Strategic Financing for New York Systems of Care

Strategic Financing for New York Systems of Care

Frank Rider, MS American Institutes for Research

NY SUCCESS

21 October 2015

Context for NY SUCCESS Counties’ Strategic Financing Plan Initiative

The goal is to assist pilot counties in the design of a financial plan to help support expanding and sustaining county-level service development

Anticipate 5 pilot counties participating in time-limited learning community from October 2015 – April 2016

Launch today, 10/21/2015 with Kick Off Webinar

Ideal timing – initial set of financing actions by April 2016 (in time for county budgeting process for FY 2016-17)

Aims of Financing Initiative:

1. Participating counties identify project team that includes1. designated team leader with decision making authority2. strong financial expert with access to necessary data3. individual involved in developing and/or supporting the county plan4. community partners with knowledge of potentially impacted services5. program and/or policy staff as applicable

2. Participating Counties develop attainable Objective Statement with milestones, measures and targets to monitor progress

3. County Project Team makes commitment, setting aside time to support this initiative and ensure SUCCESS

4. Documentation of positive learning, success stories

5. Development of toolkit for other NYS SUCCESS counties

Why a Strategic Financing Plan?

NY SUCCESS MISSION: Ensure successful outcomes across child / family systems to benefit all children, youth and families across NY. increase the capacity of organizations and individuals to effectively

implement the system of care philosophy within their own communities.

provide statewide infrastructure for knowledge sharing, technical assistance, and communication.

Five core strategies* to expand systems of care:1. Implementing Policy, Regulatory, and Partnership Changes2. Developing or Expanding Services and Supports Based on the

System of Care Philosophy and Approach3. Creating or Improving Financing Strategies4. Providing Training and Technical Assistance5. Generating Support through Strategic Communications*Stroul, B., Dodge, J., Goldman, S., Rider, F., & Friedman, R. (2015). Toolkit for Expanding the System of Care Approach. Washington, DC: Georgetown University Center for Child and Human Development, National Technical Assistance Center for Children’s Mental Health.

Why a Strategic Financing Plan?SAMHSA Requirement:

“The plan must address how the system of care will:

• Financially link with other child-serving systems

• Use Medicaid dollars

• Use other third-party payers

• Be connected and integrated with block grants

• Be included and integrated with implementation of the Affordable Care Act (ACA).”

Why might we feel like “fish out of water…”

…when the conversation turns to financing???

Why Do Many of Us Lack

Confidence When It Comes to

Financing Work?

Please share your thoughts about this

with us in the Participant Chat Box.

Why Do Many of Us Lack Confidence When It Comes to Financing Work?

• Financing work is not what attracted us to this work.

• Financing work is complicated.

• We prefer to avoid aspects of our work where we feel less competent.

• “Surely there must be someone else around here whose responsibility it is to be our financing expert.”

What Motivations Can Counteract

My Lack of Confidence to Tackle

Financing?

Please share your thoughts about this

with us in the Participant Chat Box.

What Motivations Can Counteract My Lack of Confidence to Tackle Financing??

I am deeply invested. I have seen what is possible when our system of care approaches are adopted at wide scale. As a champion/early adopter:

If I know how to optimize revenue, then I can increase and spread the benefit of our innovations to more children/students and families.

Job security, for me and my colleagues.

“If not me, then who?”

Financing professionals may not share my understanding and passion for our innovation.

Waiting for higher-ups to take care of financing – they might not share my priority.

What Can Increase My Confidence to

Tackle System of Care Financing?

Please share your thoughts about this

with us in the Participant Chat Box.

What Can Increase My Confidence to Tackle Sustainable Financing for My System of Care?

Ability to articulate both a clear vision, and a clear pathway to accomplish it

Basic understanding of strategic financing

“Interpreters” who can provide basic understanding and fluency in financing vocabulary

Knowledge of various funding options for systems of care from which to develop a menu of selected options and viable financing strategies.

What Can Increase My Confidence to Tackle Sustainable Financing for My System of Care?

Access to peer support (fellow grantees and alumni, NY SUCCESS learning community; and NY SUCCESS, TA Network and other technical assistance)

Access to information resources and tools

Sharing responsibility for finance planning with others

Confidence borne of:

Clear and convincing evidence of great outcomes

Demonstrated in Return on Investment [ROI]

Testimonials from young people and families.

Building Our Financing Literacy: A Brief Vocabulary Lesson

Appropriation, budget, expenditure

Blended funding

Braided funding

Medicaid versus Medicare

EPSDT - Medicaid [Early Periodic Screening, Diagnosis & Treatment]

“In-kind”

Matching funds

Flexible funds (“flex funds”)

Strategic Financing in a Nutshell

Five Step Process:

1. Clarify what you will need, by when

2. Map current funding and resources

3. Determine gaps between needs versus existing resources

4. Select financing strategies and funding sources

5. Make and execute a financing action plan

Multi-System Approach to Financing

1. Identify your common aims

2. Invite policy leaders, budget and data managers, youth/families and early adopters to work and learn together

3. Offer the most advantageous capacities of each respective system/entity

4. Commit to selected financing and resource strategies to promote shared benefit.

Step 1:

Clarify What You Need, by When?

What will you need to pay for?

Services and supports:

Types?

How many children/youth? How many families?

For how long?

Infrastructure needs

Supportive operations (e.g., contracting, continuous quality improvement)

Unique costs of “ramping up”

Other costs?

Strategies and

activities, services and

supports that we want

to develop and sustain

Over what time

period will we

develop,

implement and

sustain?

At what scale and pace will we

build and sustain them?

Year 1 Year 2 Year 3

Infrastructure Investments

Services and Supports

Workforce Development

Consultation/TA

MIS

CQI Processes

Etc., Etc…

Financing for What?Worksheet

Strategies/Activities 2015-16 2016-17 2017-18

Infrastructure Investments

Backbone Support for Ongoing Community Initiative

Family-Run Organization

Website: set-up, maintenance

Services and Supports

EBP Service Model #1 (unit cost x dosage x # of children/year.)

Flex Funds

Case rate (monthly cost x # months x # of

children/families per year)

Training, TA, Consultation

Training Institute

EBP Cultural Adaptation Consultancy

Management & Administration

CQI Processes

MIS

Total

Sample Cost Estimates

Worksheet

Step 2:

Map Relevant Current Spending

What resources do we already have to work with? Grant funds

Ongoing funding streams, amounts

Matching resources that will remain available

In-kind contributions

Complementary spending by other systems

Existing infrastructure components that will persist

Existing operational spending that will persist

What else?

How Is Financial Mapping Done?

1. Define the population of interest

2. Identify the needed services and supports

3. Specify the fiscal year under study:

Most recent fiscal year for which full, reconciled data are available

The financial map may be updated to demonstrate changes in funding over time.

How is Financial Mapping Done?

5. Identify potential funding sources:

Services for youth may be supported by a number of federal, state, tribal, county, municipal and even philanthropic funding sources

Address core funding sources first [Note if any core funds are tied to eligibility groups]

Examine additional funding sources that might be used to provide services [Typically group funding sources by policy domain (e.g., child welfare, socio-economic status, juvenile justice, health, education, housing, labor]

Strategies/

Activities

Source of Funds Amount Restriction on

Uses of Funds,

if any

Expected

Timeframe Funding

is Available

Infrastructure

Investments

Services and

Supports

Training, TA,

Consultation

Management and

Administration

Sample Resource

Mapping Worksheet

What is the gap between current spending and projected fiscal needs?

by services and supports

by subpopulations

by strategy/activity

by fiscal year

Step 3:

Assess Your Spending Gap

Strategies/

Activities

2015-16 2016-17 2017-18

Total

Costs

Available

Resources

Gap Total

Costs

Available

Resources

Gap Total

Costs

Available

Resources

Gap

Infrastructure

Investments

Services and

Supports

Evaluation/

Data

Collection

Management &

Administration

Sample Funding Gap

Analysis Worksheet

Step 4: Select Financing Strategies and Funding Sources

What combination of funding strategies can fill our spending gap?

Five basic financing strategies (you can mix and match):

A. Redeploy existing resources

B. Refinance to maximize public funds

C. Optimize private insurance coverage under ACA

D. Create new funding structures

E. Raise new revenues

Option A: Re-Deploy Existing Resources

… from high-cost, low-impact, services and activities; to invest in lower cost and/or higher impact options.

Examples of high-cost, low impact spending?1. __________________________________2. __________________________________

Examples of lower cost, higher impact spending?1. __________________________________2. __________________________________

Please type your examples into the Participant Chat Box.

Option B: Refinance to Maximize Public Funds

Medicaid Largest single funder of BH care for Americans

Eligibility based on financial/categorical need

Federal/State match (Federal Medical Assistance Percentage) Varies considerably by state and territory

State Medicaid agencies and federal CMS:

Determine the extent of who is eligible

Determine services: type, amount, duration and scope

Determine the delivery system for services

Establish provider types, qualifications

Set payment rates for services; and

Administer the day-to-day operations

Centers for Medicare & Medicaid Services, FY 2013 Justification of Estimates for Appropriations Committees

NY Medicaid Waiver

Section 1115 Waiver extended through December 2015: Health Home sustainability Investments in workforce for Medicaid Long-Term Care plans Transition of individuals with MH, SUD to managed care plans.

(see details at https://www.ropesgray.com/newsroom/alerts/2014/May/New-York-States-8-Billion-Medicaid-1115-Waiver-Amendment-to-Improve-Access-Quality-and-Efficiency.aspx#sthash.gu2Fe8kQ.dpuf)

New Medicaid services, definitions include:– Crisis Intervention– Family Peer Support– Youth Peer Advocacy and Training – Community Psychiatric Supports and Treatment (CPST)– Psychosocial Rehabilitation Services– Other Licensed Practitioner

(RN, NP, Psychologist, LMSW/LCSW, licensed MH counselor)

What Is Medicaid’s EPSDT Benefit?

Early and Periodic Screening, Diagnosis, and Treatment

Entitled benefit for all children enrolled within mandatory

Medicaid eligibility groups

States must cover preventive and primary care, including

dental, hearing, vision care, and mental/behavioral health

services that are medically necessary

EPSDT also covers long-term care needs of children with

special healthcare needs (e.g., therapies, medical

equipment, support services)

EPSDT: A Guide for States http://www.medicaid.gov/Medicaid-

CHIP-Program-Information/By-Topics/Benefits/Downloads

/EPSDT_Coverage_Guide.pdf

Option C: Optimize Private Insurance

ACA subsidizes Qualified Health Plans

Young adults to age 26 - coverage on parents’ plans

Approved preventive services at no out-of-pocket cost

New York marketplace exchange to define Essential Health Benefits – 10 broad categories including:

– Mental health and substance use disorder services, including behavioral health treatment

– Rehabilitative and habilitative services and devices

– Preventive and wellness services

Option D: Create New Funding Structures

• Blended funding pools

• Case rates (Wraparound Milwaukee)

• Braided funding (Arizona: Child Abuse Prevention and Treatment Act developmental screenings, and therapeutic foster care)

• Accountable Care Organizations (ACA)

Option E: Raise New Revenues

Tobacco settlement funds (1998)

California “Millionaires’ Tax” (2004 Mental Health Services Act – Proposition 63)

3 Ohio counties tax levy for PAX Good Behavior Game (May 2014) http://paxis.org/news/view/ohio-counties-pass-levy-to-support-pax-good-behavior-game

Pay for Success / Social Impact Bonds

Step 5: Develop, Generate Support for, and Execute Financing Action Plan

Scan environment for opportunities and threats

Select the most promising financing strategies

Prioritize selected strategies for action

Identify specific action steps

Generate support for plan

Be persistent and dynamic

Aces up Our Sleeves

1. Children and youth represent a “sympathetic” population.

2. Strengthening families appeals across the political spectrum.

3. We cannot afford the cost of failing to implement the effective

practices at the heart of our NY SUCCESS system of care:

Cost of not providing effective support and treatment for young

people with social and emotional challenges is significant:

Immediate related costs – wasted service dollars.

Long-term/societal costs, including intergenerational costs.

The Costs of Not Acting (i.e. costs of continuing system failure)

NY SUCCESS System of Care can reduce poor outcomes in terms of avoidable human suffering and quantifiable costs to whole community:

Example: Reducing school dropout rate - $260,000 in lost income per person over lifetime; and cost taxpayers $292,000 over lifetime. US Census Bureau ; Northeastern University

New York State Impact: $50-million in local and state tax revenue per year! http://impact.all4ed.org/#potential/income/new-york/all-students/

Local impacts (state and local tax revenue per year):

Syracuse: $2.8-million

Rochester: $4-million

Buffalo – Niagara Falls: $2.9-million

Elmira: $200,000

Utica – Rome: $700,000

Example: The High/Scope Perry

Preschool Study (Through Age 40!)

http://www.highscope.org/content.asp?contentid=219

Return on Investment in Systems of Care for Children with Behavioral Health

ChallengesStroul, Pires, Boyce, Krivelyova & Walrath (2014).

Available at http://gucchdtacenter.georgetown.edu/index.html

Expanding Systems of Care: Improving the Lives of Children, Youth and FamiliesStroul, Goldman, Pires & Manteuffel (2012). Available at http://gucchd.georgetown.edu/293751.html

MENTAL HEALTH FINANCING IN THE

UNITED STATES: A PRIMER

https://kaiserfamilyfoundation.files.

wordpress.com/2013/01/8182.pdf

Kaiser Commission on

Medicaid and the

Uninsured (2011)

For further assistance…

Frank Rider, Financing Specialist American Institutes for Research frider@air.org

Next Steps for NY SUCCESS Counties’ Strategic Financing Plan Initiative

• Project Charter due Friday, October 30th

• NYS SUCCESS Project Team member will connect with County Lead to review charter and identify tools or supports that may be needed during this initiative

• First Monthly Check In Call - Tuesday, November 17th at 1pm– We will introduce the NYS SUCCESS Project Team

– County Lead will introduce their team, share objective statement and describe what they hope to accomplish

• Monthly check in calls planned for the 3rd Tuesday at 1pm. Email reminder and meeting invitations to follow under separate cover.

Thank you again for participating in the

NYS SUCCESS Strategic Financing Plan (SFP) initiative