MEMORANDUM

TO: Members of the 2007 Legislative Interim Committee on Long-term Care Services and Supports for Persons with Developmental Disabilities Amanda Bickel, Joint Budget Committee Staff Waiting List for Developmental Disability Services July 18, 2007

FROM: SUBJECT: DATE:

Note: The following information condenses and updates briefing issues prepared for the Joint Budget Committee in December 2006. SUMMARY:

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The demand for developmental disability services continues to grow much faster than population growth and the developmental disability services budget. Eliminating current service waiting lists for adults would likely require $40 to $50 million General Fund; additional annual increases would be required to keep the waiting lists from reappearing. Access to services and the size of waiting lists varies significantly across the state.

DISCUSSION: General Background on the Developmental Disability Budget For FY 2007-08, Colorado has a budget of $410.3 million for developmental disability services in the Department of Human Services. A total of $193.1 million of this originates as state General Fund1--about 2.7 percent of the total state General Fund budget. The overall developmental disability budget includes funding for community-based services administered at the local level by

Includes General Fund appropriated to Human Services and General Fund appropriated to Health Care Policy and Financing and transferred to Human Services.

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20 community centered boards (CCBs), funding for the three state-operated regional centers (in Wheat Ridge, Grand Junction, and Pueblo), and administrative costs. The table below shows the overall growth in the developmental disability budget over the last five years. Note that most cash exempt amounts are Medicaid funds transferred from the Department of Health Care Policy and Financing (originating as approximately 50 percent General Fund/50 percent federal funds).
Table 1 Department of Human Services, Developmental Disability Services Appropriations FY 2003-04 Total FTE General Fund Cash Funds Cash Funds Exempt Federal Funds Year-to-year increase: $332,137,322 923.8 21,117,230 3,025,105 307,994,987 0 FY 2004-05 $337,826,993 921.2 20,958,573 3,226,897 313,641,523 0 1.7% FY 2005-06 $358,832,711 920.3 27,201,020 3,006,362 328,625,329 0 6.2% FY 2006-07 $392,140,253 927.8 44,033,067 2,933,294 338,266,925 6,906,967 9.3% FY 2007-08 $410,336,729 943.8 31,357,380 2,960,579 369,111,804 6,906,966 4.6%

The vast majority of developmental disability funding goes, first, to comprehensive residential services for adults ($257.6 million for 3,872 placements overseen by the CCBs and $44.9 million for 403 beds at the state-operated regional centers), and, second, to supported living services for adults in the community ($61.1 million for 3,584 placements). The balance supports services for children and their families including early intervention (for children under age 3), family support, and children's extensive support programs. Most adult services, and the children's extensive support program, are supported through Medicaid home- and community-based waivers. The waivers give the state access to federal Medicaid matching funds (which cover about 50 percent of program costs) but allow the state to limit the number of persons served. Due to the constraints of the state budget, there are service waiting lists. The table below shows total funds appropriated in FY 2007-08 for state-supported adult comprehensive and supported living services administered through the CCBs, as well as the waiting lists for services through FY 2007-08 (April 2007 data).

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Table 2 - Funding and Wait Lists FY 2007-08 Appropriation /a Adult Comprehensive Services Adult Supported Living Services $257,604,990 $61,106,767 General Fund /b Resources Funded 3,872 3,584 Wait List

$114,506,337 $33,401,969

1,368 2,324

a/ Does not include regional center funding or services supported with local funds. Case management is included. b/ General Fund includes the General Fund portion of Medicaid funds transferred to the Department of Human Services from the Department of Health Care Policy and Financing

The budget for developmental disability services is currently in flux, due to changes in the billing system and rate structure for the program required by the federal Centers for Medicare and Medicaid Services (CMS). The state has budgeted over $1.8 million for one-time costs associated with billing system changes. It added $7.6 million General Fund in FY 2006-07 to replace local funds that could no longer be accessed under the new billing system (a cost that will be ongoing). Further, in FY 2006-07, system changes resulted in one-time under-expenditure of $30 million total funds, due to decreased flexibility in CCBs' ability to administer the funds and the impact of Medicaid cash accounting. Long-term fiscal implications are uncertain; however, under the new fee-for-service billing system, the state's overall control of costs is far more limited than under the former quasimanaged care system. Growth of the Adult Waiting List for Developmental Disability Services As of April 2007, the waiting list for adult comprehensive residential services was 1,368; the waiting list for adult supported living services was 2,324.2 The tables below demonstrate the rapid growth in the waiting list for services in recent years---and that the growth in the waiting lists is driven by rapid increases in "known demand" that have occurred even as funding increases have added program participants at approximately the rate of state population growth. The tables show the numbers of persons served over the last five years in residential and adult supported living services versus the known demand3 and the ratios of persons served and known demand in the residential and supported living services programs to 1,000 persons in the Colorado adult population. As can be seen from these tables, growth in known demand has been rapidly outstripping growth in persons served. As can also be seen, the number of persons in services per 1,000 adults in the Colorado population has been relatively steady or fallen only slightly---however, the known demand per 1,000 adults in the Colorado population has grown rapidly. Staff estimates growth in demand

These figures reflect the "budget period waiting list", i.e., persons seeking services by the end of FY 2007-08. Known demand is defined as the sum of persons served as of June and the current "budget period waiting list" (in June 2001, this would be persons seeking services through FY 2002-03). 3
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for services has been running at nearly six percent per year, while growth in the state's population has been running at between 1 and 2 percent per year during the same period.
Table 3 - Developmental Disability Services Available and Demand Comprehensive Services Supported Living Services Percent Percent Persons Known Known Persons Known Known Year Served /1 Demand /2 Demand Met Served /1 Demand /2 Demand Met 2001 3,231 3,684 87.7% 3,474 3,685 75.6% 2002 3,371 4,034 83.6% 3,529 4,035 73.6% 2003 3,496 4,254 82.2% 3,598 4,255 72.8% 2004 3,582 4,367 82.0% 3,661 4,368 67.2% 2005 3,607 4,664 77.3% 3,663 4,665 63.4% 2006 3,652 4,960 73.6% 3,703 4,961 60.3% 1/ Persons served is persons served as of June of the year. 2/ Known demand is the sum of persons served and the current budget period waiting list (in 2001, this would include individuals seeking to enter services through 2002-03). Table 4 - Services and Demand verus Population Growth Comprehensive Services Supported Living Services Persons Served Persons Served per 1,000 adult Demand per 1,000 per 1,000 adult Demand per 1,000 Year population /1 adult population /2 population /1 adult population /2 2001 0.98 1.11 1.05 1.39 2002 1.00 1.20 1.05 1.42 2003 1.02 1.24 1.05 1.44 2004 1.03 1.26 1.05 1.57 2005 1.02 1.32 1.04 1.63 2006 1.01 1.38 1.03 1.71 1/ Persons served is persons served as of June of the year. 2/ Known demand is the sum of persons served and the current budget period waiting list (in 2001, this would include individuals seeking to enter services through 2002-03).

Based on the FY 2006-07 appropriation prior to supplemental adjustments, the state should have expected to serve 1.04 persons in the comprehensive residential program per 1,000 in the state's adult population---the highest ratio ever; however, because of the rapid growth in demand, the waiting list continues to grow. Colorado, like most states in the nation, faces rapid growth in its waiting list associated with an aging baby-boomer population. The population of people with developmental disabilities may be expected to follow the same pattern. Persons who are age 40 to 50 can be expected to have parents aged 65 to 75--parents who, after years of caring for their disabled child, may no longer be able to care for them. The result is a rapid growth in demand for state services that is being experienced throughout the country (as has been detailed by David Braddock in the State of the States in Developmental Disabilities). 4

Cost to Eliminate the Waiting List The table below reflects the projected cost of eliminating the current waiting lists for adult comprehensive services and supported living services.
Table 5 - Cost of Eliminating the Current Adult Waiting Lists Net General Fund Resources required Cost per client Adult Comprehenisve Services Adult Supported Living Services $29,688 $9,320 1,094 1,515

Total Cost

$32,478,672 $14,119,800

Total $46,598,472 Notes: Costs are based on current average costs; numbers of resources are based on April 2007 management report, reduced by 20 percent to account for individuals not removed from the wait list in a timely fashion and assuming 344 SLS slots would be opened up by individuals moving to comprehensive services from SLS.

Eliminating the current waiting list would only take care of the problem for a year. After eliminating the waiting list, annual increases would be required to avoid recreating just the comprehensive waiting list. Based on the most recent data, it appears that over $8 million General Fund would likely be required per year to avoid recreating the comprehensive waiting list and over $3 million General Fund would be required per year to avoid recreating the supported living waiting list.4 In the absence significant changes to the state revenue stream for developmental disability services, staff has encouraged the Joint Budget Committee to discuss with the Department of Human Services how available funding should be targeted. Recent funding has been targeted to: (1) individuals transitioning from foster-care (who are not generally included on waiting lists); (2) emergencies, based on current or imminent homelessness, an abusive or neglectful situation placing the persons health, safety or well being in serious jeopardy, are a danger to others, or a danger to self; and (3) the "high risk" indicator group, which includes individuals who are forty years or older and living at home with parents or relatives; have a condition in addition to their developmental disability that makes it more difficult for the family to continue to provide care in their home (dual diagnosis including mental illness, significant behavioral problems, non-mobile and/or medically fragile); and those who have a functioning level of profound, indicating a nearly constant level of daily care needs. Figures provided by the Department of Human Services in 2006 suggest that $12 to $15 million General Fund would be required to address solely the "high risk" waiting list. Distribution of Developmental Disability Resources and Waiting Lists Across the State Figures updated since the July 12, 2007 Legislative Council memorandum to the Developmental Disabilities Interim Committee. These figures reflect rough estimates for purposes of understanding the magnitude of the problem. Note that it could take several years to move all individuals currently waiting for services into placements, even if funding were available immediately. 5
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Developmental disability resource availability and waiting lists vary substantially across Colorado. • • • • Some areas have large waiting lists for services, while others have far smaller waiting lists, and two rural areas have no waiting lists at all. The "known demand" (waiting list + persons served) is far greater in some areas than in others. Some areas receive far more state dollars per capita of their total regional population than others. Some areas have significant support from local tax dollars; others do not.

Table 6 below shows the percentage of known demand met by CCB. As seen on the table, the percentage of know demand met by CCBs ranges from 54.4 percent to 94.7 percent. Two small rural areas (included in the 8) reported no waiting lists in June 2006, and thus demand in these areas was 100 percent met.
Table 6 June 2006 Comprehensive Percentage Known Residential Waiver Resources Used Demand Met Dev. Pathways (Arapahoe, Douglas, City Aurora) 343 68.6% Resource Exchange (El Paso, Park, Teller counties) 392 54.4% DDRC (Jefferson county and Summit area) 370 67.2% Denver Options (City and County Denver) 506 81.2% Imagine (Boulder and Broomfield) 260 78.3% North Metro (Adams County exc. City Aurora) 261 58.0% Foothills Gateway (Larimer County) 257 80.8% Envision (Weld county) 172 73.8% Colorado Bluesky (Pueblo County) 233 94.7% Mesa Developmental Svcs. (Mesa County) 157 91.8% Mountain Valley (Eagle-Garfield-Pitkin area) 72 70.6% Eastern Colorado (Elbert-Logan-Morgan area) 103 78.6% 89.3% 8 Remaining Rural Areas 468 TOTAL 3,594 73.3% Source: Derived from Developmental Disability Quarterly Management Report, June 2006 (persons served and waiting list data)

While the percentage of known-demand that is met is significant, this is only a part of the story. There is wide variation between regions in the known demand for services, as well as in the number of individuals served per capita of the general population, as is reflected in Figure 1.

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Resources per 1,000 Adult Population

0.0

0.5

1.0

1.5

2.0

2.5

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Fig ur e 1 C ompr e he ns ive D e ve lopme ntal D is ability R e s our c e s and Known D e mand by C ommunity C e nte r e d B oar d pe r 1 ,0 0 0 0 A dult Ge ne r al P opulation

C ommunity C e nte r e d B oar d Re s o u rc e s p e r 1,000 a d u lt p o p u la tio n K n o w n d e ma n d p e r 1,000 a d u lt p o p u la tio n

D ev .P at hw Re ay so s( ur ce A ra Ex pa ch ho an e, ge D ou D (E D gl lP RC as as ,C o, (J ity ef D Pa fe en rk A rs ve ur ,T on rO or el co a) le pt un rc io ty ou ns N an nt (C or ie d ity th s) Su M Im an m ag et m d ro in Co it (A e ( ar un ea da Bo ty ) ul m D s C de en ve ou r an Fo r) nt ot y dB hi ex ro lls om c. G Ci at ew ty field A ay ur ) (L or Co M ar a) es im lo En a D ra er d o vis Co ev M B io el un ou op lue n (W ty nt sk m ) el ai en y Ea n (P d c ta st e V ou lS ue al rn nt bl vc Co ley y) o s. (E lo ( M Co ag ra un es le do a C ty) -G (E ar ou lb fi nt er y) t-L eldPi og tk an -M in a re or 8 a) ga Re n m ar ai ea ni ) ng Ru ra lA re as

Figure 1 compares the distribution of resources across the state and the distribution of known demand (people served + people on waiting list). Statewide, in June 2006, there was 1.0 person in comprehensive residential services per 1,000 adults in the Colorado population. As reflected in the chart, individual CCBs had anywhere from 0.6 to 2.0 resources per 1,000 adults in their catchment areas. Statewide, if persons in services and persons on the budget-period waiting list are combined, the known demand for comprehensive residential services was 1.4 “slots” per 1,000 adults in the general population–and thus, on the graph, all CCBs would be expected to reflect total demand around this 1.4 number, whether demand was fully met or not. This is clearly not the case. Table 7, below, compares the state general population by CCB catchment area with the total funding received by the CCB from the state and total funding received from all sources in FY 2004-05. As can be seen, CCBs in areas where population has grown rapidly, such as Arapahoe Douglas, tend to receive disproportionately little support, while areas of the state where growth has been slower, such as many rural areas, tend to receive disproportionately large support compared with their catchment area. In addition, areas that accepted many people who were deinstituionalized from state regional centers tend to have disproportionately high resource allocations. This is particularly evident in Mesa, Pueblo, and Denver counties, where the regional centers that deinstitutionalized are located. As is also reflected in the table, CCBs have demonstrated varying capacity to obtain local support to augment state funding. Some counties have chosen to vote in property tax mill levies to provide services to individuals with developmental disabilities. Other county government choose, at their discretion, to allocate funds to their local CCBs. In some areas, such as the ArapahoeDouglas area, non-state sources made up as much as 32 percent of revenue. In other areas (such as Colorado Springs) non-state sources are less than 1 percent. Resource distribution among the 20 CCBs has become an increasingly contentious issue in the last few years. Allocations to CCBs have, since the program’s inception, been historically based: when a CCB receives a new “resource” for an individual, the resource is built into the CCB's base funding. If a resource “turns over”, i.e., the individual in the placement dies or moves away, the CCB retains the associated placement. Although the Department of Human Services maintains a statewide waiting list for developmental disability services, the waiting lists are actually managed at the local level and, when a resource opens up locally as a result of turn over, the CCB has been authorized to fill the open slot with someone in an emergency situation or the next individual on their local waiting list. Variations among CCBs related to rates are being eliminated, as part of the process of complying with federally-required changes. However, whether existing base resources should be reallocated, and how funds to serve additional individuals should be allocated remain contentious.

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Table 7 Developmental Disability Community Funding: Total Area Population, Total State Support, and Total Support all Fund Sources FY 2004-05 A - 2005 Regional Population Dev. Pathways (Arapahoe, Douglas, City Aurora) Resource Exchange (El Paso, Park, Teller) DDRC (Jefferson county and Summit area) Denver Options (City and County Denver) North Metro (Adams County exc. City Aurora) Imagine (Boulder and Broomfield) Foothills Gateway (Larimer County) Envision (Weld county) Colorado Bluesky (Pueblo County) Mesa Developmental Svcs. (Mesa County) Mountain Valley (Eagle-Garfield-Pitkin area) Eastern Colorado (Elbert-Logan-Morgan area) 8 Remaining Rural Areas Total for State 827,512 604,288 574,595 571,847 363,712 331,635 271,990 228,729 151,099 130,399 124,413 110,866 431,375 4,722,460 C -State DD Support per capita (B/A) $34 $44 $48 $66 $51 $57 $61 $51 $104 $88 $37 $61 $69 $54 D - CCB Support - all fund sources $41,622,409 26,688,820 37,734,856 46,407,906 23,643,495 25,509,682 19,891,164 12,365,674 17,853,855 13,068,077 5,709,913 7,718,753 39,665,392 $317,879,996 CCB Support per capita (D/A) $50 $44 $66 $81 $65 $77 $73 $54 $118 $100 $46 $70 $92 $67

B -State DD Support $28,222,322 26,419,975 27,543,361 37,487,971 18,562,934 19,031,594 16,516,120 11,738,365 15,728,555 11,483,266 4,651,970 6,725,589 29,907,410 $254,019,432

Source: Department of Local Affairs, Colorado Population Statistics; Condensed Combined Financial Statements of Community Centered Boards and Report of Independent Certified Public Accountants, State of Colorado - Department of Human Services, Division for Developmental Disabilities, June 30, 2005

Community Centered Boards in some fast-growth areas of the state argue for reallocation of base resources from CCBs with higher numbers of resources per capita to CCBs with lower numbers of resources per capita. Community centered boards in areas that would 9

stand to lose resources in the above scheme–as well as those with limited impact either way--argue that transferring existing resources would cause substantial disruption to services and would have wide-ranging, negative impacts. Advocates for people with developmental disabilities point out that the focus should be on equal access throughout the state to services for people with developmental disabilities and not on equity among the CCBs: an individual in Adams County should not be forced to wait 30 years for a resource while someone in Alamosa can be served virtually immediately upon request. Some advocates see the appropriate solution to the situation as a statewide waiting list for services, rather than one that is tied to local CCBs. However, this approach could destabilize existing services, particularly in smaller areas, depending upon whether it reallocated funds across regions. A statewide waiting list would also require additional state department involvement and oversight and presumably staffing. All CCBs and advocates note that if state funding were adequate to eliminate all waiting lists, geographical resource distribution would no longer be a major issue.

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