Fiscal Administrative and Organizational Structure

Fiscal Administrative and Organizational Structure:
Question #1: To effectively manage a network within a capitation reimbursement
model, based on a consistently administered needs assessment tool, it will be
necessary to provide supports and services to a minimum number of individuals
with variation in defined support needs. Based on your historic knowledge or initial
research, approximately how large would a DISCO’s enrollee pool need to be to
remain fiscally viable and still implement effective care plans derived from personcentered planning practices?
While this seems a question for risk experts, most SANYS forum participants worried
that DISCOs might need to be quite large to manage their financial risk. The worry is
that the large DISCOs in a capitated system will diminish attention to person
centeredness and individualization; that DISCOs’ care coordination functions will be
dominated by the fiscal implications of their decisions. The consensus of forum
contributors was that very stringent safeguards from OPWDD would be needed to ensure
that “People First” values do not become “Fiscal First” in practice.
SANYS forum participants were deeply troubled by the downsides of DISCOs being
service providers. SANYS believes it is entirely feasible for DISCOs to perform care
coordination, funding and oversight functions without being a service provider. We urge
that in the pilot phase OPWDD set up at least one DISCO that does not provide services
to its enrollees.
SANYS favors a regional distribution of DISCOs that reflects the demographic and
cultural variations across the state. From the perspectives of practical convenience most
individuals will want to relate to DISCOs that are reasonably near them.
SANYS stakeholders made these comment about the size of DISCOs:
There was concern about the imposition of large, potentially bureaucratic entities
into the lives of individuals. Everyday experience with large managed care
organizations suggests that they are not consumer oriented and focus on bottom
line fiscal impact when making service approval decisions. The matter of size
should be analyzed sharply through the lens of People First values:
individualization, choice, outcomes and quality. In all other aspects of the People
First waiver, personal relationships are valued – how will large DISCOs achieve
The right size of DISCOs for fiscally viability could be influenced by approaches
to risk sharing. Risk sharing, if well conceived, could lessen the need for large
DISCOs whose size offset their fiscal risks. Smaller DISCOs would allow a
broader regional distribution and enable more personal engagement with
individuals and providers.
In thinking about size, fiscal risks and regional distribution of DISCOs, it is
important to remember that need levels of individuals are spread unevenly across
the state. In counties where large numbers of formerly institutionalized
individuals reside (like Fulton County, Oneida County, Hamilton County, etc.)
there is a higher need level proportionate to general population.
Similarly, existing services (particularly residential) are not distributed evenly
across the state. Waiting lists are not proportional to population across regions.
This raises serious concerns about equity of access to resources and services. The
size of DISCOs must be centered on assuring equal access to services no matter
where one resides in the state.
A corollary issue to size and managing capitated resources is enrollment
decisions. What safeguards will there be to prevent DISCOs from denying
enrollment or access to needed services due to high costs? There should be an
appeals process for denials that is independent from the DISCOs.
Question 2(b): Please provide a general description of how OPWDD should evaluate
whether a DISCO pilot applicant is proposing a provider network that is sufficiently
inclusive of self directed support models, habilitative supports that are responsive to
individuals’ and families’ interests and needs for services that include family
supports, care coordination, medical care, behavioral care and dental care.
SANYS forum participants agreed that carefully designed applications will yield multi
dimensional insights on DISCO applicants’ potential to achieve the aims of the People
First waiver. Applicants “proposed provider networks” is one criterion, but there are
many other factors that forum contributors commented on. As with every other aspect of
the new waiver, conformance to People First values must dominate judgments about
worth. Applicants must demonstrate with the highest degree of credibility understanding
of, and adherence to, waiver values.
It is vitally important to consider that the People First waiver is intended to be
transformative. Applicants must show convincingly that they can transform the present
system to achieve People First goals with sensitivity and respect for individuals served or
to be served.
SANYS believes that, while all services and supports must conform to People First
values and goals, it is applicants’ attention to, and plans for, individualized and self
directed services that will be most telling of their potential to achieve transformation.
SANYS forum contributors felt strongly that OPWDD should invite self advocates and
other stakeholders to participate in the application review process.
The following comments summarize the SANYS forums’ response to this question:
If service providers are permitted to be DISCOs, applicants’ experience in
services for persons with developmental disabilities is, obviously, critically
important to assess. Do they have a reputation for top caliber quality? Have they
demonstrated person centeredness in their relationships with individuals? Have
they engaged in innovative approaches to services and supports, been willing to
think and act outside the box? Have they taken advantage of opportunities for
innovation, e.g. OPTS, Learning Institute, etc.? What do people who know them
say about them?
DISCOs will to a large degree contract with others for services. Their
applications should demonstrate whether or how they have formed collaborative,
productive relationships with other entities.
Applicants’ views on, and (if they are providers) their track record with,
individualized and self directed services is a vitally important matter. Since so
few providers have experience with self directed services, applicants must present
thoughtful and practical plans that show how they would support the growth of
self directed services in NYS.
Fiscal incentives are to be a key element of system transformation. DISCO
applicants should be asked how they would develop and apply fiscal incentives to
the provider network.
What incentives and assistance will DISCOs offer directly to individuals to
“transform” their own services and supports, e.g. trading off high cost congregate
services for flexibility, customization and control over less costly individualized
and self directed services?
Every region has providers with service specialization “niches”, e.g. medical
frailty, behavioral supports, family support, employment, etc. Applicants should
demonstrate how they will coordinate the various service specialties in the most
appropriate fashion. How will they fill gaps in services within their region?
Where over capacity or duplication exists how will DISCOs make adjustments to
balance the provide networks?
Particular scrutiny should be paid to how DISCOs and their provider contractors
will deal with high needs persons, e.g. those with medical needs, dual diagnosis,
Applicants must clearly demonstrate that their provider networks are inclusive of
services (and agencies) that are culturally oriented. DISCOs must demonstrate
how they will be culturally sensitive in their internal operations and connections
with cultural communities.
In every region at any time there are providers who are under performing, who are
in fiscal jeopardy or show programmatic deficiencies. DISCO applicants must
demonstrate what actions (positive and/or sanctions) they would take to address
provider shortcomings.
Applicants should demonstrate what measures they would take through and with
providers to achieve administrative efficiencies. In particular, what would be
their strategies in dealing with small agencies?
Since respect and responsiveness to individuals are cornerstones of People First
values, applicants should be asked how they will support self advocacy.
Applicants who are providers should be asked about their experience in
supporting self advocates. Have they engaged formally with self advocates?
Have they brought self advocates into advisory, decision making or governance
functions? How will they do so in their DISCO structures? How will they
involve other stakeholders in ongoing functions and governance – families,
community members, etc?
SANYS believes that the credibility and effectiveness of evaluating DISCO
applications will immensely benefit by including self advocates in the review
Question #3: How would you suggest that DISCOs incorporate programmatic and
administrative efficiencies into their network model while ensuring that individuals
receive quality, person centered supports and services and that direct support
professionals receive competitive benefits and wages, meet core competencies and
are well trained?
People in the SANYS forums who responded to this question immediately saw the
relationship of its three components: programmatic and administrative efficiencies,
quality supports and services and well trained and fairly compensated direct support
professionals. They were concerned that “programmatic and administrative efficiencies”
not be achieved on the backs of individuals served or the DSPs. They felt programmatic
and administrative efficiencies, if thoughtfully conceived and applied, do not inevitably
result in diminution of services and could actually lead to strengthening the direct support
The points raised in the forums are summarized as follows:
First and foremost, DISCOs must demonstrate their own programmatic and
administrative efficiencies. There is substantial concern that a new layer of
bureaucracy will add costs that come out of resources for supports and services.
OPWDD should closely scrutinize the administrative structures and overhead
costs of DISCOs to ensure that they are as lean as possible. There was frequent
mention of executive salaries.
There should be clear expectations for reinvesting savings from programmatic and
administrative efficiencies into supports and services and compensation for DSPs.
Being express and explicit about the opportunities achieving, reinvestment could
stimulate much creativity in all system stakeholders.
One powerful means to find and adopt efficiencies and programmatic alternatives
is to publicize the costs of existing services and supports. The majority of
individuals and families have very little awareness about how much the various
forms of services actually cost. While a significant proportion of costs are
necessary and appropriate to need, it is a mistake to assume existing costs are
appropriately aligned with all people being served, are relevant and/or are
immutable. Given the chance to consider how (at least a portion) of existing costs
could be redirected to alternative supports and services, providers, individuals and
other stakeholders might produce amazingly imaginative thinking.
It is widely perceived that OPWDD believes that administrative efficiencies will
be gained by reducing the number of agencies through elimination or merger.
There was concern that this will fall most heavily on smaller agencies. Forum
contributors felt that small agencies are often the most person centered, culturally
focused and creative and that their disappearance would damage the quality of
services. Experience shows that mergers, despite stated intentions to the contrary,
usually result in loss of the identity and culture of the agency being taken over.
Great care should be taken by OPWDD and DISCOs with this strategy. At the
least, every method should be explored to find savings that do not depend on
eliminating agencies.
One method of finding administrative efficiencies would be for providers to share
administrative functions such as: business operations, information technology,
marketing, human resources, training, etc.
Many commentators expressed concern that “fiscal incentives for system
transformation” are simply code words for blunt edged fee and rate reductions.
They worried that OPWDD’s and DISCO’s strategy is to reduce payments with
the expectation that, somehow, good things will result. The concept of fiscal
incentives (to find efficiencies and restructure programs) is a good one, but it
must be applied thoughtfully and in a purposeful planned way.
Providing fair compensation and appropriate benefits to the direct support
workforce is essential if the system is to meet its People First objectives. As the
range of services becomes more diverse, less structured and more individualized,
the skills and commitment DSPs becomes significantly more important. Careful
scrutiny of DSP compensation packages, revised and update training curricula,
and close attention to the well being and satisfaction of DSPs should be required
of every DISCO.
Question #4: Please provide suggestions regarding what controls/firewalls should be
applied to DISCOs that also functions as direct providers of service to ensure
adequate network choice and not unduly influence care coordination efforts toward
their own provider agency.
See our comments above about the risks of DISCOs being service providers and
well as funders. SANYS forum participants were unanimously opposed to the
idea that any degree of controls/firewalls could prevent conflicts of interest and
self referrals by DISCOs that are also service providers. Many mentioned
experiences with Medicaid Service Coordination by agencies who were also
providers where, despite purported independence of function, MSC’s were
pressured to take care of their own agency’s referral needs.
These are among their observations:
Why would you create a system that needs a “firewall”? Complete separation of
fiscal decisions and care coordination from service provision solves this problem
We believe that DISCOs should not serve their own enrollees. Let them contract
with other DISCOs if they want to provide services.
If you are going to do this, you must have close monitoring of referrals to ensure
absence of favoritism.
Consider establishing three separate entities for three functions: needs assessment,
care coordination (including referrals) and fiscal management. Each should have
fixed rates for its services with no financial incentives for service provision.
Question #5: What incentives, disincentives and strategies do you recommend to
ensure that individuals who present with more complex needs are not excluded from
participation in a DISCO of their choice and that high quality expectation for all
individuals is achieved and maintained at both the DISCO and provider level?
In the view of SANYS forum attendees this important matter requires multiple measures
to avoid its occurrence. In addition to the obvious cost disincentives to the DISCOs there
are other factors that bear on it: 1) a dearth of services for people with complex needs
within particular regions; 2) the unwillingness/refusal of providers to serve certain
individuals; 3) the uneven distribution of persons with specialized needs across the
regions of the state; 4) the limitations on choice of providers that persons with complex
needs encounter; and 5) the consequences to DISCOs and providers if/when state
operations cease to be a fall back option for individuals with challenging needs.
Forum contributors felt that the following issues must be addressed in dealing with this
Structuring of per capita rates must include careful weighting of the costs of high
needs individuals.
Where capacity within a DISCO for specialized services is weak the DISCO must
have an achievable plan to improve the availability of competent providers.
Risk sharing through pooled risk or contingency schemes must be in place to
offset any DISCO’s extraordinary experiences with high cost individuals.
OPWDD and DISCOs must have a no refusal policy regarding persons with
complex needs. Contract providers should have very limited grounds upon which
to refuse a person they have the programmatic capacity to serve. DISCO and
provider decisions on admissions should be closely monitored.
If OPWDD is anticipating transferring auspice from state operations to the
voluntary sector, there must be in depth analysis of capacity and skills among
providers to support the more challenging individuals found in state operated
programs. This is especially the case in regions of the state with a large
concentration of state operations due to institution closures (Central New York,
Finger Lakes, Sunmount, Hudson Valley, Taconic).
Question #6: How would you ensure that the network of providers established by
the DISCO is sufficiently multi-cultural and able to serve the diverse interests and
needs of the enrolled individuals?
OPWDD should take pride in its historical support for the multi-cultural interests of New
Yorkers with developmental disabilities and their families. The SANYS participants
urged that the richness of the multi-cultural network of providers and their culturally
sensitive services not be sacrificed for efficiencies and that system transformation efforts
have cultural respect as a key benchmark.
SANYS contributors made these recommendations to achieve this end:
DISCOs must be actively and visibly a part of the communities in which they
DISCOs in their governance membership, internal operations, care coordination,
quality monitoring, marketing and referrals should demonstrate cultural
competence, multi-lingual capacity, etc.
DISCO contracts with service providers should include provisions for requiring
cultural competence and quality monitoring should look for this.
One strong measure of diversity that DISCOs should pursue is hiring persons with
disabilities within their workforce.