Washington Update

1. Washington Update The Arc of Illinois Marty Ford and Julie Ward The Arc of the United States December 5, 2012

2. Presentation Outline Overview and Election Results Budget/Fiscal Problems Social Security Medicaid Health Care Other Major Disability Issues Don’t Cut Our Lifeline Campaign

3. 112th Congress - The Context 112th Congress - winding down, Legislation slow, almost gridlock • Bipartisanship – rare • Big Issues unresolved • Short post-election session of Congress • Known as Lame Duck

4. Election Results • President Obama re-elected • Republican Majority in House • Lost 8 seats • Louisiana District Run-off • Democratic Majority in Senate • Gained 2 Democratic Seats • 2 Independents caucus with Democrats • Decision making for Congressional leadership and Committee structure for 113th underway now

5. Election Impact • House and Senate Leadership • largely unchanged • Divided government remains • Decisions regarding Committee positions for 113th beginning • New leadership in House Appropriations and key Ways and Means Subcommittees

6. Lame Duck • Lame duck session of Congress • December 16th target adjournment • Can it resolve in less than a monththe fiscal/deficit problems that the Congress has not been able to resolve in the last 2 years?

7. Our Federal Debt& The Fiscal Cliff (As Percentage of GDP) Alternative Fiscal Scenario assumes:1) All expiring tax cuts are extended ($5 trillion over 10 years) 2) Medicare physician payment rate held constant ($300 billion over 10 years) 3) BCA across-the-board cuts do not happen ($1.2 trillion over 10 years) Source: CBO, March 2012. Updated Budget Projections: FY 2012 to 2022

8. Elements of the Fiscal Cliff • Expiring tax cuts ($5 trillion over 10 years) • Pledge to not raise takes • Top 2% of earners • Medicare provider payment rate ($300 billion over 10 years) • Providers face nearly 30% cut in reimbursements • Across-the-board cuts ($1.2 trillion over 10 years) • Affects defense and domestic spending

9. Lame Duck Session Alternatives • Make some changes (groundwork or “down payment”) in the law and put off the big decisions to the 113th Congress • Make major changes that impact all the critical programs that support people with disabilities • Do something in between Regardless of the approach, Medicaid, Medicare, Social Security, SSI, education, and other critical programs are at risk

10. What We SpendTOTAL FEDERAL SPENDING IN FY 2011 = $ 3.598 Trillion (in billions) Mandatory Spending Discretionary Spending Non Defense $646 Interest$227 Includes all other disability-related programs Medicaid$275 Medicare$560 Defense$700 Social Security$725 Source: Data from Congressional Budget Office, Jan 2012. The Budget and Economic Outlook: Fiscal Years 2012 to 2022

11. FAMILY SUPPORT Lifespan Respite Care Act grants HOUSING Section 811 Supportive Housing for Persons with Disabilities RESEARCH Center on Birth Defects & Developmental Disabilities National Institute of Child Health and Human Development What’s Included inNon-Defense Discretionary? EDUCATION IDEA Early Intervention IDEA Preschool Grants IDEA State Grants EMPLOYMENT Vocational Rehabilitation State Grant Supported Employment State Grant DD ACT PROGRAMS State DD Councils Protection & Advocacy Systems University Centers for Excellence And Many More….

12. Why Increase Revenue? • If revenue is not part of discussion—cuts will devastate programs • Longstanding position of The Arc’s to: • Protect the safety net • Raise revenues when needed • Protect low-income people from paying more taxes • Federal and state governments provide critical services and supports to live in the community

13. Tax Expenditures Are Substantial Federal Tax Expenditures and Major Programs in 2010, in billions Mandatory Programs Discretionary Programs Expenditures Social Security DefenseDiscretionary Non-DefenseDiscretionary* Medicare Medicaid Note: Tax expenditure figures exclude Recovery Act provisions that were allowed to expire, but include those that have been extended. Sources: Office of Management and Budget, Congressional Budget Office

14. THE ARC SUCCEEDED IN HELPING TO PROTECT MEDICAID IN LAST YEAR’S DEFICIT REDUCTION LAW, THE BUDGET CONTROL ACT. NOW THERE IS MOUNTING PRESSURE TO FIND AN ALTERNATIVE TO CUTS MANDATED BY THE BUDGET CONTROL ACT OR TO FIND ADDITIONAL CUTS IN THE FEDERAL BUDGET TO REDUCE THE DEFICIT FURTHER. WE MUST RENEW OUR EFFORTS TO PROTECT THE FOUR MAJOR PROGRAMS THAT IMPACT PEOPLE WITH INTELLECTUAL AND DEVELOPMENTAL DISABILITIES (I/DD) – MEDICAID, MEDICARE, SOCIAL SECURITY, AND SUPPLEMENTAL SECURITY INCOME (SSI) – IN ADDITION TO THE MANY DISCRETIONARY PROGRAMS THAT PEOPLE WITH DISABILITIES RELY ON TO BE A PART OF THEIR Budget Resources New National Policy Matters on Deficit Reduction www.thearc.org Find it on The Arc Blog or the budget page

15. Social Security: A Lifeline • Social Security Old-Age, Survivors, and Disability Insurance • Disabled workers & their dependents • Retirees with disabilities • Disabled dependents of retirees • Disabled survivors • Disabled adult children and disabled widow(er)s • Supplemental Security Income

16. Social Security: Current Threats • Multiple hearings in the 112th Congress on Social Security: • Solvency / financing • Administrative processing • Disability program goals • Work incentives • Alleged waste, fraud & abuse • Congressional interest in SSI and the children’s SSI program • Deficit reduction, tax reform, and entitlement reform

17. Specific Proposals • Specific Congressional proposals to cut Social Security and SSI include: • Reducing annual cost-of-living increases • Raising the Social Security retirement age • Changing the definition of “disability” / eligibility • Time limiting benefits • Block granting SSI • SSI “family maximum” and/or sliding scale

18. The Arc’s Response • Advocacy to: • Preserve benefits for current and future beneficiaries • Keep Social Security and SSI out of deficit reduction efforts • Maintain the basic structure of Social Security and SSI • Support adequate administrative funding and program enhancements for people with disabilities

19. Medicaid

20. Why is Medicaid At Risk? • Health care costs growing faster than other costs Costs The Economy • More poor people qualifying for Medicaid Demographics • More seniors using more health care Politics Medicare and Social Security more politically difficult to cut Some Governors want more flexibility

21. Other Factors • Growing perception “unsustainable” • Entitlement negative word • Perception of luxury we cannot afford • Part of the deal for tax increases • Big share of state budgets • 16% of State general fund spending

22. Proposed Medicaid Cuts President’s Budget Request • $51 billion would be cut (over 10 years) • Reduces the Medicaid provider tax threshold • Blended matching rate • Reimbursement rates for DME cut • Reduces funding for hospitals that serve low income House Budget Resolution • Cut Medicaid by over $800B over 10 years • Cut Medicaid in half by 2030 • Block grants A not-so-new idea • Per person caps

23. Other Medicaid Targets People who are dually eligible for Medicaid and Medicare Combined Medicare & Medicaid expenditure for Duals = $265.7 billion 15% of Medicaid beneficiaries=39% of costs 18% of Medicare beneficiaries=31% of costs

24. How do you become dually eligible? Generally Medicaid = Supplemental Security Income Medicare = Social Security Retirement, Survivors, or Disability Insurance Disabled Adult Child –through parent’s earnings record Low income worker Using current work incentives

25. Who Are the Duals? 9 Million Duals are among the poorest and sickest Have multiple chronic conditions 60% over age 65 with high nursing facility and hospital use 40% age 18-64 and use community based services

26. What Is the Problem People have numerous health care providers who don’t communicate Care is fragmented Costs are shifted between nursing facilities and hospitals

27. State Proposals 26 states submitted 3-year financial alignment proposals to CMS by May 31, 2012 30-day public comment periods at state level and at Federal level have closed Massachusetts and Washington State approved duals projects

28. National Senior Citizens Law Center has excellent website with all proposals: http://dualsdemoadvocacy.org/state-profiles

29. Duals with I/DD in the 26 proposals* 8 states exclude individuals with I/DD in their Duals proposals (AZ, CA, HA, IL, NC, SC, TX, VA) 10 states include individuals with I/DD in their Duals proposals (CO, CT, ID, IA, MI, MO, NY, OK, VT, WI) 8 states requested a carve out of LTSS for individuals with I/DD in their Duals proposals (MA, MN, NM, OH, OR, RI, TN, WA)

30. Managed Care People with disabilities no longer exempt-- acute care States have turned to private managed care companies (duals and waivers) Applying managed care to long term services and supports Medical model

31. Savings through Managed Care • Mandatory enrollment • Few quality metrics for LTSS • All about savings

32. Can Managed Care Do This? • Community integration • Person centered planning • Employment • Untested in LTSS • No measures-no data • People at risk

33. The Arc’s Response Managed care principles • Ensure values included • community integration, person centered planning, self-direction • Consumer protections • Independent assessments • Education and navigation • Grievance and appeals • Adequate networks

34. Affordable Care Act (ACA) • Huge advocacy victory • Complicated law • Politically polarizing • Campaign issue • Divided public opinion • Some states sued to stop it • Supreme Court weighed in 10/26/2012

35. ACA Helps People With Disabilities Ends insurance industry practices that hurt people who need health care Expands access to health care Improves long term services and supports Promotes prevention and wellness

36. Medicaid Expansion If all states implement—16 million Good financial deal for states Illinois not yet committed Federal cuts to Medicaid threaten expansion

37. Where Do the States Stand?Slide courtesy of the Center on Budget and Policy Priorities

38. Essential Benefits • Requires plans to cover • Rehabilitation and habilitative services and devices • Mental and behavioral health • Pediatric services including • dental and vision care • Chronic disease management

39. Illinois ACA Issues • Partnership health insurance exchange • Illinois benchmark—plan from largest small group product—BCBS product • Unclear how covering habilitation • State mandates • Habilitation for children • Autism • Medical foods

40. Resources

41. Bipartisan Issues Some Bipartisan Legislation Still in Play • Achieving a Better Life Experience (ABLE) ActH.R. 3432, S.1872 • Helps people with disabilities and their families save to meet their long term ongoing support needs • Convention on the Rights of Persons with Disabilities • UN treaty passed by the Senate Foreign Relations Committee with bipartisan support • 12/4—Senate failed to ratify –Sen. Durbin yes and Sen. Kirk absent

42. Other Major Issues • Employment • Integrated settings • Elimination of subminimum wages (Dept. of Labor 14(c) certificates) • DOJ • State Employment First initiatives

43. What’s in our future? There will be cuts to Medicaid Our message - Medicaid is our lifeline. Don’t Cut Our Lifeline • Our job is to make sure that they do not hurt people with disabilities or cause people to have to live in institutions. 10/26/2012

44. Bottom-Line • Budget situation threatens our programs • Many people with disabilities rely on these programs • Social Security • Medicaid, Medicare, & Affordable Care Act: • Health care programs • Long term services and supports • Special education • Employment programs

45. Bottom-Line, cont. • We cannot cut our way through the deficit • Revenues must be part of the solution • If we do not raise money: • Waiting lists will grow • Income supports and/or services will be cut or lost • Institutions may resurge as a model of “care”

46. Coalition Work • Importance of Coalition work in Washington • Consortium for Citizens with Disabilities • Coalition on Human Needs • Social Security Works & Strengthen Social Security Campaign • Americans for Tax Fairness • Campaign for Housing and Community Development Funding • Many others… • Partnering with others: Disability Policy Seminar & Legislative Agenda

47. Partnering with Others • Disability Policy Seminar • The Arc, AAIDD, AUCD, NACDD, SABE, & UCP • Legislative Agenda • The Arc, AAIDD, ANCOR, AUCD, NACDD, & UCP

48. Our Role Meet with Congress and federal agencies Support our state chapters Develop policies and principles Analyze and respond to issues Support grassroots campaigns

49. Goals of the Campaign Prioritize Medicaid Unify grassroots message Educate about Medicaid Put a face on the program Build relationship with Members of Congress

50. Tool Kit Samples messages Keep it simple Fact sheets Full tool kit is in the chapters only section of the website