RD264 - Virginia Department of Behavioral Health and Developmental Services Report on Virginia’s Part C Early Intervention System (Budget Item 305 H.2., 2011 Appropriation Act) July 1, 2010 – June 30, 2011


Executive Summary:
In the 2011 Appropriation Act, paragraph H.2. of Item 305 directs the Department of Behavioral Health and Developmental Services to report the following information to the Chairmen of the Senate Finance and House Appropriations Committees on October 1 of each year: (a) total revenues used to support Part C services, (b) total expenses for all Part C services, (c) total number of infants and toddlers and families served using all Part C revenues, and (d) services provided to those infants and toddlers and families.

Overview of Fiscal Climate for Part C in FY2011

The fiscal climate in Part C remained stable in FY2011 due primarily to increased Medicaid revenue and the availability of additional funding for Part C under the American Recovery and Reinvestment Act (ARRA). On October 1, 2009 the Medicaid Early Intervention Services Program was implemented, and the reported amount of Medicaid revenue for Part C services quadrupled in FY2011 compared to FY2010 (though part of that increase can be attributed to more accurate data collection and reporting). ARRA funds were also a significant factor in the stable fiscal climate in FY2011 and supported over $3.7 million of early intervention services for infants, toddlers and families.

Looking ahead, the fiscal outlook for FY2012 is less certain with ARRA funding ending September 30, 2011. While the increased Medicaid revenue realized through the Medicaid Early Intervention Services Program will continue and will be a critical component in the long-term funding structure for Part C, the Department, in collaboration with other State agencies and local stakeholders, is continuing to closely monitor expenditure and revenue data to determine the amount and possible sources of additional revenue needed to ensure the long-term financial stability of the Part C system after the ARRA funding ends.

Data System Update

The existing early intervention data system, ITOTS, was developed and implemented in 2001 primarily to meet annual federal reporting requirements related to child data and now presents a number of challenges to the Department in meeting federal and state reporting requirements, including the following:

• Child data is collected in ITOTS only at entry into the early intervention system and is not collected as child status or service needs change.

• No financial data for Part C services is collected through ITOTS, resulting in a burdensome paper process for collection and reporting of comprehensive and reliable data related to the cost of providing services and the revenue sources that are accessed in providing services.

• ITOTS data reports are limited and the analysis of the data is burdensome.

Following a detailed analysis of ITOTS in the spring of 2006, a first phase of data system improvements were implemented to address data integrity and better reporting. As a second phase of the project, the Department further analyzed federal and state reporting requirements and other existing data systems within the Commonwealth and other states’ Part C data systems to determine the most cost-effective data solution to meet the needs of the Virginia Part C system. Initial plans called for the functionality necessary to enter and report on delivered services and to have more complete and accurate revenue and expense data to be operational by July 1, 2009. However, fiscal constraints and the need to prioritize data system changes necessary for implementation of the Medicaid Early Intervention Services Program resulted in the need to postpone implementation of a new, expanded Part C data system.

The Health and Human Resources Secretariat is committed to developing a consistent, comprehensive and non-duplicative data system for use across Virginia’s Health and Human Resources agencies rather than developing or enhancing program-specific data systems. Since many local agencies and service providers have or are in the process of developing and implementing electronic health record systems, the Department’s focus on data collection for all programs (not just Part C) has shifted to identifying and implementing the most effective and efficient mechanism for importing the data already collected by local systems into a state database through which that data can be aggregated, analyzed and reported. Until such a system is implemented, the Department’s challenges in meeting federal and state reporting requirements will continue.

Revenue and Expense Data

The table on page 2 of the report shows revenue from all sources as reported by the 40 local early intervention systems for FY2011.

In accordance with the budget language, the chart on page 3 of the report provides detail about the total amount of federal and state Part C funds and ARRA funds expended in FY2011 for Part C direct services as reported by the 40 local lead agencies and 23 private providers.

The local lead agencies reported an additional $7,005,624 of expenses related to the system components (administration, system management, data collection and training) that are critical to implementation of direct services. Therefore, total expenses are $39,527,468. As of June 30, 2011, there were $2,546,991 of unspent federal and state Part C funds that may have been obligated expenses as of June 30, 2011 but not reflected in the expenses reported above. Part C funds for FY2011 had to be obligated by June 30, 2011 but may be spent through September 30, 2011. In addition, the number of private providers that submitted the required quarterly expenditure reports in FY2011 was half the number that reported in FY2010. As a result, the total expenditures reported by private providers in FY2011 were over $9 million less than in FY2010. Together, these factors account for the difference between the $52 million in revenue and $32 million in expenses for early intervention services reported in the table on page 3.

Total Number of Infants, Toddlers and Families Served

A total of 14,069 infants, toddlers and families received Part C early intervention services in the one-year period from July 1, 2010 – June 30, 2011. This number represents a 15% increase over the previous year. This is a far greater increase than the approximately 4% increases seen in each of the previous 2 years.

The table on page 4 of the report breaks down the services that were provided to Part C eligible infants and toddlers by the type of early intervention service determined to be needed in order to achieve the child’s outcomes as listed on the child’s Individualized Family Service Plan (IFSP).

In addition to the services listed on IFSPs, a total of 9,903 children received an evaluation to determine eligibility and/or an assessment for service planning in FY2011.