1. Financing Systems of Care Chris Koyanagi, Policy Director Bazelon Center for Mental Health Law

2. Funding Sustainable Interagency Systems of Care Advice from successful sites:  Get out of match frame of mind  Program must drive financing  Build budget with sustainable funds (Medicaid, Title IV-B, etc.)  Adhere to SOC values, philosophy  Use cooperative agreement dollars to stimulate contributions from partners and state

3. Funding Sustainable Interagency Systems of Care Advice from successful sites:  Grants are about systems change; do not lose sight of need for interagency action to change how services are delivered  Get out of match frame of mind  Program must drive financing  Address long-range financing early; don’t wait to panic at end of year 3  Use cooperative agreement dollars as venture capital

4.  Build structures to ensure strong collaboration with other agencies:  Coordinate financing policies across systems  Build relationships early and focus on high priority issues in each system  Ensure financing policies in all agencies comport and support SoC approach  Redeploy -- use money in other systems more efficiently:  Shift funds from high-end or overly-clinical services to less intensive care and family support Winning Strategies for Sustainable Systems

5. Use Match Rules to Your Advantage  Federal government is seeding a new way of doing business in your community and providing unusually long support  Federal funding declines over life of grant in a deliberate strategy to force local support  There are many resource materials available to you on financing SoC and sustaining them

6.  Use federal time-limited funds to test ideas and start new initiatives, such as:  Applying for other special grants with partner agencies  Making mini grants to stimulate new high-priority services  Selling critical services to other agencies (training and TA) Use of Federal Grants

7. Look to the Future  Use the time while you have federal funds to build activities and plans for future funding:  Get commitments for later years’ funding now  Build a strategy to win state general fund support  Co-locate staff  Provide services to avoid juvenile justice placement, child welfare large residential placements, etc. that can continue (and be funded) when federal funds expire

8. Financing Rules for Applicants: Maintenance of Effort (MOE)  Cannot use as match for the first grant year an amount equivalent to the non-federal funds expended by the applicant for same purposes over prior 2-years  This amount also cannot be used as match for subsequent years

9. Calculating MOE  To calculate MOE:  Average the amount of funds spent by applicant over the previous two fiscal years:  in same locality as that served by the cooperative agreement  for community mental health services  for children to be served by the applicant agency (your target population)  Non-federal match must then exclude this MOE base amount for each FY of the cooperative agreement

10. Definition of Match Match funds are:  Non-federal public or private funds  Funds not used as match for any other federal program (including Medicaid)  Funds spent on the system of care  Either cash or in-kind, fairly evaluated  For Indian Tribes or Tribal Organizations, Section 638 funds

11. Non-Federal Cash Match Can Be:  New state or local general fund dollars spent by any partner agency  Funds redirected from residential or other institutional services to community services for child served by the program  Funds from private entities, including health insurance, donations, etc

12. Not allowable as match are:  Funds spent for a purpose not permitted for federal grant funds  Funds not spent on SOC, but in another part of state or locality  Funds expended for services to children who are not SOC children  MOE Funds That Cannot Be Match

13. Non-Federal In-Kind Match  Can be plant, equipment, or services  Must be allowable cost under terms of cooperative agreement if site were to pay for them  Examples:  Personnel costs (teachers, child welfare workers, etc.)  Space (used by staff of any agency when serving SoC child, space for other SoC activities)  Volunteer, family, or youth time

14. Additional In-Kind Options  Vehicles for transportation  Training or TA costs  Evaluations or other support from universities or others  Donated media activities  Utilities, phone, space, or equipment  Time contributed by community members and Board  Equipment donated

15. Rules on In-Kind Match  In-kind funds must be fairly evaluated  Space/equipment where 3rd party has title must be valued at fair rental rate  Volunteer services by professionals, technical personnel, family members, consultants and others must be integral and necessary part of an approved program and constitute allowable cost if program had to pay for it

16. Calculating Value of In-Kind  Use fair market rent or value  To calculate volunteer time use:  Cost of site employee who performs similar work  or  Rate consistent with that paid for similar work in labor market in which the grantee competes  Include cost of reasonable fringe benefits  Supplies must be calculated at the market value at the time of the donation

17. Sources for Cash Match for Sites Sites have tapped:  State and local general fund  Targeted taxes  Realigned mental health budget  Redirected child welfare funds from residential care  Juvenile justice funds for diversion and probation  Private funding: foundations (local and national), United Way, community groups

18. Where is The Money? To fund a sustainable program:  States, states and states  Local government to some degree  Partner agencies: state and local funds or in-kind services  Redeployed funds into lower cost services  Third party reimbursement  Medicaid  Private insurance

19. Medicaid  Most community services covered:  In-home services  Crisis intervention (mobile teams, hot lines, in-home, etc.), crisis stabilization  Skills-building (social skills, daily living skills, communication skills, self-management skills, and independent living skills, etc.)  Behavioral aides/adolescent peer specialists  Case management  Social and recreational activities if meeting rehab plan goal  Anger and behavior management services  Day treatment  Family psychoeducation and family skill-building  Services to support participation in education, including school-based services by qualified provider

20. Evidence-Based Practices  Medicaid will pay for (and states are billing for):  Multi-systemic therapy  Wrap-around  Intensive in-home services  Family psycho-education  Integration MH-SA treatment  ACT teams  Therapeutic foster care  Illness/disability self management

21. Targeted Case Management  New rules in DRA  TCM provided by mental health agency case manager always covered, little change  TCM provided by child welfare worker or juvenile justice probation or parole officer harder to justify  Children in foster care or on probation still eligible for TCM from mental health like any other child

22. Targeted Case Management  Child welfare activities specifically not billable to Medicaid:  Gathering and completing documentation required by foster care program  Recruiting potential foster parents  Serving legal papers  Home investigations  Providing transportation  Making placement arrangements  Administering foster care subsidies

23. Other Core Federal Programs  Child welfare: Title IV-E (foster care) and IV-B to prevent out-of-home placement  Education: IDEA  Juvenile justice: Federal funds, court, and probation funds  MH and SA block grants

24. Tribal Sites  Different federal rules:  Use of PL 93-638 funds  Medicaid—can be 100% federal if provided through Indian health service program  Other revenue sources:  Tribal funds from various sources  Casino revenue  In-kind match  States: requires effort

25. Sustainability  Study of earlier graduates shows the most important funding sources are:  Medicaid  State mental health funding  Partner agency funds (obtaining and coordinating)  Redeploying funds into lower cost service alternatives

26. Conclusion  A few things to remember:  Match is a tool; not an end in itself  Work from day one on sustainability and use match to your advantage  Sustainable systems of care must be partnerships – other agencies are your customers  Medicaid and other federal entitlement programs are a core source of on-going support but state and local investment is critical

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