Center for Disability Rights, Inc. 99 Washington Ave, Suite 806B, Albany, NY 12210 One Franklin Square, Geneva, NY 14454 497 State Street, Rochester, NY 14608

CDR's Analysis of Governor Spitzer's 2007-2008 Executive Budget

In his first Executive Budget, Governor Eliot Spitzer has given disability advocates several reasons to celebrate, but also some cause for concern. The Center for Disability Rights is pleased that the Governor publicly stated his commitment to shifting funding from costly institutions to more cost effective and dignified community-based services. With his affirmation that seniors and people with disabilities should be able to live in the Most Integrated Setting, Governor Spitzer proactively embraced policy directions for which Governor Pataki never even acknowledged the need. Indeed, many disability rights advocates were arrested in the process of trying to get the previous administration to address this issue by securing passage of the Most Integrated Setting Bill in 2002. We look now to Governor Spitzer to work with our community to make living in the Most Integrated Setting a reality for all seniors and people with disabilities in New York. Governor Spitzer has taken a significant step toward ensuring community living by creating an Office of Long Term Care within the Department of Health that will focus exclusively on the delivery of long term care services. This kind of restructuring is long overdue and we applaud the Governor for this step forward. Governor Spitzer has also proposed several specific means of limiting the growth in funding for hospitals and nursing homes, but his budget contains only limited new funds for community-based services. The new initiatives he has included are good first steps, but the administration has much more it needs to do to end the institutional bias in New York and ensure that all people with disabilities and seniors are able to live in the Most Integrated Setting with adequate services. The disability community is deeply troubled by the Governor's proposal to eliminate Level 1 Personal Care Aide (PCA), or homemaker services. This proposed service cut directly conflicts with the Governor's public position supporting community based services as well as his commitment that there would be no service cuts. This homemaking service is vital to the independence of many people with disabilities, without it, people will be forced into unwanted and costly institutional placement. The Governor has also included numerous efforts to reduce the cost of prescription drugs. Most of these are reasonable, but his proposed changes in selection criteria and notification periods of the Preferred Drug Program are cause for concern. Efforts to enroll seniors in Medicare Part D are supported, but state policy must not force seniors into Part D when it would be potentially detrimental to the individual's health or financial stability. An additional proposal that marks a significant departure from the past administration is Governor Spitzer's efforts to simplify and streamline the application and eligibility process for Medicaid. Advocates have pushed for presumptive eligibility for years and are pleased that the Governor is adopting this form of streamlining in the recertification process. The Governor has also included changes that would allow for continuous Medicaid coverage to individuals who may have shorts breaks in their ability to document eligibility during the first 12 months of eligibility. Advocates have long asked for similar continuous coverage and are pleased to see the Governor's proposal. In all, the Governor's proposed budget contains some excellent initiatives that begin the shift of funding from institutional placements to community-based long term care, but more remains to be done. We look forward to working with the Governor to ensure that Level 1 PCA remains intact and that individuals have access to the medications and services needed to live active, independent lives in the Most Integrated Setting. To ensure that all individuals who want to live in their own home and community are able to do so, we must truly shift New York's long term care system to one where the Money Follows the Person! LONG TERM CARE - The Most Integrated Setting Shifting funding from institutions to community-based services We are pleased to see the Governor recognize that hospitals and nursing homes should not be the primary delivery mechanisms of long term care in New York State. We applaud the Governor's efforts to reign in spending on these institutions and instead shift spending to community-based long term care services. The Governor has proposed a freeze on the trend factors applied to hospitals and nursing facilities. Many larger hospitals and nursing homes have operated with surplus revenue and will easily manage the freeze in the trend factor. Smaller hospitals and nursing homes with tighter bottom lines will be pressured to consolidate services or find additional means to save money. Hospitals in rural areas and those hospitals serving larger populations of Medicaid recipients may be eligible for additional funding to potentially offset the impact of the trend factor freeze. In his budget, the Governor has begun to phase down the amount of funding given to healthcare institutions for workforce recruitment. At the same time, we see an increase in funding to Certified Home Health Agencies (CHHA) and Personal Care Assistance providers. This is an excellent example of how changes in budget priorities can be used to address the institutional bias in our state. The additional funding that the Governor has made available to Certified Home Health Agencies is a good beginning to expanding funding for community-based services. We particularly support the Governor for requiring CHHAs to provide new health coverage to the attendants providing these critical services in order to receive the additional funding. People with disabilities have long been frustrated by the quality of services delivered by CHHAs. A significant issue has been the failure to provide health insurance to attendants. Attendants not receiving adequate pay and benefits often have low commitment to the job and the people they serve, resulting in high turnover and low quality of care. Also, service recipients see attendants who do not have access to basic health care as a risk to their own health. The Governor's proposed appropriations also include a $5 million increase over two years for the Traumatic Brain Injury (TBI) Waiver. The TBI Waiver provides a wide variety of vital services to people with traumatic brain injury living in the community. The TBI Waiver has been responsible for the reintegration of many hundreds of people with brain injury who otherwise would still be in expensive nursing facilities. The increase for the TBI Waiver is well earned. Since the Olmstead decision in 1999, we have advocated that New York State develop and implement a plan to end its institutional bias and ensure that seniors and people with disabilities are able to live in the Most Integrated Setting appropriate to their needs and desires. The Governor's cost shifting proposals represent significant progress, but more must be done. The Center for Disability Rights joins the New York Association of Psychiatric Rehabilitation Services (NYAPRS), the New York Association on Independent Living (NYAIL), NYS ADAPT, the Coalition to Implement Olmstead in New York (CTIONY) and a number of other consumer advocacy groups in calling upon the Spitzer Administration to make meaningful implementation of the Most Integrated Setting Coordinating Council law a top disability policy priority this year! The Council released a very basic report and has much work to do to address the barriers to community living that promote unwanted and unwarranted institutionalization. Ending Coverage of Personal Care Assistance Level 1 Governor Spitzer has proposed to administratively eliminate Level 1 Personal Care Assistance (PCA). In his proposed budget, the Governor has included savings from the elimination of this service. Disability Rights advocates strongly oppose the Governor's proposal to eliminate Level 1 PCA from New York's State Plan of Medicaid Services. Eliminating this service is contrary to the Governor's stated support for community-based services and conflicts directly with his stated commitment to not cut services to individuals. Elimination of this service jeopardizes the health and wellness of many individuals and puts people living successfully in the community at risk of institutional placement. Level 1 PCA services are important home making assistance services for individuals with disabilities who do not need more intensive personal care assistance, but are unable to maintain their living environment without assistance. Individuals may use this support to ensure cleanliness of their apartment, make the bed, wash laundry, and prepare nutritional meals. Without such services, an individual may be at risk of losing their housing, becoming homeless, being shuttled from one temporary living situation to another. Ultimately, these individuals become hospitalized and get placed in a costly institutional setting. Additionally, it is our concern that if PCA Level 1 is eliminated, individuals may find "creative" means of qualifying for more intensive levels of PCA. While some individuals will be cut entirely out of the system, others may be driven into more expensive services, including institutions. We believe that neither of these options is acceptable and that PCA Level 1 must be continued in order to meet the spectrum of needs of seniors and people with disabilities. Nursing Facility Transition and Diversion Medicaid Waiver Under the previous administration, disability and senior advocates were successful in securing passage of the Nursing Facility Transition and Diversion (NFTD) Medicaid Waiver. Due to an unacceptable re-interpretation by the Federal government about the application of spousal budgeting rules, implementation has been delayed. However, the blame for these delays does not simply rest with the federal government. The New York State Department of Health is also responsible. Advocates developed a compromise interim solution last fall, but the Department of Health decided that after waiting for two years, they still needed "more time" to crunch the numbers. We look forward to working with the Governor, the DOH Office of Long Term Care and the NYS Legislature to ensure that the NFTD Waiver is able to move forward early in 2007 and ensure that services are provided to individuals in need by summer of 2007. In order to secure this progress, NYS must pass interim legislation that expands the income eligibility of the NFTD until there is resolution to the fight with CMS. The interim legislation should increase the participant needs allowance under the NFTD waiver to 300% of Federal Benefit Rate (FBR). There are strong arguments for this proposal: 1) Allowing people to keep up to 300% of the Federal Benefit Rate would significantly reduce the need for a state-funded housing subsidy. People with disabilities in New York State are facing a housing crisis. The NFTD waiver is able to address the need for accessibility as part of its service package, so the biggest barrier to finding housing is affordability. Under current policy, we force people to spend down their income to $710 per month and they do not have enough income leftover to pay for housing. The solution for the TBI waiver was to create a housing subsidy program that was fully funded with state tax money. We recognize that individuals at 300% FBR would not be paying their spend down to cover the cost of their Medicaid services, but one-half of the increased cost of those Medicaid services would be paid for by the federal government, rather than NY paying 100% of the cost for a housing subsidy program. This approach will maximize the use of federal dollars in addressing the housing needs of people on the NFTD waiver. 2) This proposal would support implementation of New York State's Money Follows the Person (MFP) Project and help assure that the state is able to secure the maximum amount of the enhanced federal matching share. In the state's MFP proposal, housing is identified as the single biggest barrier to community living. The vast majority of people in nursing facilities who would be MFP-eligible will NOT have housing they can return to, and if they are required to spend down to the current Medicaid level, they will not have the income they need to afford available housing. The Federal MFP Project is built on a pay-for-performance premise. If we cannot transition people, the state will not be able to secure the federal funds. This proposal would significantly address that key barrier and help us secure the maximum amount of the enhanced Federal match. 3) Allowing this select group of people to keep a higher level of income would promote the waiver as the preferred service choice for people who have significant assistance needs, helping shift this population from open-ended state plan services into a 1915(c) waiver program where service approvals are more closely managed and overall costs are capitated. This policy would begin to shift New York's long term care system from one that relies primarily on state plan services to a system that has more strict cost controls. The benefit of this approach is that individuals would make the choice themselves to move from a system where they are automatically eligible for services approved by the localities to a system where the state has more direct control over service approvals through the Regional Resource Development Centers established to operate the NFTD waiver. Disability advocates have been very concerned about the last administration's plan to "restructure" long term care through the elimination of entitlements and dramatic changes in services. Our approach would promote an evolutionary process for making needed changes and help address concerns raised by advocates. 4) This policy is consistent with the direction identified by Governor Spitzer to promote the use of community-based services over institutional "care". The change in policy by CMS to eliminate spousal impoverishment budgeting creates a clearly identifiable institutional bias in our state. Our proposal would offset some of the impact of the CMS policy change, although there are still situations where it clearly would still promote institutionalization. 5) This approach would help streamline and simplify Medicaid long term care eligibility. Currently, the eligibility process is extremely complicated and requires complex formulas that "deem" income from the disabled spouse to their "community" spouse, a spouse who lives in the same household. By allowing the disabled spouse to keep up to the full 300% FBR amount, we eliminate the complicated machinations that are currently used to establish eligibility, handle post eligibility income, and deem income to the community spouse. Simplifying these processes is consistent with other proposals proposed by the Governor. The most significant concern raised by DOH staff about this proposal is the concern that it is "unfair." DOH staff repeatedly raises concerns about the fact that this proposal would allow some people to keep more of their income than others. They are also concerned that if they allowed this "for one group" they would need to do it "for everyone." Apparently, DOH staff are unaware of existing Medicaid eligibility rules that allow persons who have been receiving SSI to continue to be eligible for Medicaid without a spend down after they begin receiving social security income based on the income of their deceased parents. These individuals can have incomes significantly higher than the Medicaid spend down level, yet be able to keep it all. We are not arguing about the appropriateness of this policy. Nor are we asking to extend this policy to individuals who have worked to earn their social security. We are simply pointing out that there is precedent for such a policy and the concerns raised by DOH are unfounded. NYS must still fight the Centers for Medicare and Medicaid Services (CMS) on its institutionally biased re-interpretation of a long standing means of allowing spouses to become eligible for needed long term care without impoverishing the couple. The new CMS interpretation would allow, in many cases, a community spouse to have a great deal more income when placing their spouse in a nursing facility than when keeping them in the community on a HCBS waiver. While the solution we have proposed moves New York forward with implementation of the NFTD Waiver, it does not resolve the looming crisis of CMS attempting to force its new interpretation on New York's other waivers, most notably the Long Term Home Health Care Program (LTHHCP). It will be far easier to build community support for maintaining the LTHHCP because it has so many more participants and a strong, established provider base. We hope Governor Spitzer and the new administration will work with our community to address the new institutional bias created by CMS. By working together, we can ensure that seniors and people with disabilities are able to live in the Most Integrated Setting. Long Term Care Restructuring Initiative - The Megawaiver We are concerned that Governor Spitzer has included $10 million to continue the state's long term care restructuring initiative. While we absolutely believe that NY's long term care must be radically restructured, we are concerned that this hold-over from the previous administration is operating under fundamentally flawed methodology. Governor Pataki's Health Care Reform Working Group proposed the creation of a "mega-waiver" which would incorporate and subsume current Medicaid State Plan long term care services, such as personal care and certified home health care, as well as most waivers, including the new Nursing Facility Transition and Diversion Waiver, the Long Term Home Health Care Program, the Care at Home Waiver and the Traumatic Brain Injury Waiver. The mega-waiver would provide long term care services for Medicaid beneficiaries who are not yet nursing home eligible as well as those who are and include an expanded group of seniors who are not now income-eligible for Medicaid but utilize long term care services which are currently only state-funded. We vigorously oppose the efforts currently underway within the Department of Health to apply for and develop an 1115 Medicaid mega-waiver. In addition to the funding mechanisms and programmatic weaknesses, we oppose the development of an 1115 waiver because these waivers have typically been used by states to decimate community-based services, despite rhetoric about choice and options. Governor Pataki's consultants working on the restructuring initiative started with the conclusion that a 1115 mega-waiver is the direction that should be pursued and then backed into this conclusion with limited community input. They have disregarded many of the concerns advocates have received and even falsely portrayed advocates supporting proposals that were vigorously opposed. Governor Pataki's Health Care Reform Working Group proposed the mega-waiver as part of a restructuring plan that they felt needed to be implemented in total to be effective. Their report stated:                "It is important to note that the components of the Working Group's                proposal to reform the long term care system are intertwined.                If disconnected, negative unintended consequences may result.                Therefore, we urge implementation of this proposal in totality." There are a number of proposals in the Working Group report that are not being pursued and would be inconsistent with the policy directions of Governor Spitzer. Why then should NYS continue to contract with consultants, using fundamentally flawed methodology to pursue one piece of an unfinished, ill-conceived plan from the previous administration? We strongly believe that the restructuring initiative as it is currently operating should be stopped and the funding directed to maintaining Level 1 PCA and to more meaningful long term care restructuring plans. Rather than develop a 1115 mega-waiver, we have proposed plans to simplify the state's long-term care system. The state must revitalize the Most Integrated Setting Coordinating Council. After initial restructuring plans are developed, public hearings must be organized to gain input from consumers, advocates, providers and other stakeholders on the proposed waiver. Such an effort could help identify other options to fund the continuum of long-term care options, which include both medical and social models. Spousal Refusal The new administration is encouraging counties to pursue spousal refusal recovery. We are deeply concerned about this policy direction. Spousal refusal was designed to prevent "Medicaid divorces." Although there are income and resource protections for someone who institutionalizes a disabled spouse, none exist for someone who wants their spouse to remain at home with home care services. If they want to maintain even a modest amount of income, their ONLY choice is spousal refusal. We simply do not believe the urban legend of "Medicaid Millionaires." Although there may be a few wealthy individuals refusing to pay for such assistance, the vast majority of individuals who choose this option are middle income people. Many of these individuals are elderly and only choose spousal refusal as a means to maintain their homes. One safe haven has been to secure waiver services to get spousal impoverishment protections. With the new interpretation by CMS, this situation is only going to get worse. If the state encourages the counties to pursue such recoveries, they should not pursue such recoveries against people who have income and resources below the spousal impoverishment levels. To do that would only promote costly institutionalization. HEALTHCARE FUNDING - Toward A More Rational System The Center for Disability Rights supports the Governor's efforts to tie healthcare funding to the actual provision of the services funded. By linking additional hospital Medicaid funding to higher percentages of Medicaid recipients treated and discharged, the Governor has wisely begun to end subsidies to hospitals not seeing large numbers of Medicaid recipients. Similarly, the Governor has stopped the practice of providing Graduate Medical Education funding to hospitals that do not actually have the students for which they are being subsidized! Redirecting these wasted subsidies to the provision of care to actual people is long overdue. OFFICE FOR THE BLIND AND OFFICE OF THE ADVOCATE FOR PERSONS WITH DISABILITIES The Center for Disability Rights is pleased to see the Governor announce the establishment of an Office for the Blind to coordinate New York's services to blind and visually impaired citizens. Although this proposal has been criticized by some people, it should be viewed as a significant first step toward a new approach to coordinating disability services in New York State. During his campaign, Governor Spitzer committed to re-establishing an independent Office of the Advocate for Persons with Disabilities. We are disappointed that the Governor did not include language to implement this campaign commitment in his proposed budget. While under the Pataki administration the disability community saw few substantial efforts from the Office of the Advocate, it is our belief that this was primarily due to limitations put on the Office of the Advocate by the Pataki administration. An Office of the Advocate, unfettered by administrative nay-saying, could become a strong ally of the disability community and mechanism for change within New York State. Ultimately, we see both the Office for the Blind and the Office of the Advocate for Persons with Disabilities as steps toward a bigger goal. In keeping with the Governor's efforts to establish an orderly, organized, rational and responsive government, the morass that is the configuration of services for people with disabilities needs to be reformed. We have previously recommended and continue to advocate for the creation of an Office of Disability Services. This office would coordinate services and advocacy for people with disabilities not falling under the auspices of the Office of Mental Health or the Office of Mental Retardation and Developmental Disabilities. The Office of Disability Services would encompass the Office for the Blind, Office of the Advocate for Persons with Disabilities, the Commission on Quality of Care, and other key disability programs. The Office of Disability Services would also provide a natural location for the Deaf Interagency Council, a coordinating council that would have been created by legislation passed by the legislature last year, but vetoed by Governor Pataki. We will work with the Deaf Community to pass such legislation again this year. PRESCRIPTION DRUGS Cost Reductions for NYS We support the Governor's efforts to reduce the cost paid by New York State for prescription drugs, with the exception of his proposed changes with the Preferred Drug List (PDL). We have long advocated that New York State must do more to drive down the cost it pays for pharmaceuticals through Medicaid and the Elderly Pharmaceutical Insurance Coverage (EPIC). We are pleased to see Governor Spitzer continuing and expanding the cost reductions initiated under Governor Pataki. Incentivizing pharmacies to dispense generic equivalents, reducing the reimbursement rates on name brands and reducing the reimbursement rates for generics are good steps toward reducing the overall cost of pharmaceutical drugs without interfering with an individual's ability to access needed medicine. Preferred Drug Program: Restricting notification and considering costs as criteria Although we have expressed support for cost saving measures, we believe that and open process and public dialogue remains a critical safeguard in this system. The Governor has proposed reducing the public notice of meetings from 30 days to 10 days, reducing comment period regarding recommendations from 30 days to 10 days, changing public notice of final determination from a 10 day clearly defined maximum to a vague standard of published "within a reasonable time", and most dangerously, the Governor has proposed that "cost" be a consideration in determining the preferred drug. We oppose these changes. We strongly oppose making cost a consideration in the selection of which drugs be approved for the PDL. Medication must be selected for the PDL based on its therapeutic merits. NYS should then use its buying power to negotiate better prices for preferred drugs. By making cost a selection criterion, the Governor puts dollars and cents in front of medical sense. The Governor's proposed changes in notification periods are also disconcerting. Each of the changes is aimed at giving medical professionals and consumers less time to adequately prepare and discuss the relative merits of various pharmaceuticals. These restrictions are difficult to understand because while they restrict the ability of professionals and consumers to provide input, they do not generate significant cost savings. Without full information, we are concerned that the Medicaid Pharmacy and Therapeutics Committee may be basing its decisions less on medical evidence and more on political and financial pressures to pick the least costly medicine in a class. Medicare Part D interactions with EPIC The governor has included several proposals to promote enrollment by seniors in Medicare Part D pharmaceutical drug coverage. While we support the Governor's effort to shift costs to the federal government, the many problems experienced in Part D deserve great caution. We do applaud the Governor's inclusion of funding for staff to facilitate an individual's enrollment into Part D. The massive confusion faced by Part D beneficiaries has necessitated assistance from outside advocates. We also support the Governor's proposal for New York State to pay the premiums of seniors that might otherwise not be able to afford enrollment in Medicare Part D. If New York expects more seniors to enroll in Part D, it has an obligation to ensure that individuals get the best possible plan and the least possible hassle. Facilitated enrollment should be expanded beyond this initiative and should be an often utilized service across the state to ensure that individuals are able to get the services they need. Governor Spitzer's facilitated enrollers could be used more broadly, possibly assisting individuals with disabilities to enroll in the Medicaid Buy-in. Advocates point out that participation in the Medicaid Buy-in has reached a plateau and it appears that additional assistance is necessary from the state to ensure that everyone who could benefit from the program is enrolled. Additionally, we strongly believe that any cost savings realized by shifting costs to the Federal government should be reinvested in the EPIC system by expanding coverage to people with disabilities, under the age of 65, who meet all other eligibility criteria for EPIC. MANAGED CARE DEMONSTRATION PROGRAMS While some municipalities have praised managed care as the answer to many current health care problems, many municipalities and advocates are not convinced. We are concerned that Governor Spitzer is continuing Governor Pataki's efforts to enroll as many people as possible in managed care, regardless of acuity or complexity of disability and multiple disabilities. We are pleased that the Governor's Managed Care demonstration programs will be entirely voluntary at the level of individual participation. This option should be continued throughout the future of managed care. Voluntary enrollment in managed care with the option to dis-enroll must be the standard. We are also concerned that many of the existing managed care providers are not able to adequately provide the physical and programmatic access needed by people with disabilities. It has been our experience that hospitals and healthcare plans often refuse to provide sign language interpreters, materials in alternate formats and other accessibility accommodations. Access must be provided to people with disabilities that ensure an equal ability to make use of appropriate health care and benefits. Additionally, on the national level, we have been part of numerous meetings with America's Health Insurance Plans (AHIP), the trade association for providers of managed long term care. Through these meetings, we have come to agreement on shared principles. These principles should be included in New York State law as part of the expansion of managed care. Together, we have identified principles that managed care plans should implement: 1)     consumer directed services; 2)     person centered planning; 3)     accessible, affordable, integrated housing; 4)     voluntary service coordination; 5)     delivery of services in the most integrated setting; 6)     access to independent community-based service coordinators; 7)     service plan responsive to the unique needs of individual enrollees, including access to         network and out of network specialists, if needed, who have experience in serving         individuals with disabilities; 8)     delivery of services based on individual need as determined by functional assessment; 9)     livable wage/benefits for attendants; and 10)   a system for comprehensive, continuous quality assurance. As the administration promotes the expansion of managed care, it must work with the disability community to be sure that such plans meet the needs of our community. COVERING THE UNINSURED Streamlining eligibility, closing gaps in coverage Streamlining and simplifying the Medicaid eligibility process is something for which we have long advocated. We are very pleased to see the Governor's proposal to grant "temporary" eligibility to all those applicants that "appear" eligible for Medicaid during the recertification process. This step will reduce bureaucratic waste and hurdles for people in need of continued Medicaid. Facilitating access to healthcare will enable more individuals to get timely care and produce better health outcomes. We also applaud the Governor for his proposal to disregard temporary lapses in an individual's Medicaid eligibility during their first 12 months of Medicaid coverage. It has been our experience that many such lapses are due to paperwork problems, not due to an individual's actual Medicaid eligibility. Allowing continuous coverage to these individuals will ensure better access to needed healthcare and ensure that individuals needing care are not spending their time fighting with Medicaid's bureaucracy. These proposals are a great first step, but there is more work to be done to streamline access to care. We look forward to working with the Governor, as a next step, to develop a means of granting individuals temporary eligibility upon initial application when the individual appears to meet eligibility criteria. Expanding Health Insurance for Children Though not specifically a disability rights issue, we support the Governor in his efforts to expand income eligibility for Child Health Plus and take steps to ensure that all of New York's children have health insurance. Increasing utilization of employer sponsored health plans The Center for Disability Rights supports the Governor's efforts to ensure that employers are supporting their workers with health insurance. We also support the Governor's proposals to assist families to purchase their employer offered programs. Where affording a premium or co-payment has been a significant barrier to an individual or family in participating in an employer sponsored health insurance, people have either gone without coverage or been forced onto public health plans. When an employer makes coverage available, it is much more cost effective for the state to assist an individual or family to take advantage of the employer's plan than to provide state funded coverage to the family. The Governor's Premium Assistance Program and other initiatives will assist these individuals and families to attain the employer sponsored programs. This is an initiative whose time is long overdue and we commend the Governor. AUTHORIZING CONVERSION OF A NOT-FOR-PROFIT HMO In the past decade, New York State has seen the conversion of several not-for-profit health maintenance organizations (HMOs) into for-profit corporations. Such conversions often lead to decreased quality of services for customers as the new for-profit entity squeezes its customer base and funding streams in order to maximize profits for shareholders. Because not-for-profit HMOs have operated as tax free entities doing the public good, the conversion to a for-profit creates a monumental amount of funding that must be reinvested in the public good. New York State has used some of the previous conversions to create small foundations to support charitable work, but has primarily squandered the hundreds of millions of dollars created by this process to fix immediate budget shortfalls. While many advocates would suggest that any conversion to a for-profit business is bad for the community, there is no doubt that allowing such a conversion and not enabling the community to benefit from the funding created in the conversion is bad policy and bad for the community. Governor Spitzer must end the Pataki Administration's poor fiscal practice of using 95% of the conversion proceeds to cover budget gaps. Governor Spitzer has presented a Patient-First Agenda and has committed to shifting monies from institutions to the Most Integrated Setting. If Governor Spitzer and New York State are to allow the conversion of another not-for-profit HMO into a for-profit, 100% of the funds created must be placed into a housing trust fund to fund rental subsidies in order to ensure that New York State residents have the freedom to live, work, and play in their home communities. This Trust Fund would be used be used as a rental subsidy for individuals transition from facilities into the community of their choice. Although we have proposed a means to draw down federal funds to support community living, some individuals don't, themselves, have the resources needed to afford housing. This trust fund will assure that these people have the option of community living. If the amount of the conversion proceeds are limited, the Trust Fund could be made available only to those individuals enrolled in the Nursing Facility Transition and Diversion Waver. HOUSING - Accessible, Affordable, Integrated The Center for Disability Rights is deeply disappointed that the Governor's proposed budget reflects no new funding for the Access to Home program. Started just two years ago, Access to Home funds home modifications to improve the accessibility of homes and apartments so that seniors and people with disabilities may live in their own home and not be forced into a nursing facility. Beyond not funding Access to Home, the Governor's budget reflects no new funding for home accessibility modifications nor funding for rental subsidies to enable people to simply afford to live at home. We are concerned that Governor Spitzer has failed to recognize the vast importance of housing in allowing seniors and people with disabilities to live in the Most Integrated Setting. Without housing options, the Governor's great words will remain empty rhetoric. New Yorkers with disabilities are currently facing a housing crisis which exacerbates the institutional bias of the state's long-term care system. The lack of affordable, accessible and integrated housing for individuals with disabilities and seniors is a major reason people end up in institutional settings. This issue affects every Olmstead-related group. People with mental health disabilities have been forced into adult homes because they cannot find adequate housing. People with physical disabilities end up in nursing homes because they cannot find housing that is accessible and affordable. People with developmental disabilities end up in congregate settings when they could live on their own if appropriate housing were available. Seniors are also forced into institutional settings because of inadequate or inaccessible housing. While reform efforts in the long term care system, like the NFTD Waiver could transition hundreds or thousands of people with disabilities out of institutions, this will not be possible without some means of addressing the housing crisis. TRANSPORTATION: Most Integrated Setting Means More than Staying at Home The Center for Disability Rights is pleased that Governor Spitzer is seeking to establish industry wide performance standards for mass transit. The amendment of Chapter 413 of the 1999 Transportation Law, tying payment to outcome measures will establish measurable goals and outcomes that can honestly and accurately assess the quality and consistency in the provision of services, particularly accessibility, to the residents of New York State. For too long mass transit service providers have been assessing and measuring themselves, based on perceived issues and shameless self-promotion. We recommend that Governor Spitzer incorporate specific standards for assessment of paratransit service providers. These standards should encompass criteria such as: provision of next day rides within one hour of the requested time, percentages of on time pick ups, deviation from scheduled pick ups/drop offs, and hold times at call centers. The goals of this new system of outcome measures must be consumer satisfaction with service delivery. To best create a valid, effective and consumer responsive system of public transportation, performance measurement criteria must have significant input from users of mass transportation. The Governor has required the Commissioner of Transportation to establish a panel of experts. While this panel of experts must have representation from transit administrators, transportation analysts and government officials who manage these systems, there must be majority representation from various socio-economic and disability groups who are regular riders of subways, buses, boats and para-transit. In this way, the process will not be controlled by self-interest.

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