1. 1 FY 07-08 Budget Presentation Stakeholder Briefing March 1, 2007 Office of Mental Health and Substance Abuse Services

2. 2 The Rendell Administration’s Major Budget Initiatives Increase in total state education funding for PreK–12 by 6% Accelerate property tax relief Address the transportation funding crisis for Pennsylvania’s roads, bridges, and public transit systems Continue investments to make appropriate options available for long- term living Propose the Energy Independence Initiative to invest in alternative energy production in Pennsylvania Jonas Salk Legacy Fund ($500 M for bioscience research, commercialization, and early-stage capital investments) Additional funding to address the continuing offender population growth and new resources to reduce the rate of prison re-entry

3. 3 Prescription for Pennsylvania Increases access to affordable health care coverage for all Pennsylvanians, improves the quality of care delivered throughout the Commonwealth, and helps bring health care costs under control for employers and employees. FY 07-08 budget recommends a total of $255.3 million in state and federal funds to implement this initiative. The Prescription for Pennsylvania initiatives are being paid for by levying a tax on other tobacco products. Every other state except Pennsylvania already taxes these products. Expands access in underserved rural areas ($5.4 M investment) Increases the number of health professionals equipped to address the needs of racial and ethnic minorities ($1 M) Includes a Behavioral Health Services component

4. 4 Pennsylvania’s FY 2007-2008 General Fund Expenditures Spending on Education, Medical Assistance, other Public Welfare Programs, Corrections, and Debt Service comprises 86% of total General Fund expenditures. $27.3 Billion

5. 5 National Medicaid Spending Growth MA Spending Growth is Down from 2002 Peak but Costs are Still Rising 1996 – 2007 Strong Economy, Welfare Reform, Enrollment Declines, Managed Care 1995 - 1998 Health Care Cost Growth, 1998 - 2000 Economic Downturn, Enrollment & Cost Growth, 2000 - 2003 Start of Economic Recovery, Slower Enrollment Growth 2004 - 2006 Note: Estimates in State Fiscal Year. Preliminary estimate for 2007. SOURCE: Kaiser Commission on Medicaid and the Uninsured. “Results from a 50-State Medicaid Budget Survey, State Fiscal Years 2006 and 2007” October 2006.

6. MA Eligibles Expected to Increase by 64,000 *Projected Average Monthly Enrollment +10.5% +7.0% +4.3% +4.9% -0.2% -3.6% -8.2% -1.7 % +2.8% +4.5% +4.8% +7.8% +3.9% +3.4% Source: DPW Budget Office - 2.9 % +1.4% +4.9%

7. 7 A common misconception The claim that “Pennsylvania has 1.9 million welfare recipients” is wrong and confuses health care and cash assistance

8. 8 Eligibility CategoryDec-05Dec-06% Change Chronically Ill Adults99,83199,8970.07 Elderly/Healthy Horizons243,403257,0635.6 Disabled376,428383,7692.0 Adults/Parents281,532265,497(5.7) Children821,528865,3385.3 Elderly & Disabled Are Driving Eligibility Increase

9. 9 Department of Public Welfare Provides for a $56.154 M increase for County Child Welfare needs- based budgets as mandated by Act 30 of 1991. BH transition fund for ICSI (Integrated Children’s System Integration) maintained at $8M Deputy Secretary for Early Childhood; dual reporting structure to Education and Department of Public Welfare; expansion of day care; mental health consultation Office of Developmental Programs –Office of Mental Retardation is now the Office of Developmental Programs –$28.902 M increase to expand community mental retardation and autism services –Will work to coordinate both autism services and community mental retardation services

10. 10 Office of Medical Assistance Programs: FY 07/08 Budget Initiatives MCO Pay for Performance (P4P) MCO Capitation Payment Change (PH Only) Pharmacy Carve-Out Transition Clients from Voluntary to ACCESS Plus Hospital Pay for Performance

11. 11 Other Departments and Funds PA Dept of Corrections was provided an increase of $792,000 for reintegration programs to enhance skills and treatment for inmates to reduce recidivism rates Board of Probation and Parole was provided $3.167 M to provide additional resources to enhance community re-entry preparation and offender management Department of Health was provided a 3% COLA ($1.229 M) for drug and alcohol abuse prevention and treatment services

12. 12 DPW: OMHSAS Administered Behavioral Health Funding Community Mental Health Services –Base Funds –CHIPPS –BHSI- Mental Health –MH Block Grant/SSBG/Other Federal –Other Categoricals –State Mental Hospitals DPW Administered Drug and Alcohol –Act 152 –BHSI- Drug & Alcohol Medicaid –BH FFS –HealthChoices Behavioral Health

13. 13 OMHSAS: Administered Behavioral Health County government legislatively grounded and uniquely positioned to manage local systems of care; primary objective to integrate program and fiscal accountability –48 County MH/MR Programs 1966 MH/MR Act – 49 Single County Authorities DOH Bureau of Drug & Alcohol Programs as Single State Agency DOH Primary Licensing entity for D&A – 8 State Mental Hospitals; 1 Long Term Nursing Care Restoration Center Closed or Consolidated 5 (five) state hospitals since 1994-1995 Eliminated State Hospital capacity for children & adolescents Discharged 2,539 individuals through the Community Hospital Integration Projects Program (CHIPP)

14. 14 67 HealthChoices Counties –28 counties accepted right of first opportunity –1 direct state contract with BH-MCO (Greene County) –Direct state contract with 23 counties – 15 counties accepted right of first opportunity for 7/01/07 implementation – Incorporates broad behavioral mandates – Variety of models including full risk county contracts, subcontracts with Administrative Services Organization and full risk subcontracts

15. 15 OMHSAS: Unified Systems Strategy County Based Medicaid state plan services utilizing county base funding for state match: 1990-91 CHIPP dollars follow person from State Hospital to community: 1991 Streamline appropriation Community/Hospital Appropriation: 1993-94 Act 152 Dollars administered by OMHSAS: 1996-97 BHSI funds mental health and drug and alcohol established and administered by OMHSAS: 1997 HealthChoices Behavioral Health Program Administered by OMHSAS: 1997(Southeast) OMH changes name to OMHSAS: 1998 HealthChoices expansion to Southwest 1999; Lehigh/Capital 2001 Service Area Planning Initiatives; County Planning (2003-04) Children’s Integrated Planning Initiative (ICSI) (2004-05) Expansion of Health Choices: Northeast Counties (2005-06) BH FFS Transfer (2006-07) Health Choices Expansion–23 counties (2006-07) HealthChoices Expansion to all 67 counties by 7/01/07

16. 16 Movement of Funding from State Administration to County Administration Percentage of OMHSAS Funding Under County Admin. Dollars Under County Admin. $2,906,576,139 Percentage of OMHSAS Funding Under State Admin. Note: State Mental Hospital and Medicaid Fee-For-Service Funding are under State Administration. 1994-1995 2007-2008 Dollars Under State Admin. $626,228,510 Dollars Under County Admin. $354,355,067 Dollars Under State Admin. $914,662,672

17. 17 OMHSAS: Guiding Principles The Mental Health and Substance Abuse Service system will provide quality services that: –Facilitate recovery and resiliency for adults and children –Are responsive to individuals’ unique strengths and needs throughout their lives –Focus on prevention and early intervention –Recognize, respect, and accommodate differences as they relate to culture/ethnicity/race, religion, gender identity and sexual orientation –Ensure individual human rights and eliminate discrimination and stigma –Are provided in a comprehensive array by unifying programs and funding building on natural and community supports unique to each individual and family –Are developed, monitored and evaluated in partnership with consumers, families and advocates –Represent true collaboration with other agencies & service systems

18. 18 OMHSAS: Objectives Policy implementation of a “Call for Change” to recovery and resiliency Transform the Children’s Behavioral Health System to a system that is family driven and youth guided Assure that behavioral health services and supports recognize and accommodate the unique needs of older adults

19. 19 Fiscal Year 2004-2005 Unified Mental Health and Substance Abuse Services System County Allocations –Persons Served: 200,004 –Expenditures: $401,610,444* –Ave. Expend. $2,008 MA FFS (03/04) –Persons Served: 88,141 –Expenditures: $377,941,134 –Ave. Expend. $4,288 HealthChoices –Persons Served: 227,087 –Expenditures; $1,111,910,124 –Ave. Expend. $4,896 * incomplete county data BHSI (D&A) Persons Served: 39,325 Expenditures: $40,408,520 Ave. Expend. $1,028 Act 152 (D&A) Persons Served: 5,690 Expenditures: $18,431,321 Ave. Expend. $3,239 State Mental Hospital Persons Served: 3,582 Expenditures: $404,429,485 Ave. Expend. $112,906

20. 20 OMHSAS FY 2007-2008 BUDGET SUMMARY

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23. 23 Community MH Services $991.24M total state and federal funds, net increase of $10.359M; State funds increase $30.097 $15.977 M provided for three (3) percent cost of living adjustment, including Base, CHIPPS and BHSI CHIPP funding of $18.9M included for the discharge of 200 individuals from the State Hospitals $500,000 to support respite care services for 2,000 families Transfer of $12.7M for Behavioral Health HealthChoices Expansion Transfer of $8.7M matching funds for Structured Treatment Services Elimination of funding for Psychiatric Services in Eastern PA OMHSAS: FY 2007-2008 Budget Unified System Strategy

24. 24 Presidents Proposed Budget Federal Funding Update Reflects a slight decrease in the Community Mental Health Services Block Grant Reflects a $4.442 M decrease in the Social Services Block Grant; FY 2006-07 funding restored to prior year funding level of $14.808 M Changes to the Medicaid Rehabilitative Services Option are projected to yield a federal savings of over $2.3 billion over the next 5 years OMHSAS: FY 2007-2008 Budget Unified System Strategy

25. 25 Drug and Alcohol Services $1.238 M in Act 152 funding transferred to MA Capitation as a result of HealthChoices expansion; FY 2007-08 Act 152 budget is $16.2 M BHSI IGT funding of $12.107* million BHSI funding is $45.300 million (MH: $20.130, D&A: $25.170), which includes a 3% COLA Sexual Responsibility and Treatment Program (Act 21) Implemented in April 2004 on the grounds of Torrance State Hospital Ten men are now being served SRTP program operation was transferred to the Commonwealth and operated by Torrance State Hospital (July 1, 2006) *$3 million in additional funding was provided in FY 06-07; additional funding will not be available in FY 07-08 OMHSAS: FY 2007-2008 Budget Unified System Strategy

26. 26 As of January 1, 2007, there are 1.375 M people enrolled in HealthChoices. Projected enrollment for SFY 2007-08 is 1.74 M. Funding for Fiscal Year 2007-08 is projected to be $2.3 Billion in the Southeast, Southwest, Lehigh/Capital, Northeast Zone, 23 county expansion zone and 15 county expansion zone: –Southeast Zone total $939.7 million –Southwest Zone total $435.4 million –Lehigh/Capital Zone total $408.4 million –Northeast Zone total $119.5 million –23 county expansion zone $186.4 million –15 county expansion zone $244.5 million –Mental Health portion* $2,051.0 billion –Substance Abuse portion* $283.1 million *(includes admin.) OMHSAS: HealthChoices

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28. 28 Currently OMHSAS has 8 state hospitals and 1 long term nursing care facility Since FY 1994-95 there has been a reduction of 60% in the census of the individuals being served in our state hospitals through June 30, 2008 During the same period, staff complement will have decreased by 48% Through the CHIPP funding opportunity, 2,539 individuals will have been discharged and 12,387 individuals will have received diversionary services as a result of these discharges through June 30, 2007, and supported in the community with funding of $190,337,062 Service area planning work will continue through Fiscal Year 2007- 2008

29. 29 ERIE CRAWFORD WARREN FOREST McKEAN POTTER CAMERON ELK VENANGO MERCER BEDFORD BLAIR SOMERSET CAMBRIA INDIANA JEFFERSON CLINTON LYCOMING SULLIVAN TIOGA BRADFORD WAYNE WYOMING PIKE LUZERNE SCHUYLKILL CARBON LEHIGH COLUMBIA BUCKS BERKS CHESTER LANCASTER MONTGOMERY YORK LEBANON PERRY CUMBERLAND DAUPHIN JUNIATA MIFFLIN UNION SNYDER CENTRE ADAMS FRANKLIN FULTON HUNTINGDON CLEARFIELD CLARION LACKAWANNA MONTOUR NORTHUMBERLAND PHILADELPHIA DELAWARE SUSQUEHANNA LAWRENCE BUTLER ARMSTRONG FAYETTE WESTMORELAND ALLEGHENY BEAVER WASHINGTON Warren Staff 494 Patients 180 GREENE Warren NORTHAMPTON MONROE MayviewTorrance Danville South Mountain Wernersville Norristown Allentown Clarks Summit Mayview Staff 677 Patients 303 Torrance Staff 477 Patients 237 Danville Staff 405 Patients 182 Clarks Summit Staff 513 Patients 219 Allentown Staff 377 Patients 170 Wernersville Staff 461 Patients 219 Norristown Staff 793 Patients 403 South Mountain serving all counties Staff 311 Patients 130 As of February 09, 2007 OMHSAS State Mental Health Facilities and Service Areas

30. 30 CHIPP FUNDING HISTORY (CUMULATIVE)

31. 31 MENTAL HEALTH AND DRUG AND ALCOHOL SERVICE SYSTEM Total Funding $3,532,804,649 FY 2007-2008

32. 32 Program Updates OMHSAS Fee-For-Service Transfer Transfer of 41 staff from OMAP to OMHSAS on 8/15/06 BH FFS Staff provide prior authorization for the following services: –Inpatient Psychiatric Services –Inpatient Drug and Alcohol Services –Residential Treatment for Children –Behavioral Health Rehabilitation Services (BHRS) for Children Working to replace outdated HUP manual for initial authorizations Reviewing cases individually to determine cases incorrectly identified as FFS which should be HealthChoices Refined process for automated site to correct errors in eligibility Streamlined process to resolve eligibility issues through Field Office contact with BHMCOs

33. 33 HealthChoices CMS approved waiver for the HC BH Expansion Implementation began on January 1, 2007 County Human Services Staff including MH/MR/SCA’s will co- monitor state contract HC County Option: 15 counties –Technical and Cost Proposals finalized Recommendations made to the Secretary of Welfare to support all of the proposals –Final Rates have been issued; all but three counties have accepted rates Readiness Review: Spring, 2007 Implementation will begin on July 1, 2007 Program Updates

34. 34 Objectives State Plan Services approved by CMS –Certified Peer Specialists –Mobile Mental Health Treatment HC Expansion Older Adult Priorities and Supporting Projects –MFP resubmission –Regional Forums Adult Priorities and Supporting Projects –Housing TA identified –Integrated Treatment Standards Completed Children’s Priorities and Supporting Projects –Response to the BH Taskforce Report –School Based Intensive and Partial Hospital Bulletins/Subcomm Program Updates

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