Budget boost offers some relief for DHS
LIKE several state agency heads, Department of Human Services Director Ed Lake is looking to the new fiscal year with some optimism. Credit goes to a boost in his budget, after several difficult years.
The Legislature appropriated DHS $729.4 million for fiscal 2019, which begins July 1. That’s an increase of $34 million over the current fiscal year and, with an expected increase of about $18 million in federal Medicaid matching dollars, will make DHS a bit more whole than it’s been.
“We feel like we’ve climbed out of the hole, and it was a pretty deep hole,” Lake said in an interview last week.
A boost in Medicaid matching funds will provide a real boost. The match is adjusted each year based on a three-year rolling average of each state’s economic growth. As luck would have it, the formula resulted in matching funds being cut in Oklahoma as the state’s economy weakened, because the three-year average had reflected the better days in the energy sector.
As a consequence, Lake says, DHS in recent years had to find a way to cover about $25 million in costs that would have been covered by Medicaid. Before this fiscal year, money was gleaned by streamlining, reducing administrative costs, finding energy efficiencies and other belt-tightening. This year, though, cuts took a toll on some programs and services.
As an example, DHS reduced foster care and adoption payments by 5 percent in 2017. This year, it will be able to restore those cuts.
The larger appropriation means the agency will not have to implement another freeze in enrollments for child care subsidies for low-income working families. DHS had to stop enrollments a year ago.
The agency plans to increase by 7 percent its provider rates in the Advantage Medicaid waiver program for direct care, state plan personal care and case management. Provider rates in all Developmental Disabilities Services Medicaid waiver programs and state-funded services will be increased by 7 percent; those rates had been cut in 2015.
Lake notes that the state has made gains in its adoption program, which is great. But as adoptions have increased, so has the bill for DHS — he’s had to take about $4.75 million from other areas to cover the costs. This year’s appropriation will ease that burden.
About $8 million of the $34 million will be used to cover employee pay raises that were approved for all state employees. DHS also will increase salaries for child welfare specialists to fulfill obligations of the Pinnacle Plan, which is in its fifth year. That reform plan stemmed from the state’s settlement of a classaction lawsuit over foster care.
This year’s funding boost doesn’t replace the total amount DHS lost in the previous years. Many vacancies will remain open and some programs will remain idle, Lake says, but the challenges don’t appear quite so daunting. That’s a welcome change for the agency tasked with the vital work of tending to Oklahoma’s most vulnerable children and elderly.