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Pennsylvania Consumer-Directed Care Program Threatened by State Government

March 22, 2012

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Nearly 22,000 Pennsylvanians who participate in the state’s consumer-directed care program — and the workers who care for them — face an uncertain future if a plan promoted by state government officials comes to fruition.

Currently, Pennsylvanians who are elderly and/or have a disability can choose to hire home care aides. The workers’ wages are paid for by Medicaid waivers, and the clients who hire them are considered their employers.

Intermediary entities known as financial management services (FMS) providers, meanwhile, issue the aides’ paychecks, purchase workers compensation insurance, and handle other accounting tasks.

In January, however, state Department of Public Welfare (DPW) secretary Gary Alexander announced a plan to drastically consolidate these providers, reducing their total from 37 to no more than three, and perhaps just one.

Last year, the passage of the controversial Act 22 gave DPW the authority to make sweeping changes to the FMS system without the usual regulatory oversight by the state legislature.

Alexander’s move is part of a broader campaign by the administration of Governor Tom Corbett (R) to curtail state spending by cutting funding for many programs that benefit low-income Pennsylvanians. More than 80,000 children have been cut from Medicaid rolls since last August, and a Corbett-endorsed plan to subject food stamp recipients to an asset test was scaled back only after widespread public outcry.

“Centralizing the FMS system is counterproductive to the ideal of consumer-directed care,” said Joe Angelelli, director of the Health Services Administration program at Robert Morris University and a former PHI Pennsylvania Policy Director. “A more networked and localized approach is more person-centered and effective.”

— by Matthew Ozga

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