PROVIDENCE – The push to create a new $30 million program in Rhode Island to make going to college for high school students free for two years if they chose to attend Rhode Island College, the University of Rhode Island or the Community College of Rhode Island dominated the news cycle around the announcement of the proposed FY 2018 budget by Gov. Gina Raimondo.

In turn, news about the $364 million UHIP screw-up, with the forced resignations and public shaming of two members of the Raimondo team as scapegoats, was erased from the whiteboard at assignment desks, dismissed as last week’s story.

The new bright, shiny object that served as the object of the news media’s affection was the proposed free college initiative. The $30 million program for high school students, with only $10 million of spending put into the proposed FY 2018 budget, attracted plenty of proponents and detractors, raising lots of questions.

The visit to Cranston East High School by Raimondo on Jan. 18, promoted by her communications team as a “free college rally” in support of her proposal that would “knock down financial barriers to obtaining a college degree,” occurred the day after Raimondo’s state of the state address and the day before her budget was publicly revealed. Call it media sandwich piled high with lots of ham and baloney.

Depending on your political point of view, the rally was either shameless self-promotion, preaching the gospel to a captive audience, or a brilliantly executed PR campaign to reposition Raimondo as an innovative governor, building upon the campaign ideas voiced by Democratic Presidential candidates Bernie Sanders and Hillary Clinton.

What it achieved was a shift in the conversation. [All that was missing, perhaps, was a “mission accomplished” banner.] It was, from a managing-the-media perspective, an adroit maneuver: it pushed the growing budgetary costs of Raimondo’s policy failures under the proverbial rug.

The high cost of living and dying
One number not mentioned or addressed at all in the FY 2018 proposed budget was the more than $40 million owed to nursing homes that has not yet been paid by the R.I. Executive Office of Health and Human Services, reimbursing the nursing homes for clients they have been providing care for who have applied for long-term care services under Medicaid but whose eligibility has not yet been determined.

The $40 million figure comes from the results of a recent survey conducted by the Rhode Island Health Care Association, with more than half of the 68 members responding to date, according to Virginia Burke, the association’s president and CEO.

The backlog, with the oldest case dating back more than a year to November of 2015, has left numerous nursing homes in extreme financial distress – as well as leaving the families of loved ones being cared for in a state of constant anxiety.

The providers, including nursing homes, childcare facilities, home health agencies and assisted living facilities, spoke out forcefully at a legislative oversight hearing held on Dec. 20, 2016. [See link to ConvergenceRI story below.]

Cause and effect
The causes of the backlog can be directly linked to the faulty launch of the Unified Health Infrastructure Project, known as UHIP, the software system built by Deloitte, and a series of poor policy decisions made by the Raimondo team leading up to the launch.

• First, the online portal that was supposed to serve as the way to apply for long-term care services under Medicaid, planned to be operational on Sept. 13, has never worked. In mid-October, R.I. EOHHS officials told nursing homes to stop trying to use it. No fix has yet been built, with the result that all applications must be done by paper and then scanned into the system, a process prone to errors.

• Second, about a month before the launch on Sept. 13, key DHS personnel were laid off, including three of the four staffers responsible for trying to resolve the backlog.

• Third, the initial response by DHS to the growing backlog in determining eligibility, which prompted repeated phone calls from providers beginning in early 2016, was a decision to limit communications to emails but no phone calls from providers, on just two days a month, with responses to questions about clients’ status to be given a month later.

At that time, the planned launch of UHIP was scheduled for July 1, and Depena-Affigne said that no new hires would be made until the staffing needs after the implementation of UHIP were better understood.

Who actually made the decision to push the button and go live on Sept. 13, 2016, remains a mystery. So does the involvement of Raimondo in the decision-making process.

Speaking out at hearings has consequences
While Raimondo forced the resignation of two members of her team, Melba Depena Affigne, director of the R.I. Department of Human Services, and Thom Guertin, chief technology officer, it has not solved the problem with the backlog or resulted in payments to the nursing homes for the more than $40 million owed them.

The consequences of speaking out publicly at the legislative oversight hearing are not yet clear. Has the Raimondo administration turned petulant after being criticized? Are legislators who said they were outraged by the failure to pay providers still willing to carry the water for the Raimondo administration on the budget? The bottom line is that $40 million remains unpaid and the balance keeps growing larger, with no fixes in sight.

The nursing home providers just want to get paid – and not have to negotiate with vendors when bills go beyond the 90-day past due limit, through no fault of their own.

Playing on the hopes of high school students, enticing them with the potential for two years of free college tuition as part of a new $30 million program, while at the same time refusing to fix the problems that are causing $40 million in unpaid bills in caring for the state’s most frail, vulnerable residents, appears to take on the semblance of a crass political calculation by the Raimondo team.

Translated, in the budget, do you promote a $30 million program to invest in free college for young people, or do you find the resources to pay down the $40 million backlog owed to nursing homes for uncompensated care?

The fate of Rhody Health Options
The FY 2018 budget calculations are not happening in a vacuum. The much-vaunted Reinvention of Medicaid, despite all the positive promotional exhortations by the Raimondo communications team, still remains mired in uncertainty and a lack of proven outcomes and results.

The FY 2018 budget recommends freezes in Medicaid rates for hospital and nursing homes, as well as reductions in payments, all to allegedly invest in new ways to rebalance the system toward keeping seniors in the community.

There’s a catch, however. The previous attempts to rebalance the system through investments of Medicaid dollars in what is known as the Integrated Care Initiative have not worked very well.

That is reflected in the proposed elimination in the FY 2018 proposed budget of administrative fees paid to Neighborhood Health Plan of Rhode Island.

As first reported by ConvergenceRI in its Oct. 31 issue, detailing the contents of a confidential budget memo from R.I. EOHHS:

The reason given for [the proposed cuts]: “The significant investments by Medicaid into the Integrated Care Initiative to date have had limited impact on reducing nursing home use.”

Further, under the proposed FY 2018 budget, the agency wants to repurpose a portion of the saved administrative costs, some $10 million, to develop home and community-based options “that can serve as an alternative to expensive nursing facility based care.”

Translated, the Rhody Health Options program has proven to be a costly failure, as measured by the outcomes. At the time of its launch in 2013, the state projected that savings were to be achieved by the projected transition of some 3,000 patients currently in nursing homes back into the community.

It proved to be wishful thinking – because those large numbers of promised transitions never materialized.

• In 2015, the total number of transitions achieved under the direct auspices of Neighborhood Health Plan [and not under other pre-existing programs] was 36, according to the state’s public records. That is correct: 36 transitions.

• Even more damning, the total number of transitions from nursing facilities back to the community were actually lower than the transitions achieved, compared with previous programs underway before Neighborhood Health Plan became involved, according to state’s public records.

Yet, for the last three years, the R.I. Executive Office of Health and Human Services had insisted that Rhody Health Options [the first phase of the larger Integrated Care Initiative], had been successful, singing its praises at hearings and in interviews – and also singing the praises of Neighborhood Health Plan of Rhode Island for the way it had managed the program.

Now, all that evocation of success has apparently fallen off the budgetary cliff. Why? What caused the change of heart? The reasons seem to reflect a budgetary reality: cracks are now appearing in the financial foundation supporting the reinvention of Medicaid in which the numbers and results do not add up.

How much has been invested in taxpayer dollars in administrative fees paid to Neighborhood Health Plan over the past four years to support a failed program?
Why has there been no investigation by the R.I. General Assembly, or analysis by R.I. EOHHS, publicly shared, about what went wrong?

What the budget document says
No mention of the cuts in administrative fees to Neighborhood Health Plan or what their exact size was could be found in the online version of the FY 2018 budget document.

Instead, when ConvergenceRI queried R.I EOHHS about the status of Rhody Health Options, Sophie O’Connell, communications spokeswoman, referred to Page 101 of the Executive Summary, which said, under the heading, Healthy Aging in the Community:

“The Governor recommends redesigning the nature of the state’s Integrated Care Initiative by transferring long-term stay nursing home members from Neighborhood Health to Medicaid fee-for-service and repurposing a portion of the anticipated savings (from reduced administrative payments to Neighborhood Health) for enhanced services in the community. The investments in home- and community-based care will help achieve the goal of rebalancing the long-term care system.”

As best can be determined by ConvergenceRI, the savings projected by the FY 2018 budget cuts to Neigthborhood were $12,284,295, which means that this amount will be invested in a different strategy to rebalance the system. What is that strategy? How will it work? What are the metrics? What are the lessons learned from the Rhody Health Options failure? All good questions.

ConvergenceRI followed up with O’Connell, asking about the fate of Rhody Health Options and to clarify the numbers. Here is her response:

“We are not ending the Rhody Health Options program/Integrated Care Initiative,” O’Connell said. “The budget proposes to transfer care management for those patients who reside in nursing homes over 90 days out of Managed Care [through Neighborhood Health Plan] and have their care managed through another means [like our nursing home transition team].”

O’Connell continued: “This initiative is expected to generate approximately $12.3M in savings from reduced administrative fees to Neighborhood. [We have learned that once patients are in the nursing home for more than 90 days, they are much less likely to transition back out.] We will reinvest $11.5 from this and other savings initiatives to improve the home and community-based service delivery system for elders and persons with disabilities.

ConvergenceRI also asked about the financial relationship between the change in funding for Rhody Health Options, the new strategies to be employed to rebalance the system, and the development of a new form of an accountable entity program in Medicaid for long-term care services.

O’Connell responded: “No funds are being used to support transformation or Accountable Entities from the budget,” she said. “Those initiatives are wholly supported by federal funds through the Health System Transformation Program.”

Hard of hearing
The statement by O’Connell that R.I. EOHHS “has learned” that once patients are in nursing homes for more than 90 days, they are much less likely to transition back out to the community, mirrors almost precisely the comments made by Virginia Burke back in September of 2013, as reported in ConvergenceRI:

“Neighborhood is a standout when it comes to quality,” Burke said. “I don’t want to be taken as maligning them at all. But they have no experience with the long-term nursing home population. I don’t think they have anything to bring to that population, certainly nothing that would warrant $27 million [in administrative fees] in the first year.”

The problem, Burke explained, is that under Phase I of Rhody Health Options, Neighborhood will not be able to integrate, manage or coordinate very much when it comes to patients who are in nursing facilities, once the “level of care” determination is made that long-term care in a nursing facility is needed.

“Medicare will continue to cover their doctors, their hospitals, their prescriptions, their physical therapy, their speech therapy, all that is coming from a different health care program,” she said. For the nursing home population, Burke continued, “What Neighborhood will be primarily doing is processing and paying bills, and I don’t think that’s worth millions of Medicaid dollars.”

The new program also promises to create a paperwork burden, according to Burke. “The state is creating a parallel administrative system; all the administrative hassle that goes along with provider/payer relationships is going to be doubled,” she explained, because seniors in nursing facilities have the opportunity to opt-out of Rhody Health Options and remain with the current state system.

One further point: the return to a Medicaid fee-for-service program is contrary to all the rhetoric around value-based vs. volume-based care being pushed by R.I. EOHHS. Is there a legislator who is courageous enough to ask questions about the reasons why to Elizabeth Roberts, secretary of the R.I. Executive Office of Health and Human Services, or her top deputy, Jennifer Wood?