STATE OF MAINE
118TH LEGISLATURE
FIRST REGULAR AND FIRST SPECIAL SESSIONS








Final Report
of the

TASK FORCE TO STUDY THE
COST-EFFECTIVENESS OF THE
CHILD DEVELOPMENT SERVICES SYSTEMS

February 9, 1998






MEMBERS:
Sen. Peggy A. Pendleton, Chair
Sen. James D. Libby
Rep. Elizabeth Watson
Rep. Rodney W. McElroy
Barbara Brown
Ellen Courtney
Debra Couture
Luanne Crinion
Angela Faherty
Jaci Holmes
Mary Anne Miosan
Joan Nason
Rachel Olney
Leslie Steltzer

Staff:

David C. Elliott, Principal Analyst
Phillip D. McCarthy, Legislative Analyst
Office of Policy & Legal Analysis
Rooms 101/107/135, 13 State House Station
Augusta, Maine 04333
(207) 287-1670


TABLE OF CONTENTS




1. Findings and Recommendations 1


2. Appendices 4

Appendix A Public Laws 1997, Chapter 534, section 20
Appendix B Members of Task Force to Study The Cost-Effectiveness of the
Child Development Services System
Appendix C Minutes from November 21, and December 4, 1997 Task Force Meetings
Appendix D “The Route to Early Intervention Services through Child Development Services,” Knox County Child Development Services, December, 1997



TASK FORCE TO STUDY THE
COST-EFFECTIVENESS OF THE
CHILD DEVELOPMENT SERVICES SYSTEM


Final Report


The Task Force to Study the Cost-effectiveness of the Child Development Services System was created by Public Law 1997, Chapter 534, section 20. The task force was to consist of 16 members, including four legislators, three state department representatives, two contract service providers, two parents of children receiving services through the Child Development Services (CDS) System, one CDS site director, one CDS site board member, one public school special education director, one community health nurse and one member representing the organizational development profession. The member appointed in the last category resigned from the task force before the first meeting because of scheduling conflicts; no replacement was appointed.

The charge to the task force was to:

A. Study and make recommendations regarding the most efficient and cost-effective manner in which the Child Development Services System could achieve greater administrative efficiency and economy.

B. Review and make recommendations regarding the cost-effectiveness of hiring professional staff to be employed at the regional child development services sites as compared to contracting for services with nonprofit and for-profit service providers.

The task force was directed to submit its report to the Second Regular Session of the 119th Legislature in January, 1998. A copy of the authorizing legislation, a list of the members, summaries of task force meetings and a chart showing the typical process for provision of early intervention services through CDS are attached as appendices.

The task force was convened on November 21, 1997, to begin its work and also met on December 4 and December 17, 1997, and January 5, 1998. As a result of its deliberations, the task force makes the following findings and recommendations.


1. Recommendation: The Department of Education shall:

A. Develop and use a common form and methodology for reporting information to be used in determining the cost to regional CDS sites of employing professional therapists as compared to contracting with for-profit or nonprofit agencies to perform the same services. In developing the form and methodology, the department shall consult with its independent auditor to identify appropriate cost components according to generally accepted accounting principles and federal law.

B. Develop instructions and provide training to regional CDS sites for completing the cost reporting form.

This is a recommendation of a majority of the task force.


2. Recommendation: The Department of Education shall develop and implement a quality assurance initiative for the CDS System. The purpose of the program is to provide a mechanism to:

A. Monitor attainment of federal and state performance goals;

B. Monitor state regulatory compliance;

C. Monitor the quality of services provided to assess the effectiveness of the system in providing early intervention and free appropriate public education services to eligible children and their families;

D. Evaluate the satisfaction of parents; and

E. Calculate the costs and savings of investment in early intervention services as compared to later provision of special education and other therapeutic services through implementation of a longitudinal study that tracks the progress of children who receive early intervention services.

Following establishment of the quality assurance initiative, the CDS System shall report biennially to the Commissioner of Education and the Joint Standing Committee on Education and Cultural Affairs on the effectiveness of the system in providing comprehensive early intervention services for eligible children and their families as determined by established system goals, standards and performance indicators.


This is a unanimous recommendation of the task force.


3. Recommendation: To the maximum extent possible, as part of the screening and evaluation process, regional CDS sites shall make available to parents information on current contract and site employee service providers currently available in the region.

This is a recommendation of a majority of the task force.


4. Finding: In some regions, services provided by public agencies such as regional CDS sites, Head Start agencies, public schools, public health agencies and other state agencies may lack coordination or be underutilized when planning for and providing appropriate services to eligible children and their families. A stronger effort at collaboration among all involved public agencies would result in more efficiency in the provision of services.

This is a finding of a majority of the task force.


5. Finding: Excessively high case manager workloads may be a problem in some regions. However, due to the varying conditions and needs faced by the regional sites, this is an issue that can best be addressed by local action. Regional site boards should monitor the situation in their regions and take whatever steps are available to address any workload problems that arise.

This is a finding of a majority of the task force.



APPENDIX A

Public Laws 1997, Chapter 534, section 20


Sec. 20. Task Force to Study the Cost-effectiveness of the Child Development Services System.

1. Establishment and duties. The Task Force to Study the Cost-effectiveness of the Child Development Services System, referred to in this section as the "task force," is established. The task force has the following duties.

A. The task force shall study and make recommendations regarding the most efficient and cost-effective manner in which the Child Development Services System could achieve greater administrative efficiency and economy.

B. The task force shall review and make recommendations regarding the cost-effectiveness of hiring professional staff to be employed at the regional child development services sites as compared to contracting for services with nonprofit and for-profit service providers.

2. Membership. The task force consists of 16 members appointed as follows:

A. Four Legislators, 2 of whom must be members of the Senate and 2 of whom must be members of the House of Representatives, appointed jointly by the President of the Senate and the Speaker of the House;

B. The Commissioner of Education, or a designee;

C. The Commissioner of Human Services, or a designee;

D. The Commissioner of Mental Health, Mental Retardation and Substance Abuse Services, or a designee;

E. Two members representing nonprofit and for-profit service providers, one of whom must be a clinical professional and one of whom must be a developmental therapist, appointed jointly by the President of the Senate and the Speaker of the House;

F. Two members representing parents whose children receive services through the system, appointed jointly by the President of the Senate and the Speaker of the House;

G. One member representing Child Development Services System site directors, designated by the Child Development Services System site directors;

H. One member representing Child Development Services System site board members, designated by the Child Development Services System site board members;

I. One member representing public school special education directors, designated by the Maine Association of Directors of Services for Children with Exceptionalities;

J. One member representing community health nurses with experience in providing community health services to children with developmental needs, designated by the Maine State Nurses Association; and

K. One member representing the organizational development profession, appointed jointly by the President of the Senate and the Speaker of the House.

All appointments must be made no later than 15 days following the effective date of this Act. The appointing authorities shall notify the Executive Director of the Legislative Council upon making their appointments. When the appointment of all members is complete, the Chair of the Legislative Council shall call and convene the first meeting of the task force no later than September 15, 1997. The task force shall select a chair from among its legislative members.

3. Staff assistance. The task force may request staffing and clerical assistance from the Legislative Council.

4. Reimbursement. The task force members who are Legislators are entitled to receive the legislative per diem, as defined in the Maine Revised Statutes, Title 3, section 2, and reimbursement for travel and other necessary expenses for each day's attendance at meetings of the task force. The Executive Director of the Legislative Council shall administer the task force's budget.

5. Report. The task force shall submit its report with any accompanying legislation to the Second Regular Session of the 118th Legislature by January 1, 1998.

6. Meetings. The task force may meet up to 3 times.

Sec. 21. Appropriation. The following funds are appropriated from the General Fund to carry out the purposes of this Act.

1997-98

LEGISLATURE

Task Force to Study the
Cost-effectiveness of the
Child Development Services
System

Personal Services $660
All Other 1,100

Provides funds for the per diem and expenses of legislative members and miscellaneous costs, including printing, of the Task Force to Study the Cost-effectiveness of the Child Development Services System.

LEGISLATURE
TOTAL $1,760


See title page for effective date.



APPENDIX B


Members of Task Force to Study The Cost-Effectiveness of the
Child Development Services System




TASK FORCE TO STUDY THE COST-EFFECTIVENESS OF THE
CHILD DEVELOPMENT SERVICE SYSTEM
Chapter 534, P. L. 1997

Members:

Senator Peggy Pendleton Senate Member
110 Holmes Road
Scarborough, Maine 04074
Tel: 883-5414

Senator James Libby Senate Member
RFD #3 Box 497
Gorham, Maine 04038
Tel: 929-4294

Representative Rodney McElroy House Member
P.O. Box 494
Unity, Maine 04988
Tel: 948-5225

Representative Elizabeth Watson House Member
406 Maine Avenue
Farmingdale, Maine 04334
Tel: 621-2871

Ms. Barbara Brown Representing Service Providers/Clinical
RFD #1, Box 6605 Professional
Vassalboro, Maine 04989
Tel: 872-8782

Blaine Hartford (WITHDREW) Representing Organizational Development
7 Patricia Lane Profession
Cape Elizabeth, Maine 04107
Tel: 799-0473

Karen Doughty Representing Parents Receiving Services
8 Wood Rock Road
Scarborough, Maine 04074
Tel:

Leslie Steltzer Representing Parents Receiving Services
79 Manning Mills Road
Hampden, Maine 04444
Tel: 862-2560

Ms. Mary Anne Miosan Representing Service Providers/
15 McKenny Drive Development Therapist
New Gloucester, Maine 04260
Tel: 753-6583
Task Force to Study the Cost-Effectiveness of the Child Development Service System page 2


Ellen Courtney Representing Child Development Services
CDS, Knox County System Site Directors
111 Tilson Avenue
Rockland, Maine 04841
Tel: 594-5933

Angela Faherty Representing Child Development Services
Portland Public School Dept. Board Members
331 Verander Street
Portland, Maine 04103
Tel: 874-8100

Joan Nason Representing Maine Association of
Freeport School Department Directors of Services for Children with
17 West Street Exceptionalities
Freeport, Maine 01032
Tel: 865-0928

Luanne Crinion Representing Community Health
200 Main Street Nurses
Lewiston, Maine 04240
Tel: 795-4450

Jaci Holmes, Director Commissioner’s Designee
Child Development Services Department of Education
146 State House Station
Augusta, Maine 04333
Tel: 287-3272

Debra Couture Commissioner’s Designee
Financial Analyst Department of Human Services
Bureau of Medical Services
11 State House Station
Augusta, ME 04333
Tel: 287-1973

Rachel Olney Commissioner’s Designee
Dept. of MHMR & SAS Department of Mental Health, Mental
Region 1, Lancaster Road Retardation & Substance Abuse Services
Portland, Maine 04101
Tel: 822-0126

Staff:

David Elliott and Phillip McCarthy
Office of Policy and Legal Analysis
13 State House Station
Augusta, ME 04333-0013
Tel: 287-1670



APPENDIX C


Minutes from November 21, and December 4, 1997 Task Force Meetings


TASK FORCE TO STUDY THE COST-EFFECTIVENESS OF
THE CHILD DEVELOPMENT SERVICES SYSTEM
Minutes from November 21, 1997 meeting



Members present: Barbara Brown (clinical professional/service provider); Ellen Courtney (CDS site director); Luanne Crinion (Maine State Nurses Association); Angela Faherty (CDS board member); Jaci Holmes (Commissioner of Education’s designee), Sen. James Libby, Rep. Rodney McElroy; Mary Anne Miosan (development therapist/service provider); Joan Nason (Maine Association of Directors of Services for Children with Exceptionalities); Rachel Olney (Commissioner of Mental Health; Mental Retardation & Substance Abuse Services’ designee); Sen. Peggy Pendleton; Leslie Steltzer (parent receiving services); and Rep. Elizabeth Watson

Others present: David Elliott (Office of Policy & Legal Analysis); Rep. Richard Farnsworth; Jeffrey Hubert (Macdonald Page); Dawna Lopatosky (Bureau of the Budget); Joseph Mayo (Clerk of the House); Phillip McCarthy (Office of Policy and Legal Analysis); Greg Scott, (Dept. of Education); and David Stockford (Dept. of Education)


Convening of the Task Force

¨ Joseph Mayo, Clerk of the House, presided over the convening of the task force on behalf of Rep. Elizabeth Mitchell, Chair of the Legislative Council. Having ascertained that a quorum was present, Mr. Mayo asked task force members to introduce themselves before he presided over the election of the Chairperson for the task force.

¨ Rep. Watson nominated Sen. Pendleton to serve as task force chair; the nomination was seconded by Ms. Olney, and the task force members unanimously approved the motion to elect Senator Pendleton as chairperson (13-0).


Overview of legislative history of CDS


¨ David Elliott reviewed the legislative history related to the governance of the CDS System; and Phil McCarthy reviewed the authorizing legislation that established the task force and the duties charged to the task force.


Briefing / discussion of financial aspects of CDS

¨ Jeffrey Hubert, CPA at Macdonald Page, presented an overview of the financial structure of the CDS System (copies of overheads are enclosed). The presentation included a financial profile of revenues and expenditures based on 1996 audited financial data for the State CDS Office (or Intermediate Educational Unit, IEU), and 5 CDS regional sites.

¨ Discussion centered on the following issues:

Þ The various sources of revenues that flow through the CDS State IEU and the regional CDS Sites. In the regional CDS site example, 49% of resources are Medicaid funds paid directly to contracted service providers, (and are outside of the CDS fiscal records), while 51% of the funds represent State General Funds, Federal Part H (birth through 2 years old), Federal Section 619 (three through five years old), Medicaid, and Other sources of revenues;

Þ The impact of using Medicaid funds as program income (e.g., would increasing the level of Medicaid funds -- as reimbursement for the provision of direct services -- result in a decrease in other State or Federal resources?); and

Þ The impact of managed care on the level of Medicaid funding available for CDS?


Discussion of cost effectiveness of contracting for services versus hiring professional staff

¨ Jaci Holmes presented data from a 1996 Cost Review Study based on the cost methodologies established (examples of how cost components were determined are enclosed); and

¨ Phil McCarthy presented a brief summary of effectiveness and cost-effectiveness research related to early intervention programs.


Recap discussion, identify issues for discussion at next meeting


¨ David Elliott reviewed the substantive issues discussed and task force members identified the following issues as those which should be addressed at the next task force meeting:

Þ Further review of the components included in the two cost methodologies that were established to determine the annual cost to a CDS regional site to employ a professional therapist as compared to contracting with a service provider;

Þ An examination of the policies and regulations related to Medicaid program income and direct service reimbursement; and

Þ A presentation of the mission and scope of CDS regional site operations (Ellen Courtney will present some materials).


Adjournment and meeting schedule

¨ The task force members agreed to the following schedule for the next two meetings:

Thursday, December 4, 9:30 am - 3:00 pm in the State Office Building, Rm. 113
Wednesday, December 17, 9:30 am - 3:00 pm in the State House, Rm. 334

¨ The meeting adjourned at 3:00 p.m.



Respectfully submitted,

Phillip D. McCarthy, Ed.D.




TASK FORCE TO STUDY THE COST-EFFECTIVENESS OF
THE CHILD DEVELOPMENT SERVICES SYSTEM
Minutes from December 4, 1997 meeting


Members present: Barbara Brown (clinical professional/service provider); Ellen Courtney (CDS site director); Debra Couture (Commissioner of Human Services’ designee); Luanne Crinion (Maine State Nurses Association); Jaci Holmes (Commissioner of Education’s designee), Sen. James Libby, Rep. Rodney McElroy; Mary Anne Miosan (development therapist/service provider); Joan Nason (Maine Association of Directors of Services for Children with Exceptionalities); Rachel Olney (Commissioner of Mental Health; Mental Retardation & Substance Abuse Services’ designee); Sen. Peggy Pendleton; Leslie Steltzer (parent receiving services); and Rep. Elizabeth Watson

Others present: David Elliott (Office of Policy and Legal Analysis); Rep. Richard Farnsworth; Dawna Lopatosky (Bureau of the Budget); Phillip McCarthy (Office of Policy and Legal Analysis); Dan Shagoury (Moose Ridge Associates); and Helen Zidowecki (Office of Rural Health)


Review of the minutes from 11/21 Task Force meeting and preview of the agenda and expectations for this meeting

¨ Minutes were accepted as presented; Staff previewed the agenda.

Mission and scope of the CDS regional site operation (Ellen Courtney)

¨ Ellen Courtney, Director of the CDS Site in Knox County, presented an overview of the mission and scope of responsibilities of the CDS Regional Sites System (see “The Route to Early Intervention Services through Child Development Services [CDS]”). The presentation included a step-by-step review of how children are referred to the CDS System through screening, evaluation, and the role of the Early Childhood Team (ECT) in developing and reviewing an Individualized Family Service Plan (IFSP).

¨ Discussion centered on the following issues:

Þ Transportation arrangements;

Þ Case management caseloads and co-case management alternatives;

Þ The selection of therapy providers and “least restrictive environment” provisions;

Þ Targeted case management caseloads and the impact on quality of service; and
Þ The transition from CDS services to kindergarten.


Discussion of cost effectiveness of contracting for services versus hiring professional staff

¨ Commission members reviewed and discussed sample worksheet data based on the cost methodologies established by the 1996 Cost Review Study; and

¨ Discussion centered on the following issues and task force members began to consider elements of possible recommendations related to the following issues:

Þ The trade-offs between cost containment strategies and cost-effectiveness with respect to the availability of professional therapists and the provision of services to children;

Þ The provision of an appropriate level of early intervention services as compared to an optimal level of therapeutic services;

Þ The need for flexible regulations and policies that can allow maximum efficiency and effectiveness for all concerned parties in the diverse regions of the state;

Þ The need for consistent guidelines that will be utilized by regional CDS Sites in calculating unit costs; and

Þ The need to consider parental choice and flexibility in determining the appropriate therapy providers, while maintaining “least restrictive environment” and other statutory and regulatory requirements; and

Þ The usefulness of adopting a “quality assurance” model that focuses the CDS System on achieving continuous quality improvement at each regional site while engaging parents in evaluating the effectiveness of services provided.

Recap discussion, identify issues for discussion at next meeting

¨ David Elliott reviewed the substantive issues discussed and indicated that staff will draft proposed recommendations for consideration by the task force at the next meeting.

Adjournment

¨ The task force meeting adjourned at 3:05 pm.


Respectfully submitted,


Phillip D. McCarthy, Ed.D.


APPENDIX D


The Route to Early Intervention Services through Child Development Services
Knox County Child Development Services, December, 1997



Available only in the printed report