The joint cost analysis presented by PNP/Navigant offers a first look at the aggregate reporting of cost data in the system. It does not allow for an analysis of whether the funding is adequate to facilitate quality of care, the ability to meet the needs of individuals served or the long-term sustainability of the community provider network – points made in the report. The report supports a contention long-held by the provider community and consumers that the Illinois system is fragmented and driven by budget allocations, not intensity of need or a comprehensive plan to systematically build a sustainable system that meets the changing needs of consumers.

Two important financial points came from the report:

1. On average DHS/DDD covers 98% of allowable costs for DD programs.
2. On average DHS/DMH covers 90% of allowable costs for Behavioral Health programs.

The report indicates that programs need to be at 105% of allowable costs to be sustainable in the long run. Using an average, means about 55% of DD programs are reimbursed below allowable cost and probably 70% of MI programs are reimbursed below allowable costs. Non-allowable costs can easily amount to significant dollars. If all costs are not covered, how will programs continue to provide services. It is not unusual for programs to get 85% of their funding through DHS. Local funds usually are not at a size large enough to cover significant shortages. The result: programs remain underfunded with staff paid below comparable rates in other industries because that is what is affordable. Results are similar to the outcomes of the University of Illinois cost study done at about the same time.

A most telling quote in the Executive Summary often repeated throughout the report states, “Another consideration is that differences in cost allocation methodologies across agencies may lead to differences in how revenues, costs and units of service were reported among the DD, MH and SASS programs. Further more, reported allowable costs for the DD, MH and SASS programs were not assessed to determine if they were reasonable, necessary and efficient because the data does not allow an assessment of those factors.”

The retrospective cost data that was reviewed in the PNP Associates and Navigant Consulting study provide the data necessary to determine where we are and potentially how we got there. It will be important that the “next step” be taken in determining where we want to be and a plan to get there.

Elm City was represented by IARF, our trade association in Springfield, at the various hearings. 

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These reports are long (over 100 pages) and detailed.