More North Carolina Budget Woes

At the end of the legislative session, state budget writers went from debating a zero to 10 million dollar cut, to taking a 20 million dollar cut out of state funded services for people with developmental disabilities, mental illness and addictive disease. While it is the same cut as last year, it has much greater impact. Local Management Entities (LMEs) are not required to use their fund balances to cover this cut. Most have used their fund balances to prepare for managed care changes and to fund last year’s funding cuts.

In addition, after Legislators finished their session and went home, advocates and LMEs discovered that Legislators had changed the allocation of block grant funds. $8.6 million was to be used for developmental disability services, including $4.3 million which was moved to be used for much needed guardianship services. The remaining 4.3 million was “accidentally” removed and distributed to other areas of the block grant budget.

All of this has resulted in a loss of $24.3 million in funding, mainly for services for people who do not have Medicaid or other health insurance. Reports have begun coming in from regions across the state of cuts in adult vocational services funding and proposed cuts to provider rates. Centerpoint LME issued a statement that they will take $1.7 million in service cuts, including a $633,474 cut to services for people with intellectual and developmental disabilities. Many other LMEs are meeting to discuss what service cuts will result from this loss of funds.

Problems with managed care are taking their toll on funding as well. Centerpoint has asked for $1.53 million in funds from its counties to support the managed care conversion, and Western Highlands, who converted to a managed care model in January of this year, has reportedly been spending $500,000 a month which has resulted in a $3 million dollar deficit in their budget. The Western Highlands CEO was fired and the Board and management  of Western Highlands are now considering 30% rate cuts to providers or other cuts to bring their budget back in line. Many advocates are concerned that drastic rate cuts will force providers to close their doors and cut off access to services or that “efficiencies” to be found mean cutting service hours or whole services.

Every LME and every county will eventually be impacted by the $24.3 million in cuts. The Autism Society of North Carolina asks that you talk with or write to your legislators about service cuts in your region and let us know if you have been directly affected by these cuts. Telling your story is an effective way to get your message across. The legislative oversight Committee on Health and Human Services will meet Tuesday, August 14th, from 10 AM to 3PM in the Legislative Office Building. We hope to hear of their plans to fix the $4.3 million dollar mistake and what they intend to do to ensure that people do not have services cut.

If you have questions about the budget cuts or other public policy issues, contact Jennifer Mahan, Director of Government Relations for the Autism Society of North Carolina, Jmahan@autismsociety-nc.org or 919-865-5068.

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