered at full actuarial value and that the benefits would be mandatory, not optional. 

Further, via amendment process or a standalone bill, the National Council is working with key members to push for the inclusion of community mental health providers as eligible entities to qualify for Health Information Technology (HIT) incentive payments.  As of now, community mental health providers are not included.

Continued vigilance and advocacy by the provider community are still vital to assure, in final health reform legislation, that the behavioral health community is sufficiently funded, staffed and adequately prepared to meet new service demands, regulations and other challenges.  The behavioral health community must brace for what likely will be a rapid and significant increase in the demand for behavioral health services that comes along with the increase in the number of insured individuals. 

The expansion of Medicaid is another feature of health care reform in the House bill that will require continued vigilance by providers.  The House chose the less costly alternative to cover additional lives by expanding Medicaid eligibility, to cover all non-elderly individuals with incomes up to 150 percent of the federal poverty level (FPL), over the more costly option of subsidies to assist in the purchase of coverage. 
Although the federal government may pick up the full cost of the expansion in 2013 and 2014, the federal government would reduce its share and states would then have to fill the gap.  There is an abundant amount of advocacy work still ahead to be sure.

Beginning the week of November 1, the House is expected to debate and vote on H.R 3962.  There is speculation that the House would like to put the bill to vote before leaving for Veterans’ Day on November 12.
In general, the House bill would cover 36 million people who are currently uninsured.  About 15 million of would enroll in Medicaid, and an additional 21 million would purchase coverage from a new national insurance exchange.  The Department of Health and Human Services (DHHS) and providers would negotiate rates, which differs from an earlier version of health care legislation that would have pegged rates to Medicare rates for doctors/providers.  In New Jersey, overall, that would have been advantageous since Medicaid rates, on average, are below Medicare levels.  However, the final bill deviated from that approach to quell concerns of rural states that already receive low Medicare reimbursement rates.  

The House bill also would impose strict rules on insurance companies that would ban denials of coverage on the basis of preexisting conditions.  The House bill would require employers to provide insurance to employees or pay a penalty.  Employers with payrolls of less than $500,000 annually would be exempted from this provision.

In the Senate, Majority Leader Harry Reid [D-Nev.] is putting the finishing touches on a bill that will merge health reform legislation of two Senate committees, the Senate Health, Education, Labor and Pensions and the Senate Finance Committees.  The House and Senate bills differ on how to pay for the reform with the House taxing high earners (above $500,000/year) while the Senate favors taxing high-cost benefit insurance policies.  Both bills include a government insurance plan, but the Senate version contains a public option that would allow states to opt out.  New Jersey Governor Jon Corzine has been reported as favoring opting into a public option plan, if this option should come to pass.

NJAMHA is in the process of reviewing key provisions of the House bill, with a focus on the impact on the behavioral health community, and will report more details as the analysis is completed.


Federal Agency Funding at 2009 Levels

In the absence of completed appropriations bills, and in order to keep the federal government operational, a Continuing Resolution (CR) by the Senate as part of the House-Senate Conference Report on H.R. 2918, the Legislative Branch Appropriations Act 2010, was signed into law by President Obama on October 1.

The CR, included in H.R. 2918, provides funding to federal agencies at 2009 levels through October 31, 2009.  Close to all federal agencies will be funded at the lower 2009 levels.  However, there are a few exceptions.

Exceptions to the programs funded at 2009 levels are veterans’ medical accounts and the Census Bureau, in preparation for the 2010 census.  They will be funded above 2009 levels.  Also, the Low Income Home Energy Assistance Program [LIHEAP] will be funded at the level provided in the fiscal year 2010 Labor-Health and Human Services appropriations bills.

A number of programs due to expire the end of September 2009 were extended a month.  Two of these are the Ryan White Program (the federal program designed specifically for people with HIV) and the Child Nutrition Program.


Health Reform Committee Amendments

After releasing the Chairman’s Mark of the America's Healthy Future's Act, and members of the Senate Finance Committee had the opportunity to file amendments, the committee began consideration of the amendments.

On September 22, the Senate Finance Committee accepted, among others, an amendment filed by Senator Olympia Snowe (R-ME) that would modify current Medicaid policy prohibiting reimbursement to inpatient facilities known as Institutes of Mental Disease (IMD).  The Snowe amendment would establish a three-year, $75 million demonstration project for up to eight states to expand the number of emergency inpatient psychiatric care beds available in communities that provide services to Medicaid beneficiaries between the ages of 21 and 64. 

This project would allow states to cover patients in non-public, freestanding psychiatric hospitals and receive federal Medicaid matching payments to demonstrate that covering patients in these hospitals will improve timely access to emergency psychiatric care, reduce the burden on overcrowded emergency rooms, and improve the efficiency and cost-effectiveness of inpatient psychiatric care. 

Currently, psychiatric hospitals are required to provide these emergency services under the Emergency Medical Treatment and Active Labor Act (EMTALA), but these facilities are ineligible to receive federal matching payments because of the federal rules prohibiting IMDs from receiving federal Medicaid reimbursement.  The services eligible for federal payments under the demonstration projects are limited to emergency psychiatric treatment and stabilization.

Further, the National Council for Community Behavioral Healthcare reported on two amendments filed that relate to mental health:

The Senate Finance Committee passed the Stabenow/Wyden/Kerry Amendment applying the Wellstone/Domenici mental health and addiction parity law to all benefit packages offered through the exchanges for the individual and small group markets. 

The intent of two amendments, one introduced by Sen. Bingaman and the other by Sen. Stabenow, pertaining to the State Medicaid Option Promoting Health Homes and Integrated Care have been met; Chairman Max Baucus released modifications to his draft bill that now include:

Community mental health centers (CMHCs) would be deemed eligible as providers for this demo.  They were previously listed as one of the specialties excluded as eligible.

*  A clarification was provided that Medicaid beneficiaries with “at least one serious and persistent mental health condition” would be eligible to receive services through the demo.

NJAMHA will continue to report on other amendments accepted.  You may view other changes, which are available on the Senate Finance Committee's Web site.

Recent Votes: House of Representatives

Housing and Transportation Appropriations Bill
By a vote of 256-168, the House of Representatives passed an appropriations bill (HR 3288) on July 23, 2009 funding housing and transportation for federal FY 2010.  The bill provides $68.8 billion in discretionary spending and $123.1 billion in total spending for transportation, housing, and urban development programs.  The House had rejected an amendment that had proposed a five percent across-the-board cut in the bill, which would have cut $3.4 billion from the bill's $68.8 billion in discretionary spending.

Specific to housing, the bill appropriates $18.2 billion in Section 8 vouchers for low-income tenants; $8.7 billion in Section 8 funds to provide low-income housing for the elderly, disabled and others; $7.3 billion for public housing maintenance and repairs; $1.85 billion to help communities house the homeless; and $350 million in housing aid for those with AIDS.

Included is a $173 million increase for homeless programs under the McKinney-Vento Homeless Assistance Act, raising funding to $350 million.  It is anticipated that the Senate will begin work on its version of the funding bill the last week of July.

New Jersey’s House representatives voting yes to pass the bill:  NJ Congressmen John Adler, Rob Andrews, Frank LoBiondo, Rush Holt, Frank Pallone, Jr., Donald Payne, Steven Rothman, Albio Sires, and Chris Smith.  Voting no:  NJ Congressmen Scott Garrett, Leonard Lance, and Rodney Frelinghuysen.

Departments of Labor, Health and Human Services, and Education Appropriations Bill
By a vote of 264 – 153, the House passed HR 3293, making appropriations for the Departments of Labor, Health and Human Services, and Education for the federal fiscal year ending September 30, 2010.  The bill provides $160.7 billion in discretionary spending and $567 billion in mandatory spending for health, education, and labor programs in fiscal 2010.

Within the bill, $31.3 billion is dedicated to the National Institutes of Health; $14.5 billion in Title I education funds for disadvantaged school districts; $11.5 billion in Individuals With Disability Education Act (IDEA) payments to school districts; $6.7 billion for public health programs; $5.1 billion for to help the poor pay heating bills; and $1.4 billion in job training funds.

The bill ends a 21-year ban on funding needle-exchange programs.

Voting yes:  NJ Congressmen Rob Andrews, Frank LoBiondo, John Adler, Chris Smith, Frank Pallone, Jr., Steven Rothman, Donald Payne, Rush Holt and Albio Sires.

Voting no: NJ Congressmen Scott Garrett, Leonard Lance, and Rodney Frelinghuysen. 

House Passes the Frank Melville Supportive Housing Investment Act of 2009
On July 22, 2009, by a vote of 376-51, the Frank Melville Supportive Housing Investment Act of 2009 passed the House of Representatives.  The vote was held under a suspension of the rules to cut debate short and pass the bill, needing a two-thirds majority.

The bill amends section 811 of the Cranston-Gonzalez National Affordable Housing Act to improve the program under such section for supportive housing for persons with disabilities (Retains authority to provide such assistance to private nonprofit organizations to expand the supply of such housing.) 

The bill repeals the authority of the Secretary of Housing and Urban Development to provide tenant-based rental assistance directly to eligible persons with disabilities; revises tenant selection procedures; and requires a lease between a tenant and a housing owner to be for at least one year.

The bill would reform Section 811 and stimulate additional new rental housing units by:  authorizing a new Section 811 Demonstration Program to promote more integrated housing opportunities, and enacting improvements to the existing Section 811 production program to sustain the program's viability.

The bill was introduced by Congressman Chris Murphy (D-CT) and Congresswoman Judy Biggert (R-IL).  New Jersey Congressman Albio Sires is one of the bill’s ten co-sponsors.

Congressman Scott Garrett was the lone NJ Congressman to vote in opposition.

The bill now goes to the Senate to be voted on.  Debate may occur on a companion bill in the Senate, S 1481.  S 1481 is sponsored by New Jersey Senator Robert Menendez.


National Budget News

President Obama just released his full budget providing a more detailed account of the budget blueprint recently approved by Congress.  He proposed a detailed fiscal year 2010 federal budget that reduces or terminates 121 programs for a $17 billion savings in a proposed $3.4 trillion federal budget.  Of the $17 billion of proposed savings, around half of the cuts relate to the defense budget. 

The cuts proposed, if adopted by Congress, reportedly may not reduce government spending.  Instead, President Obama’s proposed budget may increase overall spending on the president’s priorities including health care reform, and any reductions or savings would be shifted to the president’s priorities. (Washington Post, May 7, 2009)

Secretary Kathleen Sebelius, U.S. Department of Health and Human Services (DHHS), presented an overview of the president’s budget for the department.  As expected, health care reform is a high priority.  The president’s 2010 budget establishes a health care reserve fund of $635 billion over 10 years to finance health reform that is expected to reduce spiraling health care costs, improve quality, and assure coverage for all Americans.  The reserve is funded by new revenue and by savings from Medicare and Medicaid. 

Also highlighted were increased funding for a Medicare Integrity Program that will help fight fraud and abuse  The budget also calls for over $1 billion in funding to increase the number of nurses, doctors, and health care workers in this country, especially in areas that are traditionally underserved, and includes funding to help eliminate health disparities.  Sebelius cited quality and access to care as critical components of the president's reform plan.

Overall, President Obama's proposed budget includes a total of $879 billion for the DHHS in FY 2010, an estimated $63 billion increase over FY 2009. Highlights from the DHHS budget-in-brief released today are included below:

Eroding Block Grant Funding:  The Community Mental Health Services Block Grant (level funding at $421 million), the Social Services Block Grant (level funding at $1.7 billion), and the Substance Abuse Prevention and Treatment Block Grant (level funding at $1.8 billion) are funded at the same levels as FY 2009, which constitutes a cut. 

Expanding Drug Courts:  The Administration is requesting $59 million to expand the treatment capacity of drug courts, an increase of $35 million.

Expanding Supply of Nurses:  $263 million, an increase of $92 million, is proposed to address the shortage of nurses.

Increasing Funds to the Substance Abuse and Mental Health Services Administration (SAMHSA):
The FY 2010 budget requests $3.5 billion for SAMHSA, an increase of $59 million above FY 2009 to support prevention and treatment services for mental illnesses and substance abuse. The budget in brief also includes $102 million, an increase of $2 million, for the administration of SAMHSA programs and the support of national data collection efforts to enable SAMHSA to continue to support states promote quality behavioral health services.

Integrating Substance Abuse Screening and Interventions into General Medical Settings: $29 million is proposed toward this effort. 

Supporting Mental Health:  The budget proposes $986 million, an increase of $17 million, for the prevention and treatment of mental illness.

Supporting Children’s with Serious Emotional Disorders:  The budget proposes the provision of $125 million, an increase of $17 million, for grants to states and localities to support the development of comprehensive community-based systems of care for children and adolescents with serious emotional disorders.

Addressing Homelessness:  A total of $103 million, an increase of $8 million, is slated for community-based services for individuals suffering from severe mental illness who are facing homelessness.  This includes $68 million, an increase of $8 million, for the Projects for Assistance in Transition from Homelessness (PATH) formula grant that allows local programs to use their grant funds in ways most appropriate to their communities to assist in the transition from homelessness. The total also includes $35 million to support services, in coordination with existing permanent supportive housing programs and in other community-level settings, for individuals and families experiencing chronic homelessness.

Preventing Suicide:  The proposed budget includes $47 million specifically targeted to prevent suicide and continues to support activities authorized by the Garrett Lee Smith Memorial Act, which supports interventions in schools, juvenile justice systems, and other youth support organizations.

Protecting Individuals with Mental Illness: Unfortunately, the budget proposes $36 million, the same level of funding as FY 2009, to support States in protecting individuals with mental illnesses and serious emotional disturbances from abuse, neglect, and civil rights violations.

Expanding Funds for the Low Income Home Energy Assistance (LIHEAP): The Budget requests $3.2 billion for the LIHEAP program to help low-income households heat and cool their homes.

Strengthening Communities Fund: The Budget provides $50 million in FY 2010 for the Strengthening Communities Fund (SCF), a new effort created through the Recovery Act and funded at $50 million in FY 2009. Funds will be used to build the capacity of faith-based and community-based non-profits to serve low-income and disadvantaged populations through expanding service delivery, increasing community access to public benefits, and helping individuals of low and moderate-income secure and retain employment. The SCF replaces the Compassion Capital Fund.

Holding Support Funding Stagnant As Related to Developmental Disabilities: The budget requests $184 million, the same as FY 2009, to help ensure that individuals with developmental disabilities have opportunities to contribute to and participate in all facets of community life and can access culturally competent support services that are consumer-centered.

Increasing Support of Minority Health:  The OMH Budget request of $56 million, an increase of $3 million above the FY 2009. The Budget request will provide funding to continue disease prevention, health promotion, service demonstration, and educational efforts to reduce and ultimately eliminate disparities in racial and ethnic minority populations. The $3 million will assist States in strengthening their existing health care infrastructure for serving racial and ethnic minorities, including developing State-wide collaborations and ensuring the use of best practices. The increase is part of an HHS-wide effort to more effectively address diversity in FY 2010.

Increasing “Savings” in Medicaid:  The President’s Budget includes $1.5 billion in savings to Medicaid in FY 2010 and $22 billion over ten years.

Proposing, Legislatively, Qualified High-Risk Pools:  State high-risk health insurance pools target certain individuals who cannot otherwise obtain or afford health insurance in the private market, primarily due to pre-existing health conditions. The Budget proposes $75 million in mandatory funds for FY 2010 to be used towards helping States offer health insurance options for hard-to-insure populations.

Converting to ICD-10:  The budget includes $62.5 million to begin converting to ICD-10, a classification system of diseases, injuries, and medical conditions developed by the World Health Organization. The ICD-10 code set, currently used by much of the industrialized world, will make it easier to determine if a claim was appropriately billed, provide more specific data necessary for value-based purchasing, and prevent fraud and abuse. Regulations promulgated on January 2009 require CMS and other insurers to convert to ICD-10 by October 1, 2013.

Expanding Research, Demonstrations and Evaluation: The FY 2010 Research, Demonstrations and Evaluation budget request is $57.0 million, a $27.0 million increase over FY 2009. Of this total, $30 million will be dedicated to expanding the Medicare and Medicaid research agenda. CMS will develop new demonstration and pilot projects that will focus on payment reforms such as better aligning provider payments with costs, providing higher quality care at a lower cost, and improving beneficiary education.

NJAMHA will continue to track updates as the budget wends its way through the budget process.


CMS Rescinds Harmful Regulations

NJAMHA is pleased to report that CMS plans to rescind the Medicaid final rules on Targeted Case Management and Hospital Outpatient Clinic Services.  These rules had threatened to dramatically reduce the levels of federal financial support for, and narrow the scope of, Medicaid services critical to the support and recovery of individuals with mental illnesses.

NJAMHA vigorously advocated with New Jersey's congressional delegation to prevent the implementation of these rule, as their implementation would have a deleterious impact on persons with mental illnesses and the providers that serve them.  In fact, over the past two years, NJAMHA has included its concerns about these regulations in its annual D.C. visits to the state's congressional delegation.

During 2007, the Centers for Medicare and Medicaid Services (CMS) issued seven Medicaid regulations that threatened to dramatically reduce the levels of federal financial support for, and narrow the scope of, critical Medicaid services, including rehabilitative services, targeted case management and outpatient hospital clinic services.  These rules, promulgated under the direction of the previous administration, constituted unilateral actions by CMS in the absence of Congressional authorization.

The CMS will issue a proposed rule in the May 6, 2009 Federal Register rescinding the December 2008 final rule entitled "Clarification of Outpatient Hospital Facility (Including Outpatient Hospital Clinic) Services Definition" and certain provisions of the December 2007 interim final rule entitled "Optional State Plan Case Management Services." (Targeted Case Management), including the prohibition against "bundling" of rates and the "intrinsic element" test (denying reimbursement for case management services that are part of another program).

The Bush administration had projected that the total seven Medicaid rules CMS had proposed or finalized would have reduced federal Medicaid payments to states by a total of approximately $15 billion over the next five years, but according to states' estimates, the regulations would have reduced federal payments $49.7 billion over five years, over three times the Bush administration's estimate.

If implemented, New Jersey could have realized a $4.5 million reduction in federal payments in FY 2008 as well as $55 million over 5 years under the CMS rehabilitative option services regulations and $95.7 million between FY 2008 and FY 2012 under the CMS case management interim final rule.  This does not even include the losses if the other CMS Medicaid rules were implemented.

However, a March 2008 report presented to the United States House of Representatives Committee on Oversight and Government Reform, prepared by majority staff, not only projected considerably higher reductions to most states in federal financial support, but also found that: 

The combined effect of the reductions in federal funds from all seven regulations represented a major fiscal blow for many states;
The regulations would reduce federal spending by shifting costs, not through greater efficiencies;
The regulations would disrupt existing systems of care for fragile populations;
The regulations threatened the financial stability of the hospitals, emergency rooms, and clinics that treat Americans without health insurance;
The regulations would impose significant administrative burdens and costs on state Medicaid programs;
The impact of the regulations extended beyond Medicaid beneficiaries; and
The regulations did not have the support of the State Medicaid Directors

In New Jersey, hospital closures, a growing uninsured and underinsured population, insufficient funding of safety net programs, and state budget shortfalls would have magnified the effect of these federal cuts. 

No doubt that if these regulations were to have been implemented, safety net programs serving adults with mental illnesses and children with serious emotional and behavioral disorders would have closed their doors or substantially reduced services and served far fewer individuals at-risk. 

As reported by the National Council for Community Behavioral Healthcare, since the other Medicaid regulations of concern, including the rehabilitative services rule, had not yet been adopted, they do not need to be rescinded.  The Council adds that "…the Obama Administration has given every indication that it does not plan to implement…" the other Medicaid regulations. 


Senate Budget Hearings: DHS – Preferred Drug Lists on the Horizon

On April 15, the Department of Human Services (DHS) testified before the New Jersey Senate Budget and Appropriations Committee on the department's proposed FY 2010 budget.  Senator Barbara Buono (Legislative District 18) serves as the Chair of the committee, and Senator Paul Sarlo (Legislative District 36) serves as the committee's Vice Chair.

DHS Commissioner Jennifer Velez reported that the FY 2009 DHS budget totals $4.9 billion in state share dollars. However, due to the current year shortfall, DHS had offered $108 million as part of the FY 2009 midyear reductions.  For FY 2010, DHS proposes a budget of $4.6 billion, a reduction of $366 million or 8 percent, even after covering over $490 million in entitlement or other mandatory growth obligations.

Peppered throughout the commissioner's testimony, and prefacing many budget committee members' questions, there was a repeated recognition of the nation's unrelenting economic recession and the staggering state budget shortfalls that are occurring not only in New Jersey, but also in countless states across the country.

Commissioner Velez, throughout her testimony, reminded the committee that although this was a difficult budget year with very difficult choices, DHS remained focused on minimizing "…any detrimental effect of these choices upon the individuals who rely on our [DHS] services."  Nonetheless, despite the Commissioner's sincere efforts, hard work, and dedication to spare vulnerable individuals served by DHS, the proposed budget does contain cost "savings" that will undoubtedly deleteriously affect adult and child recipients of DHS services and supports, eligible due to disability or severe financial constraints.

Among these harmful "savings" are Medicaid co-payments for prescription drugs in the amount of $2.00 per prescription with a cap of $10.00 per month, or $120.00 a year.  For several years, the state has proposed various co-payments, which the stakeholder community and the Legislature have successfully fended off.  Commissioner Velez argued that instituting co-payments was a more acceptable alternative to eliminating Medicaid optional services, which include pharmaceuticals, prosthetics and various life-saving supports, an option that did receive some attention during budget deliberations, but would have been a much more Draconian alternative.

Numerous national studies have shown that prescription drug co-payments, in particular, have an adverse effect on consumer use of medication as prescribed.  Consumers, particularly those who are disabled and economically disadvantaged, will simply forego filling their prescriptions in favor of meeting their basic needs, such as food and shelter.  NJAMHA continues to take an active and strong stand in opposition to these co-payments.  Several committee members voiced their opposition to these co-payments, as well.

Another area of serious concern is the $10 million in "savings" that has been booked in the proposed budget.  In response from a committee member as to whether these savings would be realized through the implementation of a Medicaid Preferred Drug List (PDL), Commissioner Velez and Division of Medical Assistance and Health Services (DMAHS) Director John Guhl responded that this was a possibility.  Commissioner Velez and Guhl stated that DHS must develop a plan, by January 1, 2010, that will generate $10 million in additional pharmaceutical savings.  They added that while the language was general, a PDL was definitely on the table given the dire budget situation.  The committee member made it clear that the Legislature did not have the "stomach" for a PDL.  Commissioner Velez and Guhl underscored their intent to engage in a dialogue with stakeholders, between now and January, to discuss ways to realize these savings and possible alternatives. 

There were several concerns expressed by committee members on the Senate (S 2654) and Assembly (A 3625) bills that would provide a plan to rebalance state resources to provide community services and supports for persons with developmental disabilities.  A component of the plan is to consolidate and close several developmental centers, retaining one each in the northern and southern portions of the state.  Commissioner Velez was asked if the state supports the legislation.  She responded that DHS supports the closures, but there must be assurances that a robust community system of care is in place prior to any closures.  Both Commissioner Velez and Ken Ritchey, Assistant Commissioner, Division of Developmental Disabilities, emphasized that the safety of the individuals transitioning is paramount and expressed some concern with the pace of the bill's plan.

Senators Stephen Sweeney (Legislative District 3) and Marcia Karrow (Legislative District 23) asked Commissoner Velez about the proposed rule DHS/DMAHS published in the April 6, 2009 NJ Register on general acute care hospital rebasing, which would establish a new diagnosis related group (DRG) rate setting methodology using hospital paid claims data, as the present DRG methodology was seriously out-of-date and not reflective of advanced medical procedures.

The new DRG rates will reimburse New Jersey general acute care hospitals for Medicaid fee-for-service inpatients and will also be used to price inpatient charity care claims used to determine annual charity care subsidy payments to hospitals, with some hospitals seeing increases and others experiencing losses of between $1 million and $2 million.  DHS testified that after several models were run by an independent entity, it selected the methodology that would minimize the impact on any hospital while protecting safety net hospitals and two most utilized Medicaid services – high risk maternity and mental health.  Sen. Karrow remains concerned that any losses would place hospitals in further peril, particularly since those at risk are reeling from inadequate Medicaid reimbursement rates. 

Sen. Karrow, once Vice Chair of the Hunterdon Human Services Advisory Council (HSAC), expressed concern about the loss of HSAC funding that occurred when the Department of Children and Families (DCF) was newly formed and "took" that pot of money.  Sen. Karrow lamented the loss of the councils and praised them for the extensive work they accomplished regarding allocations, audits, contract reviews and other tasks, thereby relieving DHS from some of these responsibilities - all for only about $60,000/county. 

Sen. Karrow asked if DHS could "capture that money" again.  Commissoner Velez answered that this is but one of a number of issues she is trying to figure out that resulted after the split from DHS.  Commissioner Velez also publicly praised the HSACs in their success in leveraging Continuum of Care (CoC) Homeless program funds.  Commissioner Velez reported that she and DCF Commissioner Kim Ricketts are in discussions on exploring what can be done to restore the HSAC funding with non-state dollars. 

There was some good news.  Commissioner Velez was able to report the expansion of categorical eligibility for households is up from 135 percent to 185 percent of the Federal Poverty Level (FPL), starting as early as the fall of this year. It is anticipated that an additional 35,500 households will qualify for additional supports.  DHS has also worked on streamlining the application process through development of online applications and telephone interviewing to aid seniors and individuals with disabilities. 

Further, the American Recovery and Reinvestment Act of 2009 (ARRA) brought $2.2 billion, over 27 months, in federal stimulus dollars to Medicaid – approximately $600 million for FY 2009, just over $1 billion for FY 2010 and the balance of $500 million for FY 2011.  This additional funding obviates the need for deeper service reductions and provides federal financial support to assist in addressing increasing caseloads in essential DHS programs.

As related to NJ FamilyCare, if the DHS recommended appropriation is approved, premiums for children with family incomes from 151 percent to 200 percent of the FPL would be eliminated.  The elimination of the premium for children will ensure that more children in need will maintain their health coverage.  However, the enrollment of parents with income from 151 percent to 200 percent of the FPL would be closed, to realize a savings of about $9.7 million.

As related to mental health, Commissioner Velez reported substantial progress over the past year, including treatment improvements, the opening of a patient self-help center on the grounds of Ancora, implementation of the evidence-based practice of peer support and reductions in patient census, although the state is awaiting the findings from a review by the U.S. Department of Justice.  

She also mentioned that the Division of Mental Health Services (DMHS) Olmstead efforts have significantly reduced state hospital census, which is reportedly the lowest in the state's history of operating state hospitals, despite the state's population growth.

Among those testifying alongside DHS Commissioner Jennifer Velez were DHS senior staff Kevin Martone, Deputy Commissioner of DMHS, Divisions of Addiction Services (DAS) and Deaf and Hard of Hearing (DDHH) and the Commission for the Blind and Visually Impaired (DCBVI); John Guhl, Director of DMAHS; Jon Poag, Acting Assistant Commissioner of DMHS; and DDD Assistant Commissioner Ritchey. 

NJAMHA will continue its coverage of the FY 2010 state budget as more details emerge.


NJAMHA Meets with Congressional Delegation in D.C.

On March 25th, NJAMHA CEO Debra L. Wentz visited the Washington D.C. offices of key members of New Jersey’s Congressional delegation to discuss federal issues directly affecting NJAMHA member organizations. 

Member visits were made to the offices of U.S. Senators Robert Menendez and Frank Lautenberg.  On the House side, NJAMHA visited the offices of Congressmen Frank Pallone, Jr. (District 6), member of the House Energy & Commerce Committee and Chair of the committee’s Health Subcommittee; Congressmen Leonard Lance (District 7), member of the House Financial Services Committee; and John Adler (District 3), member of the House Financial Services Committee.

We were pleased to have had an opportunity to speak directly with Senator Menendez who had just come from a meeting held by President Obama with lawmakers on the priorities of Obama’s federal FY 2010 budget proposal, of which health care ranked among the top three priorities, along with education and energy.  NJAMHA thanked the senator for the key role he played in allowing New Jersey to continue eligibility for the State Children’s Health Insurance Program (SCHIP), NJ FamilyCare, for households with incomes up to 350% of the federal poverty level, one of the highest in the nation, and for lifting the five year bar that prevented lawful immigrant children from applying to receive SCHIP benefits during this period.

NJAMHA received a warm welcome from freshman Congressman Leonard Lance.  Congressman Lance moved to the U.S. House of Representatives from the New Jersey Legislature, where he served as a member of the State Senate beginning in 2002, representing New Jersey’s 23rd Legislative District.  Congressman Lance has steadfastly supported the mental health community in his State legislative service, and we are confident of his continued support as a member of New Jersey’s Congressional delegation.

Among NJAMHA’s “asks”, during the meetings, were stopping the implementation, or preventing the issuance, of the potentially harmful Medicaid regulations promulgated by the Centers for Medicare & Medicaid Services (CMS) in 2007 and 2008, under the previous administration; and asking for their support of the Community Mental Health Services Act (H.R. 1011), which contains provisions for co-location of behavioral and primary health services in mental health settings, integration of treatment for co-occurring mental health and substance abuse disorders, strengthening of the mental health workforce, grants for mental health education and training programs and health information technology for mental health providers.  All were receptive to the provisions of the act, with Congressmen Adler’s and Lance’s offices agreeing to consider NJAMHA’s request for their co-sponsorship. 

As related to the federal FY 2010 budget, among NJAMHA’s requests were appropriations of $35 million for primary and behavioral healthcare integration in mental health provider organizations and a $100 million increase for the Community Mental Health Services Block Grant.

The NJAMHA contingency heartily thanked all of the lawmakers visited for their votes to pass the Children’s Health Insurance Program Reauthorization Act of 2009 (CHIPRA) that will extend CHIP health care benefits to tens of thousands of additional children in New Jersey who would otherwise be ineligible.  CHIPRA also contains a parity provision that places mental health benefits on par with the customarily richer primary health care benefits. 

NJAMHA also expressed sincere appreciation for lawmakers’ advocacy in derailing the potentially deleterious Medicaid regulations and for those who voted in favor of the American Recovery and Reinvestment Act of 2009, which brought New Jersey an increase in the Federal Medical Assistance Percentage (FMAP) to stave off additional cuts to Medicaid programs that support many of the consumers served by NJAMHA members. 

Joining CEO Wentz on the visits were several members of NJAMHA’s Board of Directors including: Chris Kosseff, President/CEO, University of Medicine and Dentistry of New Jersey University Behavioral HealthCare; Harry Marmorstein, President/CEO, The Lester A. Drenk Behavioral Health Center; and William Sette, President/CEO, Preferred Behavioral Health of NJ.  Others included Alexa Eggleston, Director of Public Policy, National Council for Behavioral Healthcare; Colleen Dorney, Corporate Development Assistant, Preferred Behavioral Health of NJ; and Carolyn Bray, Health Policy Consultant, New Jersey Association of Mental Health Agencies.

For additional information on the visit, contact Carolyn Bray at cbray@njamha.org.


Five Year Wait for Legal Immigrant Children Almost Over

New Jersey Division of Medical Assistance & Health Services is seeking amendments to the Title XIX and XXI State Plans and 1115 waiver to enable the New Jersey Medicaid and NJ FamilyCare Programs to be able to cover certain legal immigrants, children and pregnant women, without a five-year delay. 

The Children’s Health Insurance Program Reauthorization Act (CHIPRA) signed by President Obama ended the federally-required waiting period for lawfully residing immigrant children and pregnant women, who were otherwise eligible for Medicaid and the CHIP program, known in New Jersey as FamilyCare. 

Prior to the enactment of CHIPRA, federal law required lawful immigrant residents to wait a full five years to obtain these public benefits.  However, New Jersey covered these residents, but with State dollars only.  The passage of CHIPRA enables the State to cover these children and pregnant women without a five-year delay, and the State may now obtain federal matching funds to do so.

The State will also verify, during redeterminations, that the individual continues to lawfully reside in the United States using the documentation presented to the State by the individual on initial enrollment.

The removal of the five year wait will most assuredly reduce or eliminate barriers to health care that now exist for low-income immigrants. 

NJ FamilyCare, the State's children’s health insurance program, covers children from working families with household incomes up to 350% of the federal poverty level.  Currently 130,000 children in New Jersey are covered under these programs, and the expansion is expected to expand coverage for up to an additional 100,000 New Jersey children.


Obama Signs Spending Bill

President Obama has signed the Omnibus Appropriations Act of 2009.  The $410 billion spending bill will fund most of the federal government through September 30, 2009.   The federal government had been operating in FY 2009 under a Continuing Resolution at FY 2008 funding levels. 

With enactment of the bill, many departments will see significant increases, reportedly around 8 percent or more above FY 2008.

On March 11th the Senate had approved, by voice vote, the $410 billion Omnibus Appropriations Act of 2009 (H.R. 1105), with both Senators Robert Menendez and Frank Lautenberg voting to approve.  The House of Representatives previously passed the bill by a vote of 245-178.

The appropriations package (H.R. 1105) provides $66.3 billion in discretionary funding for HHS programs, a 3% increase from the current level. The Substance Abuse and Mental Health Services Administration (SAMHSA) is to receive $3.335 billion, an increase of $100 million compared to FY 2008.

Included in the SAMSHA funding is a new $7 million grant program advocated for by the National Council for Community Behavioral Healthcare (NCCBH).  The funds are committed to the co-location of primary health care services within Community Mental Health Organizations to address the high death and disability rates among persons with serious mental illnesses.

The Omnibus bill includes nine appropriations bills, including the 2009 Labor-HHS-Ed appropriation.  Three appropriations bills-Defense, Homeland Security, and Military Construction-VA-were passed and signed into law last year.
For a more thorough look at the spending in the bill, go to:
National Council for Community Behavioral Healthcare
AP Summary
Bill Text:  House Committee on Appropriations


Stimulus Enacted

President Obama signed the American Recovery and Reinvestment Act of 2009 (HR 1), into law on February 17, 2009.  The law provides $787 billion in spending and tax relief.  

Major provisions of the bill include:

  • The moratorium on federal regulations related to Medicaid targeted case management, school-based administration and transportation services, and provider taxes is extended until the end of June 2009. This language directs the Department of Health and Human Services to not issue finalized regulations on Medicaid rehabilitative services (issued in August 2007), graduate medical education and intergovernmental transfers. It also adds a moratorium on
    Medicaid regulations for hospital outpatient services through June 2009. 
  • A temporary 6.2% increase in the federal portion of the Federal Medical Assistance Percentage (FMAP) to help states avoid cutting eligibility and services for Medicaid beneficiaries.
  • A multibillion dollar investment in health information technology that includes meaningful patient privacy protections that includes behavioral health organizations.

As more details unfold in terms of the impact on New Jersey, NJAMHA will continue to report.

Stimulus Passes House and Senate

On February 13th, the House of Representatives approved a $787 billion stimulus plan by a 246-183 vote.  No Republicans voted for the bill.  Later in the evening, after hours of waiting for Senator Sherrod Brown (D-Ohio) to arrive from Ohio to cast the final aye vote, the bill was passed in the Senate by a vote of 60-38.  It now moves to the president for signing.

New Jersey will see an infusion of $2.2 billion for Medicaid. Reportedly, this is $86 million higher than the amount New Jersey would have received in the Senate version of the package

Under the provisions of the bill, New Jersey would retain or create 100,000 jobs in the state over the next two years; provide 731,000 unemployed residents with an extra $100 a month in unemployment insurance; and qualify 148,000 laid off workers for extended unemployment benefits, according to the National Employment Law Project. These numbers could change as the bill has not yet been passed by the Senate.
The overall stimulus measure is critical to states in general.  The two-year compromise package includes $87 billion to help states fund Medicaid.  The package gives an across-the-board increase to all states of 6.2 percent of the state's Medicaid matching formula and gives a bonus to states with higher unemployment rates.  To qualify to receive these federal Medicaid funds, states must keep the eligibility standards and application processes that were in place as of July 1, 2008 (i.e., maintenance of effort requirement for eligibility).
The compromise version also sets aside approximately $54 billion for a "state fiscal stabilization" fund designed to help states stem cuts in their state budgets.  This is less than the $79 billion in the House version, but more than the $38 billion in the Senate's bill.

NJAMHA will continue to report as more details emerge


Congress Reaches Agreement on Stimulus

On February 11th, key negotiators resolved the differences between the U.S. Senate and House economic stimulus bills [American Recovery and Reinvestment Act (ARRA)], reaching accord on a $790 billion stimulus bill. It is expected that the House and Senate will vote on the bill this week sending the bill to President Obama by February 16th.

The National Council for Community Behavioral Healthcare reports that:

The ARRA includes an across-the-board Federal Medical Assistance Percentage (FMAP) increase to all states of 6.2% with the bonus structure based upon increases in a state's unemployment rate.  The FMAP increase also includes maintenance of effort requirement for eligibility.

Also included in the ARRA are the premium subsidies for COBRA.  The subsidies would cover 60 percent of the premiums for nine months for eligible workers.

The ARRA provides a payment of $250 to Social Security beneficiaries and SSI recipients receiving benefits from the Social Security Administration and Railroad Retirement beneficiaries, as well as veterans receiving disability compensation and pension benefits from the Veterans Affairs. 

Moreover, the ARRA includes a moratorium on the Medicaid Hospital Outpatient Regulation that was effective December 8, 2008.  Of the other six Medicaid regulations, the moratoria are extended on the final rules on targeted case management, provider taxes, and school-based administration and transportation services through June 30, 2009.  Legislators also included a Sense of Congress that the Secretary of Health and Human Services should not promulgate regulations concerning intergovernmental transfers, Graduate Medical Education, and rehabilitative services. Given that the final rehab services rule was never issued, it is hoped that this Sense of Congress will result in the Administration repealing this draft regulation.

The Health Information Technology (HIT) grants were included at the amount of $2 billion; it is not yet clear whether the Senate language that the National Council achieved which made Community Mental Health Organizations eligible for the grants has survived conference.

On February 10, the U.S. Senate voted 61-37 to pass an $838 billion economic stimulus package.  The U.S. House had passed its bill late January. The total of the reconciled bill is less than the total of the recently passed Senate package and the recently passed House package. 

NJAMHA will continue to track developments and report to members over the next few days as more details emerge. Specific provisions that pertain to protecting children with emotional disorders and adults with mental illnesses, which NJAMHA has advocated to be contained in the final package include:

* An increase in the Federal Medical Assistance Percentage (FMAP), over the next 27 months.
* State aid to states to plug state budget holes created by the economic recession.
* An extension of the moratoria on six Medicaid regulations (including those for Case Management, Graduate Medical Education, and Rehabilitation Services) as well as a moratorium on the Medicaid rule, effective December 8, 2008, that applies to hospital outpatient services.
* Full funding for Health Information Technology (HIT) and development of electronic medical records, with the inclusion of community-based mental health providers as eligible for grants and incentive payments.
* Restoration of the full $2.5 billion for retrofitting and upgrading supportive housing developments for people with disabilities and elderly under the U.S. Department of Housing and Urban Development (HUD) 811 & 202 programs.
* The investment in Comparative Effectiveness Research (CER) to improve quality and clinical outcomes, but with added protections for consumers by not restricting access to therapies that may be more costly, but are medically indicated.
* The elimination of the cap on the Temporary Assistance for Needy Families (TANF) emergency contingency fund.

Action Alert: Stimulus Negotiations Underway

On February 10, the U.S. Senate voted 61-37 to pass an $838 billion economic stimulus package (the American Recovery and Reinvestment Act of 2009).  The U.S. House had passed its bill late January.  House and Senate negotiations are underway to reconcile the differences between the two bills.

Please contact your Senators and House representatives to urge them to assure that the final negotiated package includes provisions that will protect adults and children with behavioral health issues.  Specifically:

  1. $87 billion in temporary federal Medicaid matching payments (FMAP), over the next 27 months.
  2. $79 billion in direct aid to States, vs. the Senate’s $39 billion.  State aid is a major part of both bills, but the Senate cut $40 billion from the state fiscal stabilization initiative.  New Jersey, as states across the nation, needs these additional dollars to plug state budget holes created by the economic recession.
  3. A 3-month extension of the current legislative moratoria on six Medicaid regulations (including those for Case Management, Graduate Medical Education, and Rehabilitation Services) as well as a moratorium on the Medicaid rule, effective December 8, 2008, that applies to hospital outpatient services.  The Senate version does not include the moratoria.
  4. Full funding ($20 billion) for Health Information Technology (HIT) and development of electronic medical records, with the inclusion of community-based mental health providers as eligible for grants and incentive payments.
  5. Restoration of the full $2.5 billion for retrofitting and upgrading supportive housing developments for people with disabilities and elderly under the HUD 811 & 202 programs.
  6. The $1.1 billion investment in Comparative Effectiveness Research (CER) to improve quality and clinical outcomes, but with added protections for consumers by not restricting access to therapies that may be more costly, but are medically indicated.
  7. The elimination of the cap the Senate bill places on the TANF emergency contingency fund.
  8. 65 percent subsidization of the cost of healthcare insurance for the unemployed, as compared to the 50 percent in the Senate version.

The U.S. Senate Finance Committee released a chart noting major differences between the House-pased and Senate-passed versions of the American Recovery and Reinvestment Act of 2009.  This chart indicates notable differences between the two.


Health Reform Laws Now in Effect

Three State health care laws became effective the early part of February (Asbury Park Press, Michael Symans, Feb. 4).  The laws are part of a legislative health reform package prompted by recommendations of the New Jersey Commission on Rationalizing Health Care Resources. 

The Commission was established in October 2006, by order of Governor Jon Corzine.  Primarily, the Commission was charged with exploring the reasons hospitals in the State were struggling financially; developing criteria for the identification of essential general acute care hospitals in New Jersey, and recommending ways to “rationalize” the hospital health care delivery system.

The laws that became effective this week follow:

1)  P.L. 2008, CHAPTER 58, approved August 8, 2008, authorizes enhanced State monitoring of hospital financial performance and State intervention in the management of identified distressed hospitals.  This law was based on the Commission’s recommendation that the State implement a more proactive, structured and formal approach to identifying and assisting distressed hospitals. 

The law authorizes the Commissioner of the Department of Health and Senior Services (DHSS) to determine whether a hospital is in financial distress, or is at risk of being in financial distress, using specified financial indicators.  If so, the Commissioner may appoint, in consultation with the hospital, a monitor to prevent further financial deterioration.

2)  P.L. 2008, CHAPTER 60, approved August 8, 2008, prohibits hospitals from charging certain uninsured persons, with family incomes under five times the federal poverty level, more than 15% over the applicable Medicare rate.  The law also requires the DHSS to establish reasonable rates, for hospital health care services, based on a sliding scale.

3)  P.L. 2008, CHAPTER 57, approved August 8, 2008, amends the training requirement for trustees of general hospitals.  The newly enacted law amended previous requirements for trustees appointed prior to April 30, 2007, now requiring them to complete the training within six months from the law’s effective date. 


Stimulus Bill Under Senate Debate

Senate Democrats announced that the stimulus bill under consideration this week has insufficient support to pass unless provisions that would not supply a more immediate economic boost are trimmed. (Washington Post, February 4, 2009)

The 111th Congress and the new administration continue crafting an economic stimulus bill that would stem job losses, extend unemployment and health benefits, expand food stamp benefits, provide tax relief measures, and provide essential financial aid to states reeling from the current national economic recession. 

The House of Representatives passed (244Y/188N) its $819 billion version of the economic stimulus bill, the American Recovery and Reinvestment Act (HR. 1), on January 28.   Work on the bill is currently underway in the Senate.

HR 1 includes a temporary increase in federal support for Medicaid.  NJAMHA joins with Mental Health America in urging the Senate to support the increased federal funding for Medicaid and other health programs, an extended moratorium on several Medicaid regulations proposed under the previous administration, and the provision of additional funding to address mental health and substance use treatment.

Stimulus Passes House and Senate

On February 13th, the House of Representatives approved a $787 billion stimulus plan by a 246-183 vote.  No Republicans voted for the bill.  Later in the evening, after hours of waiting for Senator Sherrod Brown (D-Ohio) to arrive from Ohio to cast the final aye vote, the bill was passed in the Senate by a vote of 60-38.  It now moves to the president for signing.

New Jersey will see an infusion of $2.2 billion for Medicaid. Reportedly, this is $86 million higher than the amount New Jersey would have received in the Senate version of the package

Under the provisions of the bill, New Jersey would retain or create 100,000 jobs in the state over the next two years; provide 731,000 unemployed residents with an extra $100 a month in unemployment insurance; and qualify 148,000 laid off workers for extended unemployment benefits, according to the National Employment Law Project. These numbers could change as the bill has not yet been passed by the Senate.
The overall stimulus measure is critical to states in general.  The two-year compromise package includes $87 billion to help states fund Medicaid.  The package gives an across-the-board increase to all states of 6.2 percent of the state's Medicaid matching formula and gives a bonus to states with higher unemployment rates.  To qualify to receive these federal Medicaid funds, states must keep the eligibility standards and application processes that were in place as of July 1, 2008 (i.e., maintenance of effort requirement for eligibility).
The compromise version also sets aside approximately $54 billion for a "state fiscal stabilization" fund designed to help states stem cuts in their state budgets.  This is less than the $79 billion in the House version, but more than the $38 billion in the Senate's bill.

NJAMHA will continue to report as more details emerge


Pending Federal Regulations Halted

In the early hours of the new administration, a memorandum was issued instructing federal agencies to cease moving forward with any pending federal rules and regulations. This affords the new administration an opportunity to review and approve any new or pending regulations previously issued under the Bush administration.

Among the pending rules and regulations are a few that NJAMHA strongly opposed:  Targeted Case Management, Rehabilitative Services, and Graduate Medical Education.  A moratorium on their implementation is in effect through April 1, 2009.  This directive from the Obama administration now subjects them to a new review. 

NJAMHA maintains that the implementation of these rules would lead to cuts in Medicaid funding by the federal government, which would substantially reduce safety net mental health services for individuals served by NJAMHA member organizations.

The memorandum, sent by Rahm Emanuel, White House Chief of Staff and Assistant to the President, requested federal agency department and agency heads to:

*  Not send proposed or final regulations to the Office of the Federal Register (OFR)for publication prior to review by a designee of the President.
*  Withdraw from the OFR all proposed or final regulations not yet published.
*  Consider extending for 60 days the effective date of published regulations that have not yet been implemented.

Unfortunately, the hospital outpatient services rule, that NJAMHA continues to advocate against, became effective in December 2008 so it is not affected by this recent policy directive.  However, NJAMHA continues to explore a legislative remedy from New Jersey’s Congressional delegation to limit the potentially deleterious effects of the rule on hospitals.


Legislation Announced to Pare Down State Developmental Centers

Legislation to close five of the state’s seven developmental centers was unveiled on January 8, 2009.   

New Jersey Assembly Budget Committee Chair, Assemblyman Louis Greenwald (Legislative District 6), held a press conference on the bill, Assembly Bill 3625.  The bill aims to close five of New Jersey’s seven State-operated developmental centers within five years and reduce the population of the centers by 80 percent within five years. 

Click herefor additional details on the bill.

Greenwald stated that developmental centers consume over 30 percent of the $1.4 billion budget of the NJ Division of Developmental Disabilities.  The cost of housing in a developmental center costs around $641 per day as compared to the community at $300 per day.  He added that the current Community Services Waiting List, which has doubled to 8,000 over the past decade, would be significantly reduced.

The bill calls for the creation of a 17 member Community Services Planning Council for Persons with Disabilities to assist with implementation of the phase-out plan.  Among the membership would be state officials, families, advocates, and union representatives.

Among those invited to stand alongside Assembly Greenwald at the press conference were Pat Davis-Johnson, whose son resided over eighteen years at the New Lisbon Developmental Center before moving successfully into the community;  Kim Todd, CEO, New Jersey Association of Community Providers; and Ari Ne’eman, President, Autistic Self Advocacy Network.

NJAMHA will continue to track the legislation.


CMS Launches Internet-Based Provider System

The Centers for Medicare & Medicaid Services (CMS) has established an Internet-based Medicare provider enrollment process.  The online system will enable physicians and non-physician practitioners to enroll as a Medicare provider, track the status of their enrollment applications, and amend their Medicare enrollment information twice as quickly, according to CMS, as compared to the present system.  (Provider type exceptions include suppliers of durable medical equipment, prosthetics, orthotics, and supplies.)  

CMS will phase-in the implementation of the online process across all states.  The online system has just begun in 15 states, New Jersey is among them.  Physicians and non-physician practitioners practicing in New Jersey may now begin to use the online system. 

More details available here.

NJ State Senators Move to Congress

In the U.S. Congress, although the Democrats fell short of gaining the 60 seats needed in the Senate to clear parliamentary procedural obstacles, election returns resulted in the expansion of Democratic control. 

It was the first time in more than 75 years that Democrats were on track for large House gains in back-to-back elections. They picked up 30 seats in 2006. (Associated Press, Julie Hirschfeld Davis)

In New Jersey, U.S. Sen. Frank Lautenberg (D-NJ) won his fifth term in office, and two state Senators are moving to the U.S. House of Representatives. 

New Jersey Democrats gained a greater edge in the U.S. House of Representatives.  For over a decade, Democrats maintained a 7-6 majority in the House.  With this election, that edge has increased to an 8-5 advantage with NJ state Democratic Senator John Adler (D-Camden) winning Republican Rep. James Saxton’s seat (R-3rd).  Rep. James Saxton retired from office after 24 years in Congress. 

Meanwhile, in New Jersey’s Congressional District 7, Republican state Senator Leonard Lance (R-Hunterdon) won the seat open by Republican incumbent Rep. Mike Ferguson (District 7), who did not seek reelection after four terms in office.

The remaining New Jersey incumbents maintained their seats:  
U.S. Rep. Rob Andrews (D-1st Dist.); U.S. Rep. Frank LoBiondo (R-2nd Dist.); U.S. Rep. Christopher Smith (R-4th Dist.); U.S. Rep. Scott Garrett (R-5th Dist.); U.S. Rep. Frank Pallone (D-6th Dist.); U.S. Rep. William Pascrell (D-8th Dist.); U.S. Rep. Steve Rothman (D-9th Dist.); U.S. Rep. Donald Payne (D-10th Dist.); U.S. Rep. Rodney Frelinghuysen (R-11th Dist.); U.S. Rep. Rush Holt (D-12th Dist.), and U.S. Rep. Albio Sires (D-13th Dist.).



Parity Passes

Mental Health Parity is now law.

The U. S. House of Representatives passed, on October 3, the Emergency Economic Stabilization Act of 2008, which includes mental heatlh parity.  The House vote to pass was 263 – 171.  The Senate had already cleared the bill.  President Bush wasted no time in signing the legislation soon after the vote. 

The bill’s enactment brings mental health parity into law after almost a decade of advocacy by the mental health community.  After passage, House Speaker Nancy Pelosi stated:

By including the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act in this essential legislation, we are requiring that illness in the brain be treated just like illness anywhere else in the body for insurance purposes. This is helping to end discrimination against those who seek treatment for mental illness. Simply put, it will save lives." 

The package also includes the extension of several expiring tax breaks for businesses and individuals and an increase in the Federal Deposit Insurance Corporation’s (FDIC’s) coverage from the current $100,000 to $250,000. 

Voting to pass the Economic Stabilization Act were New Jersey Congressmen Robert Andrews, Michael Ferguson, Rodney Frelinghuysen, Rush Holt, Frank Pallone, Bill Pascrell, Jim Saxton, and Albio Sires.  Voting against the bill were New Jersey Congressmen Scott Garrett, Frank LoBiondo, Donald Payne, Steven Rothman, and Chris Smith.  Voting positions on this bill do not necessarily reflect the positions of New Jersey Congressmen on mental health parity, but included consideration of the many economic stipulations within the comprehensive bill.


Senate Passes Bailout and Parity

The evening of October 1, the U.S. Senate passed the $700 billion financial markets bill (bailout) by a vote of 74-25.  The House is expected to take up the bill on Friday, October 3.  Fifteen Republicans and ten Democrats voted against the bill. 

Both NJ Senators Menendez and Lautenberg voted in favor.  The package adds provisions to the House version - including temporarily raising the FDIC insurance cap to $250,000 from $100,000.  The bill also extends several expiring tax cuts. 

The Senate then took up H.R. 1424, the parity bill , which would require health insurance companies to cover mental illness at parity with physical illness, passed by the House in March.  An amendment passed that replaces the text of H.R. 1424 within the text of the Emergency Economic Stabilization. 

NJAMHA will continue to track.

Congress Acts on Interim Spending Bill and Parity

Congress remains active over the last few days of the 110th Congress, second session.  Following is an update of key legislation that relates to the mental health community, much of which has been eclipsed by the economic rescue bill:

Interim Federal Spending Bill
On September 27, 2008, the U.S. Senate passed the Department of Homeland Security Act, 2008 (H.R.2638) by a vote of 78-12.  The House passed the funding resolution a few days earlier.  The $634 billion measure, of which a total of $30 billion is targeted to domestic programs and disaster relief, is now cleared for the White House, where it is expected to be signed by President Bush.  $600 billion will fund the Departments of Veterans Affairs, Defense, and Homeland Security into 2009.

The new federal budget year begins October 1, 2008. Democratic leaders opted to wait for a new president and the next Congress before completing the appropriations bills.  The legislation would keep most federal agencies, including Labor-HHS-Education, funded at fiscal 2008 levels through March 6, 2009, the deadline by when the next Congress and a new president must address unresolved spending issues. 

Among the domestic funding provided in the bill is $5 billion for the Low Income Home Energy Assistance Program.  This amount is twice the amount of funds dedicated to the program last year. 

House Stymied on Job Creation and Unemployment Relief Act of 2008
On September 26, 2008, the U.S. House passed, in a 264-158 vote, the Job Creation and Unemployment Relief Act of 2008 (H.R.7110), sponsored by Rep. David Obey [WI-7].  The bill would provide a total of $60 billion in government funds to boost the economy. 

Included in the House economic stimulus bill was a temporary increase in the Federal Medicaid Assistance Percentages (FMAPs), in the amount of $13 million, to assist states shore up their Medicaid programs, which are under pressure  in a depressed economy. 

However, the Senate effectively blocked the measure from progressing.  Additionally, the president did not support the bill stating that the costs were too high.

Senate Rejects Reid/Byrd Economic Stimulus Plan
On September 25, 2008, Senate Majority Leader Harry Reid [D-NV] and Appropriations Chairman Robert Byrd [D-W.Va] released a $56.2 billion stimulus plan, the Reid/Byrd Economic Recovery Act of 2008, (S 3604) - the Senate’s version of an economic stimulus package.  It included $19.6 billion that would reduce States’ share of Medicaid costs by increasing the FMAP by four percent, for states coping with high Medicaid costs.

The Senate voted 52-42 to reject a motion to proceed, 8 votes shy of the 60 needed to move the plan.   

Mental Health Parity
Both the U.S. Senate and the House of Representatives approved mental health parity legislation on Tuesday, September 23.  The House passed a standalone bill (H.R. 6983), introduced September 22, 2008 by Rep. Patrick Kennedy [D-RI], and the Senate attached, as an amendment, parity language to a tax measure, the Renewable Energy and Job Creation Act of 2008 (H.R. 6049), sponsored by Rep. Charles Rangel [D-NY].

The House voted 376-47 in favor of the standalone parity bill, the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008.  New Jersey Rep. Scott Garrett voted against the bill, Rep. Jim Saxton did not vote, and the remaining Congressmen voted in support of the bill. 

Meanwhile, on September 23, H.R. 6049 passed the Senate by a 93-2 vote; however, on September 29th, House Democrats refused to consider H.R. 6049, also referred to as the Senate’s tax extenders bill.  With Congress about to adjourn, passage of H.R. 6049 is questionable. 

NJAMHA continues to provide updates


Critical Need for Federal Funding Increase

Congressional leaders are pushing for a second economic stimulus package that will provide a temporary increase in federal dollars to States.  As many as twenty-nine States are facing significant shortfalls in their FY 2009 revenues. These shortages are resulting in cuts to many lifeline programs, including Medicaid. 

In reaction to the dramatic economic slowdown, Democratic leaders in both congressional houses have prepared economic stimulus packages that they will attempt to have passed this week. 

Each plan includes a temporary boost to States’ Federal Medical Assistance Percentages (FMAPs).  These are federal matching funds for State expenditures for certain services including those covered by Medicaid.  The Social Security Act requires the Secretary of Health and Human Services to calculate and publish the FMAPs each year.  New Jersey’s is 50%.

Senate Majority Leader Harry Reid [D-NV] and Appropriations Chairman Robert Byrd [D-W.Va] just announced a $56.2 billion stimulus plan, the Reid/Byrd Economic Recovery Act of 2008, that includes $19.6 billion that would reduce States’ share of Medicaid costs by increasing the FMAP by four percent, for states coping with high Medicaid costs.

The package could either move on its own or be added to a stopgap omnibus spending bill (HR 2638) that funds the government until March, which was approved by the House on September 24, 2008. The Senate might not vote on the stopgap bill until September 27, 2008 (CQ Politics, David Clarke and Liriel Higa, September 25, 2008).

At the same time, House Speaker Nancy Pelosi [D-CA] announced that the House would consider its stimulus package on the floor as early as September 26, 2008.  Congresswoman Pelosi stated that the House package will also include additional Medicaid funding for States in the amount of $13 billion.

But it may be an uphill battle for Democrats with some Republican leaders questioning spending billions of dollars on programs that, in their opinion, may do little to help stimulate the economy.

There is very little time before the end of this Congress to pass a second stimulus package with a temporary FMAP increase.  Please contact your senators and representatives at 1-800-828-0498, or find your representative's contact information here (provided by the National Council for Community Behavioral Healthcare).  Urge them to pass a temporary increase in Medicaid funding, as part of an economic stimulus package, to help those who are most vulnerable. 

Mental Health Parity Approved in Congress

Both the U.S. Senate and the House of Representatives approved mental health parity legislation on Tuesday, September 23.  The House passed a standalone bill (H.R. 6983), and the Senate attached the same language to a tax measure, the Renewable Energy and Job Creation Act of 2008 (H.R. 6049).

The Senate tax bill passed by a 93-2 vote, and the House voted 376-47 in favor of the standalone parity bill, the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008. 

There is strong bipartisan support for mental health parity in both congressional chambers.  New Jersey Senators, Lautenberg and Menendez, both support mental health parity.  In the House, except for Rep. Scott Garrett (R-5th), New Jersey’s congressional delegation voted yes for parity.  Rep. Saxton did not vote on the most recent parity bill.

It is important to note that the House standalone bill (H.R. 6983) would not require group health plans to offer mental health coverage. However, if a plan does offer mental health coverage, then the bill would require that insurers offer the same level of benefits for mental health treatment as they offer for medical conditions.  The bill would require:

1)  Equity in financial requirements, such as deductibles, co-payments, coinsurance,  and out-of-pocket expenses.
2)  Equity in treatment limits, such as caps on the frequency or number of visits, limits on days of coverage, or other similar limits on the scope and duration of treatment.
3)  Equality in out-of-network coverage.

H.R. 6983 would not affect state laws that offer stronger consumer protections.  Further, businesses with fewer than 50 employees would be exempt.

NJAMHA believes it is critical to make full parity mandatory. Without full parity, people with serious mental illnesses, and their families, will continue to be burdened with exorbitant out-of-pocket expenses or, worse, will go without treatment.

The two chambers must now reach agreement on how to cover the $3.4 billion cost over 10 years before Congress recesses.  It is expected that agreement will be reached by both houses, and a parity bill will go to President Bush for signing.  Hopefully, parity will be enacted in the last days of the 110th Congress – after a decade of advocacy. 

NJAMHA continues to track.


Senate May Act on Parity

The U.S. House of Representatives has decided not to move on its stand-alone mental health parity bill, as was the strategy late last week.  Instead, the House plans to wait for the U.S. Senate to act on mental health parity, as an amendment to the Senate’s tax package, which may occur as early as September 23, 2008. 

Late last week, mental health parity legislation was moving as both a stand-alone bill and as an amendment to the tax package.  It was to be considered in the House of Representatives this week. 

Both New Jersey Senators, Lautenberg and Menendez, support mental health parity. 
The legislation would require private insurance plans, that offer mental health benefits as part of the coverage, to offer such benefits on par with the medical surgical benefits.   It is critical that parity legislation be passed prior to the adjournment of this Congress, which is slated for September 26th.

NJAMHA believes it is critical to make full parity mandatory. Without full parity, people with serious mental illnesses, and their families, will continue to be burdened with exorbitant out-of-pocket expenses or, worse, will go without treatment. 

A recently published editorial (Washington Post, September 19, 2008) written by Rosalynn Carter, Chair of the Carter Center Mental Health Task Force, and Betty Ford, Founding Chairman of the  Betty Ford Center, praises Congress for reconciling the House and Senate versions of the parity bill and presses for passage.  

The editorial states:  “Major mental disorders cost the nation at least $193 billion annually in lost wages, …Moreover, when insurance companies deny people coverage, these costs and others are shifted to the economy and public sector…”

NJAMHA will continue to cover the story.

Medicare Bill Becomes Law

On July 15, President Bush vetoed the Medicare Improvements for Patients and Providers Act of 2008 (HR 6331); however, soon after, Congress overrode the veto, by bipartisan votes of 383-41 in the House/70-26 in the Senate. 

Bush had vetoed the bill because he opposed cuts to private Medicare Advantage (MA) plans, which were called for in the bill to achieve the physician payment cut reversal. 

The legislation benefits Medicare beneficiaries, including the elderly and persons with disabilities. Both the House of Representatives and Senate had approved the bill by veto-proof margins.

In the Senate, New Jersey Senators Lautenberg and Menendez voted for the bill and voted in favor of overriding the president’s veto. New Jersey Representatives Scott Garrett (R-5th) and Rodney Frelinghuysen (R-11th) were New Jersey’s only two congressmen voting against the bill and against the vote to overturn the veto.  Rep. Jim Saxton (R-3rd) did not vote. 

The bill now becomes law.  The Medicare physician payment rate cut of 10.6 percent, that became effective July 1, 2008, has been reversed.  This was achieved by cutting bonus payments to MA plans.  Physicians will now have 18 months of stable payments after which a heftier cut, of about 20%, may occur.  The Medicare fee cuts are based on a longstanding federal funding formula that mandates reimbursement cuts to doctors when the growth rate in Medicare costs exceeds the growth in the gross domestic product.

To the further benefit of Medicare recipients served by the nonprofit mental health community, the act:

1)  Eliminates, over a phase-in period, the discriminatory copayment rates for Medicare psychiatric outpatient services – achieving parity between the coverage of mental health and medical conditions.

2)  Expands coverage for preventive services.

3)  Eliminates Medicare Part D (Voluntary Prescription Drug Benefit Program) late enrollment penalties paid by subsidy-eligible individuals.

4)  Requires inclusion of drugs, under Medicare Part D, in situations where a lack of access to drugs in the category or class would have major or life threatening clinical consequences and/or where there is a significant clinical need to have access to multiple drugs within a category or class due to unique chemical actions and pharmacological effects of the drugs within the category or class.  This has particular relevance to serious mental illnesses.

5)  Awards grants to states for increasing the delivery of mental health services or other health care services to meet the needs of veterans of Operation Iraqi Freedom and Operation Enduring Freedom living in rural areas.

6)  Revises requirements for Medicare Advantage (MA) private fee-for-service plans as well as MA plans for special needs individuals.


Medicaid Rules Delayed

On June 30, President Bush signed the war supplemental spending package (HR2642).  Included are $162 billion for the wars in Iraq and Afghanistan, a 13-week extension of unemployment insurance, and a delay in the implementation of six Medicaid regulations for one year. 

If implemented, New Jersey could have realized a $4.5 million reduction in federal payments in FY 2008 and $55 million over 5 years, under the CMS rehabilitative option services regulations; $95.7 million between FY 2008 and FY 2012, under the CMS case management interim final rule; and a reduction in payments of $3.5 million in FY 2008 and $11.5 million over five years, under the cuts to graduate medical education  - a significant percentage of doctors train at public hospitals.

In New Jersey, hospital closures, a growing uninsured and underinsured population, insufficient funding of safety net programs, and State budget shortfalls would have magnified the effect of these federal cuts.  

NJAMHA vigorously advocated with New Jersey’s congressional delegation to delay the implementation of these rules.  At this time, implementation of the rules has been blocked, but it is important to note that in the absence of any congressional action going forward, the regulations could go into effect as early as April 2009.  NJAMHA remains vigilant and will continue its advocacy.

No doubt that, if these regulations were to be implemented, safety net programs to adults with mental illnesses and children with serious emotional and behavioral disorders would have closed or substantially reduced services and served far fewer individuals at-risk. 

Thanks to all of you who reached out to your U.S. House and Senate members to stave off this threat.


National Updates on Medicaid Moratoria, Labor-HHS-Education Bill and SCHIP

Medicaid Moratoria
On June 26th, the Senate voted 92-6 to pass the supplemental war appropriations bill (HR 2642).  The bill includes $21.1 billion in domestic spending. The House of Representatives had passed the war appropriations bill June 19th.

Of critical importance to NJAMHA members is the bill’s one-year delay in the implementation of six Medicaid rules proposed by the Centers for Medicare and Medicaid Services (CMS).  The rules on case management, rehabilitative service option and the proposed rule on Graduate Medical Education are among the six rules.

NJAMHA had mounted a strong campaign to move Congress to place moratoria on these rules, as their implementation would have a deleterious impact on persons with mental illnesses and the providers that serve them. 

The bill now goes to President Bush for signature, which is expected to occur next week.

Labor-HHS-Education Appropriations Bill/SCHIP
On June 26th, the Senate Appropriations Committee voted 26-3 to pass the FY 2009 Labor-HHS-Education appropriations bill containing discretionary spending of $153.1 billion - $7.7 billion over that proposed by President Bush.   A presidential veto is likely because the bill exceeds the president's proposed spending target.

Included in the bill is funding for the Social Security Administration (SSA), of $10.4 billion, to cover the administrative expenses of the SSA, $50 million over the President’s budget request and $632 million more than FY 2008, to continue efforts to reduce the backlog of disability claims. SSA reviews current disability cases to ensure beneficiaries remain eligible for Social Security.

Senate Appropriations Committee Chair Robert Byrd (D-W.Va.) said that he plans to have the committee approve the 12 appropriations bills by the end of July. However, Senate Majority Whip Richard Durbin (D-Ill.) said that the full Senate likely will not vote on any of the bills this year. (Wayne, CQ Today, June 26)

Just prior to the vote on the Labor-HHS-Education appropriations bill, the appropriations committee also passed, via voice vote, an amendment negating the August 17, 2007 State Children’s Health Insurance Program (SCHIP) policy directive issued by Dennis Smith, former Director of the Center for Medicaid and State Operations. The directive requires states to enroll 95% of children in families, with annual incomes of up to 200% of the federal poverty level (FPL), into the SCHIP program before they could expand the program’s eligibility to families with annual incomes over 250% of FPL, an almost impossible threshold to meet. 

For New Jersey, if the directive were allowed to stay, up to 10,000 children would be denied health care coverage through SCHIP.  New Jersey has a 350% FPL eligibility criterion due to the state’s high cost of living.  Under this directive, the state would have to demonstrate that 95% of SCHIP and Medicaid eligible children in families below 200% FPL were enrolled before it would be permitted to enroll children above 250% FPL.  The directive also would require that children be uninsured for a full year before they could enroll in SCHIP. 

New Jersey filed a lawsuit challenging the directive.


National: Labor-HHS Spending Bill Approved by Senate Subcommittee

On June 24, 2008, the Labor, Health and Human Services, Education and Related Agencies Appropriations Subcommittee approved, by voice vote, a fiscal 2009 spending bill for the departments of Labor, Health and Human Services and Education.  The bill exceeds President Bush’s proposed budget by just over $7 billion. 

Last week, the House appropriations subcommittee approved its version.  The full House and Senate Appropriations committees will both approve their own versions of the bill on June 26.  The bill is expected to stall this year, primarily over differences with the president on spending levels.

The bill funds employment, health care and education programs and would take measures toward reducing fraud, waste and abuse within federal agencies.
U.S. Senator Tom Harkin (D-IA), Chairman of the Labor, Health and Human Services, Education and Related Agencies Appropriations Subcommittee, today provided details of the subcommittee’s funding package:

Legislation highlights

Job Training – The Subcommittee legislation provides more than $2.9 billion for state grants for job training, an increase of $25 million over last year and $499 million over the budget request.  In addition, the bill includes more than $1.6 billion for the Office of Job Corps, an increase of $40 million over the FY 2008 level and $85 million more than the President’s budget request.

Worker Protection – The Subcommittee legislation provides more than $851 million to ensure the health and safety of workers, including $504 million for the Occupational Safety and Health Administration (OSHA) and $346 million for the Mine Safety and Health Administration (MSHA).  This total is an increase of $33.7 million above the FY 2008 level.

Health and Human Services
National Institutes of Health – The Subcommittee legislation provides more than $30 billion to fund biomedical research at the 27 Institutes and Centers that comprise the NIH. This represents an increase of $1 billion over the FY 2008 level and President’s budget request. The Subcommittee’s increase will allow the NIH to award the highest number of new research project grants in its history and keep up with the biomedical inflation rate for the first time in six years.

Community Health Centers — The Subcommittee legislation provides more than $2.2 billion for community health centers, $150 million over the FY 2008 level.
Nursing Education — The Subcommittee legislation provides more than $167 million for nursing education, $11.6 million over the FY 2008 level.

Pandemic Influenza — The Subcommittee recommendation includes $585 million to prepare for and respond to an influenza pandemic.  Funds are available for the development and purchase of vaccine, antivirals, necessary medical supplies, diagnostics, and other surveillance tools.

Colorectal Screenings – The Subcommittee provided $25 million to establish a nation-wide program to support colorectal screenings for low-income individuals.

Senior Nutrition Services – As Americans are enduring steep increases to food and fuel costs, senior meal programs are being hit hard by both crises due to the rising cost of food and the rising cost of delivering those meals to homebound seniors. The Subcommittee bill increases funding for senior nutrition services by $43 million, for a total of $801 million.

Head Start — The Subcommittee has included $7.1 billion for the Head Start Program, an increase of $223 million over the FY 2008 comparable level.
Title I (Education) — The Subcommittee has provided more than $14.5 billion for Title I grants to Local Education Agencies, an increase of more than $631 million over the FY 2008 level, and more than $491 million  for school improvement grants, the same amount as the FY 2008 level.

Education for Individuals with Disabilities — The Subcommittee bill provides more than $12.5 billion to help ensure that all children have access to a free and appropriate education, and that all infants and toddlers with disabilities have access to early intervention services.  This amount includes $11.4 billion for Part B grants to states, an increase of $477 million over last year and $140 million more than the budget request.

Improving Teacher Quality – Research proves that improving teacher quality is the most important thing schools can do to help students succeed academically. In an effort to meet the goal of leaving no child behind and providing strong teachers to classrooms across the country, the Subcommittee has provided more than $3.6 billion through 14 separate programs aimed at hiring teachers or improving teacher quality.

Related Agencies
Social Security Administration (SSA) — $10.4 billion is included for the administrative expenses of the SSA, $50 million over the President’s budget request and $632 million more than FY 2008, to continue efforts to reduce the backlog of disability claims. SSA reviews current disability cases to ensure beneficiaries remain eligible for Social Security.

Elimination of Fraud, Waste, and Abuse:
For fiscal year 2009, the Subcommittee has increased funding for a variety of activities aimed at reducing fraud, waste, and abuse of taxpayer dollars. These program integrity initiatives have been shown to be a wise investment of Federal dollars resulting in billions of dollars of savings from Federal entitlement programs--unemployment insurance, Medicare and Medicaid, and Social Security:

Unemployment Insurance Program Integrity – The Subcommittee recommendation includes $50,000,000, an increase of $40,000,000, to conduct eligibility reviews of claimants of Unemployment Insurance. This increase will save an estimated $200 million annually in inappropriate Unemployment Insurance payments.

Social Security Program Integrity – The Subcommittee recommendation includes $504,000,000 for conducting continuing disability reviews [CDRs] and redeterminations of eligibility for Social Security Disability and Supplemental Security Income benefits. CDRs save $10 in benefit payments for every $1 spent to conduct these activities, while redeterminations save $7 in payments for every $1 for doing this work.

Health Care Program Integrity - In fiscal year 2006, Medicare and Medicaid outlays accounted for nearly $1 out of every $5 of the total Federal outlays. Fraud committed against Federal health care programs puts Americans at increased risk and diverts critical resources from providing necessary health services to some of the Nation's most vulnerable populations.

The Subcommittee has included $198,000,000 for Health Care Fraud and Abuse Control (HCFAC) activities at the Center for Medicare and Medicaid Services.  No discretionary funds were provided for this activity in fiscal year 2008.

Investment in health care program integrity more than pays for itself based on 10 years of documented recoveries to the Medicare Part A Trust Fund. The historical return on investment for the life of the Medicare Integrity program has been about 13 to 1.


NJAMHA Testifies on State Budget Bill

The State Legislature recently released a $32.8 billion Fiscal Year 2009 State budget bill.  The proposed budget cuts State hospital charity care funds 9 percent; grants no cost-of-living increase for nonprofit providers serving vulnerable New Jersey residents, as provider expenses skyrocket and lag behind the pace of inflation; and eliminates or reduces the amount of property tax and renter rebates.

The good news to report is that NJAMHA and its advocacy partners prevailed in getting Medicaid copays, included in the originally proposed budget, eliminated.  These copays were to have been applied to prescriptions, outpatient hospital visits, and hospital visits to emergency rooms for non-emergency care.  There were also some charity care cuts that were restored; however, any cuts to the numerous New Jersey hospitals struggling to continue to serve the state's low-income and uninsured residents is impossible to classify as good news. 

Today, the Assembly Budget Committee took testimony on the budget bill (A2800).  As always, NJAMHA testified before the committee on behalf of its members and the vulnerable individuals they serve.  NJAMHA CEO Debra L. Wentz testified:

Because of inadequate resources, adults and children in need of mental health services often must wait weeks or months for services when they turn to non-profit mental health care providers for help. Our organizations have experienced double digit increases in insurance, fuel and energy.  Without a reasonable increase, community workers cannot earn a livable wage to allow them to put food on the table and gas in their cars.  New Jersey can provide a compassionate system that promotes wellness and recovery, enabling consumers to become productive members of their community or it can choose to cut costs at the front end and pay later."

Once again, NJAMHA and the Cost of Providing Care Coalition pushed for a 3.6% cost of providing care increase for community providers.  Although no increase was included in A2800, Assemblyman Joseph Cryan (District 20), in response to advocates, including NJAMHA, who continue to fight for an increase, stated strongly at today’s hearing that the Legislature and community providers must work together in the upcoming year to consider including an annualized cost-of-providing-care inflationary increase in state budgets going forward. 

The Senate and Assembly are expected to reconvene tomorrow, June 19, to vote on the bills.  Reportedly, the full Legislature may vote as early as Monday on the budget, which constitutionally must be signed by July 1.

NJAMHA continues its active opposition, to the lack of any increase in the cost of providing care and to the cuts in hospital charity care funding, through letters to editors of major newspapers, extensive legislative visits, testimony before state and legislative committees and continued work with its grassroots advocacy network.

Additional specifics on the proposed budget presently under consideration:

Charity care funding to hospitals still falls significantly short – a $111 million cut remains. A total of $32 million was added to charity care funding, bringing the total to $605 million from the $573 million the governor had originally proposed back in February.  The $573 million constituted a drastic $143 million reduction from the current charity care funding level of $716 million. 

The newly proposed plan would give all hospitals at least 10 percent of their previous annual funding.  Previously, numerous hospitals were slated to have all of their charity care funds gutted.  In addition, $44 million would be put into a hospital stabilization fund, up from the originally proposed $35 million, for hospitals providing significant amounts of charity care. 

Seven New Jersey hospitals have closed in the last 18 months with another closure expected this year. 

The New Jersey FamilyCare Program, for low-income children and their families, received a budget boost.  The proposed budget plan would increase the program by $8 million to assist in expanding the FamilyCare health insurance program to cover additional parents and mandate health insurance for all children, as a preliminary move toward universal health care – a legislative initiative of Senator Joseph Vitale (Legislative District 19). 

NJAMHA will continue to report on the budget as new developments occur.


Congress Announces Appropriations Schedules

The U.S. Senate and House Appropriations Committees announced their appropriation markup schedules.

The Senate Appropriations Subcommittees, as well as the full committee, will begin marking up the FY 2009 appropriations bills during the week of June 16. Senator Robert C. Byrd [D-W.Va], Chairman of the Senate Appropriations Committee, intends to complete full committee action on all 12 appropriations bills by the end of July.

The Labor, Health and Human Services Subcommittee is tentatively scheduled to mark-up its FY 2009 budget during the week of June 23, with full committee action shortly after.

In the House, Congressman Dave Obey (D-WI), Chair, House Committee on Appropriations, distributed the subcommittee allocations [302(b)s] for fiscal year 2009 appropriations bills. Allocations will be considered by the full committee on Wednesday, June 18.

These subcommittee allocations reject numerous cuts proposed by the president, including those affecting health care and community block grants, substance abuse treatment programs, affordable housing, and energy assistance to low income families.  

The House Subcommittee markup on Labor, Health, & Education is scheduled for June 19. 


Congress Adopts FY 2009 Budget Resolution

Last week, Congress approved a Fiscal Year 2009 budget resolution (S Con Res 70), marking the beginning of the annual budget appropriations process and initiation of work on the 12 annual spending bills.

The resolution includes additional dollars for domestic programs.  Bush’s proposed cuts to Medicare and Medicaid were rebuffed by Congress.  These cuts are not included in the resolution.  The Senate voted 48-45 in favor of the spending plan while the House vote was 214-210 in favor. 

Proposed in the resolution is domestic spending beyond that requested by President Bush.  The president has threatened to veto appropriation bills that exceed his request, so Democrats may opt to delay action on major appropriations bills until Bush’s successor takes office.

House Appropriations subcommittees are expected to start marking up the 12 FY 2009 bills next week, the second week of June.  The House Appropriations Labor, HHS, Education, and Related Agencies Subcommittee, according to Representative James Walsh (R-N.Y.), ranking member of the committee, will not mark up the Labor-HHS-Education appropriations bill for a few weeks (CQ Today, 6/4).  The Senate will begin to mark up appropriations bills as early as June 16 (CQ Today, 6/4).

As reported by Washington Highlights, May 20, 2008, the budget includes $198 million for FY 2009 Medicare fraud and abuse initiatives. It also contains several 5-year, non-binding, deficit-neutral reserve funds including: 

• Support for increasing Medicare physician payments
• Implementation of mental healthy parity legislation
• Delaying implementation of certain Medicaid regulations, including the Graduate Medical Education (GME) proposed rule
• $50 billion to reauthorize and expand the State Children’s Health Insurance Program  (SCHIP)
• Promotion of the adoption of health information technology, including electronic prescribing
• Funding initiatives to cover the uninsured and underinsured

The President’s $3-trillion spending plan for FY 2009, released February of this year, contains significant cuts in community mental health services funding for the Center for Mental Health Services (CMHS) within the Substance Abuse and Mental Health Services Administration (SAMHSA).

The Bazelon Center for Mental Health Law cites a few of the programs, targeted by the president, for elimination or deep cuts:

• State Incentive Grants for Transformation to support the development of comprehensive plans to address fragmentation in a state’s public mental health system (to be eliminated)
• School violence prevention (to be cut by $17.8 million)
• Jail diversion (to be cut by $2.9 million)
• Seniors mental health (to be eliminated)
post traumatic stress ($ 17.5 million cut)
• Consumer support technical assistance centers (to be eliminated)
• Suicide prevention ($15.1 million cut)

Bazelon also reports that the “…only two programs with proposed increases are the children’s mental health services program, at $114.5 million (a $12.2-million increase) and the PATH program to address homelessness among people with mental illnesses, at $59.7 million (a $6.4-million increase).”

The Administration proposed two new initiatives:  one to provide  for mental health drug courts ($2.2 million) and a second to address mental health needs identified by state and local communities ($7.3 million) through a mental health targeted capacity expansion program.

John Spratt (D-SC), House Budget Committee Chairman, said in a floor statement on the Fiscal Year 2009 Budget Conference Report:

Our budget begins by undoing the damages done by the President’s budget to services that people depend upon…Take Medicare and Medicaid, for example, pillars of medical care for millions of Americans. The President would cut Medicare by $479 billion over ten years (2009 – 2018) and Medicaid by $94 billion. We reject those cuts; restore Medicare and Medicaid to current services; and accommodate adding up to $50 billion to the Children’s Health Insurance Program, fully offset, to reach millions of children eligible but not yet enrolled in CHIP. "

NJAMHA continues to follow.

NJAMHA Testifies on Outreach Staff Safety Bill

On June 5, NJAMHA CEO Debra L. Wentz testified before the Senate Health, Human Services and Senior Citizens Committee on the Courage and Compassion Act of 2008, Senate Bill 1855, which evolved from NJAMHA’s legislative outreach visits with Senate leaders. 

The bill would provide $12 million in funding to community outreach workers to supplement the salaries of the committed and courageous mental health outreach staff of nonprofit community mental health agencies who risk their own health, well being, and safety by providing outreach in communities where safety concerns are high.

The bill’s sponsors are Senator Diane Allen (District 7), Senate Deputy Minority Leader, and Ronald Rice (District 28), Senate Assistant Majority Leader.

NJAMHA will continue to track the bill's progress.

Debra Wentz’s testimony follows:

New Jersey Association of Mental Health Agencies, Inc. (NJAMHA)
Debra Wentz, Ph.D., CEO
Testimony: Senate Bill 1855
June 5, 2008
Senate Health, Human Services and Senior Citizens Committee

Good afternoon, Chairman Vitale, Vice Chair Weinberg and committee members. Thank you for considering this legislation and this important issue today. First, I want to offer my deepest gratitude to Senator Rice for introducing this vital bill.

I am Debra Wentz, CEO of the New Jersey Association of Mental Health Agencies, which represents 125 non-profit community mental health care providers located in every county of the state. These organizations serve more than 400,000 adults and children with mental illnesses and substance abuse and behavioral disorders. While much of the work of community mental health workers is conducted in a hospital or office setting, a substantial portion of their work involves outreach into the community – into homes and onto the streets. Some of our workers even have to coax clients out of a life in a car, in the woods or under a boardwalk.

I am constantly amazed by the dedication, compassion and courage of these employees and we all owe them our gratitude for the important and unselfish service they provide to our communities. Every day, they help individuals with mental illnesses and behavioral disorders get the treatment and services they need to turn their lives around and to start on the road to recovery.       

The Courage and Compassion Act of 2008 addresses a critically important concern – the safety of these mental health outreach workers who serve New Jersey’s most vulnerable citizens.

These employees dedicate their lives – and often risk their well-being – to serve those with mental illnesses. As part of their work, community mental health employees often must go into high-crime areas, where gang activity and substance abuse are rampant, and work with traumatized families and unstable individuals.

As noted in a report entitled Guidelines for Security and Safety of Health Care and Community Service Workers, “Community service workers are at risk of hostile behavior from the public when they visit clients at hotels, apartments or homes in unfamiliar or dangerous locations, especially at night.  Sexual assaults with serious injury, other physical assaults and robberies, have been reported by workers in the community. In addition, clients or their relatives and friends may direct their anger, which can be extreme or violent, at community workers.”

I must add a word of caution. As we address this problem, we must not further stigmatize individuals with mental illness, who are more likely to be the victims of crime than the perpetrators. However, we must be realistic and recognize that our employees often are called upon to respond when these individuals are in crisis or when the situation has become dire. And even if these individuals do not pose a risk, other family members or the neighborhood may.

Across the nation, several mental health workers have been killed while on the job in recent years. This past February in Massachusetts, a community worker was stabbed to death.  In the state of Washington, the tragic death of a mental health worker prompted new legislation to improve safety conditions.

While we have had incidents of serious injury in New Jersey, we have not experienced a death, at least none that I am aware of. But we must not wait until the ultimate tragedy occurs here before we act.

There is much that can and must be done.

In the State of Washington, which released a report on safety issues in the wake of the death of Marty Smith, numerous requirements and recommendations were funded to help ensure the safety of community mental health workers. They included:
 Enabling programs to send two workers into the community so that a mental health worker never has to conduct a dangerous visit alone.
 Improving training so workers are more likely to identify threats and crises.
 Summits to develop best practices and solicit ideas to enhance safety.

In New Jersey, we face another critical problem: the inability to recruit and retain workers for these difficult and potentially dangerous jobs. Because salaries lag as much as 40 percent behind comparable positions for State jobs, community workers often leave for government positions once they have gained experience. High vacancy and turnover rates, combined with a prevalence of inexperienced workers, can hamper the ability to provide the effective, careful treatment and services that are necessary. Additionally, inadequate staffing levels make it difficult to send out two workers when safety concerns warrant backup. Community providers must be able to pay adequate salaries in order to recruit and retain a sufficient number of workers for these demanding jobs.

Additionally, we believe New Jersey should explore the option of providing funding to send security staff along on some community visits, just as the state does for DYFS visits.

NJAMHA is holding a meeting this month with the Division of Mental Health Services and a broad cross-section of our membership to discuss these concerns and to develop a plan to ensure the safety of our community mental health workers. We ask the Legislature to recognize the importance of this matter and to provide the resources to allow community providers to address the issues of compensation, training, staffing levels and the development of best practices.

Again, I profusely and sincerely thank you for your attention to this critical issue and I look forward to working with you to ensure the safety of these courageous and compassionate employees.  


Senate Passes Domestic Spending Package

On May 22, 2008, the U.S. Senate passed its war funding measure by a vote of 70-26.  The separate domestic spending package also passed - by a vote of 75-22, a veto-proof margin.  Included in the domestic spending component are, among others, a 13 week extension of unemployment benefits and heating assistance for the poor. 

The domestic spending part of the bill would also block the implementation of federal regulations that would restrict access to programs, such as the State Children’s Health Insurance Program (SCHIP), and delay the implementation of seven Medicaid rules, until April 9, 2009, that would limit access to critical support services, such as case management and rehabilitative services.  These federal regulations, if implemented, would also shift costs for these essential programs from the federal government to states.

NJ Senators Lautenberg and Menendez voted in support of the domestic spending amendment to the bill.

The package must now move to the U.S. House of Representatives for final consideration, after the Memorial Day recess.  Both houses of Congress must approve a bill for it to be sent to the president for signing.  President Bush opposes the domestic spending component.

NJAMHA continues to track.

Medicaid Moratoria Bill Survives to-Date

The House of Representatives voted May 15 on a supplemental war spending bill.  House leaders had broken the bill into three amendments.  The first was funding to continue the wars in Iraq and Afghanistan, the second concerned policy measures in Iraq that the president opposes, and the third (Amendment #3) was domestic spending, which included the moratoria on the federal Medicaid regulations.  If unblocked, these Medicaid rules would result in restricted care to Medicaid beneficiaries, reduced payments to providers and shift costs from the federal government to states.

The House voted against continued war funding.  However, the domestic spending portion of the bill (Amendment #3), containing the imposition of the moratoria on the federal Medicaid rules, passed 256 to 166, with 32 Republicans voting to support this section of the bill.  New Jersey Representatives voting in support of the domestic spending section, Amendment #3, included Reps. Smith (R), LoBiondo (R), Rothman (D), Payne (D), Holt (D), Sires (D), Andrews (D), Pallone (D), and Pascrell (D).  Voting against the domestic measure of the bill were Reps. Garrett (R), Frelinghuysen (R), Saxton (R), and Ferguson (R).  

The president reasserted his position against the policy and domestic spending components of the war funding bill, threatening a veto.  Next week the Senate considers its version of the war funding bill, which is expected to restore the war funding and remove the policy restrictions that President Bush opposes.  Less clear, is the action on domestic spending.  While the president has threatened a veto, there is strong bipartisan support for this measure of the bill.

NJAMHA continues to track the course of the moratoria on the Medicaid regulations and continues its strong support of the moratoria. 


Moratora Linked to War Funding Bill

On May 15, the U.S. House of Representatives is considering the Senate amendment to H.R. 2642, the emergency supplemental bill to fund the wars in Iraq and Afghanistan and pressing domestic needs. 

Added for consideration is the placement of moratoria on certain federal Medicaid regulations, including Case Management/Targeted Case Management.  If not blocked, these federal regulations would reduce services to persons with disabilities and cut payments to the safety net providers provde these services.  If the regulations are implemented, New Jersey and other states face significant losses in federal funds to the detriment of adults with serious mental illnesses and children with serious emotional disorders.  Showing strong support in the House, on April 23, the bill passed the House by a vote of 349-62.

Moving forward, House Democrats last week revealed their plan to link their priority domestic spending projects and a troop-withdrawal timeline to additional funds for military operations in Iraq and Afghanistan.  The moratorium is a component of the domestic spending section of the supplemental war funding bill.

In the Senate, attaching legislation to delay these Medicaid rules to the next supplemental appropriations bill is actively under consideration.  However, there are Republican Senators opposing the effort to delay the implementation of these federal Medicaid rules and the linkage to the war supplemental funding bill. 

The Democratic leadership is pushing to include the moratoria in the war funding bill, hoping to increase the chance of passage in the Senate.  Senate Democrats are hopeful that the Senate will be able to pass its version of the bill next week, with the war and domestic spending included and the troop-withdrawal language removed.

It is possible that the House would pass the same bill sending it to the president by Memorial Day.  The president opposes moratoria on the regulations and may veto the domestic spending component of the bill.

NJAMHA continues to track and report back to our members.

House Passes Medicaid Moratorium Bill

On Wednesday, April 23, 2008, two-thirds of House Republicans joined with Democrats, in a 349 to 62 vote, to pass H.R. 5613, the Protecting Medicaid Safety Net Act (Dingell [D-MI]/Murphy [R-PA]), which would place a moratorium, through April 1, 2009, on seven Medicaid regulations that would cut federal Medicaid funds and shift more costs onto State budgets. 

Aside from Rep. Rob Andrews (D-1), who did not vote, and Rep. Scott Garrett (R-5) voting against, the remaining New Jersey Congressmen voted to pass H.R. 5613:  A heartfelt thanks to Reps. Frank LoBiondo (R-2), Jim Saxton (R-3), Chris Smith (R-4), Frank Pallone, Jr. (D-6), Michael Ferguson (R-7), Bill Pascrell, Jr. (D-8), Steve Rothman (D-9), Donald Payne ((D-10), Rodney Frelinghuysen (R-11), Rush Holt (D-12), Albio Sires (D-13).  Click here to see Roll Call Votes.

Included in these seven regulations are Medicaid case management services, rehabilitative services and graduate medical education.   In New Jersey, case management cuts would impact safety net services including Integrated Case Management Services (ICMS), Care Management Organizations (CMOs) and Youth Case Management (YCM) services.  The rehabilitative services cuts would affect Programs for Assertive Community Treatment (PACT), Mobile Response, and residential services.

The president has threatened a veto, but there is apt to be a sufficient number of votes in the House, and perhaps in the Senate, to override a presidential veto. 

Now the bill moves to the Senate Finance Committee and then to a vote on the Senate floor.

Click here for Associated Press report.

National Updates: Moratoria on CMS Regulations and SCHIP

On Wednesday, April 16th, the House Energy and Commerce Committee unanimously approved a bill (46-0), Protecting Medicaid Safety Net Act of 2008 (H.R. 5613), that would delay the implementation of several Medicaid rules for one year, until April 1, 2009, after a change in the administration.  The bill was introduced by Representatives Dingell and Timothy Murphy (R-PA) March 2008.

The regulations include, among others, those on Medicaid rehabilitative option services, case management/targeted case management services, and graduate medical education.  NJAMHA opposes these regulations, which were promulgated by the Centers for Medicare & Medicaid Services. 

Federal funding would be drastically reduced or eliminated if these regulations were implemented.  It is estimated that New Jersey could realize a $4.5 million reduction in Federal payments in FY 2008 and $55 million over 5 years, under the CMS rehabilitative option services regulations;  $95.7 million between FY 2008 and FY 2012, under the CMS case management interim final rule; and a reduction in payments of $3.5 million in FY 2008 and $11.5 million over five years, under the cuts to graduate medical education. (Source:  Governor Corzine’s Washington D.C. Office)

As a result of NJAMHA’s April 9th Washington D.C. visit to seven members of New Jersey’s Congressional Delegation, three additional congressmen demonstrated their support of the moratoria bill.  Congressmen Donald Payne, Frank LoBiondo, and Albio Sires have now signed on as cosponsors of H.R. 5613, joining Congressmen Frank Pallone, Jr., Mike Ferguson, Bill Pascrell, and Rush Holt.  

The Bush administration has indicated it would veto the legislation; however, it has been reported that there may be a sufficient number of votes in both the House and the Senate to override a presidential veto.

H.R. 5613 moves to the full House of Representatives to be scheduled for a vote.

Regarding the State Children’s Health Insurance Program (SCHIP), Robert Pear, in the August 19, 2008 edition of the New York Times, reported that attorneys from the Government Accountability Office have ruled that the Bush administration violated Federal law last year when it restricted States’ ability to provide health insurance to children in families with incomes above 250 percent of Federal poverty level.  In effect, this ruling may make the August 17, 2007 CMS directivedenying expansion of eligibility unenforceable.

New Jersey’s SCHIP is one of approximately 22 states that have expanded eligibility to families with higher incomes, or that are contemplating expanding eligibility. New Jersey’s eligibility includes children with family incomes of up to 350% of the Federal poverty level. 

In October 2007, Governor Jon S. Corzine filed a lawsuit on behalf of the people of the State of New Jersey challenging the August 17, 2007 letter issued by the Bush Administration limiting SCHIP eligibility.  The suit charged the Bush Administration of “…circumventing the public rule-making process by fundamentally and arbitrarily changing the program via letter, which would have the effect of denying health insurance coverage for over 10,000 New Jersey children.”

NJAMHA continues to track developments in relation to moratoria and SCHIP.

U.S. House Moves on CMS Rule Moratorium

On April 9, 2008, during NJAMHA’s annual visit to New Jersey’s Congressional Delegation in D.C., NJAMHA received promising legislative news – the Health Subcommittee of the House Committee on Energy and Commerce had just completed a mark up of H.R. 5613, the “Protecting the Medicaid Safety Net Act of 2008”. 

H.R. 5613 was introduced March 13, 2008 by Representative John Dingell [MI-15].  NJAMHA deeply thanks New Jersey Congressmen Frank Pallone, Rush Holt, and Mike Ferguson for cosponsoring the legislation.

As originally introduced, the bill would institute a temporary, one-year moratorium on seven Medicaid regulations that, if implemented, would significantly reduce federal funds supporting particular Medicaid services that predominantly serve adults with serious mental illnesses and youth with severe emotional disorders. 

Under the leadership of Congressman Pallone, the Chair of the Health Subcommittee, a mark up on the bill was completed.  The bill was amended by voice vote and favorably forwarded to the full Committee on Energy and Commerce. 

NJAMHA was in Washington, at the time of the mark up, making its case in support of H.R. 5613, which would also provide Congress the opportunity to examine the regulations that CMS unilaterally proposed/issued, when news of the mark up broke. 

NJAMHA voiced strong opposition to these CMS regulations, in particular the ones related to the proposed Rehabilitation Services regulations, the interim final rule on Case Management/Targeted Case Management Services, and the proposed prohibition on Medicaid payments for Graduate Medical Education, affecting teaching hospitals. 

Most recently, on April 3, New Jersey Assemblyman Herb Conaway, Jr., M.D., representing the National Conference of State Legislatures, testified before the Health Subcommittee stating the potentially deleterious effects that implementation of these CMS regulations would have on consumers and providers saying “The impact of these rules going into effect and sucking billions of dollars out of the Medicaid program would strike a devastating blow to the Medicaid program, Medicaid beneficiaries and our network of safety-net providers.

The full news release, prepared by the Committee on Energy and Commerce, may be read here.

NJAMHA will continue to actively track and report further legislative developments as they occur.


NJ Files Lawsuit: CMS Case Management Interim Final Rule

Led by the Attorney General of Maine, New Jersey joined Maine as a co-plaintiff in a complaint filed in the U.S. District Court, challenging the validity of the U.S. Department of Health and Human Services (DHHS), Centers for Medicare and Medicaid Services (CMS), Interim Final Rule on Medicaid Case Management Services, which was published in the December 4, 2007 Federal Register with a March 3, 2008 effective date.  The complaint is seeking injunctive relief.  The lawsuit challenging the Case Management Rule went into effect on March 3.   

The rule was intended to revise the definition of Medicaid case management services to incorporate changes made by the Deficit Reduction Act of 2005 (DRA).  NJAMHA opposed the interim rule expressing concerns to CMS that the rule would place individuals with mental illnesses at risk by placing overreaching limits and prohibitions on case management services delivered by nonprofit mental health providers.  Case management services are fundamental to the treatment and recovery of children with emotional and behavioral disorders and adults with mental illnesses.

The lawsuit asks the U.S. District Court for the District of Columbia to strike down the new rule.  The legal basis of the complaint, according to Maine’s Attorney General, is that portions of the Interim Final Rule promulgated by the U.S. Department of Health and Human Services, “…are arbitrary, capricious, an abuse of discretion and not in accordance with the 2005 Deficit Reduction Act or any of the provisions of Title XIX of the Social Security Act. The complaint also alleges that the DHHS violated the rule making requirements of the federal Administrative Procedure Act (APA) and that the Interim Final Rule does not provide a reasonable transition period…”  

Among the key areas of the rule challenged in the complaint:

  • Inadequate Notice:  DHHS did not provide notice or seek comment prior to publication of the rule.
  • Single Case Manager:  The suit states that the DRA of 2005 does not authorize DHHS to limit case managers.  This is particularly critical for persons with mental illnesses who often have co-morbid conditions.
  • Billing Methodology:  The DRA does not authorize DHHS to specify any particular form of billing.  The rule prohibits bundled payments and requires billing by discrete service in 15 minute intervals.  It is common for States to pay on a weekly or monthly basis.
  • Transition from Institutions:  The complaint challenges the restrictions on the amount of time case management may be provided to persons transitioning from institutional to community settings.
  • Implementation Period:  The lack of a reasonable transition period to comply with the [challenged] requirements of the rule. 


NJAMHA Opposes CMS Interim Final Rule on Case Management

The Centers for Medicare & Medicaid Services issued an interim final rule on Medicaid Case Management Services that, once effective, would significantly reduce federal funds supporting case management services and threaten their viability. 

The rule narrows the definition of what services would qualify for Medicaid reimbursement under case management and has the distinct probability of diluting or eliminating essential services to adults and children with serious mental illnesses and emotional and behavioral disorders. 

There are now two recently introduced bills pending in Congress that would postpone the rule until 2009 – Senate Bill 2578 and H.R. 5173.  Congressman Keith Ellison [MN] introduced the House bill on January 29, 2008, and Senator Norm Coleman [MN] introduced the Senate bill on January 30, 2008.  

The bills would temporarily delay application of proposed changes to Medicaid payment rules for case management and targeted case management services by placing a moratorium on implementation through April 1, 2009. 

At this time, no members of New Jersey’s Congressional delegation have signed on as cosponsors, but the bills have only recently been introduced. Please contact your Congressional representative to request his co-sponsorship or to enlist his support to advance these bills in any way possible.

Comments on the interim final rule are due Monday, February 4, 2008 and are to be effective only four weeks after, on March 3, 2008.

Click here to read the interim final rule in its entirety.  Find NJAMHA’s response here


SCHIP Veto Override Fails Again

A second attempt by House Democrats to override President Bush’s December 12th veto, of the expansion of the State Children’s Health Insurance Program (SCHIP), has failed by about 15 votes. 

The vetoed bill would have expanded health benefits to 10 million low-income, uninsured children, up from 6.6 million.  According to New Jersey Congressman Rush Holt (District 12), this includes more than 225,000 children in New Jersey. The legislation also blocks a recent Administration effort to force some New Jersey children out of the program.

The spending increase to cover the expansion is $35 billion over a five year period.  The program presently costs $5 billion a year.

The House will continue its efforts to expand the program.  The SCHIP bill likely will be taken up again later this year.




President Signs Gun Bill

On January 8th, President Bush signed the NICS Improvement Amendments Act of 2007 (HR 2640) into law. The legislation prevents persons with serious mental illnesses from purchasing guns. 

The legislation amends the Brady Handgun Violence Prevention Act to: (1) authorize the Attorney General to obtain electronic versions of information from federal agencies on persons disqualified from receiving firearms; (2) require federal agencies to provide such information to the Attorney General, not less frequently than quarterly; and (3) require federal agencies to update, correct, modify, or remove obsolete records and notify the Attorney General of such action to keep the National Instant Criminal Background Check System (NICS) up to date.

The law authorizes up to $1.3 billion to states in grant money, over five years, to establish or improve systems for reporting the names of persons prohibited from purchasing guns, including people who are involuntarily committed to psychiatric hospitals; found by a court of law to lack capacity to contract or manage their own affairs; and people who are found not competent to stand trial or not guilty by reason of insanity.

The law also requires that states create mechanisms to allow individuals who are no longer dangerous to have their names expunged from the list, a provision that was not included in early versions of the bill.

U.S. Representative Carolyn McCarthy [NY], whose husband was killed by a gunman on the Long Island Rail Road in New York in 1993, introduced the bill in 2002. NJ Congressional Representative Bill Pascrell was one of the seventeen co-sponsors of the legislation.


Medicare, Medicaid, SCHIP Extension Becomes Law

On December 29, 2007, President Bush signed into law S. 2499, the "Medicare, Medicaid, and SCHIP Extension Act of 2007".  This law extends the State Children's Health Insurance Program (SCHIP) through March 31, 2009; blocks the Administration from acting on proposed changes to Medicaid's rehabilitation services option for six months (until June 30, 2008); and provides a 0.5 percent Medicare payment increase for physicians for 6 months, delaying for six months the anticipated physician fee cut of 10 percent. 

To recap, SCHIP was to have expired September 30, 2007 and had been maintained through continuing resolution.  This law extends, but does not expand coverage.  Previous congressional efforts to expand the program met with vetoes from President Bush on two occasions.  Efforts to override the vetoes failed.  The extension is expected to provide states with enough money to cover those presently enrolled.

The moratorium on the rehabilitation option in the law is welcome at this time, but the mental health community must continue to work in opposition to rules and regulations issued by the Centers for Medicaid and Medicare Services (CMS) that would reduce Medicaid funding for community-based mental health services for children and adults.  It is also important to note that this law does not affect the Interim Final Regulations for Optional State Plan Case Management Services issued by CMS.

These regulations alter, or in federal parlance "clarify" the definition of case management services and may restrict the extent of services presently covered by the Medicaid program.  The Interim Final Regulations also shift the Medicaid payment methodology from a bundled to a fee-for-service approach.  Comments are due to CMS by February 4, 2008 with an effective date March 3, 2008. 

New Jersey's Congressional delegation voted in support of the extension.  You may want to convey your appreciation to your representative, and use this opportunity to provide information on the potential impact the CMS proposed rehab option regulations and interim final rule on case management may have on your organization and on the New Jersey residents you serve.


President Signs Budget Bill

President Bush signed the $555 billion dollar Omnibus budget bill for 2008 (H.R. 2764) on December 26, 2007.   The legislation will fund 14 Cabinet departments and federal agencies for the federal budget year that began October 1, 2007.

President Bush expressed disappointment in the number and cost of earmarks legislators inserted in the bill.  Although the president approved the overall budget, he was critical of the number and cost of earmarks contained in the bill.  A review of the merits of the earmarks will be conducted, which may lead to the elimination of some earmarks, pet projects of Congressional leaders that bring federal dollars into their states for various purposes.   

President Bush pledged that “In February I will submit my budget proposal for fiscal year 2009, which will once again restrain spending, keep taxes low, and continue us on a path towards a balanced budget. I look forward to working with the Congress in the coming year to ensure taxpayer dollars are spent wisely.”

As related to areas of interest to NJAMHA members, the final Omnibus spending bill includes restoration of $34 million in reductions in the president’s budget for a range of discretionary programs at the Center for Mental Health Services (CMHS) including state incentive grants, youth violence prevention and elderly services. 

Most programs at the Center for Mental Health Services (CMHS) are close to, or lower than, their FY 2007 levels.  Funding decreases include the Mental Health Block Grant; Projects for Assistance in Transition from Homelessness (PATH) outreach programs; and children’s mental health programs. 

Programs with increased funding include jail diversion programs, protection and advocacy and Garrett Lee Smith suicide prevention programs.  In addition, $6.8 million is allocated for programs under the Mentally Ill Offender Treatment and Crime Reduction Act for programs that include pre-booking diversion, training of law enforcement and post-sentence re-entry.



On December 19, 2007, the U.S. House of Represenatives passed the Medicare, Medicaid and SCHIP Extension Act of 2007 (S.2499).  The Senate passed its bill yesterday. NJAMHA has reported previously on the bill.

Included are an extension of the State Children's Health Insurance Program and a six-month moratorium on rulemaking related to the rehabilitative service option.

The bill now goes to President Bush for his signature.

newHead testing

For the second time in three months, President Bush vetoed legislation, HR3963, on December 12, that would have expanded the State Children's Health Insurance program.  The bill was introduced October 24, 2007 by Rep. John D. Dingell [MI].  New Jersey Assemblyman Frank Pallone [D-6] is one of the bill's 23 cosponsors.

The legislation would have reauthorized the program and provided health coverage for 10 million American children by investing $35 billion over five years and would have increased enrollment to about 10 million youth, across the country. 

The president continues to oppose an increase in cigarette taxes to fund the program expansion and is concerned that the expansion would extend to middle-class families, moving away from the original focus of the program – health care for the working poor. 

New Jersey Assemblymen Smith and Garrett voted no; Assemblymen Ferguson and Saxton did not vote, and the remaining New Jersey Congressional Delegation voted yes.

If an override of Bush's veto is not successful, Congress is expected to pass a temporary extension to maintain funding for the program for at least part of 2008.

SCHIP Update

On October 25th, the U.S. House of Representatives passed H.R. 3963, the revised version of the Children's Health Insurance Program (SCHIP) bill, sponsored by John Dingell (D-MI 15th). New Jersey Congressman Frank Pallone is one of the bill's 23 cosponsors.
The bill passed by a vote of 265-142. House Democrats revised the legislation to try to gain a sufficient number of Republican votes to override a Presidential veto. However, there remains an inadequate number of Republican votes to do so.
One concession to Republicans was the shift toward serving poorer children by enrolling more children into the Medicaid program and less into SCHIP, as compared to the original version of the SCHIP bill. this bill was introduced October 24, 2007. The new version of the bill prohibits access to the expanded program by illegal immigrants and would phase out adults from the program in one year, rather than the two in the vetoed version of the bill. It also sets a cap on eligibility for children whose family incomes are at 300% of the federal poverty level (FPL). In New Jersey, the cap is 350% of FPL.

NJ Files Complaint to Protect SCHIP

New Jersey Governor Jon S. Corzine just filed a complaint on October 1st in U.S. District Court to block the new federal rules, recently promulgated by the Centers for Medicare and Medicaid Services (CMS), that apply to the State Children's Health Insurance Program (SCHIP). 

Essentially, the lawsuit accuses the federal government of bypassing established public rule-making procedure by issuing changes to the program through a letter instead.  According to Governor Corzine, these changes would have the detrimental effect of denying health insurance coverage for over 10,000 children in New Jersey from lower-income families. 

"SCHIP is an unqualified bipartisan success in New Jersey and in states across the nation, and the Bush Administration's determination to pursue a course of action that will harm our children's health is incomprehensible," Governor Corzine said.

The new rules would block states from enrolling children from families with incomes over 2 ˝ times the federal poverty level (FPL), until the children have had no health coverage for one year or longer.  NJ FamilyCare provides coverage to children of families with incomes up to 3 ˝ times the FPL, due to the fact that the state's cost-of-living mightily surpasses the majority of states.

In addition, the new rules prohibit states from enrolling any new children unless the state has enrolled 95% of its eligible families with incomes below 200% of the FPL ($41,300 for a family of four), which has not been accomplished by any state across the country. 

Seven other states, Arizona, California, Illinois, Maryland, New Hampshire, New York and Washington, are threatening legal challenges of their own if President Bush vetoes the compromise SCHIP bill that has passed both the U.S. Senate and House.

SCHIP, also known in New Jersey as NJ FamilyCare, is a joint state-federally funded program available to children and families whose incomes are too high to qualify for Medicaid, but not sufficient to purchase private health insurance.

The ten year old program has fallen prey to political football, with President Bush threatening to veto expansion of the program to a level beyond his proposed $5 billion increase, over five years.  The compromise bill passed by the Senate and House would expand the program by $35 billion over five years. 

Families USA estimates that there are about 127,000 children eligible for SCHIP in New Jersey and with the additional $35 billion in funds authorized in the compromise bill for SCHIP over five years, New Jersey should be able to serve about 100,000 children, as reported by NJ Policy Perspective.

To view Governor Corzine's complaint, click here.

NJAMHA continues to track developments.

Congessional Bills to Block Proposed Federal Limitations on SCHIP

Legislation introduced in the U.S. Senate (S. 2049) and House (H.R. 3555), September 12, 2007 and September 17, 2007, respectively, would nullify the requirements set forth in the August 17, 2007 letter to state officials from Dennis Smith, Director of the Center for Medicaid and State Operations (CMSO).  Click here to read CMSO letter.

The communication from CMSO requires states that have established or that expand the income eligibility level for children under the State Children's Health Insurance Program (SCHIP) above 250 percent of the federal poverty level (FPL) to comply with new requirements as a condition of covering such children.  These bills would render the CMSO requirements null and void. 

Specifically, the letter reveals CMSO’s intention to block states from enrolling children with family incomes above 250 percent of the FPL in the State Children’s Health Insurance Program (SCHIP) and would limit coverage to the lowest-income children by requiring states to first assure that at least 95 percent of the children in the state below 200 percent of FPL are enrolled prior to extending the program to families of at higher levels.  In addition, before including these families, states must assure that the higher income families had no health insurance from a private insurance plan one year prior to application for SCHIP benefits.

New Jersey Congressman Frank Pallone [NJ-6] introduced H.R. 3555 and Senator Ted Kennedy [MA] introduced S. 2049.  New Jersey Senator Robert Menendez is one of the bill’s eight (8) co-sponsors.  Senator Kennedy noted that a bill already passed by the Senate would allow states to cover children with family incomes up to 300 percent of FPL.  In fact, eighteen (18) states, including New Jersey, presently cover families up to 350 percent of the FPL, which is above the proposed CMS limit.  In New Jersey, about 10,500 children above the 250 percent of poverty threshold are covered under the state's SCHIP program - New Jersey FamilyCare. "They're the working poor," says Ann Kohler, Deputy Commissioner, New Jersey Department of Human Services.  Sometimes they're one-parent households struggling to make ends meet."

NJAMHA will continue to report on the bills’ progress.

Bush Threatens to Veto SCHIP Bill

On September 20th, President Bush held a news conference on the State Children's Health Insurance Program (SCHIP), known as FamilyCare in NJ, openly challenging congress to send him a simple extension of the program.  He has threatened to veto any bill that expands the program beyond his proposed $5 billion over five years, or a 20% increase over current levels.  There appears to be an agreement in congress to a final bill containing an increase, which Bush is prepared to veto.

SCHIP is a state-federal insurance program geared to families who do not qualify for Medicaid, but who cannot afford private health insurance.

With SCHIP to expire September 30th, the president is bracing for a showdown with congressional supporters of the House and Senate bills that would expand the program between $35 billion (House version ) and $50 billion (Senate version) over five years.  Bush claims any expansion beyond his proposed increase will require an increase in taxes, which he will not support.  It is important to note that the funding for any increases supported by congress would primarily come from an increase in the tobacco tax.  Bush also referred to the philosophical divide on the best approach to health care, and that the direction congress is moving is toward a government-run health care system, an approach he does not favor.

New Jersey Governor Jon Corzine has sent a letter to President Bush vowing to continue to enroll New Jersey children in the SCHIP, at present state eligibility levels, regardless of recent federal efforts to limit such enrollments. Corzine is prepared to pursue legal action to further the goal of protecting poor and vulnerable children.  Click here to read Governor Corzine's letter.

Bush stated that if "congress" allows the program to lapse, he has instructed Mike Leavitt, Secretary of Health and Human Services, to work with states to mitigate any negative effect on poor children.

NJAMHA continues to track.

NJAMHA Testifies Before the Commission on Rationalizing Health Care Resources

In October 2006, by Executive Order of Governor Jon Corzine, the NJ Commission on Rationalizing Health Care Resources was established to "...ensure the state's supply of hospital and other health care services is best configured to appropriately respond to community needs for high-quality, affordable and accessible care ..."  

Foremost among the responsibilities of the Commission is to recommend a means for reviewing and approving the development and/or redeployment of health care assets and services around the State. 

Other major tasks of the Commission include: 

  • Assess the financial and operating condition of New Jersey's general acute care hospitals;
  • Evaluate the effectiveness of established programs in meeting their intended objectives;
  • Analyze the characteristics of New Jersey's most financially distressed hospitals; and
  • Determine appropriate geographical regions throughout New Jersey for provision of access to medical care for the residents of New Jersey, including those who are low-income and medically underserved.

As previously reported, NJAMHA recently met with the Commission's Executive Director, Michele Guhl.  The thrust of the meeting was to emphasize the necessity to encompass mental health services provided by acute care hospitals within the Commission's deliberations.  NJAMHA stressed the importance of including mental health services in determining "essentiality" and to assure decisions reflect the comprehensive system of care, across hospitals and community services.

The Commission is holding three public hearings.  Representing NJAMHA at the August 14 hearing was Kathleen Gronet, Administrative Director, Outpatient Behavioral Health at St. Clare’s Hospital.

Ms. Gonet’s testimony urged the Commission to recognize hospitals’ vital role in providing mental health services when weighing “essentiality”, emphasizing that mental health care be placed on par with physical health, as the Commission examines the needs of New Jersey residents.  Hospitals with mental health programs offer a safety-net to New Jersey residents, who are poor, uninsured, under-insured, marginalized by their mental illnesses, or among the growing number of undocumented and illegal immigrants. 

The testimony continued stating that nearly half – 39 of 80 hospitals – hold contracts with the Departments of Human Services and Children and Families, to provide a wide spectrum of services to adults and children with mental illnesses and behavioral disorders.  These services must be preserved to avoid the expenditure of higher health care costs and to minimize or avoid family disruption.
The Commission members on the panel showed a genuine interest in understanding and hearing more about mental health services provided by many hospitals in the state.  Overall, Commission members were very interested and interactive with all issues that were presented during the hearing, and it was clear that mental health services were an active part of their deliberations.

One of the questions asked was what was more important, local access to emergency services or local access to inpatient care to which Ms. Gronet responded that local availability of both was critical for consumers in crisis and for family members supporting their family members during crises and subsequent treatment.
There was also a question about financial implications.  Ms. Gronet discussed how a
high percentage of mental health care is uncompensated (Charity Care), significantly and negatively impacting hospitals that provide mental health services.  She further emphasized that hospital essentiality must not just focus on acute medical care, but also on the mental health services provided by the hospital.
Affirming the importance of mental health services, Michele Guhl reported that the next meeting of the Commission will focus on mental health care.

The final hearing is scheduled for August 28th at the George P. Luciano Family Center for Public Services and Leadership, Cumberland County College, 3322 College Drive, Vineland.  NJAMHA urges you to testify about the necessity of hospital-based mental health services in your community.
The Commission has published an Interim Report you may find here.  The interim report recognizes hospitals' continuing pressures to attend to the needs of an increasing number of low-income residents who are uninsured and who are unable to pay for rendered care and the inadequate reimbursement from public payers to cover the care delivered to publicly insured patients.

The Commission has six subcommittees:  Access and Equity for the Medically Underserved; Benchmarking for Efficiency and Quality; Infrastructure of Health Care Delivery  (information technology issues), Reimbursement/Payers; Regulatory and Legal Reform; and Hospital/Physician Relations and Practice Efficiency.  Brief descriptions of each and membership rosters may be found here.

A final report from the Commission is expected December 2007.


Senate Approves SCHIP

By a vote of 68-31, which may be a veto proof majority in the Senate, the U.S. Senate just passed legislation, H.R. 976, to provide health care coverage for millions of low-income children-the State Children’s Health Insurance Program (SCHIP).  SCHIP is a joint federal-state program that provides health care coverage to low-income children and is set to expire at the end of September 2007. 

The legislation has come under a veto threat by President Bush. Both New Jersey Senators, Robert Menendez and Frank Lautenberg, voted for passage.

Part of the cost of the SCHIP expansion is to be covered through a 61 cent increase in the cigarette tax and  other nicotine products. 

The Senate bill would provide an extra $35 billion to expand health insurance for more children under the program, 3.2 million more children, and ensure continued coverage for the 6.6 million children already enrolled in the program.

Just one day earlier, the U.S. House of Representatives approved a $50 billion increase financed by higher tobacco taxes and cuts in payments to private insurers in the Medicare Advantage program for the elderly.

In May, Senators Smith and John Kerry (D-MA) introduced The Children’s Mental Health Parity Act to prohibit discriminatory limits on mental health care in SCHIP plans.  Language from the Senators’ bill was included in the SCHIP measure passed late last evening, August 2, 2007.

Other bill highlights include:

  • Allowing states to cover pregnant women up to 200 percent of poverty ($34,340 for a family of four) through a state plan amendment;
  • Allowing states to apply for a waiver to cover children and pregnant women between 200 and 300 percent of poverty; Freezing coverage of parents and creates a path for states to move childless adults into Medicaid; and
  • Corrects problems from the 2005 Deficit Reduction Act that prevents citizens from accessing the program because the citizen documentation requirements are too stringent. 

The Senate and House now must reconcile the differences between their bills prior to sending a final bill to President Bush after the August recess.


SCHIP Moves in House

On August 1, by a 225 to 204 vote, the U.S. House of Representatives approved the Children's Health and Medicare Protection Act of 2007, H.R. 3162. 

The bill would extend and improve the State Children's Health Insurance Program (SCHIP) to enhance beneficiary protections under the Medicare, Medicaid, and the SCHIP program.  The SCHIP is a federal-state health insurance program for children of working poor families. 

The program, initiated a decade ago, is scheduled to expire in September 2007.  Extending the current program for the next five years would cost $25 billion.  Benefits include dental and mental health services.

The bill is sponsored by Representative John Dingell [MI] and was introduced July 24, 2007.   NJ Representative Frank Pallone [NJ-6] is among the 12 co-sponsors.

H.R. 3162 would insure coverage for 5 million additional children who otherwise would have no access to health care and would expand the program by $47 billion over five years.  The Senate bill, which is expected to be considered any day now, would expand the program $35 billion over five years and continue coverage to about 1 million children, who without this expansion would be eliminated from the program, and expand coverage to an additional 3 million children.  The source of funds for continuation and expansion is an increase in the federal tax on tobacco.

Although, overall, the votes on the House bill followed party lines, with Democrats supporting the bill and Republicans voting against, in New Jersey, all Democrats voted to support the bill, but Republican Reps. Ferguson and LoBiondo deviated from party line and voted in support of H.R. 3162.  NJ Reps. voting in support were Rob Andrews [District 1]; Frank LoBiondo [District 2]; Frank Pallone [District 6]; Mike Ferguson [District 7]; Bill Pascrell [District 8]; Steve Rothman [District 9]; Donald Payne [District 10]; Rush Holt [District 12]; and Albio Sires [District 13].  Voting against were Reps. Jim Saxton [District 3]; Chris Smith [District 4]; Scott Garrett [District 5]; and Rodney Freylinghuysen [District 11].

New Jersey is one of only 11 states that cover adults through the program, which was originally designed only for children. New Jersey policymakers opine that offering coverage to parents makes them more likely to enroll their children.

President Bush has threatened to veto legislation that is too expansive citing his concern that expanded eligibility would encourage families with private coverage to switch to government subsidized programs.  Bush supports extending the program, but proposes only a $5 billion increase over five years and cuts in federal support, which is presently 65 percent to the state's 35 percent, for adults and states enrolling people making more than 200 percent of the poverty level.  New Jersey covers children in families that make up to 350 percent the federal poverty level, which NJ Senator Menendez, Governor Corzine, and state policymakers believe is warranted in a high cost of living state such as New Jersey. 

A Senate amendment that would have reduced the federal support for all beneficiaries with incomes over 200 percent of the federal poverty was defeated. 

NJAMHA will continue to cover developments in SCHIP legislation.


Action on Parity Bill

On Tuesday, July 10, the House Education and Labor Subcommittee on Health, Employment, Labor and Pensions is scheduled to hold a hearing on The Paul Wellstone Mental Health and Addiction Equity Act of 2007 (HR 1424).  This bill would prohibit treatment limits on mental health and substance-related disorder benefits in group health plans that are not similarly imposed on medical and surgical benefits in such plans.  Currently, plans are allowed to charge higher co-payments, coinsurance, deductibles, and maximum out-of-pocket limits and impose lower day and visit limits on mental health and addictions treatment than those for physical health.

Representatives Patrick Kennedy (D-RI) and Jim Ramstad (R-MN) introduced HR 1424 on March 9, 2007.  On June 27, 2007, it was referred to the House Subcommittee on Health, Employment, Labor, and Pensions. The bill has 268 co-sponsors.  With the exception of NJ Congressman Scott Garrett (District 5), New Jersey’s Congressmen, both Republican and Democrat, have signed on as co-sponsors.

On February 12, 2007, Senate Bill 558, "The Mental Health Parity Act of 2007", was introduced by Senators Edward Kennedy (MA) and Pete Domenici (NM).  This bill also would provide parity for annual and lifetime limits between mental health coverage and medical-surgical coverage.  The Senate Health, Education, Labor & Pensions Committee approved S 558 on February 14, 2007.  Both NJ Senators, Robert Menendez and Frank Lautenberg, are co-sponsors.

The Senate bill differs from the House bill, introduced by Senator Kennedy’s son, Representative Patrick Kennedy (RI), in that the Senate bill does not specify what mental conditions or diagnoses must be covered.  Another key difference is that the House bill would not override any existing state parity laws, but the Senate version would supersede state parity laws, where they exist, particularly around treatment limits and cost-sharing.

NJAMHA has long advocated, and continues to press, for the passage of federal parity legislation.  We continue to track its movement.

Updated as of July 9, 2007

FY 2008 State Budget Moves Forward: NJAMHA Testifies

June 15, 2007

For the first time in budget history, in the interest of creating a transparent budget process, and assuring that no legislator personally benefited from his/her budget requests, the proposed budget bills were posted on the NJ Legislature Web site, as were most lawmakers’ budget resolutions, individually identified by the requestor and noting if there were any potential conflicts of interest.  The resolutions included cuts, add-ons, and transfers.

Today and Monday, there will be public review and testimony on the proposed Fiscal Year 2008 Budget bills (A5000/S3000 –identical bills).  The bill appropriates $33.48 billion in state funds and $10.2 billion in federal funds for state Fiscal Year 2008. Democratic legislative leaders are looking for both the Assembly and Senate to approve the budget proposal Thursday, June 21st.

In addition, two public hearings, held by the Assembly Budget Committee, were scheduled the week prior to the June 21 anticipated date of budget approval.  Debra L. Wentz, CEO, New Jersey Association of Mental Health Agencies, Inc. (NJAMHA) testified at the June 15 public hearing.

Prior to Wentz’s testimony, Assemblyman Louis Greenwald, Chair of the Assembly Budget Committee, publicly acknowledged NJAMHA’s visibility in its advocacy throughout each phase of the budget’s development, which he believed was very effective in crafting the budget documents.    

In her testimony, Wentz expressed gratitude that we will not be spending this year’s July 4 holiday wrangling over the state budget, as last year.   However, NJAMHA members, and the vulnerable children and adults they serve, will not be so lucky.

Pressing for a 4.1% cost of providing care increase, starting July 1, 2007, she stressed that NJAMHA members will be spending the holiday weekend, and those leading up to it and afterwards, wrestling with their own budgets – making their own tough decisions. 

Essential positions remain vacant, programs may close and who knows how many children and adults in need may be turned away.  There is not enough funding to pay for the services the state wants non-profit organizations to deliver as their contracted partners.  Providers have to pay for skyrocketing gas, energy and insurance NOW. They cannot wait until January to pay their bills.

Regarding the proposed budget per se, primarily the budget proposed property tax relief, school and municipal aid, and funding for health care initiatives - with no tax increases.  Legislators ended up adding $189 million in spending to the budget plan initially proposed by Governor Corzine in February.

Upon review of individual budget items, there were a few that stand out in terms of having an impact on NJAMHA members and the individuals they serve:

  • Elimination of all proposed co-pays for Medicaid beneficiaries (medical day care, ER visits for non-emergent care, prescription drugs, and outpatient visits).  NJAMHA was prominent in the fight against copayments, and took an active role with the Coalition for a Moral Budget, chaired by Lowell Arye, Executive Director, Alliance for the Betterment of Citizens with Disabilities.
  • Authorization for the Commissioner of Human Services to utilize savings, up to $8 million, that materialized from the annualization of the February 2007 hospital Medicaid psychiatric reimbursement reductions for individuals 22 and older. Utilization of these funds may be for outpatient hospital psychiatric services rate adjustments in the Medicaid program and/or reinvestment into community-based community based psychiatric services for these adults.
  • 3% cost of providing care increase beginning January 2008 (1% more than the Governor’s proposed budget, but significantly lower than the 4.1%, starting July 1, 2007 for which NJAMHA, and other major advocacy organizations, strenuously advocated). Specifically, this budget item provides $13,157,000 for the increase in the Departments of Human Services, Children and Families, Health and Senior Services, Labor and Workforce Development, and Law and Public Safety. $716 million to assist hospitals treat the uninsured ($133 million above the $583 million allotted in the Governor’s proposed budget.  This amount includes an increase in Graduate Medical Education reimbursement).  Further, the formula for distribution of charity care dollars was updated to base the awards on the number of patients served in 2005 rather than in 2002. 

Following are several sections within the proposed budget with language related to NJAMHA providers:

No funds appropriated for Treatment Homes and Emergency Behavioral Health Services, Youth Case Managers, Care Management Organizations, Youth Incentive Program and Mobile Response shall be expended for any individual served by the Division of Child Behavioral Health Services, with the exception of court-ordered placements or to ensure services necessary to prevent risk of harm, unless that individual makes a full and complete application for Medicaid or NJ FamilyCare, as applicable.

Differential Response programs funded by the Department of Children and Families (DCF) to prevent child abuse and neglect shall assure cultural competence.  DCF will offer training in cultural competence to staff of community-based organizations under contract to DCF.

Funding for the Governor’s Council on Mental Health Stigma is carried over in the budget consistent with the recommendations in the final report of the Governor’s Task Force on Mental Health.

Funds are appropriated, consistent with the Governor’s Task Force on Mental Health, for the Office of Disaster Mental Health.

Approximate appropriations made for Community Care:  $37.45 million to be expended consistent with the recommendations of the Governor’s Task Force on Mental Health - $14M for Mental Health Screening Centers; $2.6M for Self-Help Centers; $4.9M for psychiatric services; $5.1M for support services for permanent supportive housing; $789,000 for supported employment; $600,000 for jail diversion in Atlantic County; $600,0000 for jail diversion in Essex County; $600,000 for jail diversion in Union County; $729,000 for additional jail diversion programs; $2.8M for bilingual and culturally competent services; $1M for treatment of co-occurring disorders; $1M for Short-Term Care Facilities; $850,000 for Community Health Law Project; and $1.5M for Special Case Management services.

No Medicaid funds shall be expended for partial care services to any provider who was not a Medicaid/NJ FamilyCare approved provider of partial care services prior to July 1, 2006.

Payments appropriated under Medical Assistance Recipients-Outpatient Hospital shall be conditioned upon the following provision:  certifications shall not be granted for new or re-locating off-site hospital-based entities (in accordance with N.J.A.C. 10:52-1.3) with the exception of providers whose services are deemed necessary to meet special needs by the Division of Medical Assistance and Health Services (DMAHS).

Continuation of Medicaid funds for dual eligibles (Medicare/Medicaid) to cover non-formulary drugs and copayments under the Medicare Part D benefit.

Medicaid funds for programs such as Adult Mental Health Residential, Prescription Drugs, Outpatient Hospital, Clinic Services, and Transportation Services are conditioned upon the Commissioner of Human Services making changes to such programs consistent with the federal Deficit Reduction Act of 2005.

The appropriation for Payments for Medical Assistance Recipients-Outpatient Hospital shall be subject to the following condition:  hospitals may provide continued services to eligible individuals age 22 or older in partial hospitalization programs in need of additional care beyond the 24 month limit and shall bill for these extended services at the community partial care rate of $77 per day.  Costs related to such services shall be excluded from outpatient hospital costs settlements.

$500,000 allocated for the Autism Center at the University of Medicine and Dentistry of New Jersey.

$1M transferred to DHS from the “Drug Enforcement and Demand Reduction Fund” for community based substance abuse services and another $1.5M from the “Drug Enforcement and Demand Reduction Fund” for the same purpose.  Other similar transfers are also contained in the budget.

Funds are in the budget for Re-Entry Case Management Services, consistent with the recommendations of the Governor’s Task Force on Mental Health.  The funds are in the budget under the Department of Law and Public Safety.

Under Department of Corrections, funds are budgeted for Re-Entry Case Management Services, to be expended per the recommendations of the Governor’s Task Force on Mental Health.  Funds are also included for Re-Entry Substance Abuse Programs.

Funds to cover the costs of increases in the number of applicants qualifying for the Social Services Student Loan Redemption Program are provided in the budget.
As budget discussions come to a close, NJAMHA will be preparing a more in-depth analysis for our members.


FY 08 House HHS Spending Bill

Last week, the week of June 4th, work was underway in the House on the Labor-HHS, Education spending bill. 

On June 7th, the House Appropriations Labor, HHS, Education Subcommittee approved a fiscal year 2008 Labor-HHS-Education bill that includes $153.7 billion in discretionary funds, a 6.2% increase from FY 2007 after adjustments and $12 billion more than President Bush requested.  The bill focuses on affordable and accessible healthcare. 

As reported by CQ, Departmental totals in the bill include:
·  $68.2 billion for the Department of Health and Human Services.
·  $61.7 billion for the Department of Education.
·  $11.9 billion for the Department of Labor.

House Democrats plan to complete work on all spending bills prior to the July 4th recess.

Scheduling of work on the appropriations bills in the Senate has not yet been finalized.  However, Senate Majority Leader Harry Reid [Nevada] indicated that appropriations bills have been placed on the agenda upon the Senate's return from July 4th recess.

FY 2007 Supplemental Bill Moves to White House

May 25, 2007

Congress just approved the FY 2007 supplemental spending bill.  The bill has been cleared to go to the president who has signaled he will sign it. 

The House voted yesterday on two amendments to the placeholder spending bill (H.R. 2206), which was passed by the Senate on May 18.  H.R. 2206 makes emergency supplemental appropriations for the fiscal year ending September 30, 2007.

The House passed the two amendments to the supplemental before the measure moved to the Senate where it passed 80 to 14.  It now advances to the president and is expected to be signed promptly in that it contains emergency funds for the continuing war.

While the majority of the $120 billion spending in the bill is dedicated to the war, which does not include a deadline, the bill does contain billions in domestic spending, including disaster relief, a phased increase in the minimum wage, and veteran medical services. 

The bill also makes appropriations, in the amount of $650 million, to the Department of Health and Human Services, Centers for Medicare and Medicaid Services, to eliminate the FY2007 shortfall in funding for the State Children's Health Insurance Program (SCHIP), a government-supported health insurance program that assists working-poor families.  New Jersey is one of the 14 states with a shortfall in its SCHIP, known in the state as NJ FamilyCare.  Without this infusion of emergency funds, NJ FamilyCare funds were expected to be depleted in the next few weeks. 

The bill also raises the federal minimum wage.  The increase will be staged in three steps:  to $5.85 per hour 60 days after the president signs the bill into law, then $6.55 per hour a year later and $7.25 per hour a year after that.

As more details emerge, NJAMHA will continue to keep you posted.

Meanwhile, the House has begun its preliminary work on the FY 2008 spending bills.
However, work on the FY 2008 Labor, Health and Human Services (HHS), Education, and Related Agencies spending bill, which contains funding for mental health and substance abuse programs, will not begin until after the Memorial Day recess.


Accord on Supplemental FY2007 Spending Bill

May 23, 2007

Reportedly, yesterday evening, Congressional and White House negotiators struck an agreement on the FY 2007 federal supplemental spending bill.  The bill will total approximately $120 billion, with the imminent release of the final version, expected this week. 

The supplemental includes funding for the war in Iraq and domestic programs, including the State Children’s Health Insurance Program (SCHIP).  According to New Jersey Medicaid officials, funds for New Jersey’s SCHIP, known as FamilyCare, may be depleted by June 2007. 

Although the language of the bill is not yet available, the American Hospital Association reports that “It is our understanding that the bill includes AHA-backed language placing a one-year moratorium on the Centers for Medicare & Medicaid Services' (CMS) Medicaid rule on intergovernmental transfers and certified public expenditures, and preventing the agency from working on any rules related to eliminating federal payments for graduate medical education (GME) under Medicaid. The moratorium on GME is particularly important since CMS late Friday issued proposed regulations that would prohibit such payments.”

Congress presses on to complete the bill approval process and send it to the White House prior to this weekend’s Memorial Day holiday.



NJ SCHIP Shortfall Continues

On April 26th, a House and Senate conference committee approved a $124.2 billion supplemental appropriations bill for military operations in Iraq and Afghanistan.  Wrapped in the supplemental bill is funding for the State Children's Health Insurance Program (SCHIP), which for New Jersey, is due to run out of funding by May 2007. 

The bill would direct the Secretary of Health and Human Services to allot each remaining SCHIP shortfall state the amount necessary to eliminate the remainder of FY2007 funding shortfalls.  There are 14 states with SCHIP deficits, including New Jersey.  

SCHIP is a program that provides health insurance to children and parents (in NJ) who are uninsured.  It is jointly financed by the Federal and state governments and administered by the state Medicaid program.  

Since President Bush has vowed to veto the bill because it contains a timeframe for withdrawl of troops from Iraq, lawmakers are developing a strategy that will insulate the SCHIP funds from a presidential veto.   

NJAMHA continues to track this issue.

Federal Budget Update

On March 22, the House of Representatives' Budget Committee approved its FY 2008 budget resolution.  The $2.9 trillion plan exceeds President Bush's FY 2008 request for discretionary spending by more than $24 billion and is $7 billion higher than the Senate's resolution.
The resolution includes additional funds for mental health care for veterans.  Further, the budget resolution would provide as much as $50 billion in additional funds for the State Children's Health Insurance Program (SCHIP) over five years, provided that the spending is offset elsewhere in the budget.  The full House likely will vote on the budget resolution during the week of March 26th.
The full House is expected to take up a $124 billion FY 2007 supplemental appropriations bill.  The measure includes $750 million in emergency funds for SCHIP.
Meanwhile, on March 23rd, the U.S. Senate approved, by a 52 to 47 vote, a $2.9 trillion budget plan that would raise the federal tax on cigarettes to cover an extensive expansion of the national children's health insurance program.  An amendment was adopted on March 21st that would use an estimated $132 billion surplus in FY 2012 to provide $15 billion of a proposed $50 billion expansion of SCHIP, an amount that would increase dollars for the program by 200 percent over the next five years.  

The Senate plan would also increase spending on domestic programs by $18 billion, which is 4% over the president's request, and almost 3% over current levels.  The Senate plan does not support the president's proposal to reduce the rate of growth in the Medicare and Medicaid programs.  

Several negative amendments were defeated during floor debate, chiefly:

  1. an amendment sponsored by Senators Bunning (R-KY) and Grassley (R-IA) that would have undermined Medicaid's guarantee of EPSDT (Early and Periodic Screening, Diagnosis, and Treatment) for children;
  2. a Chambliss (R-GA) amendment that would limit state flexibility to cover parents and childless adults; and
  3. a Cornyn (R-TX) amendment that would have limited eligibility for SCHIP to children with family incomes below 200 percent of poverty, cutting off children in states, such as New Jersey, that had set eligibility at higher levels - up to 350% of federal poverty level.   

Robert Pear, NY Times (April 1, 2007), reports that "Congress faces a deadline for action on the Children’s Health Insurance Program. Legal authority for the program expires on Sept. 30, and 14 states expect to run out of money before then.  The House and Senate have voted to provide about $750 million to help those states get through the next six months. But the money is included in a war spending bill that Mr. Bush has threatened to veto because it sets a timetable for gradually withdrawing most American troops from Iraq. So the future of the child health program is unclear."


U.S. Senate Budget Committee voted to approve a fiscal year 2008 budget resolution
March 6, 2007, the U.S. Senate Budget Committee voted to approve a fiscal year 2008 budget resolution that includes funds for the expansion of State Children’s Health Insurance Program (SCHIP).

The budget resolution includes $15 billion of the $50 billion over five years that Democrats seek to expand SCHIP. According to committee Chair Kent Conrad (D-N.D.), the additional $35 billion could become available through spending reductions in other areas or new revenue.

The budget resolution includes about $18 billion more for domestic discretionary spending in FY 2008 than President Bush requested.

Prior to approval of the budget resolution, the committee by voice vote passed an amendment sponsored by Sen. Pete Domenici (R-N.M.) to allow for a mental health parity bill under consideration in the Senate. 

Further, the committee rejected amendments sponsored by Republican members that would have reduced Medicare reimbursements to health care providers by tens of billions of dollars (Dennis, CQ Today, 3/15).

The U.S. House Appropriations Committee, on March 15, 2007, passed a Supplemental Appropriations Bill that includes funds for SCHIP. Fourteen states this year face a combined $745 million deficit in federal funds for SCHIP. The committee on March 15, 2007 increased funds for SCHIP included in the legislation from $735 million to $750 million (Johnson, CongressDaily, 3/16).  The bill also rejects an amendment that would have prohibited the funds to be used to cover children with annual incomes over 200%.  This is good news for New Jersey because New Jersey's SCHIP Program-FamilyCare-presently includes families up to 350% of the federal poverty level. 

Without an an infusion of SCHIP dollars from the federal government, New Jersey FamilyCare will run out of funds by May 2007. 

Reauthorization of the SCHIP Program is necessary for the program to go forward.  The program must continue to allow New Jersey Medicaid to enroll parents up to 350% federal poverty level, as NJ has one of the highest costs-of-living in the nation.

New Jersey now assists about 127,000 children and 80,000 parents in its FamilyCare Program, yet it is estimated that there are about 242,000 children remain uninsured in our state. 

Because other states are expanding their enrollment, and the SCHIP annual allocations are not sufficient to meet actual need, there are fewer funds available to reallocate to states creating the likelihood that a significant number of working poor families will lose medical coverage.  This coverage includes outpatient and inpatient mental health benefits and mental health supports to seriously emotionally and behaviorally disturbed children, such as day treatment, care management, and in-home support services.  This loss of coverage will undoubtedly lead to higher costs elsewhere in the system, such as state and community hospital psychiatric hospitalizations, increased utilization of emergency rooms and placement of children outside of their homes.

NJAMHA is pleased that the U.S. House and Senate Appropriations and Budget Committees, respectively, recognize the necessity of SCHIP.  Also, Congress’ advancing of parity legislation and rejection of cuts in reimbursements to Medicare health care providers is likewise positive news on the national front.

NJAMHA will continue to track progress.

Federal Mental Health Parity Moving

Mental health and addiction advocates are hopeful Congress will pass legislation this year requiring health insurance companies to pay for mental illness and substance abuse treatment on par with coverage for physical health care.  

The "Paul Wellstone Mental Health and Addiction Equity Act" would prohibit group health plans from charging higher copayments, coinsurance, deductibles, and maximum out-of-pocket costs and prevent the imposition of limits and lower day and visit limits on mental health and addiction treatment than those provided for physical health care.

Forums are being scheduled at this time across the country.  The national tour is called "The Campaign to Insure Mental Health and Addiction Equity." At each of these forums, testimony will be heard from citizens affected by mental illness and addiction.

In New Jersey, Congressman Frank Pallone, Jr. [D-NJ] will be conducting a field hearing with the intent of moving the federal mental health parity bill.  The hearing is tentatively scheduled for February 26, 2007 in Trenton.  NJAMHA will keep members advised of the details as they unfold.

U.S. Representative Jim Ramstad [R-Minn.] and Representative Patrick Kennedy [D-R.I.] held a public hearing on January 22, 2007 in Minnesota.  Representative Kennedy says the Wellstone Bill will be introduced in the Senate by his father, Senator Edward Kennedy of Massachusetts.

Congressmen Ramstad and Kennedy report that House Speaker Nancy Pelosi has promised to hold hearings on the bill this year. The bill, originally sponsored by Democrat Paul Wellstone in the mid-90s, did not advance in previous Congressional sessions, despite wide bipartisan support. 

With the recent change in Congressional leadership, key Congressional members of the 110th Congress are optimistic that the bill will win passage and be sent to the President for signing by this spring.

Governor’s “State of the State” Address Focuses on Property Tax Reform and Indicates Future Focus on New School Funding Formula, Government Health Care and Pension Costs, and Other Issues

Governor Jon S. Corzine delivered his “State of the State” address to a joint session of the State Legislature on January 9, 2007. Prior to discussing plans for property tax reform in detail, he highlighted achievements made in 2006 and acknowledged other important issues, including New Jersey’s need for accessible and affordable health care, affordable housing and improvements in education for preschool- and kindergarten-age students. However, he stressed that property tax reform must first be addressed, referring to it as “a cork in a bottle” that holds back resources and is hampering citizens’ confidence. “We need to turn the citizens’ greatest burden into an opportunity for a greater future,” Gov. Corzine said. “The state of our state is stronger than we often acknowledge and in facing problems, we gain great opportunities.”

As reported in the Star-Ledger (January 7, 2007), the Governor does have plans for universal health coverage, restructuring higher education and other issues. However, these initiatives will not be publicly addressed until funding is secured for them—and achieving property tax reform is essential to make such funding available.

Regarding progress made in 2006, Gov. Corzine underscored the following accomplishments from last year:
• Plans to build a stem cell research institute, which will establish New Jersey as the medical research capital of the nation and the world.
• Child welfare reform, with achievements including the licensing of additional foster homes, expansion of training for staff, reduction of staff turnover and an increase in the number of adoptions, which exceeded the state’s objective.
• Reduction of the structural deficit.
• Enactment of the clean needle law to prevent the spread of HIV/AIDS.

For the remainder of his speech, Gov. Corzine focused on property tax reform, beginning with the announcement that “we are far closer to a comprehensive agreement” and that “the road traveled is greater than the stretch that lies ahead.” He highlighted the centerpiece of the tax relief plan, which will be a direct credit to reduce property tax bills for 1.9 million of New Jersey’s 2 million homeowners. His plan calls for a 20 percent property tax reduction, for most homeowners, and a cap of 4 percent on annual property tax increases. To make this happen, funding will be derived primarily from a portion of the recent sales tax increase and with funds that have gone toward property tax rebates.

Gov. Corzine noted that senior rebate and freeze programs and veterans’ programs will remain in place. The remainder of the tax reform plan includes appointing a comptroller to assure sustainability and accountability and encouraging school districts and municipal governments to consolidate or share services and spending.

Gov. Corzine also described several other issues related to property tax reform:
• Regarding health and retirement benefits for public employees, Gov. Corzine observed that this is a significant unfunded liability and he would like to pursue negotiations with state employees, first through the collective bargaining process. He stressed that we need to achieve significant savings on pensions and health benefits through the collective bargaining process, and explained that these savings are needed to help fund property tax reform.
• Regarding a new school funding formula, he pledged to have a new formula developed as soon as possible, ideally before the FY 2008 budget is set. He explained that this formula will be based on individual children’s needs and will account for economic and demographic differences; that aid will be distributed more broadly throughout the state; and that the government will institute greater accountability for school spending.
• Regarding asset monetization, Gov. Corzine referred to this issue as “another corked bottle that needs to have the cork removed.” His strategy is to pay down debts to free up money for other purposes, pledging that proceeds will be used only for debt relief and capital investment and that high standards of safety, service and maintenance will be preserved.  He emphasized that the funds freed up through debt reduction would not be used as a one-time fix to cover operational expenses.

If the state government does not succeed in implementing these changes by the fall of this year, Gov. Corzine will call for a Constitutional Convention in the fall on a public ballot.

Testimony Before the Senate Budget and Appropriations Committee Regarding Mental Health Parity, November 27, 2006

The New Jersey Association of Mental Health Agencies, Inc. (NJAMHA) fully supports the Comprehensive Mental Health and Substance Abuse Parity bill and strongly urges you to pass this very important legislation. For too long, New Jersey’s most vulnerable citizens—more than 400,000 children and adults—have been limited or denied access to treatment due to the unfair discrimination and stigma associated with their disorders. Without comprehensive parity, these individuals face the most severe form of discrimination by not having the vital opportunity to seek treatment and achieve recovery and wellness in the same way as individuals with physical illnesses are able to do. Treatment of mental illnesses, as well as emotional, behavioral and substance abuse disorders, needs to be covered under the same terms and conditions as are provided for other illnesses. Furthermore, individuals should not have to encounter barriers when they decide to seek the help they need.

For several years now, there has been a strong push to incorporate mental health into insurance coverage. This drive has come from all directions: at the national level with the Mental Health Parity Act of 1996 and more recently, the Domenici-Wellstone Mental Health Parity bill of 2003; at the New Jersey state level, with the New Jersey Substance Abuse Prevention and Treatment Advisory Task Force (report released in 2001), the Mandated Health Benefits Advisory Commission (report released in February 2005) and the most recent Governor’s Task Force on Mental Health (report released in March 2005); and at the community level with agencies and organizations that advocate on behalf of individuals with mental illness. It is no surprise that 34 states to date have already enacted some form of mental health parity because it simply makes sense.

Thousands of children and adults in New Jersey go untreated each year for their debilitating mental illnesses because they are denied coverage and cannot afford to pay for treatment. Without adequate care, these individuals succumb to physical illnesses, which leads to absenteeism, low productivity, increased workers’ compensation claims, increased incarceration and recidivism, and increased hospitalization and long-term stays in healthcare facilities—all of which are very expensive to employers, the state and the nation. Mostly, the loss of a decent quality of life—or in the case of suicides, of life itself—is a cost that a compassionate society should not endure.

Just imagine a child suffering from an eating disorder who is malnourished and whose immune system cannot function properly, or an individual with Post Traumatic Stress Disorder who is diagnosed with heart problems. Similarly, individuals with substance abuse disorders frequently experience physical co-morbidities that are exacerbated by ongoing substance abuse. Without appropriate treatment, these individuals’ conditions will deteriorate to a point where immediate medical attention will be necessary. Requiring long-term hospitalization, these individuals will accumulate expensive healthcare costs for which they often have difficulty paying. The burden is then placed on the state and healthcare facilities to finance the treatment of these individuals, when the existence of simple mental health coverage in insurance would entice individuals with mental illness to seek treatment for their illness before it escalates into further mental and physical problems. Ending discriminatory coverage for mental health services will save money for the healthcare system as the secondary and tertiary physical effects of untreated mental illness are eliminated.

Extensive research, at both the state and national levels, has shown that mental health parity would not significantly increase insurance premiums. For example, the Substance Abuse and Mental Health Administration estimates that full parity coverage would increase insurance premiums by only 3.6 percent. In fact, limiting and denying mental health coverage leads to higher costs for employers and the state. In 2000, the estimated economic burden of depression—including major depression, bipolar disorder and dysthymia—was $83.1 billion, with more than $56 billion of that amount related to workplace and suicide-related costs. In 2002, the indirect cost of schizophrenia was $32.4 billion, while the direct cost of treating the disease was $22.7 billion. Clearly, the negligible costs for mental health parity far outweigh the costs of permitting individuals with mental illness to go untreated. It would be “penny wise and pound foolish” to not fund the cost of mental health care because of the inevitable, significantly higher costs to the State and employers.

That’s just the financial cost. We must also consider—and avoid—the very high personal cost for the individuals with mental illness who endure physical and mental suffering, which in many cases, prevents them from thriving in school or work and in personal relationships and striving to achieve personal goals.

On behalf of NJAMHA, I would like to commend Senators Vitale and Buono for their excellent work on this bill and their commitment towards individuals with mental illness. I would also like to thank the Committee for their serious consideration of this bill, which ends the unfair discrimination of mental illness and helps thousands of New Jersey’s children and adults to recover from their illnesses and lead productive, rewarding lives.

Testimony Before the Division of Mental Health Services (DMHS) Forum Regarding Wellness & Recovery Workforce Development, November 15, 2006

The New Jersey Association of Mental Health Agencies, Inc. (NJAMHA) represents 125 nonprofit mental health provider organizations, both freestanding and hospital-based.  We thank you for convening these community forums to field suggestions on promoting the values and concepts of wellness and recovery among the nonprofit workforce.
Contrary to retooling mental health staff in the nonprofit sector, the major areas NJAMHA views as holding the most potential for advancing the wellness and recovery model involve broader systemic changes, e.g., consistency across the regulations of the multiple state divisions/departments that govern mental health programs, alignment of reimbursement streams under a wellness and recovery model, standardized training curriculum, on-site and Web-based training opportunities, allowance of training credits to be counted toward experience requirements, and the inclusion of state psychiatric hospitals in operationalizing the wellness and recovery model, especially in the treatment and discharge planning components of care.

A few specific recommendations of NJAMHA that need to be developed in collaboration with the Division of Mental Health Services’ Wellness & Recovery Committee include:

  • Build on the expertise of nonprofit mental health providers.  Develop a resource inventory of programs that incorporate wellness and recovery models of care. There is a wealth of programs operating in the community that are based on these principles.  For example, a significant number have implemented Wellness Recovery Action Plan (WRAP) programs that are based on Mary Ellen Copeland’s research and the intrinsic principles of hope, personal responsibility, education, self-advocacy, and consumer support. 
  • Develop a state-standardized training curriculum with direct involvement of providers, consumers, and families. 
  • Assure the delivery of consistent training on a local and regional basis.  There should be a primary vehicle through which a uniform training program would be disseminated, carrying a universal theme and curriculum in each and every county/region across the state.  The Division of Developmental Disabilities (DDD) has adopted this approach by developing a standardized curriculum and outsourcing the delivery of the training through local Arc-NJ offices, which provide the training at an affordable cost.
  • Institute agency-based and Web-based training courses, allowing vital staff to remain on-site.  Given staffing issues, primarily staff recruitment and retention, it is difficult to spare direct service and supervisory staff the travel and training time consumed by extensive use of off-site training sessions.
  • Allow staff to use training as a substitute for experience.  Staff requirements for critical direct service and supervisory positions in various program elements call for one to two years of experience, which is difficult for otherwise qualified staff to acquire.  Participation in a stipulated number of approved training sessions/hours should be counted toward the experience requirement.
  • Include state hospital staff in community wellness and recovery training sessions to encourage the incorporation of wellness and recovery principles in treatment and discharge planning.
  • Revise/develop regulations governing training and staff credentials to incorporate addictions and mental health.  At present, mental health regulations often overlook staff qualifications that include addictions experience.

These are preliminary recommendations that NJAMHA hopes will serve to launch further discussion and mediation.  NJAMHA members request the opportunity to provide more extensive recommendations as deliberations on this topic become more advanced.

Again, thank you for providing the opportunity to voice our initial recommendations.  We look forward to continuing the dialogue.

Testimony Before the Department of Children and Families Regarding the FY 2008 Budget, November 9, 2006

The New Jersey Association of Mental Health Agencies represents 125 non-profit community-based mental health care providers throughout the state providing mental health, substance abuse and behavioral health care services to hundreds of thousands of adults and children.

Our members provide critical services to children with behavioral and emotional disorders and living with families in crisis. The programs run the gamut from intensive residential services, care management organizations, mobile response, youth case management, partial care, outpatient  and school-based services. NJAMHA members also provide services to families involved in the child welfare system, such as treatment for substance abuse and mental illness, and programs to unify separated families. This multitude of programs is the backbone of the community systems of care that New Jersey depends upon to assist vulnerable children and families.

As the Department of Children and Families develops its first budget since its creation, we urge you to maintain your commitment to ensuring that no resources are taken from services to fund administrative costs. We also urge you to ensure that you do not build new silos, but rather ensure that the system of care is fully integrated, family focused and makes sense. And we urge you to seriously examine the forces that have weakened both the adult and children’s behavioral health care systems over the years.

We recognize that this past year has been one of tremendous turmoil, change and achievement for the children’s behavioral and child welfare systems. With the creation of the new department, the settlement of the Child Welfare lawsuit and the restructuring of child behavioral health services, the State of New Jersey is facing a time of critical challenges and promise.  

We applaud the state’s effort to have an outside careful review of the entire system of care for children to ensure that it is “right sized.” The full spectrum of services—from the highest level of residential services for children with specific needs to outpatient services—must be readily available in the community. As you know, there are significant gaps in New Jersey’s system of care for children. Deficiencies include inadequate specialized residential services and a lack of options for children “aging out” of the system. We applaud the state’s efforts to begin to meet these needs, but there are still numerous other gaps. 

Each part of the system must be adequately and fairly funded to meet the demand, with sufficient staffing to support optimum sized caseloads. Need must drive the provision and allocation of services, rather than the temptation to access dollars in a particular program or the existence of artificial and inflexible caps.

For example, inadequate Medicaid funding for children’s psychiatric services in community-based programs adds to the lack of child psychiatrists and long waits for service. Children are referred to private psychiatrists at much higher reimbursement rates. The state could save enormous sums of money and provide better service by “right sizing” this part of the system.

Another example of a need to right size is the proliferation of “in-home” services. While these services certainly are warranted in some circumstances, they are being overly utilized because of the ease to refer and high reimbursement rates. More children could be served just as effectively -- and with greater oversight --  at lower cost to the state in established programs, if they were appropriately funded.  

However, as in the adult mental health system, many portions of the child behavioral system suffer from a compensation gap between staff at community behavioral health care provider agencies and state employees with similar responsibilities. On average, entry level state government salaries are at least 20 to 30 percent higher than comparable positions in the community. As the salary and benefit disparity continues to widen, we witness the loss of nonprofit staff to higher paying positions in government. As you know, it is not uncommon for employees in the community child behavioral health system to leave their jobs for DYFS positions.

This situation leads to high turnover and vacancy rates, with some programs reporting a 50 percent turnover rate annually and 25 percent vacancy rates. Obviously, this situation can cause turmoil in the lives of children and families who need consistency in care.

We urge DCF to invest in raising contract rates and to work with DHS to raise Medicaid rates -- some of which have not increased in 30 years -- to close this compensation gap.

Compounding this problem are the rare and inadequate annual cost-of living-adjustments (COLAs) for nonprofits. This year, the COLA was 1 percent. These meager increases, while greatly appreciated when compared to no increase, do not keep up with either growing demand or double digit utility and health insurance rate hikes, which have also wreaked havoc on nonprofits’ budgets.
For Fiscal Year 2008, we urge an increase of 4.1 percent COLA, which is in line with the Consumer Price Index for the Northeast Region.  We also ask DCF to support Assembly Bill 3713 and Senate Bill 2495, which would require the Governor's budget recommendation to annually provide funds for a cost-of-living adjustment to community providers and would alleviate the need to plead for increases each year. 

We applaud the state for adding additional funding for children’s behavioral health and child welfare services in the last fiscal year. And while it is vital that programs be added to the continuum of care, the system cannot survive if its core is not strong. Providing fair and adequate salaries is the key to the strength of the system.

Additionally, a system of care that operates efficiently and effectively is critical to its health. Unnecessary micromanagement of services stifles innovation, drives up operational costs and discourages underpaid, overburdened mental health workers.  DCF must coordinate oversight and regulations, which should be outcome-focused, and communicate them to the appropriate executives, as well as other personnel in a timely manner

Enhanced coordination across divisions -- as well as other departments in the state -- also is essential.  Most nonprofits have multiple contracts with two or more divisions within DCF, the Department of Human Services, and the Department of Health and Senior Services, as well as others. We must tear down the silos that hamper comprehensive and effective service delivery and tie up staff filling out paperwork rather than providing services.

Funding should also be made available to: expand the role of families in the system; ensure staff training in evidence-based and culturally competent services; and invest in the information technology that is necessary to move the system toward one that tracks and encourages improved outcomes.

Overall, we must ensure that providers, children, families and government work as true partners in strategically developing budgets, policies, regulations and programs that meet the needs of children and their families. Devoid of this partnership, future system changes will be developed in a vacuum without regard to how they impact the existing system or whether they create inequities in funding and salaries.

In the development of these policies and programs, the state must respect inherent variations in communities by incorporating more local control to ensure individualized service plans that are suited to the needs and strengths of each child and family.

In the spirit of this cooperation, NJAMHA is crafting a position paper that will address these and a multitude of issues affecting child behavioral health services in New Jersey. We enthusiastically embrace the opportunity to work with DCF to create a system of care in New Jersey that can serve as a model to the rest of the nation.

Testimony Before the Department of Human Services Regarding the FY 2008 Budget, October 19, 2006

The New Jersey Association of Mental Health Agencies, Inc. (NJAMHA) represents 125 nonprofit community hospitals and freestanding agencies that provide behavioral health services across the state to hundreds of thousands of adults and children. Our members provide a wide spectrum of services and treatment to help individuals with mental illness, and emotional, behavioral and substance abuse disorders work toward recovery.  

Community mental health organizations do an outstanding job of meeting the needs of the most vulnerable residents of New Jersey. In doing so, they also save the state billions of dollars by reducing the number of individuals residing in state psychiatric hospitals, or incarcerated in state prisons or county jails… by helping citizens remain in their community, find jobs, live on their own, care for their families and contribute to society.

As we demonstrated last year, untreated mental illness costs New Jersey and its businesses $4 billion and each dollar invested in mental health and substance abuse treatment reaps its benefits many times over. But a price tag cannot be placed on an individual's ability to reclaim his life.

In recent years, the state has made a noteworthy commitment to mental health services, recognizing the underfunded need. However, the investment has neither kept pace with demand nor expenditures. There are growing waits-for-service as demands for service burgeon while state funding has not kept pace.

There are a number of issues that New Jersey must address.

First and foremost, the state must begin to close the compensation gap between staff at community behavioral health care provider agencies and state employees with similar responsibilities. As the salary and benefit disparity continues to widen, we witness the loss of nonprofit staff to higher paying positions in government. On average, entry level state government salaries are at least 20 percent higher than comparable positions in the community.

This situation leads to high turnover and vacancy rates, with some programs reporting a 50 percent turnover rate annually and 25 percent vacancy rates. Obviously, this situation can cause turmoil in the lives of consumers who need consistency in care and delays in service delivery as positions lie vacant.

We urge DHS to invest $25 million as a down payment on a multi-year plan to close this compensation gap.

Annual cost-of living-adjustments (COLAs) for nonprofits are rare and require yearly pleas to the Governor and state legislature by the nonprofit community.  Further, when COLAs are included in the state budget, they are inadequate.  This year, the COLA was 1%. These meager increases do not keep up with either increasing demand or double digit utility and health insurance increases, which have also wreaked havoc on nonprofits' budgets.
For Fiscal Year 2008, we urge an increase of 4.1 percent, which is in line with the Consumer Price Index for the Northeast Region.  We also ask DHS to support Assembly Bill 3713 and Senate Bill 2495, which would require the Governor's budget recommendation to annually provide funds for a cost-of-living adjustment to community providers under contract with DHS.   

Further compounding the financial problems faced by providers are Medicaid reimbursement rates that have not been adjusted in almost 30 years.  For example, a comprehensive psychiatric intake costs about $200, but Medicaid reimburses providers $45.  A medication visit was relatively recently raised to $9 from $4.50, but the actual cost of the service is closer to $60.

DHS should hold hearings to examine and develop recommendations to address the significantly inadequate Medicaid reimbursement rates and their impact on systems of care and access to needed services and support.  The result of these hearings should be reflected in the Fiscal Year 2008 DHS budget request in terms of increased state funds to increase federal financial participation (FFP).

Government's unnecessary micromanagement of services stifles innovation, drives up operational costs and discourages underpaid, overburdened mental health workers.  DHS must coordinate oversight and regulations, which should be outcome focused instead of process oriented. Additionally, enforcement of regulations must be less punitive and more collaborative and educative. By focusing more on services and less on site reviews, the system could save money and serve more individuals.

Enhanced coordination across divisions also is essential.  Most nonprofits have multiple contracts with two or more divisions within DHS and the Department of Children and Families. We must tear down the silos that hamper comprehensive and effective service delivery. Efficiencies in the area of contracts would translate into savings that could be applied to nonprofits' utility increases and staff compensation. And as the state moves to a recovery focused system of care, we must ensure that Medicaid provides the funding to support this reform.

DHS must also invest in improved information technology. As behavioral health services become more outcomes focused, it is essential that providers have the tools to accurately track and compare data. Through such a process, providers can assess the success of programs and make modifications when necessary

Overall, we must ensure that providers, consumers and government work together in the development of budgets, policies, regulations and programs that meet the needs of consumers. We welcome the opportunity to partner with the department to fulfill Acting Commissioner Clarke Bruno's goal of ensuring that treatment and services pass the "good enough for me" test.

Testimony Regarding Child Behavioral Health Case Management, October 13, 2006

While NJAMHA is in the process of developing a comprehensive position paper on the child services system, we have recommendations that will serve to improve children's behavioral health services whether the state decides to consolidate case management or maintain the current structure.

I would urge the State to use due diligence in considering this matter and ensure that changes are in the immediate and long-term best interests of children and families. Over the last several years, New Jersey's child behavioral health system has undergone significant changes in leadership, direction, governmental structure, providers and philosophy. The final expansion of the existing system to Morris and Sussex counties and Hunterdon, Somerset and Warren counties, which made the current system statewide, was just completed in January of this year. Additionally, the enforceables demanded by the child welfare lawsuit and its recent settlement agreement added pressures to an already strained system and diverted the State's attention from proactive reform.

Understanding that the state must assess how the system was working, it contracted with the University of South Florida to conduct a comprehensive system-wide evaluation. We urge DCBHS to carefully examine the results of this study in collaboration with system providers before moving forward with an overhaul of the case management system.

Likewise, it is imperative that the design of child behavioral health services be based on data that accurately reflects the needs of children and families and not on anecdotal evidence. Decision making through the use of data is critically important to both community providers and the State. To date, we have not seen sufficient data that supports a complete system overhaul.

New Jersey's child behavioral health system has both strengths and weaknesses and we must accurately assess what they are. Numerous families would attest to the wonderful care and services they have received through the system. We certainly agree there is need for improvement. But when we move to remedy problems, we must be careful to determine the true causes.

For example, the state has expressed concern about children losing their case managers when they graduate to a less intensive level of service. There are numerous causes – not just a divided system -- that create this situation. For example, high staff turnover rates, prompted by inadequate salaries and/or demanding jobs, are an even greater problem leading to transfers to different case managers.  Additionally, there has been no data provided to the community on the number of children who have moved between the intensive and moderate levels of care.

The structure of the system is less the issue, rather than systemic problems that hamper the delivery of family-focused, culturally competent and effective services. Regardless of whether case management functions are unified, there are issues that must be addressed to ensure that the needs of children and families are met.

The current system is flawed because there are different sets of rules, expectations and resources for the various layers of the system. By establishing a consistent mission, with comprehensive training, appropriate levels of funding and caseloads and an effective information tracking system, the state could dramatically improve the level of services provided to children.

We recommend:

· A three-tiered system of case management, divided into intensive, moderate and care coordination. Each level must have appropriate capacity to meet demand, with manageable, yet flexible, caseloads. Contracted caseloads must be respected. Currently, children are often assigned to a level of service based on "caps" rather than on the true assessment of the child's needs.

· Care coordination should be conducted in the community, at the local level, rather than by the Contracted Systems Administrator. The current system does not provide for follow-up to ensure appropriate services are being rendered and are effective. Additionally, these services are often provided in-home at an exceptionally high per hour Medicaid rate and could be provided as effectively in an outpatient, community provider location at less cost. Certainly, there are instances when in-home services are necessary and desirable, but these services should be monitored by the local system and subject to a Quality Assurance process.

· By ensuring only those children who truly need in-home care are receiving it, the state could save money that could be better utilized elsewhere in underfunded sections of the system. Adequate resources must be dedicated to appropriately serve children and their families.

· Capacity in the intensive level of service must be expanded to appropriately meet demand. Currently, when a Care Management Organization is at its cap, children are referred to Youth Case Management, even though they require more intensive care.

· A case rate should be established for moderate level cases. This case rate should be differentiated to appropriately reflect the intensity of the services to be provided. By moving away from the current 15-minute billing practices of Youth Case Management to a case rate, service providers could better focus on the child's and family's needs rather than providing services that are "billable."

· The entire system should be family-focused and driven. All system partners should be trained in a clearly defined family-centered, wrap-around and culturally competent case model. Services based on the same value system should be delivered at all levels of care. 

· Family Support Organizations (FSOs) should be expanded to serve children and families at both the moderate and intensive level of services. Families should have a strong role in decision-making at all levels and family voice needs to be encouraged. For instance, if several children in one family are in different levels of the system, the family should have the option of being served by one case manager (or more), whichever they prefer.  Additionally, families should be able to keep their service provider and not be forced to change providers when moving from mobile response to a moderate or intensive level of service or when moving between the moderate and intensive levels of service.

· Families should not feel penalized when they graduate to a less intensive level of care. With modifications in the system, inclusive of a "family case management model" rather the current individualized model, coupled with adequate financial resources, balanced caseloads, appropriate training and a family-focused mission, services would not diminish when a child needed less intensive oversight.

· Understanding that communities have different cultural and geographical make-ups, the system should be flexible and be directed at the local level, enabling communities to assess and meet their needs as they see most appropriate.

· Above all, there must be adequate community services available. For example, if there are inadequate residential or outpatient resources, case managers will be unable to refer children to the services, which meet their needs.

Testimony Regarding the Contracted Systems Administrator, October 17, 2006

As the Division of Child Behavioral Health Services develops a Request for Proposals for the Contracted Systems Administrator, NJAMHA offers the following recommendations:
· NJAMHA supports the Contracted Systems Administrator serving as both a call center and operating a management information system, but not serving as a level of care coordination. The call center should serve as a single point of entry into the child serving system.  

· It should use a toll free phone number for access that must be publicized throughout the state to ensure that all family members and all referring systems understand how to enter the child-serving system.  This toll free phone number must be answered 24 hours a day, seven days a week by a call center located in New Jersey. 

· Call center employees, who are the gatekeepers to the system, must know New Jersey well and include multi-lingual staff who can speak to family members in the language of their choice. 

· All call center staff must be properly trained through a certification process to ensure consistency among all staff answering the phone and ensuring that children and families receive excellent customer service. 

· In addition, all Contracted Systems Administrator staff must attend the same trainings that are offered to all system partners, which should include, at a minimum, training in the wraparound model, cultural competency, and all staff must be trained and certified on the strengths and needs assessment and the crisis assessment tool.  

· Call center staff must have access to a complete and up-to-date resource directory and have a working knowledge of the formal and informal services that are available in every county of New Jersey.   

· NJAMHA recommends using a user-friendly, web-based management information system (MIS) to make it easier for everyone to view and access electronic records from any location that has an Internet access.  This MIS system needs to have the capabilities to be easily updated and changed as the needs of the system change.  This system need to collect accurate data that can be used to produce relevant, real-time reports for all users, as well as provide the capabilities for customized reports to improve quality and increase outcomes for users of the system.  NJAMHA recommends that this system have the interface capabilities to integrate provider records into the MIS system to avoid duplication of data.  NJAMHA also recommends comprehensive training be provided on this system and a written manual that includes information on what data should be included in the electronic record.  In addition, the fields in the electronic record need to be capable of being translated into the language of choice by the family.  The system should allow siblings to be linked via the electronic record.  This management information system must provide real-time authorizations for services.

· NJAMHA recommends that all care coordination services be conducted in the community, at the local level, rather than by the Contracted Systems Administrator, to provide proper follow-up to ensure that the child and family received the services they needed. Also, when the Contracted Systems Administrator authorizes a needs assessment for a child or adolescent, that assessment should also be performed in the county where the child lives.

· NJAMHA recommends that providers, specifically chief executive officers, as well as program directors, receive clear, written communications regarding current policies and procedures, as well as written communications when policies and procedures are changed.   

· The Contracted Systems Administrator should employ fifteen service specialists for all fifteen child-serving areas that cover the twenty-one counties to ensure that each system of care has a designated representative to address issues and concerns and serve as the knowledge expert for resources for each area.  These service specialists must work collaboratively with all system partners to address and fix issues on the local level.

Status of Federal Fiscal 2007 Appropriations Bills

As of close to the end of September 2006, merely weeks away from the start of the new federal fiscal year, none of this year’s appropriations bills have been signed into law. 

The U.S. Senate has passed only two (2) of the twelve (12) appropriations bills-the Homeland Security and Defense spending bills.  The other ten (10) remaining appropriations bills have not been considered by the Senate.  With the impending November elections, Congress will likely complete its business in a lame-duck session after the election. 

In contrast, the U.S. House of Representatives has passed every appropriations bill except for the contentious Labor-Health and Human Services (Labor-HHS) bill. The Labor-HHS package was amended in committee to include a controversial raise in the minimum wage.  

Congress must pass continuing resolutions that temporarily fund federal programs until appropriations bills have been enacted into law to avoid a government shut down.  In all likelihood, the unfinished appropriations bills will most likely be combined into one large "omnibus" bill.

Following are details on the Labor-HHS bill.

Bill Funding:
FY06 Comparable:           $141.088 billion ($460 billion mandatory)
FY07 Budget Request:      $137.794 billion
FY07 Bill:                         $141.930 billion ($454.6 billion mandatory spending)
Discretionary spending in the bill will increase a little less than one percent over last year. 
Maximizing Access to  Community-Based Health Care

The bill earmarks a record level of funding to expand access to community-based health care.  Total funding provided for Community Health Centers is $2 billion, $206 million above last year and $25 million above the request.  This funding increase will allow the creation or expansion of 300 medical facilities across the country.  These centers will continue to serve minority and underserved areas and homeless and needy populations. 
Supporting Healthier Neighborhoods and Strengthening Health Care Infrastructure

• Telehealth—The bill includes an increase of $3 million for a funding level
• Social Services Block Grant is level funded at $1.7 billion, an increase of $500 million over the President’s request.

Other Items
• The bill terminates 56 programs for a savings of $1.66 billion. 
• The bill provides approximately $1 billion for Member projects, $100 million less than previous, comparable levels and less than 1% of the total funding in the bill. 
• Maintains current law on all abortion restrictions.

NJAMHA Leadership Conducts Productive Meeting with Department of Children and Families Commissioner Kevin Ryan

August 3, 2006

NJAMHA CEO Debra Wentz and several representatives from the Board and children's programs initiated a productive meeting with Department of Children and Families (DCF) Commissioner Ryan, during which he committed to work with NJAMHA as a partner. Throughout the discussion, NJAMHA representatives highlighted the organization's expertise, experience and members' offer to provide free consultation through the development of regulations, policies and services. They requested that a structure be established to ensure that providers are involved in such planning to resolve problems, rather than being asked for feedback on solutions that have already been developed without their input. Commissioner Ryan specifically stated that he welcomes such involvement and open communication, which will continue through quarterly meetings with NJAMHA, as well as some other NJAMHA representatives' involvement on the Commissioner's Advisory Committee.

NJAMHA raised numerous issues and stressed that funds must not be drained from services. Commissioner Ryan gave a commitment to make cuts internally and strive to avoid diverting funds from provider services.

Bruce Stout, Division of Child Behavioral Health Services (DCBHS) Director, and Lisa Eisenbud, DCF Chief of Staff, also participated in the meeting.

Vision of DCF

Commissioner Ryan identified DCF's vision as strengthening families and keeping children safe. He explained that the blueprint is a starting place that he hopes will increase public confidence in the child welfare reform efforts. He mentioned that while other government departments serve children and he aims to work with them, his initial focus in August and September is to better integrate the divisions in DCF, which include DCBHS, Division of Youth and Family Services (DYFS) and Division of Prevention and Community Partnerships. Once this integration is deemed effective, Commissioner Ryan will then look into bringing in programs from other departments, such as Law and Public Safety and the Department of Health and Senior Services.

While the settlement agreement includes some benchmarks, Bruce Stout has 16 priorities beyond the settlement agreement.

Commissioner Ryan expressed his commitment to integrating the case management system and to work with NJAMHA to achieve this goal. His objective is to have both a youth case management (YCM) program and a case management organization (CMO) in one agency and that both entities would interface with child protective systems without duplicating work.

Another major project is the development of a more comprehensive Family Preservation and Reunification Initiative, through which Commissioner Ryan is striving to develop services and better integrate those services into a case practice model. He stressed that "we want removal to be the last resort, to keep families together and transition kids who are in custody back to their families." The initiative will first be piloted and will include prevention through partnerships with counties. Commissioner Ryan plans to have a framework developed by next spring for comprehensive county-based needs assessments to be conducted every three years, possibly through the county-based Human Services Advisory Councils. In addition, an array of preventive secondary and tertiary services for children who are at risk of abuse will also be developed.

DCF will conduct a comprehensive review of all contracts to establish what was accomplished through these contracts and determine how the benefits to children will be measured.

Budgetary cuts of approximately $20 million will be necessary to make this initiative possible and will be determined within the next month. Some cuts have already been made through consolidation of some DYFS county offices, and others will be merged. Commissioner Ryan specifically stated, "The last place we'll look for cuts is in services."

Commissioner Ryan also noted that no-bid contracts have been eliminated and, therefore, the process of awarding contracts will be slower. In addition, DCF will create a college consortium for providing training on prevention and safe parenting practices.

Contract Payments

The meeting attendees addressed the fact that payments from DCF have not been received since July 1, 2006, that there is confusion about who is handling contracts and that some agencies are waiting for contracts. Lisa Eisenbud mentioned that she and Lisa Taylor, DCF Director of Administration, are looking at business practices, including contracting, to make them more cohesive. They aim to centralize contracts as much as possible across departments (i.e., Department of Human Services and DCF) and divisions. However, problems within the Office of Children's Services (OCS) must be addressed first.

IT Project

NJAMHA's IT Project Director June Noto remarked on the inefficiencies in various State departments and emphasized the need for infrastructure that would provide funding not just for technology, but also training to maximize the investment in that technology. She stressed that NJAMHA provides advice and training free of charge, as these services are included in NJAMHA's contract with DMHS. She further emphasized that government departments need to integrate on the back end in order to prevent costly duplication. Commissioner Ryan requested that NJAMHA provide language that he could incorporate into the DCF request for proposal (RFP) for training.

Cost of Unfunded Mandates

The meeting attendees emphasized the need for Commissioner Ryan and all government staff to think through programs and determine the costs to providers before implementing these programs.

Commissioner Ryan noted that the Quality Service Review project has not been abandoned. However, the providers indicated that this project seemed to be abandoned due to lack of consistent communication.

Both Commissioner Ryan and the meeting attendees agreed that the Rensselearville Institute Training project is not a wise investment.

Utilizing Accredited and Licensed Entities for DCBHS

The meeting attendees stressed the importance of holding all types of providers to the same standards and requiring accreditation and licensing for contract bids. In-home providers were identified as the greatest problem. Since they do not have to meet the same licensing standards and they receive very little supervision, their qualifications are not verified and there is a real potential for fraud. Commissioner Ryan expressed a high level of concern about this issue and the vulnerable people involved. He committed to having an investigation conducted.

Quarterly Meetings

Commissioner Ryan agreed to hold quarterly meetings with NJAMHA. He also invited NJAMHA to send representatives for the Commissioner's advisory group that will begin in early fall.

Meeting attendees requested that this process be based on continuous quality improvement, that they be given the opportunity to be involved and that their input be taken seriously. Commissioner Ryan seemed receptive to these requests.

Operational Incentives in DCF Contracts

Lisa Eisenbud noted that the Treasury has DCF's proposal to extend the DMHS Operational Incentives Policy to DCF. The Treasury will not approve the operational incentives until DCF demonstrates control of the contracts in OCS.

Interaction of Youth Case Management Programs and Case Management Organizations

Meeting attendees raised the issue of discrepancy in rates between these programs, i.e., the YCM programs receive lower payments than CMOs when YCM programs are handling CMO-level cases. The group stressed the need for a Medicaid case rate, which would enable the YCM and CMO staff to focus on services and quality, rather than documentation of every 15-minute time interval they work. In addition, the Medicaid case rate should cover unbillable services, such as appearing in court.

The overload of cases at YCM programs also was addressed. Commissioner Ryan proposed an interim step of perhaps limiting YCM caseloads, i.e., children would be served through DYFS or a YCM program, not both.

Bruce Stout stated that he is launching a public process regarding the RFP for the Contracted Systems Administrator renewal and what the RFP should include. Focus groups will be conducted with YCM and CMO staff, as well as others involved with the child welfare system, followed by three regional stakeholder forums to develop the RFP.

Commissioner Ryan agreed that he needs to visits sites to gain a better understanding of what the community providers do. He will work with Paula Sabreen to arrange a visit at her agency. He will also work with NJAMHA staff to identify other sites that he should visit.

Plan for Outpatient Mental Health Care Services

Meeting attendees noted that traditionally, funding is provided for adult mental health care services, but not for children, and they mentioned the low Medicaid reimbursement rate for psychiatrists. As a result, there are no places where children can go for outpatient services. Bruce Stout mentioned he has launched a "right-sizing" project; although no additional funds are available, utilization control will be implemented to develop reasonable Medicaid rates.

$22 M COLA /No Prior Authorization

July 8:

A $22 million COLA is included, for community care providers, in the $33.6 billion Budget passed by the Legislature and signed by Governor Corzine today. While the funding is included in the Department of Human Services budget, there were some reports that the money applied to Children and Families Department contracts as well. The budget document language, however, only referred to DHS contracts. NJAMHA will pursue clarification as soon as possible.  Meanwhile find COLA language under Grants-in-Aid, under 99-7500 Administration and Support Services (S2007/A4900).

The inclusion of the COLA in such a tight fiscal year represents a major victory for NJAMHA's advocacy efforts, which continually called for an increase despite the state's fiscal woes.

While Governor Corzine line item vetoed 53 items totalling $51.3 million, the $22 million for the COLA inserted by the Legislature at the last minute remained intact.

It also appeared that NJAMHA and other advocacy groups, including NAMI-NJ, were successful in convincing the Governor to remove language from the budget that would have required prior authorization for particular psychotropic medications for Medicaid recipients, including those without a generic equivalent.  While the prior authorization language had been removed from the PAAD section by the Legislature, it remained in the adopted budget for Medicaid recipients. After a day of contacting the governor's office, Debra Wentz was informed by a Governor's Office Public Policy staff member tonight that the prior authorization language had been removed.

As previously reported, copayments for prescriptions, outpatient visits and non-emergent emergency room use are eliminated from the budget. It appears that all other NJAMHA priority expenditures remain basically unchanged from Governor Corzine's original proposal. However, NJAMHA will conduct an extensive analysis of the Legislature's budget and the governor's veto message and provide details as soon as possible.   

NJAMHA CEO Presses for Removal of Prior Authorization Language from Budget

Restricted access to all psychiatric medications desperately needed by consumers of mental health services is in the budget before the governor.  NJAMHA has steadfastly lobbied against the inclusion of this language.

In a last minute effort to remove this restriction, Debra Wentz, CEO, NJAMHA, is urging the office of the Governor's chief counsel, Stuart Rabner, to recommend to the governor removal ,via line item veto, of prior authorization of brand name psychiatric medications. 

Wentz pressed counsel's support staff to assure immediate delivery of NJAMHA's plea, and the message was in fact directly delivered.

WE MUST REMEMBER OUR MOST VULNERABLE CITIZENS  Debra L. Wentz, CEO of the New Jersey Association of Mental Health Agencies, Inc., said today that we must remember our most vulnerable citizens with mental illness.

Assembly Bill 4801, which was voted on early Saturday morning still includes prior authorizations for psychotropic prescriptions, said Dr. Wentz, and NJAMHA would like to see the Governor line item veto this clause.

In national studies, it has been proven that making it difficult for individuals with mental illness to get their medicine is detrimental to their well-being and will ultimately increase costs for the state through increased hospitalizations and greater demand for services,” she said.

“We have remained committed to meeting the needs of individuals with mental illness, even though the state cannot pay for the services either through contracts or Medicaid,” said Wentz. “It is imperative that the stalemate be resolved and that the final budget plan not include prior authorizations. She noted that placing resources into mental health services is a wise investment in people, families and communities that will save the state money in the long run.

Wentz said the state should not interfere with a doctor’s prescription decision, noting that it often takes years to find the appropriate psychiatric medication to help an individual on the road to recovery. Numerous studies have shown that cost savings achieved by limiting access to mental health drugs are offset by a decline in the quality of care, leading to increased medical emergencies and the need for more mental health services.

Special Message from Kevin Martone, Assistant Commissioner, DMHS.
In an earlier conversation, he noted that the availability of this funding only applies to DMHS contracts. It appears programs funded under other contracts will have to await the reinstatement of state government, unless other divisions can obtain similar alternative funding sources

The latest media reports indicate that the Assembly and Senate budget committees will meet later this afternoon, with Legislative sessions to vote on the spending plan scheduled for this evening. Governor Corzine has said he would await passage of the budget before re-opening state government.

Dear Agency Provider:

After over a week of coping with the floods and government shutdown, the Department of Human Services and Division of Mental Health Services have been working diligently with a limited staff to seek alternative means to ensure that providers receive contract funds to maintain services in the community.  

By re-configuring block grant funds based upon eligible activities, the Division has processed payments for nearly every provider that we contract with.  Providers with direct deposit should begin receiving funds into accounts on Monday.  Providers that receive checks in the mail should receive those sometime next week.  Once we are able to process FY 2007 payments from State funds, providers will receive the balance of funds shortly thereafter.  

The Division of Mental Health Services will resume full operations once Governor Corzine authorizes us to do so.  This crisis has been a stressful time for all of us, and I want to express my gratitude to all of you for your patience.  Should questions arise as you receive payments, please contact your Contract Administrator early next week.  If you received this email erroneously, please forward it to your CEO/CFO.  Thank you.

Kevin Martone, LSW
Assistant Commissioner
NJ Division of Mental Health Services
50 E. State Street, 3rd Fl
Trenton, NJ 08625
(609) 777-0702

DMHS Message to Providers

Message from Kevin Martone, Assistant Commissioner, DMHS (Bruce Stout, Director, Division of Child Behavioral Health Services sent out the identical letter to providers of youth services.):

Dear Provider,

As one of our key partners providing important, and often vital, human services to the residents of New Jersey, I want to let you know that Commissioner Kevin Ryan and his senior staff have been hard at work during this state government shutdown to identify an interim solution to avoid any lapse in our funding commitment to you. 

We understand that this shutdown raises questions and uncertainties about how and when the Department of Human Services may be able to provide you with its next scheduled payment.  As such, we want to assure you that we are doing all that we can through this challenging time to maintain our commitments to you and the communities we serve.

We have identified and are working through some options that may allow us to provide you with at least the funding amount you need to maintain ongoing services.  We will notify you immediately of any definitive solutions we have confirmed and will provide you with an update of our contingency plans by Friday, July 7 at the latest. 

Please know that we value your service and appreciate your patience and understanding.  If you have any questions about agency operations, please you're your DMHS Regional Office.



Kevin Martone, LSW
Assistant Commissioner
NJ Division of Mental Health Services
50 E. State Street, 3rd Fl
Trenton, NJ 08625
(609) 777-0702

Provider Payments

Anticipating provider payment issues, Deb Wentz spoke with DMHS Contract Administration prior to the shutdown.  She was advised that barring any different directions from the administration or the Legislature, providers would be made whole when funds started to flow again.

Richard O’Grady, CEO of the New Jersey Association of Children’s Residential Facilities (NJACRF), reports that FY 06 payments will continue to be processed by Unisys and usually for 1/2 to 3/4 of July, most residential payments are for FY 06 services.  He understands that contingency plans are in the works now for incrementally securing funds for FY 07 in the absence of a budget, but there is no concrete information at this time. 

NJAMHA expects to get details directly from DHS shortly.

Stalled Budget Impacts Providers

July 5: 11:45 a.m.

The Star Ledger reported today that nonprofit agencies that provide services to the state are nervously wondering how long they can hold on without payment.

"If it goes beyond two weeks, we'll be in trouble," said Jeff Fetzko,
executive director of the Somerset Home for Temporarily Displaced Youth
in Bridgewater, which relies on $2 million in state contracts to support
its $3.1 million shelter and group home operation.

Corroborating the unofficial information reported to NJAMHA yesterday, "Human Services Commissioner Kevin Ryan said the state is seeking a bank line of credit
of about $15 million to ensure some 90,000 adults get mental health
treatment and 9,000 people with developmental disabilities stay in group
homes just for next week, as well as to preserve some other programs.
The bank would pay the contractors on the state's behalf."

DHS is in the process of preparing an update for providers.  NJAMHA will share it as soon as it is received.


Stalemate Continues

July 5  9:00 a.m.-Day 5 of Shutdown

Governor Corzine addressed a joint session of the 211th Legislature for a second time in as many days. 

He opened his address by stating that the budget issues remain the same today as yesterday.  He is open for compromise, but stands firm in generating recurring revenues and avoiding quick, one-time fixes that have contributed to the budget shortfall.

He recognized the disruption the state shutdown has had on the public and understands the public's anger.  He stressed that shutting down non-essential state services was not a discretionary act on his part, but is required by the state's Constitution in the absence of a balanced state budget.

He ended his brief address by pledging to stay in his office until there is a logical and honest end to this crisis.  His door remains open.  

Legislators ended their July 4 session last night around 11:00 p.m. and spent the night at a hotel down the street from the Statehouse. Corzine remained in his office.

Meanwhile, beaches, state parks, and casinos are closed, or are in the process of closing.  Open are essential services including state psychiatric hospitals, institutions for persons with developmental disabilities and state police.

The state has extended to August the deadline for auto registrations and drivers' licenses that came due June 30.

NJAMHA will be closely monitoring the possible suspension of the state pharmaceutical prescription program for seniors and persons with disabilities.  Presently, the program is intact, but if state funds are not available by next week, some administration officials have said to the media that this program may be in jeopardy, and recipients may not be able to access their medications.  Again, at this time, the program is operational. 

Updates will continue...

Budget Update

July 4:  10:00 p.m.

As of this writing, NJAMHA is unaware of any state budget resolution. 

However, earlier in the evening a Department of Human Services (DHS) representative unofficially reported to NJAMHA that DHS is actively working with Treasury, along with other high level officials in the administration, to find a way to provide cash to providers as quickly as possible in the absence of an appropriation.

Also, in reference to support services, municipal welfare and county welfare agencies are not affected by the state shutdown.  All child protective services will continue and neither NJ Medicaid nor NJ FamilyCare will be disrupted by the shutdown.

NJAMHA wiill continue to keep you informed as we hear more information.

Corzine Addresses Lawmakers

July 4, 11:00a.m.

Corzine said the government shutdown is required and warned of more dire effects if the impasse continues such as pharmacists not being reimbursed for seniors' prescription drugs, families unable to move into homes because warranty certificates are not processed and postponing a summer camp for the blind and developmentally disabled. Highlights of his speech follow:

The shutdown of state government is more than a mere inconvenience to the citizens of New Jersey.
  • Beginning next week, the state will not have the ability to refund pharmacies for the medicine they are providing to our seniors.
  • A known financial crisis...has turned into an immediate constitutional crisis and a personal crisis for our citizens.
  • The focus on the short-term solutions to long term problems has continuously compounded the state's deficit.  It cannot and will not continue. Many of the recommendations made by the Legislature have already been agreed to.  We have agreed to eliminate the hospital tax. We have agreed to eliminate proposed taxes on alcohol and water. ...[but] we are still over one billion dollars away from a balanced budget.
  • President Codey, Speaker Roberts and I have all agreed that unfortunately new revenues along with spending cuts are necessary to fix this problem.  Each of us believe that an increase in the sales tax is a fair and responsible method to raise new revenues.  Our disagreement today is over what portion of the sales tax should go towards putting the state on sound fiscal grounds.
  • It is four days past when we should have had a budget in place.  We must stay here until we meet our Constitutional obligation.  Our obligation of public office extends beyond doing the thing we want or the things that are easy.
  • It requires us to rise above the politics of fear and make decisions that are in the best long-term interests of those we represent

    Governor Speaks Out on Budget Crisis

    July 3:  4:00 p.m.

    Just moments ago, Governor Corzine spoke out on the state budget crisis on a local radio station. He stated that the budget issue in NJ is a long running problem making New Jersey one of a handful of states with a serious deficit.  He added that New Jersey has been remiss in not taking on its financial responsibilities in past budgets.

    Thus far, a $2.5 billion cut in expenditures has been proposed, but is still insufficient to make up the deficit.  Cuts have been deep, and the governor fears that any further cuts might negatively impact public safety.  Additional recurring revenues are essential at this time to balance the budget.

    Assembly Speaker Roberts was quoted by the interviewer as calling Corzine's decision to shut down state operations as "unconscionable and indefensible".   Corzine's response to that was that the state constitution required the shut down.  There was no budget passed as of the June 30 deadline, so money cannot be spent.

    Corzine is of the opinion that the NJ Senate ,and some lawmakers in the Assembly, would be willing to accept the proposed budget with some "modifications".  Corzine called Assembly Speaker Roberts "uncompromising".  He attributed the present stalemate to problems of "political leadership".

    In response to a question posed on the 45,000 furloughed state workers, Corzine said that he is as concerned about these workers as much as anyone else is, but that we are in a crisis and must follow the law.  A budget must first be presented by the Legislature or else he cannot reopen state government. 

    About 150 furloughed state workers held a vigil in Trenton today.  Corzine expects that these workers will receive back-pay after the budget impasse is resolved.

    This morning, a state appeals court ruled that the 12 casinos in Atlantic City must close their doors by 8 a.m. tomorrow if a state budget is not enacted or if a higher court does not intervene with a ruling in their favor.

    Dozens of motorists visiting the state's motor vehicle offices today were angered at finding the offices closed for business.

    NJAMHA will keep you posted.




    State Still Shuttered

    July 3, 2006

    The state is in its third day of shutdown.  Lawmakers have not yet reached a compromise on how the $4.5 billion hole in the budget will be plugged. 

    Today's Newark Star Ledger reported today that "In a meeting at the governor's mansion in Princeton last night, Assembly Democrats offered a list of ideas that included a broad array of new tax increases as alternatives to Gov. Jon Corzine's proposed sales tax increase.  The meeting ended after four hours with no hint of agreement.

    The Senate is scheduled to meet today, at noon, but had no legislation on which to vote.  No Assembly activity was scheduled.

    Courts and motor vehicle offices are closed.  Sales of lottery tickets and road construction have been halted.  The closure of casinos and racetracks are impending and their fate will be decided July 5 if no budget is adopted prior. Meanwhile, State offices, including DMHS, are closed except for workers deemed "essential".

    If the shutdown continues, Governor Corzine said that state-aid services, such as prescription drug assistance, may be affected.

    36,000 state employees are working without pay, and it is unknown whether the non-essential furloughed workers will ever be paid.  Corzine is leaving that decision up to the Legislature after the 2007 state budget is adopted.

    Budget Still Stalled

    July 2, 2006

    Over bitter intraparty differences on the proposed hike in the sales tax, on July 1, Governor Jon S. Corzine closed state government for the first time in history.  The governor stated that "It gives me no joy…to do what I'm forced to do here…. And there will be people who do not receive the attention that they rightfully deserve from our state government."

    The governor signed an executive order, initiating a phased shutdown of state government operations, and non-essential state government employees were notified not to report to work.

    About 45,000 state employees were furloughed Saturday, July 1; however, close to 36,000 state employees designated as essential were to work without pay until a budget is put in place.  These include state police, prisons, psychiatric hospitals, and child welfare. 

    The Newark Star Ledger reports that over the past five years, New Jersey has missed the July 1 deadline for a balanced budget on four occasions, and although past governors had threatened a shutdown, one has not occurred because all of the previous budgets were adopted earlier than July 2.

    The full implications or the length of the shutdown continues to remain unclear.  As of this report, the shutdown has begun its second day.  The conflict leaves New Jersey without a budget as the constitutional deadline for a new fiscal plan has elapsed.

    Assembly Speaker Joseph Roberts, Jr., D-Camden, called the Assembly Budget Committee back to the Statehouse for a meeting today, Sunday, July 2.  The Senate is scheduled to meet in Trenton on Monday, July 3.

    As to the impact of the shutdown on provider organizations, it is up to individual agencies to determine how they will respond to the government shutdown. It is expected that checks for contracts would be delayed as they usually are received one to two weeks after the budget is signed. 

    NJAMHA has spoken with the Division of Mental Health Services (DMHS), and they have confirmed that they would retroactively honor agencies' contracts back to July 1, unless otherwise directed by the Treasury, Governor's Office or a vote by the State Legislature to withhold those dollars. 

    It is contingent upon each agency to determine if it is unable to maintain all of its services and which are not essential if it fears facing a financial setback as a result of the shutdown.

    Further, NJAMHA has analyzed the proposed Assembly Democratic spending plan. Expenditures in the budget proposal that would impact NJAMHA members do not appear to be significantly different than those included in Governor Corzine's budget plan, although the legislation does not include co-payments for Medicaid beneficiaries for prescriptions and emergency room use.

    NJAMHA will continue to monitor the situation. 

    Board of Social Work Examiners Website 2006-2008 Renewal Process

    The Division of Consumer Affairs (DCA) will, for the first time, offer on-line social work licensure/certification renewal for the 2006-2008 cycle. Though the on-line process will be available throughout the regular renewal period ending August 31, 2006, and for the following 1-month late renewal period through September 30, 2006 which includes the additional late fee of $100.00, the paper renewal process will begin mid-July 2006 when a renewal will be mailed to those who have not yet renewed on-line. A "my license" notification with instructions for the on-line process will be mailed ahead to all New Jersey social workers .
    All social workers are encouraged to renew on-line as it simplifies the process and allows for a credit card payment. A receipt of payment is available by pressing "print" after the on-line process is complete. Once you have cleared the receipt screen, you cannot retrieve the screen in order to document your on-line renewal process and payment nor will the Board provide you with a receipt of your payment.

    NOTICE - For the 2006-2008 renewal the DCA is issuing a credit - a reduction of fee amount for each level. The credit results in a reduction of $40.00 for the LCSW level, $30.00 for the LSW level and $20.00 for the CSW level. Your renewal will indicate the correct payment amount to submit at your level.

    New Medicaid ID Cards

    Beginning now, the NJ FamilyCare/Medicaid program is replacing its monthly paper Medicaid eligibility identification card with the Health Benefits Identification Card, (HBID), a permanent, plastic, magnetic stripe card.The NJ FamilyCare/Medicaid program is replacing its monthly paper Medicaid eligibility identification card with the Health Benefits Identification Card, (HBID), a permanent, plastic, magnetic stripe card. Starting now, plastic cards will be mailed to beneficiaries in three counties (Camden, Monmouth and Sussex). Those who receive the card in May must begin using it on June 1, 2006, while individuals who live in the other counties will receive their HBID cards in August 2006, and must begin using them on September 1, 2006.After that, all monthly paper ID cards will be discontinued.Key facts about the HBID card: Each eligible family member will receive his or her own card. The card is for identification purposes only.Providers will verify eligibility. The HBID card is a technology upgrade, not a policy change. People receiving the HBID card should use it the same way they use their monthly paper Medicaid card. Medicaid will be presenting on the card at the May 25th NJAMHA Billing Supervisors Practice Group. Additional information gleaned from the presentation will be shared with our members.

    SAMSHA Releases New Report
    Just recently, on April 6, 2006, the  Substance Abuse and Mental Health Services Administration (SAMHSA) released The 2004 National Survey on Drug Use and Health (NSDUH). This is an annual survey of  the non-institutionalized population of the United States, aged 12 years and older. For full report, click here

    Although the report details statistics, on both a national and a state-by-state basis,  related to illicit drugs, alcohol, and tobacco products, the survey contains a component on major depressive episodes, serious psychological distress and the incidence of treatment of any mental health problem in 2004.

    SAMSHA reports that:  “The data show that  West Virginia had the highest rate
    of serious psychological distress among persons ages 18 and older in the
    past  year (12.7 percent) while Hawaii  had the lowest rate (7.1 percent).
    Increases in serious psychological distress  appeared in 10 states, Arizona, 
    California,  Florida,  Illinois,  Iowa, New  Jersey,  Pennsylvania,  Texas, West 
    Virginia and  Wyoming, generally the result of  increases among persons ages 26
    and older.

    More notable data from the national summary  statistics showed that Among the 4.6 million adults with both serious  psychological distress (SPD) and a substance abuse disorder in 2004, only 6%  received both types of treatment.

    In 2004, there was an increased rate of SPD in  adults (9.9%) from the rate in 2002 (8.3%).  The most prevalent type of treatment for  mental health problems among adults in 2004 was prescription medication (10.5  percent of the population), followed by outpatient treatment (7.1  percent). Additional findings  follow: Major Depressive Episode:

    In 2004, there were 35.1 million (14.7  percent) persons aged 12 or
    older who had at least one major depressive  episode (MDE) in their lifetime.
    Of these, 19.3 million persons (8.1 percent  of the population) had an MDE in
    the past 12 months, including 2.2 million  youths aged 12 to 17 and 17.1
    million adults aged 18 or  older.

        *   The past year prevalence of MDE was  highest for persons aged 18 to
    25 (10.1 percent) and lowest for those aged 26  or older (7.6 percent). The
    rate among youths aged 12 to 17 was 9.0 percent.  Females were more likely than
    males to have MDE in the past year (10.6 vs. 5.5  percent).Persons with past year MDE were more  likely than those without MDE
    to have used an illicit drug in the past year  (28.8 vs. 13.8 percent). Similarly, substance dependence or abuse was more  prevalent among persons with MDE
    than among those without MDE (22.0 vs. 8.6  percent, respectively).Among persons aged 12 or older with past  year MDE, 62.3 percent
    received treatment (i.e., saw or talked to a medical  doctor or other professional
    or used prescription medication) for depression  within the past 12 months.

    Serious Psychological Distress:

        *   While MDE estimates describe persons with  a specific mental disorder, the survey also produces estimates of serious  psychological distress (SPD), which describe persons with a high level of  distress due to any type of mental problem. In 2004, there were 21.4 million  adults aged 18 or older with SPD. This represents 9.9 percent of all adults, a  rate that increased since 2002 when it was 8.3  percent. SPD was highly correlated with substance  dependence or abuse. Among
    adults with SPD in 2004, 21.3 percent (4.6 million)  were dependent on or
    abused alcohol or illicit drugs, while the rate among  adults without SPD was 7.9
    percent. Among the 21.4 million adults with SPD in  2004, 10.3 million, or 48.1 percent, received treatment for a mental health  problem in the past year.

        *   Among the 4.6 million adults with SPD and  a substance use disorder in 2004, 47.5 percent (about 2.2 million) received  treatment for mental health problems, and 11.0 percent (503,000) received  specialty substance use treatment. Only 6.0 percent (274,000) received both  types of treatment. Treatment for Any Mental Health Problem. In 2004, 27.5 million adults (12.8  percent) received treatment for
    mental health problems in the past year. This  estimate is similar to the estimates in 2002 and  2003. The most prevalent type of treatment for  mental health problems among adults in 2004 was prescription medication (10.5  percent of the population), followed by outpatient treatment (7.1 percent).  1.9 million adults (0.9 percent) received inpatient care for mental health  problems at some time within the past 12 months. In 2004, 5.7 million youths aged 12 to 17  (22.5 percent) received
    treatment or counseling for emotional or behavior  problems in the year prior to
    the interview. This is higher than the estimates  for 2002 (19.3 percent) and 2003 (20.6 percent). 

    NJAMHA asks Congress to reverse Medicaid cuts

    Out of serious concern over the President's FY 2007 budget request and its impact on persons with mental illnesses and children with emotional and behavioral disorders,  NJAMHA's Board of Directors paid a visit to six of New Jersey's U.S. Congressmen. 

    On March 9, 2006, NJAMHA visited the offices of Congressmen Rodney Frelinghuysen [R-11th District], Rush Holt [D-12th District], Frank LoBiondo [R-2nd District], Donald Payne [D-10th District], Jim Saxton [R-3rd District], and Christopher Smith [R-4th District].  Congressman Smith was the sole New Jersey Republican representative voting against the cuts in the Budget Deficit Reduction Act.  All other votes followed party lines, with Democrats voting against and Republicans voting for the act.

    The issues of utmost concern that were discussed on March 9th included the reduction of vital Targeted Case Management services (TCM).  In New Jersey, the children's system of care hinges on TCM services as well as adult Integrated Case Management Services (ICMS).  Mental health consumers need specialized case management to prepare and motivate them to secure needed medical services as well as education, housing, employment, and other social services that will allow them to successfully integrate within their communities. 

    Other concerns expressed covered possible levying of cost sharing requirements for Medicaid beneficiaries, mandating the collection of co-payments in order to receive services,  requiring proof of U.S. citizenship (birth certificate, passport, etc.) at application and redetermination for Medicaid benefits, which will administratively burden case managers, which will result in reducing service capacity, and possibly result in the loss of reimbursement for providers if services are delivered without proof of citizenship.  A survey commissioned by the Center on Budget and Policy Priorities found that Medicaid coverage could be in jeopardy for 3.2 to 4.6 million U.S.-born citizens because they do not have a U.S. passport or birth certificate readily available.

    NJAMHA shared its concern with the proposed 50% cut in the Housing and Urban Development (HUD) Section 811 program.  These cuts would be especially harmful in New Jersey, as these cuts would jeopardize the development of new subsidized supportive housing units.  New Jersey is gearing up to create 10,000 new housing slots over a 10-year period per the state's Mental Health Task Force recommendations. 

    The ongoing issue of insufficient salaries and benefits for direct service workers in the nonprofit mental health sector, as compared to their counterparts in the state service sector who receive higher compensation, was brought to the attention of legislative staff.  NJAMHA requested legislation, or an amendment to existing legislation, that would improve the salaries and benefits of direct service mental health workers treating Medicaid clients.

    Low Medicaid reimbursement rates were mentioned.  Low rates result in a significant provider dropout rate, thereby limiting provider choice.  This is contrary to the choice provisions in federal statute.  It also contributes to growing waits-for-service.

    NJAMHA will continue to track the FY 2007 federal budget request.

    Low Income Subsidy Still Available


    By Everett M. Lo
    Social Security Administration Regional Public Affairs Office in the New York Region

    There is still time to apply for extra financial help through the new Medicare prescription drug program that went into effect on January 1, 2006.

    These days, many Medicare beneficiaries have already decided which of the Medicare plans to sign up for.  Others may still be making a decision.  But if you have limited income and resources, don’t forget to see if you can qualify for extra help to pay for part of the monthly premiums, annual deductibles and prescription co-payments under the new prescription drug program.  You can apply even if you have already decided upon a prescription drug plan.

    That extra help could be worth an average of $2,100 per year for those who qualify.

    Social Security continues to take applications from Medicare beneficiaries who may be eligible for the extra help.  To qualify, an individual must have total annual income below $14,700 and resources limited to $10,000.  The limits for a married couple living together are higher:  $19,800 in combined annual income and $20,000 in resources.  These resources can be slightly higher – an additional $1,500 per person – if some of the money will be used for burial expenses.  Even if your annual income is higher, you still may be able to get some help if you support other family members who live with you or have earnings from work.

    Also, for non-dual eligibles, it is important that all beneficiaries understand that even if they qualify for the extra help, they still need to enroll in a Medicare-approved prescription drug plan to obtain both coverage and the extra help.

    So remember:  it is not too late to see if you qualify for some extra help with prescription drug costs.  More than four million people have already applied.  But if you are not one of them and you think that you might qualify for the extra help, you can complete an online application that may be found by going to Social Security Online .  Or you can contact Social Security at 1-800-772-1213 (TTY 1-800-325-0778) and ask for an application in the mail, or request more information.  But the clock is ticking, so do it today, and then enroll in the new Medicare prescription drug program by May 15, 2006 (for non-dual eligibles).


    Medicare Part D Snafu

    The implementation of the new Medicare Part D benefit has produced myriad access- to-medication issues, particularly for dual Medicare/Medicaid beneficiaries.  These beneficiaries are among the most vulnerable in that they are economically disadvantaged (in most cases below 100% of the federal poverty level, or $9,310 for one person and $12,490 for two persons) and frequently have complex medical and psychiatric conditions.  In New Jersey, there are 140,000 dual eligibles.

    A number of state Medicaid programs have had to cover the cost of medications for dual eligibles as a result of issues associated with Medicare D implementation.  To date, New Jersey has spent over $15 million since the January 1, 2006 inception of  Medicare D benefit.

    In response to states' issues concerning implementation of the Medicare D benefit, the Centers for Medicare & Medicaid Services (CMS), which is the federal agency responsible for administration of the benefit, will facilitate states in seeking recoupment of state dollars that have been spent on this federal benefit.  In a January 13, 2006 open letter, CMS Administrator Mark McClellan advised that states should be payer of last resort and intends on working with states to limit their financial exposure.

    Glitches in Medicare D implementation include the erroneous charging of copayments and deductibles; lengthy waits to speak with Prescription Drug Plan (PDP) customer service representatives; PDP non-adherence to transition plans that were to assure recipients' medication regimens would not be interrupted, during transition to the new benefit, even if prescribed medications were off-formulary; and pharmacists' inability to identify enrollee plans due to computer systems issues.

    On January 10, 2006, United States Senator Frank R. Lautenberg (D-NJ) announced that he will introduce legislation that will require the federal government to repay states, with interest, for the costs they are currently bearing as a result of failures in the administration of this new prescription drug benefit.  Senator Lautenberg stated that "The cost of prescriptions for millions of low-income and disabled beneficiaries have not been covered by the Federal government since January 1st as a result of administrative errors, forcing States – including New Jersey – to foot the bill."


    NJ FamilyCare Program Expands

    The New Jersey Family Care Program is expanding effective September 2005. The “Family Health Care Coverage Act” was signed into law by acting Governor Codey July 2005.  Senators Joseph Vitale and Barbara Buono, Assemblyman Robert Morgan, M.D., and Assemblywoman Loretta Weinberg sponsored the expansion legislation.

    The "Family Health Care Coverage Act" reforms the NJ FamilyCare Program and provides for an expansion of NJ FamilyCare and Medicaid eligibility for families and, with federal approval, adults with no dependents.

    The NJ KidCare and NJ FamilyCare programs have been consolidated into the NJ FamilyCare Program, which will also provide a buy-in process for families over the income threshold.  The program’s enrollment and renewal processes have been simplified, as required by the act.  A one-page application, an on-line application, and revised eligibility criteria have been developed to enhance access to the program.

    It is anticipated that this health insurance program for the working poor will increase the utilization of preventive care, such as regular doctor checkups, over episodic care, such as emergency room visits, which would help to stabilize costs in other state health compensation programs.

    Expansion of Eligibility:

    Children up to age 19 whose family gross income is up to 350% of the federal poverty level (FPL) will continue to be eligible for either Medicaid or NJ FamilyCare, based on their family's income.

    Effective September 1, 2005, parents of eligible children whose family earned income does not exceed 100% of the FPL will be eligible for Medicaid (under current law, eligibility for parents is limited to persons whose income does not exceed approximately 34% of the FPL).

    Effective September 1, 2006, parents of eligible children whose family earned income does not exceed 115% of the FPL will be eligible for Medicaid.

    Effective September 1, 2007, parents of eligible children whose family earned income does not exceed 133% of the FPL will be eligible for Medicaid.

    Pending approval from the federal government, adults without dependent children whose income does not exceed 100% of the FPL will be eligible for Medicaid. The income eligibility limit will be phased in over a three-year period.

    By mid-fall 2005, a "buy-in" program will be established through which a parent or caretaker whose family gross income exceeds 350% of the poverty level may purchase coverage under NJ FamilyCare for a child under the age of 19, who is uninsured and was not voluntarily disenrolled from employer-sponsored group insurance coverage within six months prior to application to the program. The premium for coverage shall not exceed the amount the program pays per month to a managed care organization under NJ FamilyCare for a child of comparable age whose family income is between 200% and 350% of the FPL, plus a reasonable processing fee.

    For additional information and an application, please click here.

    Medicaid Commission Adopts Recommendations
    On August 18, 2005, the Health and Human Services Medicaid Commission adopted recommendations to reduce federal Medicaid spending- $10 billion in over the next five years.The recommendations reflected many of those proposed by the National Governors Association (click here for details) including levying co-payments on Medicaid beneficiaries with higher incomes for nonpreferred drugs when preferred drugs are available. It is hypothesized that this recommendation will result in savings of about $2 billion over five years. Also recommended is a change in the prescription drug reimbursement formula, which calls for basing the reimbursement on Average Manufacturer Price (AMP). Currently, the reimbursement is based on the Average Wholesale Price (AWP) plus a specified dispensing fee.

    Another recommendation, in an area suggested by the National Governor's Association, concerns the transfer of assets in qualifying for Medicaid long-term care. Specifically, the recommendation is to extend the look-back period for the transfer of assets from three to five years

    The Commission will send a report with its recommendations to U.S. Department of Health and Human Services Secretary Michael Leavitt by September 1, 2005.Congress will consider the recommendations during the federal budget reconciliation process this fall.  Congress is not required to adopt the proposals of either the administration or of the Commission. The House Energy and Commerce Committee and the Senate Finance Committee have jurisdiction over Medicaid. In fact, there are two New Jersey Congressmen who sit on the House Energy and Commerce Committee. Congressman Mike Ferguson and Congressman Frank Pallone. Contact information for the NJ Congressional Delegation may be found here.  

    The commission's second report is due December 31, 2006. It will concentrate on the development of recommendations ensure the long-term sustainability of the Medicaid program. The meeting is scheduled for October. Please register your concerns with our New Jersey Congressional Delegation, particularly with respect to co-payments.

    Loan Redemption Program
    Thanks to Acting Governor Richard Cody, a $3.5 million appropriation has been included in the FY 2006 state budget for a new loan redemption program to serve as an incentive to qualified graduates of bachelor's or graduate degree programs to accept professional human service positions in nonprofit agencies and some state direct care facilities.  NJAMHA has vociferously advocated, with legislators and policymakers, for remedies to address mounting staff recruitment and retention issues in the nonprofit mental health sector. 

    Have been hired as a direct care professional at a qualified facility within one year after completion of a bachelor's or graduate degree program. The degree must be in a human service discipline (e.g., psychology, counseling, social work or a health-related profession such as occupational therapy). Have been hired as a full-time direct care professional at a qualified facility on or after July 14, 2005.The services to be performed by the applicant may include, among other related services, counseling, medication management, assistance with activities of daily living and budgeting assistance. "Qualified facilities" means any of the following: A non-profit agency in the state that contracts with the Department of Human Services (DHS) or Juvenile Justice Commission (JJC) to provide direct care services to persons served by the Department or Commission.A facility operated by DHS that provides direct care services.A county psychiatric hospital. A facility operated by the JJC.A veteran's memorial home operated by the Department of Military and Veterans Affairs (DMAVA).Loan redemption amounts may total up to $5,000 per year.

    May not exceed $20,000 for 4 years of service. Will not be provided for less than one year of service. Applicatons will soon be made available at HESAA You may also contact Steven Tessitore at (609) 588-2349 for additional information.

    NJ Loan Redemption Bill Enacted

    Good news!  Loan redemption legislation (S2334/A3756/A3809) was signed by Acting Governor Richard Codey on July 14, 2005.  This legislation will help to reduce college debt for degreed individuals accepting direct care positions in public and nonprofit agencies to address critical staffing shortages. NJAMHA testified in support of A3809, which opened loan redemption to a broad array of human service majors.

    Prior to the enactment, there were two Assembly versions of the Student Loan Redemption Act.  There was also a Senate bill companion to A3809--Senate Bill 2334, sponsored by Senators Fred Madden and Diane Allen (prime sponsors). Assembly Bill 3756, supported by the NASW-NJ and sponsored by Assemblyman Neil Cohen, limited loan redemption to undergraduates or graduates of social work education programs entering professional social worker positions in eligible agencies. 

    In contrast, A3809, sponsored by Assemblyman John McKeon, was more all-encompassing and, as such, more reflective of the nonprofit mental health service delivery system.  A 3809, which is now Public Law, applied to graduates hired as full-time direct care professionals who provide one or more of the following services to eligible persons: counseling; physical, occupational, recreational or speech therapy; case management; vocational training; assistance with activities of daily living; medication management; budgeting assistance; addiction treatment services; nutrition; and other clinical services.

    The committee combined the two Assembly bills to make the qualifications relate to a wider cross-section of human service majors as opposed to restricting loan redemption to only social work majors.  The Governor's Mental Health Task Force recommended loan redemption in its final report.

    Click here for full text of the testimony.

    Hearing on the FY 2006 Budget for the Department of Human Services
    The New Jersey Association of Mental Health Agencies, Inc. (NJAMHA) attended today’s NJ Senate Budget and Appropriations Committee Hearing, chaired by Senator Wayne Bryant, on the proposed FY 2006 Budget for the Department of Human Services (DHS).DHS Commissioner James M. Davy and his staff testified before the committee on the DHS proposed Fiscal Year 2006 Budget.  DHS is requesting an increase of $362 million in state dollars.  Contributing factors to the need for the proposed increase are the shortfall in federal funds for the Temporary Assistance for Needy Families Program, the court-ordered Child Welfare System Reform, the expansion of mental health services, growth in expenditures in the State Medicaid Program and increases in the General Assistance caseload.

    Members of the committee had numerous questions and concerns the imposition by Medicaid of $3.00 co-pays for chiropractic, home health and physician services and $1.00 co-pays on prescription drug for most adults (pregnant women are exempted).  Although Commissioner Davy expressed concern about the co-pays, he stated that New Jersey is one of only 15 states that do not impose a co-pay.  He further stated that without the co-pays, reimbursement rates paid to hospitals and pharmacies and some specific types of medical coverage for adults would have to be cut. Clearly, the committee members were concerned about the negative impact the co-pays would have on consumers and their access to critical services.  The committee requested more information on the experience of other states.

    At least three senators emphasized the need for a cost of providing care increase for community providers who offer vital services to the most vulnerable citizens and recognized the impact the lack of an increase has on the recruitment and retention of community provider staff.  The commissioner acknowledged his understanding of the need for an increase and indicated that he would be looking to find the funds in this current budget year, to provide an additional .5% COLA increase to the 3.5% COLA that was already approved in the current budget.  He pointed out that this would be difficult given the shortfalls in the current DHS budget, but that he recognized the desperate need for an increase.  Senators also expressed the necessity for an annualized increase as this issue has also, as it does annually, cropped up in the discussions on the fiscal year 2006 budget.

    In the DHS budget document prepared by the Office of Legislative Services (OLS), key points pertinent to mental health include:

    Brisbane will close by January 2006.  In testimony, DHS stated that a constellation of community services will be created in three geographic hubs:  North, Central, South.  RFPs will be developed and will be going out to the community shortly.  These RFPs are intended to provide an array of services to meet the needs of these youth.  The Brisbane Bridge fund appropriations will increase by over $5.5 million to develop needed community programs to enable remaining youth to be transferred by the end of December 2005.

    Greystone Park Psychiatric Hospital Bridge Fund appropriations increase by $2.8 million for continuing and new costs associated with the development or expansion of mental health programs primarily directed to reduce admissions to, and the census of, Greystone.

    Community Care funds supporting community mental health services will increase by $26.3 million for services such as mental health screening, self-help, psychiatric services, housing support, jail diversion, Short Term Care Facilities, and specialized case management.

    Grant funding increases $54.2 million, to $223.1 million, under Child Behavioral Health Services, to enhance and expand programs such as Treatment Homes/Emergency Behavioral Health Services ($142.3 million); Care Management Organizations ($31.1 million); Intensive In-Home Behavioral Assistance ($20.5 million); Mobile Response ($9.0 million) and Youth Incentive Program ($7.4 million).

    New grant funding of $19.6 million proposed under Prevention and Community Partnership Services, which includes expansion of the School-Based Youth Programs.  Approximately $4.3 million in grants will be awarded for Area Prevention and Support Services, otherwise known as Child Welfare Planning Councils; $3.6 million in grants will be awarded to develop county Collaboratives; and $2.8 million in grants will be awarded for Community Case Managers.

    For a complete analysis of the FY 2006 budget for the Department of Human Services,click here.

    Medicare Modernization Act
    The date for full implementation of the Medicare Modernization Act is scheduled for January 1, 2006. On that date, people presently dual eligible for Medicare and Medicaid will receive their prescription drugs under the Medicare Part D, the Prescription Drug Benefit.

    Nationally, moving 6.4 million seniors and persons with disabilities to the new Medicare prescription drug benefit will be a major undertaking to say the least. It is anticipated that many vulnerable individuals will fall through the cracks. Advocacy groups across the nation have been lobbying with legislators todelay implementation, including NJ's Medicare Part D Coalition formed to address the issues associated with the implementation of the Medicare Part D Benefit. For a brief report recently issued by the Medicare Rights Center on the Medicare Modernization Act and its potential negative impact on consumers served by your agencies, please click here

    Maine Importing Less Expensive Drugs
    On September 30, 2004, Governor John Baldacci of Maine announced that he intended to request permission from the federal government to import prescription drugs from Canada. The administration has been concerned about the safety of drug importation and the new Medicare law does not allow the practice.

    Although a few states import prescription drugs against the policy of the U.S. Food and Drug Administration (FDA), Maine's concept has a difference. Maine is working with the Penobscot Indian Nation to make them a wholesale distributor of imported drugs and then sell the drugs to U.S. pharmacists to dispense. Governor Baldacci claims this idea would generate jobs for the tribe.

    The Campaign for Mental Health Reform: Medicaid briefing paper now available
    A report by the Campaign for Mental Health Reform recently issued a briefing paper on Medicaid restructuring. It provides a general overview of Medicaid and information on a variety of related topics including Medicaid service options, Medicaid cost increases, and proposed policy changes.

    It is a straightforward, easy-to-read document that may be used for many purposes including advocacy. To view the full report, please click here.

    Inpatient 2005 Prospective Payment System (PPS) Increases
    The September 2004 edition of Healthcare Financial Management reported: On August 2, 2004, the Centers for Medicare and Medicaid Services (CMS) issued a final rule increasing Medicare FY05 hospital inpatient PPS payments by $5 billion more than 2004 projections, for a total of $105 billion. CMS projects the rule's changes will produce an average 5.8% payment-per-case increase for all hospitals, a 5.7% increase for urban hospitals, and a 6.2% increase for rural hospitals.

    The final rule basically implemented provisions related to acute care hospitals that were included in the Medicare Modernization Act. For more information, click here.

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