FY09 Community Services Agreement calls for Belt Tightening

The permanent impasse surrounding the passage of revenue legislation has resulted in major funding cutbacks so that the state may comply with its constitutional mandate of a balanced budget. Consequently, the FY09 Illinois budget has included reductions that have put a noticeable strain on provider resources and the services they can offer despite the ongoing commitment of DMH Director Jones and her staff to leaving no stone unturned in minimizing the financial impact on the Division's provider-partners.

Funding under the FY09 Community Services Agreement between DHS/DMH and providers was immediately reduced by nearly three million dollars. Additionally a nearly 16 million dollar reserve has been placed on community agency payments. "Frank and honest communication between the Division and providers continues to be crucial," stated DMH Fiscal Policy Chief Craig Williams.

"We're all working for the same thing, ensuring that consumers continue to have ready access to vital services. Obviously, it's an even bigger challenge these days but by keeping this goal in mind we've already had some successes including the four million dollars in advance payments to providers at the start of 2009."

Director Jones and her staff have met with several provider trade organization representatives including the Illinois Association for Rehabilitation Facilities (IARF), the Community Behavioral Healthcare Association (CBHA), and the Illinois Hospital Association (IHA) to discuss the anticipated impact of the FY09 cuts.

Acutely aware of the plight of many providers in serving mental health consumers, Director Jones acknowledged, "We recognize what a difficult time this is for the public mental health system in Illinois. At such times, it is especially important that stakeholders in the system cooperate and work together in a focused way to ensure that, even with more limited resources, critical services remain available to those with mental health service needs."

Under her direction, DMH has developed core principles to manage the recent funding reductions:

  • Preserve core community mental health services to as many people as possible
  • Maintain the movement towards a mental health service system consistent with the vision of recovery
  • Preserve grant/federal funding, including funding that is dependent on matching state funds
  • Maintain efforts to maximize federal reimbursement to the system
  • Per a fee-for-service funding approach, continue to adjust funding to support the actual delivery of mental health services to consumers
  • As possible, establish a minimum provider funding level "floor" to support overall system stability

Every DMH service is important to supporting its mission. Nonetheless the budget dilemma has pressed the Division to prioritize the following as funding priorities:

  • Crisis Services
  • Medication Services - Administration, Monitoring, and Training
  • Psychiatric Services
  • Case Management
  • Community Support - Individual, Group, Team and Residential
  • Assertive Community Treatment
  • Mental Health Assessment
  • Treatment Plan Development, Review and Modification
  • Residential Programs
  • Therapy/Counseling for Children & Adolescents

Although recognizing that each provider's circumstances and community is unique, Associate Director for Community Services Jackie Manker urged that, to the extent possible, providers adopt the above principles and prioritized service list. "No one likes being between an economic rock and a hard place," she stated, "but I'm confident that our provider-partners will continue to work closely with us to make sure that people in need will still have access to services. We're all in this together." Director Jones is also very concerned that equity between community services and state facilities be maintained and is committed to ensuring that any further budget activities are addressed with that mind.

Director Jones advises that there are several things that providers can do to ease the burden as well as prepare for better times. First among them is keeping the regional offices informed of their situation and any prospective changes so that DMH can keep appropriate state officials up to date of the actual impact of these reductions. Secondly, the Division will continue to push for expedited payments to those providers confronting exigent financial circumstances. Lastly the Division realizes that this is the first funding reduction that many providers are being hit with while transitioning from a grants-based to a fee-for-service (FFS) funding mechanism. It is crucial that providers manage their finances in a manner that establishes a secure foundation for the future under FFS. To that end, general techniques and principles for consideration can be found in Parker-Dennison's Cost Restructuring Document.