Legislators Pursue Immediate Funding for Medicaid Fee Increases


TwitterFacebookCopy LinkPrintEmail

HARTFORD — Legislators aim to secure immediate funding for Medicaid fee increases for physical and mental health services this year, despite the governor’s administration requesting additional time for a comprehensive rate review. 

A bill proposed in the Human Services Committee would require the state Department of Social Services to send more funding through Medicaid to behavioral health providers, certain physicians, dentists and people working in the state’s Birth to Three program. 

State Sen. Matt Lesser, D-Middletown, the committee’s co-chair, said the legislature should not wait to address what he called high-priority needs. 

“I don’t think we need to find out if we’re also underpaying in other areas to realize we’ve got a problem with this basket [of services],” Lesser told CT Examiner. 

Last year, the state completed the first of a two-part study conducted by DSS into its Medicaid payment rates. The report compared Connecticut’s reimbursement rates for specific medical, dental and behavioral health providers with rates used by five other states: Maine, Massachusetts, New Jersey, New York and Oregon. According to the report, Connecticut’s rates for behavioral health and physicians were generally lower than those of its neighboring states. 

The bill requires the department to create a new rate methodology for mental health services based on nationwide wages and the providers’ qualifications. According to the report, Connecticut Medicaid pays mental health providers 62% of the average payment made by its five comparison states. It would cost Connecticut an additional $42.4 million to match what neighbor states pay. 

State Rep. Lucy Dathan, D-New Canaan, expressed concern during a public hearing on Tuesday about the shortage of behavioral health services caused by current Medicaid rates.

“I come from Fairfield County. You would think in our neck of the woods it would be something that there would be a lot of access to. And I know, for instance, in my district, I hear from Medicaid recipients who are not able to access behavioral health either within the school system with their children or within the [Federally Qualified Health Centers] in other areas,” she said. 

Child advocate Sarah Egan called the children’s behavioral health situation a yearslong “five-alarm fire” that demonstrates a connection between years of low funding, staffing shortages and access to care. 

“What does it look like when we don’t fund Medicaid appropriately? It looks like 30 children sitting in the [Connecticut Children’s Medical Center] emergency department. That Department for Behavioral Health is built for 12 [children], not 30,” she said. 

Egan explained that there were 1,200 children stuck in emergency rooms in three quarters of 2023, and over 400 remained in the ER for more than four days.

“Just in the last couple of weeks, we had a teenager 40 days in the emergency room. Forty days — with autism and [an intellectual disability] — until the hospital socially admitted the child, because you just can’t live in the emergency department. And why are they there? Because there’s no place to go.” 

Department of Social Services Commissioner Andrea Barton Reeves said at the hearing that her department intended to wait until the completion of the second part of the Medicaid study next year before determining how to address the rates. She said they wanted to raise reimbursements systematically, taking into consideration the existing increases providers were already receiving.

“The bill would actually limit the department’s necessary flexibility to be able to adjust rates on a careful, analyzed basis,” Barton Reeves told the committee. 

But Lesser said the need to address the Medicaid rates was urgent, given the “massive amount of need” they were seeing. 

“We do need to move forward on Medicaid rates this year — this bill is an attempt to do this,” he said. He added that the goal was to have the department develop a “rational basis” for its rate-setting, rather than having it dependent on agencies with resources to lobby the General Assembly for additional funds.

“My fear, if we keep on having studies on top of studies, is that we’ll never get there on that. Meanwhile, we’ve got some really acute needs,” Lesser said.

Nonprofits and behavioral health providers across the state have repeatedly spoken about increasing staff shortages and growing waitlists, due to their inability to find and pay qualified professionals. In December, the Child and Family Agency in New London closed its intensive in-home program for children with severe behavioral health needs — known as IICAPS — which meant the loss of critical services for elementary-age children in eastern Connecticut. 

Egan also mentioned the demand for IICAPS in her testimony. 

“We’re pushing a 600-family waitlist. And let me be clear — there is no alternative,” she said. 

The bill would also increase reimbursement rates for any Birth to Three provider from $120 to $169 per hour, and require $10 million be added to the state budget in each of the next three years for increasing reimbursement rates for medical and dental services at Community Health Centers. 

In testimony, many of the Birth To Three providers, including speech and language pathologists, and program directors noted that the reimbursement rates for Birth to Three had not been updated since October 2017, despite a 20 percent increase in costs since then.

Elaine Balsley, the director of Reachout, Inc., an organization in Hamden that works with young children with developmental delays, said about half of the children who participated in Birth to Three programs do not need special education, which she said will save the state a significant amount of money in the long run.

Balsley said the number of children being evaluated for Birth to Three services has risen from 7,500 in 2017 to just over 11,000 this year. While the number of referrals are increasing, she said, staff shortages and the inability under federal law to maintain a waitlist has put pressure on current staff. Autism services, she explained, have been cut in half since 2017. 

“With no waiting lists and a very difficult time hiring and retaining staff, the staff that we currently have are feeling overwhelmed. And as an employer, I cannot offer them any increases in pay or benefits because I am not receiving any more income,” Balsley said.

The Human Services Committee is also considering two other bills to get more funding to nonprofits and health providers — one that would require state contracts with nonprofits to be adjusted to inflation, and another that would adjust the Medicare reimbursement for Community Health Centers and increase their reimbursements based on inflation.  

Emilia Otte

Emilia Otte covers health and education for the Connecticut Examiner. In 2022 Otte was awarded "Rookie of the Year," by the New England Newspaper & Press Association.