Overview of Opportunities: Managing Children Services Funding To Maximize Revenues

1. Fiscal Essential for Children’s Services Forum Overview of Opportunities: Managing Children Services Funding To Maximize Revenues Charlene Chase January 27, 2006

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3. Keys to Successful Leveraging • Communicating a clear vision to guide revenue management & maximization (not just revenues for the sake of revenues) • Developing a strategy for refinancing and reinvestment • Providing incentives for key stakeholders • Building the infrastructure necessary to sustain (“audit-proof”) leveraging

4. The Federal Grant-in-Aid “System” • There are hundreds of overlapping (“Fungible”) Federal-State funding streams supporting children’s services • Funding streams have different definitions of: • Eligible programs • Eligible providers • Eligible people • Most funding streams are “capped,” a few are “open-ended.”

5. What Does “Open-Ended” Mean? • There is no limit on the amount of funding a State can receive under “open-ended” programs like Medicaid, Title IV-E, Child Support Enforcement, Food Stamps, and Supplemental Security Income (SSI). • Instead of a fixed amount, under open-ended programs the Federal Government pays a fixed portion or “Federal Financial Participation” (FFP) percentage of the amounts claimed. • The only restraint on claiming Federal funding is the ability to generate non-Federal (“matching”) funds.

6. Sources of Matching Funds • Non-Federal funds directly appropriated to the State or local cognizant agency (e.g., county general funds in human services agencies) • Non-Federal “certified public expenditures” by an agency under contract to the cognizant agency (e.g., county general funds in probation) • Unrestricted third-party cash donations to the cognizant agency that do not revert to the donor • Leveraging involves tapping existing matching funds and requires no additional cost to the County.

7. Sources of Matching Funds: Proposition 10 • Proposition 10 funding can be used as matching funds to draw down Federal funding under Title IV-E and MediCal. • Community based organizations (CBOs) typically have access to non-Federal funding other than Proposition 10 that can be leveraged. • Unless incentivized, however, first five grantees would prefer local and Proposition 10 funding.

8. Sources of Matching Funds:Third-Party Donations Federal policy has recently been changed to allow private funding to be used as match for Title IV-E, provided those funds are: • Unrestricted (i.e., do not specify the recipient), • Cash (not in-kind), • Donations (not loans) to the local human service agency, and • Do not revert to donor.

9. Sources Of Matching Funds: University Partnerships • Public universities can play important roles in revenue maximization initiatives, including: • Technical assistance, • Training, and • Monitoring. • Counties can generally contract with public universities without competitive bidding. • Universities can also contribute at least half of the non-Federal (“matching”) funds, reducing the costs of revenue maximization to counties.

10. Value of Community Partners • The Federal funding we are focusing on is “open-ended”. It is in the interest of families and children to have the “maximum manageable” number of stakeholders participate in a revenue maximization initiative. • Community partners have access to different Federal and Non-Federal funds and can often “swap” matching funds (Including general funds, realignment, and third-party funding).

11. Integrated Funding • Integration of funding recognizes the complexity of human services funding • Integrated funding takes advantage of the opportunities created by that complexity to strategically increase Federal and other funding in support of a vision. • Integration of children’s funding at the county level results in “cross agency” funding across the human services agencies as well as local community based organizations

12. Federal Funding Sources: Medicaid (MediCal) • “Regular” MediCal covers in-patient and out-patient services on a fee-for-service basis paid for by the Federal and State governments. • Early and periodic screening, diagnostic, and treatment (EPSDT) provides a gateway to Medicaid funding that may not be available from the state. • Additional opportunities exist in MediCal Administrative Activities (MAA) and optional targeted case management (TCM). • FFP ranges from 50% to 90%.

13. MediCal (Continued) Targeted Case Management (TCM) Existing target populations include: • “High risk” women, infants, children, and young adults to age 21 • Adults and children at risk of abuse and unfavorable developmental, behavioral, psychological, or social outcomes, including individuals who: • Abuse alcohol and/or drugs; • Are at risk of physical, sexual, or emotional abuse; or • Are at risk of neglect.

14. MediCal (Continued)Administrative Activities • MediCal outreach • Facilitating MediCal applications • MediCal non-emergency, non-medical transportation • Contracting for MediCal services • Program planning and policy development • Training

15. Title IV-EPre-Placement Prevention • In 1987 the State of Missouri successfully challenged the Federal Government by arguing that, while the Title IV-E statute requires pre-placement prevention, Federal funding was limited to out-of-home care. • Departmental Appeals Board Decision #844 ordered the Federal Government to provide Federal Financial Participation (FFP) for “administrative” costs related to children who are “reasonable candidates” for foster care.

16. Title IV-E (Continued) “Administrative” Costs • Referral to services, • Preparation for and participation in judicial determinations, • Placement of the child, • Development of the case plan, • Case reviews, • Case management and supervision, and • A proportionate share of overhead costs.

17. Title IV-E (Continued) “Reasonable Candidates” • Children who have been found eligible for Title IV-E, OR • Children with documentation of judicial proceedings related to removal from their homes, OR • Children with a case file that clearly indicates that, absent effective preventive services, Foster Care is the planned arrangement for the child.

18. The Federal Challenge • The Federal Government has taken exception to recent claims for Title IV-E. • The Federal Government has also acted to restrict the ability to claim Title IV-E costs by attempting to narrow the definitions of “administrative costs” and “reasonable candidates.” • This Federal Challenge may cause some to shrink from the opportunity to increase legitimate access to Title IV-E.

19. The Santa Barbara Model • The California Department of Social Services (CDSS) has authorized all counties to utilize the Santa Barbara model to draw down Title IV-E Pre-Placement Prevention funding, consistent with ACL No. 04-32 issued September 7, 2004. • CDSS is currently examining expansion of the ACL’s public agency Pre-Placement Prevention Model to private agency contractors. • State law, the principles of “Redesign,” and the state’s fiscal crisis strongly argue for CDSS’ willingness to open Title IV-E Pre-Placement Prevention to counties willing to observe protocols comparable to Santa Barbara County’s MISC Model.

20. Cross Agency FundingWhat Does It Look Like? • The “Traditional Agency Silos” are replaced by a shared vision for children and families • A partnership between county and community based agencies is formed to implement best practices and shared funding • Communication must occur regularly between the executive, management, fiscal and workers in all agencies

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22. Integrated Cross Agency Funding for Family & Children Public Health Mental Health Medi-Cal (TCM / MAA) CHDP Realignment County General Funds Grants EPSDT (MC) Medi-Cal Realignment County General Funds CBO’s Probation Foundation Grants United Way First 5 County General Funds Donations County General Funds Realignment Grants Title IV-E Pre-Placement / Prevention Title IV-E Cash / Foster Care Social / Human Services

23. Integrated Family & Children's Services Social/Human Services Child Welfare CalWORKs MediCal Food Stamps Public Health Mental Health Case Management Treatment Broad Array of Health Care Services & Treatment Community-Based Organization Community-Based Organization Case Management Family & Individual Support Case Management Family & Individual Counseling Probation Case Management & Supervision

24. Next Steps • Communicate with other county human service agencies to develop shared vision • Present possibilities for managing children’s funding which would maximize revenues • Identify interested partners • Select priority opportunities for first stage of implementation • Develop a strategy for priority steps and timeline of implementation

25. Next Steps (Continued) • Analyze infrastructure needs (additional workload for claiming & documentation) • Share the vision with CAO & Board along with opportunities for increasing revenues for children at no new county cost • Illustrate leveraging only works when increased revenues are reinvested to maintain matching ability--supplanting kills leveragingcapacity • Advocate with State to Allow Counties Access to federal IV-E Prevention Pre-placement, Including for CBOs.

26. Next Steps (Continued) • Involve expertise on Federal law in the development and structuring of integrating human services • Ensure leveraging structure, documentation, targeted population to be served and claiming are all “audit proof” under Federal law and regulations