Harriet Dichter, Acting Secretary of Public Welfare | www.dpw.state.pa.us
2010-11 Executive Budget
Commonwealth of Pennsylvania Department of Public Welfare
Budget Briefing
February 2010
Edward G. Rendell, Governor
2010-11 Executive Budget
The recession continues pressure on revenues and state budgets
-15%
-10%
-5%
0%
5%
10%
Pe
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nta
ge
Ch
an
ge
State tax collections from the first three quarters of 2009 showed the largest decline since 1963.
Source: Nelson A. Rockefeller Institute of Government. Original Sources - U.S. Census Bureau (tax revenue) and Bureau of Economic Analysis (GDP price index).
Year-Over-Year Percent Change in State Tax Collections: Nationwide Four-Quarter Moving Average
Edward G. Rendell, Governor
2010-11 Executive Budget
In tight times, DPW’s investments generate jobs and immediate economic rewards
The Economic Multiplier Effect:
• Every dollar of Medical Assistance healthcare spending generates $2.77 dollars in economic activity across Pennsylvania
• For every dollar Pennsylvania invests in early childhood programs, more than two dollars is circulated throughout our local economies
Creating and Sustaining Jobs:
• Medical Assistance spending for FY10-11 will support an estimated 218,000 Pennsylvania jobs
Return on Investment:
• Every $1 spent on substance abuse treatment saves $4 in reduced future health care costs and $7 in reduced future criminal justice costs
Edward G. Rendell, Governor
2010-11 Executive Budget
State investments leverage $12.2 billion in federal dollars
Program Office FY10-11 Federal Dollars
Child Development and Early Learning $524 million
Children Youth and Families $459 million
Developmental Programs $1.65 billion
Income Maintenance $1.33 billion
Medical Assistance Programs $8.0 billion
Mental Health and Substance Abuse Programs $274 million
FEDERAL DOLLARS LEVERAGED $12.2 billion
Edward G. Rendell, Governor
2010-11 Executive Budget
More Pennsylvanians Need Help2.1 million children and adults rely on
Medical Assistance for health care
2.1 million(Jan 2010)
Edward G. Rendell, Governor
2010-11 Executive Budget
TANF Cash Assistance Increases as the Recession Hits PA
267,682(Oct 2005)
197,027(Mar 2009)
217,820(Dec 2009)
Edward G. Rendell, Governor
2010-11 Executive Budget
Short term extension of enhanced FMAP will help Pennsylvania meet rising needs
• Original sunset: 12/31/10• Now: Expect states will
receive enhanced FMAP through FY10-11
• Worth $5.3 billion total – up from $4 billion
• Federal dollars will help us avoid most – but not all – painful cuts in this budget
Additional FMAP (billions)
Edward G. Rendell, Governor
2010-11 Executive Budget
Risks to the Budget1. The Economy – if the recovery is slower than
expected, revenues will be below target
2. MCO Pharmacy Rebates – if Congress fails to act, we will have less pharmacy savings
3. Enhanced FMAP – if the Congress fails to extend the enhanced match for Medical Assistance, the budget will not balance
Edward G. Rendell, Governor
2010-11 Executive Budget
DPW Guiding Principles • Support sustainability—
preserve services for those who need them
• Improve quality and results—ensure services improve the lives of those who receive them
• Ensure accountability—ensure efficient use of tax dollars
Edward G. Rendell, Governor
2010-11 Executive Budget
Budget Overview$388 million increase in state dollars
4.9% increase from 2009-2010
FY10-11 Budget: Control Growth and Assure
Sustainability, Quality, Results and Accountability
Edward G. Rendell, Governor
2010-11 Executive Budget
$363 M Safety net services and increases required by federal law
+$385 M Federal and other revenue replacement
$748 M Additional State Dollars Needed
Constructing a Budget that Works
Step 1: The Budget Drivers
Step 2: Cost Containment $748 M Budget Drivers
-$360 M Cost Containment and Adjustments
$388 M Total Growth
Edward G. Rendell, Governor
2010-11 Executive Budget
DPW has reduced staff and personnel each year since 2003
Total Savings: $230 million in salary and benefits savings since 2003
Reduction in DPW Workforce from 2003 to 2010
Institutional Workforce (including from closures)
1,840 fewer workers
Non-Institutional Workforce 1,340 fewer workers
Total 3,180 fewer workers
Ensuring efficient use of tax dollars
Edward G. Rendell, Governor
2010-11 Executive Budget
Over $825 million cost savings in last year
Ensuring efficient use of tax dollars
MA fraud, abuse and efficiency efforts
$656M cost avoided
MA Third Party Payor collections
$110M collected
Improvements to contract negotiation processes
$50M cost avoided (over the life of the contract)
Improvements to auditing processes
$10M cost avoided(over the life of the contract)
Edward G. Rendell, Governor
2010-11 Executive Budget
The FY10-11 budget prepares PA to meet rising demand
– MA enrollment is expected to grow 3%– In child welfare, the number of children needing out-
of-home placement will continue to decline, allowing more children to be served in their homes
– 150 new individuals will be able to access MR community services to avoid institutionalization
– More children will be able to participate in early learning programs, and more individuals will be able to access needed mental health and substance abuse services
Edward G. Rendell, Governor
2010-11 Executive Budget
Many states have been forced to make cuts• Arizona is repealing Medicaid coverage for childless adults and
adults with serious mental illness, and eliminating portions of its cash assistance and preschool programs
• Texas has cut the number of children receiving child care subsidy
• California has cut nearly all funding for services supporting HIV/AIDS patients, and it completely eliminated funding for domestic violence shelters and maternal, child, and adolescent health programs
Preserving services for those who need them
Edward G. Rendell, Governor
2010-11 Executive Budget
The Continuing Commonwealth Commitment
• With each budget the Commonwealth has remained committed to maintaining the health care and human services safety net
• That sustained investment in access, quality and accountability has yielded impressive results since 2003
• The FY10-11 Budget funds the continuation of these critical initiatives
Edward G. Rendell, Governor
2010-11 Executive Budget
Selected Highlights 2003-2009
Office of Medical Assistance Programs
providing quality, cost-efficient healthcare for millions of Pennsylvanians
The HealthChoices program, serving approximately 1.1 million people, achieved significant quality improvements from 2006 to 2009:• cholesterol management for individuals with cardiovascular disease increased 13%• frequency of prenatal care increased 10%• comprehensive diabetes care increased 7%
Office of Mental Health and Substance Abuse Programs
supporting individuals with mental health and substance abuse needs
Expanded Behavioral Health HealthChoices statewide improving access and quality for 350,000 Pennsylvanians
Improving quality and results
Edward G. Rendell, Governor
2010-11 Executive Budget
Selected Highlights 2003-2009
Office of Child Development and Early Learning
improving the early learning of PA children
In 2003 less than one in five PA children aged three and four had access to quality early education; now one in three does
Office of Income Maintenance
supporting PA families as they move toward self sufficiency
The TANF caseload reached the lowest point since 1961; even with the recession, the caseload is down 18.6% since 2005
Cross-Office Work
efforts that reach across multiple DPW offices
In the child welfare and early learning systems a single state-of-the art child screening tool has been adopted statewide; MA has created a new payment to support better assessments of children
Improving quality and results
Edward G. Rendell, Governor
2010-11 Executive Budget
Office of Mental Health and Substance Abuse Services (OMHSAS)Deputy Secretary Joan Erney
FY 10-11 Priorities
Complete closure of Allentown State Mental Hospital allowing more individuals to achieve life in the community
Improve services to children by implementing the Systems of Care Grant, supporting families with children with serious mental illness in 15 PA counties
Expand Positive Behavior Support Model, reaching kids school-wide, to 40 more schools for a total of 10
Improve statewide service consistency by adding Psychiatric Rehabilitation & D&A Services to the State Plan
Increase the number of counties serving the homeless population through the PATH Program
Improve effectiveness by converting five community treatment teams to Evidenced Based Assertive Treatment Teams
Expand access to care by increasing the number of publicly funded tele-psychiatry programs by more than 50%
Edward G. Rendell, Governor
2010-11 Executive Budget
Office of Developmental Programs (ODP)Deputy Secretary Kevin Casey
FY 10-11 Priorities
Further advance access and quality in autism services across PA through autism-specific services for adults and three regional ASERT Centers
Move 150 new individuals with MR into critical community services
Implement a data-driven quality management program for the MR system
Continue to transition to new payment system including the development of draft regulations
Implement further reforms and improvements to increase DPW’s ability to protect the health and safety of individuals living in personal care homes
Edward G. Rendell, Governor
2010-11 Executive Budget
Office of Children, Youth and Families (OCYF)Deputy Secretary Richard Gold
FY 10-11 Priorities
Improve abuse screening by completing statewide roll-out of state-of-the art safety assessment tool by adding all children receiving services in out-of-home placements
Implement new federal financing under Fostering Connections for permanent legal custody permanency option
Continue implementation of a five-year strategic plan which will create a state-wide child welfare data system
Continue to reduce the need for out-of-home placements by funding special grants in all 67 counties
Implement a statewide Quality Services Review/Continuous Quality Improvement Process
In 16 targeted counties, safely reduce the number of children in out-of-home care by 20%
Edward G. Rendell, Governor
2010-11 Executive Budget
Office of Income Maintenance (OIM)Deputy Secretary Linda Blanchette
FY 10-11 Priorities
Maintain focus on employment and expand opportunities for TANF recipients to gain valuable workplace skills
Assuring Pennsylvanians don’t go hungry by continuing to improve SNAP participation
Update and improve computerized data exchanges to increase program integrity and accuracy
Complete implementation of Modern Office which includes a team-based workload approach, knowledge-sharing and redesigned work processes to improve business operations and increase efficiency in the 12 largest County Assistance Offices
Deploy statewide a new eligibility system including expanding and enhancing document imaging to move one step closer to an electronic eligibility record
Edward G. Rendell, Governor
2010-11 Executive Budget
Next Steps
The Budget is online at www.dpw.state.pa.us
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