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HCRS Urges Senate to Approve Medicaid Rate Increase

HCRS today called on the State’s Senate to pass a budget that includes a two-percent Medicaid rate increase for designated mental-health and developmental-disability agencies. HCRS also applauded the State House of Representatives for its recent decision to pass the increase. Without such funding, services to Vermonters with developmental disabilities and mental-health and substance-use disorders have been and would continue to be significantly jeopardized.

Vermont’s designated agencies have received just one 3% rate increase over the past five years.  This severe under-funding has, among other consequences, limited HCRS’ ability to provide adequate cost-of-living increases to its staff.  Salary differentials between agency health-care professionals and public employees have widened, often reaching a financial gap of $13,000 to $16,000 per year – and in some cases, more. This disparity has resulted in system-wide annual turnover rates of 27.5%.  HCRS’ turnover rate currently stands at 24%.

“HCRS services represent an essential part of the fabric of social services and health care in our communities, but the quality of treatment and even the access to such care are undeniably compromised by rapid staff turnover and vacancies,” said George Karabakakis, Ph.D., Chief Executive Officer, HCRS. “While the proposal now before our Senate would increase our Medicaid rates by just two percent, that amount would still help to offset increasing health-care and operating costs. It would be a step towards adequately funding community mental-health services, providing competitive staff salaries, and preserving the therapeutic relationships that are vital to any successful, community-based care system.”

A recent independent review of a designated agency budget by the Green Mountain Care Board found that “despite responsible budgeting practices, as presently funded, the agency struggles mightily to recruit and retain the staff it needs so it can meet its programmatic and statutory mission.” Unlike other health-care providers, designated agencies cannot shift funds from one formally approved program to another, so they depend on the State to pay adequate rates for the services they provide 360 days each year.

“This provider network is ready and willing to continue the good work done every day,” said Julie Tessler, Executive Director of the Vermont Council of Developmental and Mental Health Services, “but we must see action on a three-percent Medicaid rate increase to ensure this well-established system of mental health, developmental disabilities, and substance abuse services continues to provide support to Vermont’s communities.”

Because they are community based, designated agencies achieve excellent results in meeting the needs of those they serve. In a client-satisfaction survey recently conducted by HCRS, 96% of respondents reported that the services made a positive difference in their lives. These critical services yield many positive outcomes, including reduced costs to the criminal-justice system, greater success for struggling students in schools, increased employment for clients, fewer emergency-room visits and inpatient/institutional care, and successful recovery from addictive disorders.

“Given the savings created by avoiding more expensive intervention,” said Karabakakis, “not to invest in our designated agencies is penny wise and pound foolish.”