Gov. Jerry Brown’s proposal to cut funding for the developmentally disabled will end up costing taxpayers millions of dollars.
I work for a nonprofit that serves the developmentally disabled. It is a difficult business, made even more difficult by the economic downturn. Reimbursement rates for the population we serve have not increased since 2009 while costs have continued to rise. This freeze in rates translates into an effective cut of 8.4 percent.
It is no surprise then that Novelles Developmental Services, a for-profit company, recently closed two of its facilities. Salisbury House and Mooncrest House are two of only three such facilities in Santa Barbara County that provide nursing services to the developmentally disabled in a residential setting. My organization runs the sole remaining facility.
It’s probably worth mentioning that the cost for clients requiring this level of care is approximately $70,000 per bed, per year in a residential setting. This compares to the State Developmental Centers, where the average cost per bed is in excess of $300,000. Taking an average number of $300,000, were the 10 clients recently evicted to be put in the State Developmental Centers, the increased cost to taxpayers would be more than $2.3 million per year — and this for only 10 clients.
If Gov. Brown’s proposed cuts to the developmentally disabled population are approved by the Assembly and Senate, it will cost the taxpayers tens of millions of dollars per year. More residential facilities will close as already thin margins disappear. The state will have no choice but to repopulate the State Developmental Centers. These are poorly run, fiscally irresponsible and dismal facilities that cannot begin to serve clients at the level of care offered in a residential setting, putting all associated costs aside.
Quoting a recent press release from the California Association of Health Facilities, “If just 1 percent (11 facilities) of small facilities close, 66 people could be forced to leave their home and move to a State Developmental Center. The cost of absorbing 66 residents would be almost $17 million — more than the Department of Health Care Services estimated budget savings of $11.5 million in fiscal year 2012-13 and $12.6 million in FY 2013-14.”
But 1 percent is a very conservative number given that in our own county 66 percent of facilities have closed in the last month. It is more likely that 10 percent of facilities will close statewide, costing taxpayers $110.5 million in FY 2012-13 and $120.6 million in FY 2013-14.
This is a slam dunk — a no-brainer to any rational mind. Whether Republican or Democrat, the numbers clearly speak to the shortsightedness of our governor and the blindness of legislators that could knowingly pass such legislation. Therein lies the problem.
Gov. Brown has thrown a blanket over Medi-Cal reimbursement without thought or foresight. If nothing else can be said of Gov. Brown, he is clearly well versed in the “sound bite”-driven political decisions being made in defiance on any man’s practical wisdom or logic.
The organization for which I work is blessed. We are a nonprofit, so “margins” disappear. We have much greater flexibility in making residential facilities work. We are in the process of purchasing a home in Santa Barbara to ease the stress of the recent closing of the two facilities in our county. This is possible only because of sound fiscal management (we own our other two homes outright), a deep passion for the clients we serve, incredible support from the Tri-Counties Regional Center and the visionary thinking of Montecito Bank & Trust.
We are in a very unusual situation by which the purchase of a home for $675,000 can still make sense in an environment where those historically and passionately supported by those in power are now targets in a dangerous and painful political battle being waged by, of all people, Gov. Brown.
I have never been good about asking for help, but I am asking for your help today. Please forward this to your state legislator, your friends, family and co-workers. Again, politics are of little import. Logic and math demand that we radically oppose any cuts to residential care facilities serving the developmentally disabled.
Gov. Brown has demonstrated he has no heart. Perhaps we can force him to prove to us he has a brain.
— Tim Durnin is an independent consultant for nonprofit organizations, schools and small business. Contact him at firstname.lastname@example.org, follow him on Twitter: @tdurnin, or click here to read previous columns. The opinions expressed are his own.