January 8, 2019
Preparing for 2019
Last month I wrote about gearing up to restore the disability industry’s 7%, an amount that was in the budget that the Governor refused to spend (or impounded). While we are optimistic we will be successful, it is incumbent on HBI, as it is on all disability providers, to prepare for the worst. This preparation is also especially important in ensuring the HBI remains fiscally strong when the new Disability Waiver Rate System or DWRS take full effect in either 2020 or 2021. Even with the 7% cut restored in its entirety, the full effect of the new DWRS on HBI’s finances will be problematical.
So we at HBI, the Management Team really, have begun to look at all of our revenue and expenses. Our first goal is to locate and develop new revenues; our second is to find spending that does not compromise the delivery of our mission, our retention of licenses, our recruiting and retention of direct care and nursing staff. This is not easy because HBI already spends the vast majority of these funds on these purposes. We spend much less than average on administrative costs for instance.
Here are some examples of how we are trying to enhance our revenue and contain our expenses.
One component of the DWRS allows a provider, on behalf of an individual, to seek an “exception”. An exception is an extraordinary individual’s need that results in a provider response, the costs of which are not covered in the ordinary DWRS rate calculation. At present only those individuals who are fully on the new system are eligible for the “exceptions”, but starting in 2019, providers will be able to notify the county of individuals for whom it will be applying in 2020 or 2021.
HBI has been actively seeking these additional revenues for its individuals at its high medical homes and so far none of its applications have been denied. However, the applications were researched, written, submitted, tracked, and renewed by current staff. Last summer the Board of Directors and Management decided to put in place an Administrator whose sole job is to do so. We approached the Foundation BOD, which quickly approved subsidizing such a position for one year. We have since hired this position and we are off to the races, both applying on behalf of those who are currently eligible and preparing county notifications of those who will be in one to two years.
With respect to expenses, we are examining all of the things or items for which we spend. One of those is supplements. We know that we live in a society where vitamins and other supplements are quite popular. Everyone has their own favorites, including many of our families. They request that we get these for their relatives we serve. Unfortunately, the vast majority are not covered by Medical Assistance, which covers the cost of almost all of the medications the individuals take. These are not inexpensive, but in deference to the wishes of the our families, HBI has been covering the cost of these. In November for instance we spent over $4000 on supplements for all of our individuals, which works out to be approximately $50,000 annually. We will not be able to continue doing so for long. So we are studying ways to change this policy.
These are two examples of how HBI is preparing financially for the future. We are on top of things and are determined to remain financially sound.