Credibility on the cost of DDS care — an update

The administration’s cost analysis in shutting the Monson, Templeton, and Glavin developmental centers was submitted in July to the House and Senate Ways and Means Committees and to the Joint Committee on Children, Families, and Persons with Disabilities.  The submittal was required by language in the Fiscal Year 2010 state budget.

Just to reiterate, our two main objections to the administration’s cost analysis are these:

1) The administration’s cost analysis appears to compare apples to oranges:  It compares developmental center residents to community-based residents in concluding that community-based care is less expensive.  But community-based residents are, on average, younger, less medically involved, and less intellectually disabled than are the residents of the Monson, Glavin, and Templeton Centers. Thus, it’s not that care in the community system is less expensive, it’s that the community system serves people who, on average, need less expensive care.

2) The administration’s cost analysis projects only capital expenditures needed for keeping the three developmental centers open.  It doesn’t appear to include any projections for the costs of building new group homes in the community that will be needed when the developmental centers are closed.

The Springfield Republican, on Sunday, reported on our overall objection to the validity of the administration’s cost study.

The newspaper went on to quote Senator Gale Candaras, co-chairman of the Legislature’s Children and Families Committee, as saying she accepts the administration’s savings projections in closing the centers. Candaras would not, therefore, appear to be a likely vote in favor of a mutually credible, independent study of the cost issue.

On the other hand, Senator Stephen Brewer, Vice Chairman of the Senate Ways and Means Committee, is quoted as promising to scrutinize the administration’s transition plan for Monson residents.  “If we don’t have a level of comfort, she (DDS Commissioner Elin Howe) will have a fight on her hands,” Brewer said.  It’s not clear, though, if Brewer was referring to having a level of comfort with the cost analysis itself.

I put in calls in the past week to key staff members of the three legislative committees that received the administration’s cost analysis. I asked if they had all received a letter we had sent rebutting the cost analysis and whether they thought an independent analysis might be needed.

All of the committee staff said they were aware of our letter, and I got the impression that all at least view the point we’ve raised about the failure to compare equivalent populations as a potentially valid criticism of the administration’s analysis.  One staff member said we had provided “helpful information” to his committee and indicated that committee members may ask DDS about our concerns during upcoming budget hearings.

At the same time, I didn’t get the impression that there was much if any sentiment among the committee staff I talked to, to recommend that an independent agency undertake a new cost analysis.

One staffer acknowledged that the administration has not provided any “specific information” to her committee about how it had calculated a cost for community-based care in its report.  She said she assumed figures in the the administration’s cost report did indeed represent an average cost of care the community system.  

The staffer said, though, that the administration had previously given her committee some rough cost comparisons between the facilities and the community system for persons with different levels of intellectual disability.  Those comparisons, she said, showed a lower community cost for people with equivalent disability levels.  But she said she had no information on how the administration had derived those figures.

That same staff member said she believed the administration’s overall claim that there would be a savings in closing the developmental centers because of what she views as the high cost of heating and maintaining the centers.  I responded that the Fernald Center budget, which we examined a few years back, showed that the cost of the physical plant was only about 8 percent of the facility’s projected budget for Fiscal Year 2010 and that the cost of staffing was the big cost item, at more than 75 percent of the projected budget.  (I later faxed her a Fernald budget document that shows this.)

The committee staff member then asked me what we believe the real figure for community based care would be for people now living in the developmental centers.  I said we don’t have a figure on that because we aren’t privy to all of the administration’s numbers, but that we think the cost would not be lower in the community for a number of reasons.  I cited the centralization of services in the developmental centers as the number one reason for possible lower costs in the facility system.

In sum, as I suspected, the three committees that received the administration’s cost analysis have, up to now at least, accepted the administration’s savings claims and figures at face value. We may have made them a little more aware of that, but it’s not clear they are willing to do anything about it.

Meanwhile, in order to shed as much light on this issue as possible, we have asked the administration under the Public Records Law for additional documents and analyses backing up its cost-savings projections in shutting the three developmental centers.

It would indeed be great if an independent agency such as the Inspector General or the State Auditor were to step in to put the cost savings debate to rest once and for all.  But given the apparently low likelihood of that happening, we’ll try to be as credible about the issue as we can.

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