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Final Report - RI Department of Children, Youth & Families

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CHAPTER 4: FINANCING THE SYSTEM OF CARE<br />

“wrap” around services provided by and through Comprehensive Care Networks.<br />

Comprehensive Care Networks do not need to control these dollars, but do need to be able to<br />

access them.<br />

Similarly, development <strong>of</strong> one or more case rates can be phased in over time, as data becomes<br />

available to support and justify this structure. Case rates are simpler to administer than<br />

encounter-based claiming, but need to be designed to provide the same level <strong>of</strong> data feedback<br />

to inform ongoing decision-making.<br />

For any financing strategy to be successful, it must be guided by constant review <strong>of</strong><br />

clear, accurate, actionable data that describes the operation <strong>of</strong> the system overall. This<br />

data, at minimum, must include caseload (the number <strong>of</strong> active eligibles), expenditure (both<br />

on an individual level, as well as projected for the system as a whole, based on current<br />

eligibility and patterns), and outcomes (the result realized in consequence <strong>of</strong> the expenditure,<br />

based on an understanding <strong>of</strong> the need at the onset <strong>of</strong> the expenditure).<br />

Rate structure is an essential element <strong>of</strong> any financing strategy. Rates must be established in<br />

a rational fashion that blends considerations <strong>of</strong> cost, capacity, and outcomes, and then<br />

maintained in a disciplined fashion. If we value evidence-based services, they should be<br />

reimbursed based on performance. The State should pay the same rates for like services<br />

across all programs and departments, but should not pay higher rates than other payors unless<br />

a sound rationale that supports the outcomes desired for the system can be articulated.<br />

Coordination and cooperation among state departments is critical to address these issues.<br />

Development <strong>of</strong> funding strategies must be concurrent with system <strong>of</strong> care design and<br />

development, focused on maximizing resources that support the needs <strong>of</strong> the children.<br />

Program and fiscal staff, across departments and agencies, must both be intimately involved<br />

in planning and development.<br />

The main financing challenges facing the system are:<br />

! How to design a system <strong>of</strong> performance risk <strong>of</strong>fset by financial reward;<br />

! How to “transplant” monies invested in the current system to the allocation (sites,<br />

practices, and modalities) required by the new system;<br />

! How to do so without sacrificing the current system as it is needed until the new system is<br />

fully developed; and<br />

! How to fund this transition in a reasonably controlled way.<br />

Some type <strong>of</strong> all-encompassing rate(s) that reflect a fully mature system’s operation and<br />

contribution may be optimal. The development <strong>of</strong> such a structure would take significant<br />

time and in-depth analysis.<br />

In the interim, these challenges can be addressed with an interlocking strategy <strong>of</strong> “wraparound”<br />

models and incentive rates. Comprehensive Care Networks would be paid one or<br />

more “base rates” for common core services provided to all children with whom they would<br />

become involved (embedding the costs necessary to provide general administrative supports<br />

to the Regional Offices). For the purpose <strong>of</strong> DCYF Comprehensive Care Networks, the base<br />

rate would cover services not otherwise billable to other payors. Services required to support<br />

an individual child would be billed over and above the base rate to whatever payor was most<br />

appropriate, based on individual circumstances (including but not limited to Medicaid, health<br />

System <strong>of</strong> Care Task Force <strong>Report</strong> (January 2003) 39

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