Early intervention providers: Stop demanding more payment. Demand more freedom.

It is budget negotiation season in New York State, and you can tell this by the long line of elected municipal leaders and other special interests who get invited into budget hearings to beg for more funding.

People who watch the process closely call this the 'tin cup brigade' and that is an apt description of the process even if it does ruffle the feathers of those in line.  Leading the line are the Counties and other municipalities who are forced to endure the unfunded mandates passed onto them by the State.  A prime example is the New York State Early Intervention Program.

Funding the early intervention program has been a nightmare for many years.  As the program has grown the costs were shifted around - most recently this involved a complex payment scheme that used an intermediary acting as a fiscal agent that billed the private insurance companies.  The idea behind that was to create a cost sharing context with the private insurance sector, but all that was accomplished was that the program lost participating providers, small women-owned early intervention businesses were decimated, disabled children were placed on waiting lists, and an out of state fiscal agent contractually skimmed millions of dollars out of the woeful trickle of payments that made it into state coffers.  To top it all off, the Counties remained the payer of last resort anyway as only a fraction of payments were processed and collected.

 There are a number of legislative proposals made last year and this year that intend to 'solve' the funding problems with this program.  Legislation has been (re)introduced that creates large grant funding mechanisms so that payments flow directly from the State to the Counties for administration of the program (S4372/A6517); there are proposals that involve 'refund payments' made from the State to the Counties for purposes of property tax relief (S6486); and there are proposed mandates on insurance companies to pay claims (A135).

It is difficult to know which, if any, of these will gain any traction - but the takeaway is that the creation of the intermediary system has failed and Counties are still bearing large amounts of unfunded costs.

The screams from within the Counties are not 'PLEASE TAKE CARE OF OUR CHILDREN.'  The screams are 'STOP TAXING US SO MUCH.'

It is important to understand why the screams are what they are.  If you ask people individually you will not find many who would oppose funding programs that provide care for disabled children.  That is particularly true if we are in a good economy.  However we are not in a bountiful economy and everyday people are struggling to meet their basic expenses.  That is why the voices that scream 'STOP TAXING US SO MUCH' are so notable.

Don't believe politicians who are telling you how great our economy is.  The fact that no one wants to pay for funding programs for disabled children is direct evidence that the economy is a mess.

Ironically, many of the people who would hold out their tin cups and beg for political largesse are also those who believe that they are being taxed too much.   Not only is the economy a mess but our population is currently unable to understand the dynamics of WHY it is a mess.

Government solutions are almost always re-distributional in nature and that is why we see such boondoggles for payment schemes because all of them ultimately fail and all of them ultimately create undue burden on taxpayers.  Unfortunately, providers do not clearly understand the complexities of reimbursement and funding so they end up joining the end of the Tin Cup Brigade Line and joining the chorus of demands for more payment.

Since it is budget time I remind my colleagues of the importance of studying basic economics and of becoming proficient in understanding the complex web of social services funding.

I also encourage them to put down their tin cups and to try another tactic.

Stop demanding more payment.  Demand more freedom.

If the State got out of the way, providers could interact with families and their insurance companies directly - and I assure everyone that any provider could do better with getting claims reimbursed than the State Fiscal Agent.   Local providers could become in-network providers with their local insurers.  They would know and apply the local rules for coding and reimbursement.  The money would flow in a cost-sharing fashion from the private sector just as it properly should.

Private practice providers successfully bill private insurance.  EVERY. DAY.  Why can't we model the early intervention program after a model that we know already works?

The State could then resume its proper role as Payer of Last Resort and those funds could be funneled to Counties in the form of much smaller grants.  Municipalities could contract with those providers who are most efficient in their service provision and billing.  The system would be functionally privatized but would include a safety net as appropriate.  Quality in the program would be ensured by monitoring the outcomes and billing performance of the providers.


I have virtually no expectation that the State would ever implement a functionally privatized model of care that involves cost sharing and has built in quality drivers.  But I can dream.


Consider demanding more freedom.  You might be surprised at what that freedom gives you.


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