Vermont Legislature SmartTranscripts:

[Speaker 0]: Okay. Good morning, everyone. We have a packed AHS house here. Welcome to everyone. We're pleased to see so many folks here and happy to have the secretary and all of her staff here. Not all of her staff, but a good chunk of your leadership team. And we're going to be taking a look at sort of the overall AHS budget. And I think just because some folks haven't been in the room with other folks before, will do a quick round of introductions. So I'm Theresa Wood, I'm from Waterbury. I also see both the news for in Honeyfield.

[Anne B. Donahue (Ranking Member)]: Anne Donahue from Northfield, also the survey. Berlin?

[Daniel Noyes (Clerk)]: Morning. I'm morning. I'm Dan Noyes. I represent Wilkett, Hyde Park, Johnson, Belvidere. Hi.

[Doug Bishop (Member)]: Good morning. Eric Maguire.

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: I represent Long Island City.

[Doug Bishop (Member)]: Good morning. Doug Bishop. I'm one of Colchester's representatives. Good morning. My name is Zon Eastes.

[Zon Eastes (Member)]: I live

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: in Guildford, and I also represent Vernon.

[Jenney Samuelson (Secretary, Agency of Human Services)]: Hi. I'm Jubilee McGill from Newport,

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: and I also represent Middlebury, New Haven, and Wey Garofano.

[Speaker 0]: I live in Essex, and

[Jenney Samuelson (Secretary, Agency of Human Services)]: I also represent Esme Cole.

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: Good morning, Tracy O'Connell, Chief Financial Officer with the Agency of Human Services.

[Jenney Samuelson (Secretary, Agency of Human Services)]: Good morning, I'm Jenny Sydnosson, I'm the Secretary of the Agency of Human Services.

[Matt Levin (Vermont Early Childhood Advocacy Alliance)]: Madam Leban, Vermont Early Childhood Advocacy Alliance.

[Jenney Samuelson (Secretary, Agency of Human Services)]: General Farrell, Executive Director of Northeast Indian Community Action and President of the Vermont Community Action Partnership.

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: Bill Bowen, Commissioner of the Department of Disabilities, AG. John Murad, Interim Commissioner for

[Jenney Samuelson (Secretary, Agency of Human Services)]: the Department of Corrections. Yes, yes. Sandy, offline from the Department Justice.

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: Well,

[Speaker 0]: everyone. Last week we had somebody sitting on the floor over there, So I had to take a quick look. So welcome everyone. As I said, we're pleased to have you here and we look forward to this morning's discussion. So Secretary, the floor is yours and committee, we do have information on our iPads. And Laurie, can you unclick that livestream Thank you. Floor is yours. Thank you.

[Jenney Samuelson (Secretary, Agency of Human Services)]: Morning. For the record, I'm Jenny Sangerson, the Secretary for the Agency of Human Services. I'm joined here by our Chief Financial Officer, Tracy O'Connell, and by our executive leadership team at the agency to present the agency wide budgets for the Agency of Human Services. This year, we're going to cover both what's in numbers and how we got to our budget, because I think it's really important for folks to understand that we re engineered the process for the Agency of Human Services budget. The Agency of Human Services for committee members has a budget of $3,700,000,000 The majority of that is in our six departments, with the Department for Vermont Health Access administers the Medicaid program, the Department for Health, the Department for Mental Health, Department for Children and Families, Department for Disabilities, Aging, Independent Living, and the Department for Corrections. We also have the Secretary's Office at the Agency of Human Services, which encompasses, and we'll go through them in more detail, several programs, including the Vermont Chronic Care Initiative, the Office for Health Care Reform, and the Blueprint for Health. And so we'll walk through that. The Agency of Human Services is one of the largest agencies in state government. It has over 4,000 employees. As you see here, you can see the representation of the employees in each of the departments. We also have representative vacancy levels in each one of the departments across the agency.

[Speaker 0]: Secretary, how would you like to handle questions? Would you like to wait till you get to the pause points? I prefer to take them ongoing, but I will defer to you and how it best works for you. Ongoing works as long as we make sure that I know that you were scheduled downstairs.

[Jenney Samuelson (Secretary, Agency of Human Services)]: We are still downstairs.

[Speaker 0]: At 10:30, so I want to give you at least a couple of minutes to get down there. So committee okay. Members, just sort of keep that in mind. So I'm going to raise the first question on the vacancy levels. So obviously, DMH stands out as a large number there, as well as Dale and DOC in terms of total agency. And when we're looking at vacancy numbers, what's the vacancy savings rate that has been calculated into this budget?

[Jenney Samuelson (Secretary, Agency of Human Services)]: It varies by department. I think generally we like to keep it at about 4%, but in the areas of DMH and perhaps corrections, we adjust more closer to what we are seeing here in vacancy rates. I think it's also important to note that for the Department for Mental Health, the vacancy rates there, a significant portion of those vacancies are filled with travelers. And so that has an impact overall on the budget. So you'll see that as we go through.

[Speaker 0]: So I'm

[Jenney Samuelson (Secretary, Agency of Human Services)]: picking up from what you're saying is that it sounds mostly like it's at the Vermont Psychiatric Care Hospital. The majority of the vacancies that we see in both the Department of Corrections and the Department for Mental Health are facility levels, with a much bigger impact on the Department for Mental Health. Commissioner Haas, I see you nodding your head. Yes, I can add that.

[Emily Hawes (Commissioner, Department of Mental Health)]: VPCH is hovering a little over 35% vacancy rate, and River Valley is a little lower than that, and that's improved over the past couple of years, but most of those vacancies are limited with our direct floor staff.

[Speaker 0]: Okay,

[Jenney Samuelson (Secretary, Agency of Human Services)]: And I do want to highlight both in both Corrections and in the Department for Mental Health, we have seen significant improvements with a high of close to, I believe it was 60% at the Vermont Psychiatric Hospital post the pandemic. So the use of any kind of traveling staff would

[Speaker 0]: be under some sort of contractual arrangement. So you wouldn't see them in here. So, Tracy, did I understand you correctly to say both at DOC and at DMH that that they are budgeted at close to this amount for vacancy savings? That's correct.

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: Hey, Ravi. We can hear yours. Yes.

[Speaker 0]: Excuse me, representatives, could you mute yourselves, those who are online?

[Jenney Samuelson (Secretary, Agency of Human Services)]: Thank

[Speaker 0]: you.

[Jenney Samuelson (Secretary, Agency of Human Services)]: In this slide, you can see the breakdown of the agency's budget, with the majority of our budget in global commitment, which is split between administered out of the secretary's office and then allocated to each of the departments for the program. I think overall, you can see where the rest of the funding falls. Yes, and so the general fund request for state fiscal year 'twenty seven is an increase of 6.1% or 86,100,000.0. Approximately 74,900,000.0 of that is directed towards current services funding. So just what it costs to keep the lights on in terms of running AHS and the providers. And then $11,200,000 or 0.8% is directed towards some base initiatives that we'll describe later on. For this year's budget process, we relied significantly on the executive leadership team at the Agency of Human Services. You see them present here in the room because this was a process that wasn't just one department by one department, but in constructing our budget, we did this as a whole agency approach. That executive leadership team includes myself, our deputy secretary for the agency, the Medicaid and Health Systems Director, Jill Olson, and the sixth commissioner. So this year, in budget process, we took a different approach. The first thing that we did was to identify what our priorities were. First, evaluating and looking at what the priorities of the governor are, improving the economy, making Vermont more affordable, and protecting our most vulnerable. I think we're all familiar with those. In looking at that, the Agency of Human Services executive leadership team, with their deep knowledge and experience both in what's happening on the ground in Vermont and what's happening in their departments, identified for the agency what our priority focus areas were for this year, including housing with a particular focus on addressing homelessness, substance use and mental health integration, also access across prevention, treatment, recovery, and stability, health care affordability and sustainability and quality, and a strong and resilient agency of human services workforce. So you will see these reflected as we go through in our budget. One of our goals this year was not only to look at and evaluate the programs throughout the agency to determine whether they were actually meeting what our overall goals were. There's a lot of programs that have emerged over the agency over decades. And we often don't pause and evaluate their effectiveness and their contributions to both our goals and our mission at the agency. So in alignment with that, you'll see the resources and the budget this year should reflect both the effectiveness and efficiency of our programs and the priorities of the agency of human services.

[Speaker 0]: Can I ask a question just before you skip to that? So I meant to ask this one. We had Doctor. Hildebrandt in here earlier around substance use and mental health. And I noticed prevention, treatment, recovery, and stability, but I don't notice harm reduction there. And I'm wondering about that.

[Jenney Samuelson (Secretary, Agency of Human Services)]: Doctor. Hilbetenden, if you'd like to comment.

[Matt Levin (Vermont Early Childhood Advocacy Alliance)]: Yes, and you're absolutely right. It is included absolutely in our priorities. To be honest, some people put them in different buckets. What harm reduction is considered, I personally consider it a prevention measure, but it's also sort of in that spectrum of truth. But absolutely is one of our priorities and something we do prioritize.

[Speaker 0]: Okay, thank you.

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: I just

[Speaker 0]: want to make sure that it hadn't fallen off the absolutely

[Jenney Samuelson (Secretary, Agency of Human Services)]: a component of the work that we do.

[Speaker 0]: Thank you.

[Jenney Samuelson (Secretary, Agency of Human Services)]: So as we worked through our budget process this year, we started by looking at what would it take to keep the current programs and efforts that we have going within the Agency of Human Services budget. We projected any increases that would be necessary. Initially, those increases were $117,000,000 We also compared that against what we would have estimated was our projection for increases for this year at a 3% general fund. Looking at that, the agency was short by about $74,000,000 as a starting place. The departments each came forward after going through processes, particularly in the Medicaid program, to evaluate the programs that we have on the ground, whether they are effective in showing the outcomes that we are trying to achieve. Some other areas included the number of individuals that impacted whether those programs were statewide, whether they're mandatory Medicaid programs or not. And so each of the departments focused on identifying any of the programs that were not performing the way that we had. We found several programs that had been an initial idea and pilot and had not been brought to scale. We found some that were no longer serving the number of Vermonters that we had originally anticipated. And so we looked at opportunities for gaining efficiency and effectiveness in our programming. We also looked hard internally to see where the agency of human services could tighten our belts and become more effective and efficient as an agency administering our programs. And

[Speaker 0]: when you talked about the 3%, received a copy of the governor's budget instructions. I just wanna make sure that I understand that because in some years it does include contractual obligations for state employees. In some years, it's that sort of outside the 3% calculation. This year, my understanding is that was included within, is that correct? Correct. So how much, let's just say, 3% is 42,400,000.0 in GF, how much of that is taken up with staff salary increases and benefits and the like?

[Jenney Samuelson (Secretary, Agency of Human Services)]: So that right here. The salary was 18 out of our pressures of the 117,000,000, which we whittled down to 115,000,000, 18% of that was for salary and fringe. And I do want to note that 3% was our starting place. I want to go back and remind folks earlier in our discussions here, our overall increase in the agency was over 6%. And so as we look at this, as we look at the 18% here, it is not on that 3%, that 18% is within the 6%. The 6%. The

[Speaker 0]: budget Budget percent of 6%, yeah.

[Jenney Samuelson (Secretary, Agency of Human Services)]: But we started at the agency with looking at where we could get to 3%, and we ended at this point at 6%. So I want to make sure that folks know it's not a process where that 3% ever cut.

[Speaker 0]: Just to make sure that my committee understand that PAY Act is what all that's called, is included within the confines of the sort of guidance that was issued by agency administration.

[Jenney Samuelson (Secretary, Agency of Human Services)]: Yeah, I think. Okay. Correct. Thank you. So again, this chart just shows the breakdown of the areas in which we are seeing pressures. The two biggest categories being lost revenue, whether it be, and I'll get into that in the next slides, whether it's from the federal government or state revenues and also in the caseload and utilization for the Vermonters that we serve. So the next few slides will be kind of a highlight or a flyover of the different changes of our budget. I believe you're going to have other the other AHS departments in to testify more into the details of these changes. So we're just going to give an overview. And then I will share that there is a supplemental document available on your web page that just combines everything. It's a one stop shop of all the changes in our budget. So Lori has posted that as well. Thank you. Yep, I'll go back to the presentation. Okay, so in the category of lost revenue, the biggest change we're seeing is in FMAP. That's the federal medical assistance percentage from CMS. This is the federal share of Medicaid. It went down 0.73% from state fiscal year 'twenty six. And that's variable every year. It has to do with all the states across the country and how they're faring economically. And so for us, that was a $13,000,000 loss of federal funds that we needed to backfill with general funds.

[Speaker 0]: That would have been just to maintain what we Exactly. Have right And so what is our total FMAP? That's a seven

[Jenney Samuelson (Secretary, Agency of Human Services)]: The point seven federal share right now is 58.07%.

[Speaker 0]: 58.07, federal share. Correct.

[Jenney Samuelson (Secretary, Agency of Human Services)]: Which is still considerably higher than what we have seen historically. So I just, again, I want to reinforce what Tracy said. This is something that fluctuates every year by a little bit of a percentage point. As we talk about this, this has nothing to do with what's happening more globally at the federal level, but is a normal Medicaid fluctuation. Some years it goes up, some years it goes down. And right now it's still considerably higher than it has been

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: used And just to put

[Speaker 0]: in context, the Medicaid budget is $2,200,000,000 So that's why just any small change is quite impactful. So to the best of our knowledge here, the feds haven't changed the components of that calculation.

[Jenney Samuelson (Secretary, Agency of Human Services)]: Which is different than the next one. Yes. So the next one, so previously the federal government matched SNAP admin at 50%. And now starting in October 2026, that will go down to 25%. And so that's a loss of $4,500,000 federal share on the SNAP admin side.

[Speaker 0]: So I thought we were thinking that was going to be a bit higher than that. Well, this is three quarters of a year. Oh, right. I'm afraid that's right. I remember that now. Yes, thank you.

[Jenney Samuelson (Secretary, Agency of Human Services)]: Yeah, we'll annualize it next year. Takes up the difference of So it's good to know that an will additional budget pressure next year. And then in the child care special fund, there was a revenue downgrade in forecast. I will say this program, it's still in its infancy and that we're still trying to understand, and I think the economists are still trying to understand the impact of the payroll tax of how the revenues will level off. So for this year, we had to backfill $8,700,000 with general fund to support that program. And then that second big category is caseload and utilization, which we saw a lot of this in budget adjustments. So we have the Medicaid consensus, the clawback and buy in, the developmental services. This is the case load pressures that we're anticipating in 'twenty seven. And then for nursing home and home and community based bed days, 4,400,000.

[Speaker 0]: So I noticed that you're not budging any and maybe you do a little bit later. Do you do anything for extraordinary financial relief since in Dale that seems to be a perennial issue?

[Jenney Samuelson (Secretary, Agency of Human Services)]: Not extraordinary financial relief per se, but we do have the inflationary increase further down in size. Okay.

[Speaker 0]: I'm just curious because it seems to be perennial at this point in time. I mean, it's coming down. It is coming down. Yes, I get acknowledged as coming down, but it was still between 14,000,000 and $16,000,000 in BAA. So it doesn't seem like it's going to be zero next year. Let's just put it that way. Would that be accurate? I I think so. Yes. Yes. And so why wasn't it budgeted for? We typically,

[Jenney Samuelson (Secretary, Agency of Human Services)]: it is a one time fund that is that is done out of BAA. Yeah. Think We're doing it the same way we've done And I think we like to see how many applications we're going to receive for that extraordinary financial relief because it's been coming down there, I think, was it 14 a year before? It

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: came down, it's 14 this year. It's 14 year. Okay, 20 last year. Sorry, definitely. But we don't know what it will be.

[Jenney Samuelson (Secretary, Agency of Human Services)]: And it was relatively stable prior to the pandemic. It trended up. We have taken significant efforts to do things to bring that down, and Dale can cover those when they come back, or debug when they come back, if it's helpful for the committee. But because we're seeing it trend down, what we're seeing is it's what we believe is the beginning of the efforts and still the tail of the others. So it's difficult to predict. Thank you. And as we spoke of, about $21,000,000 supports the salary and fringe for the agency, over 4,000 positions. There is a request of just shy of $05,000,000 general fund to support 12 new KU staff. That's the eligibility and enrollment staff at DIBA to support the new Medicaid work requirements and the biannual redeterminations.

[Speaker 0]: So this, again, is a result of federal changes in Medicaid requirements to reapply every six months instead of annually and all of that kind of stuff. So are those permanent classified staff? Are they limited services? What's the deal? Permanent classified. Permanent classified. And then have you budgeted anything for community partners in terms of looking at how actual recipients are assisted? Because our community partners are the ones who see them on a day in and day out basis. So whether it's Community Action, designated agencies, AAAs, all the parent child centers, legal aid, I mean, all of those people are the ones who see the recipients on a day in and day out basis. So have you budgeted anything recognizing that increase in work at those providers?

[Matt Levin (Vermont Early Childhood Advocacy Alliance)]: We have not. The plan is to pull together our partners and work through the communications and how we involve them into what are the best practices in leveraging, but we have learned through the onboarding process that we did a couple of years ago and use those as an example of strategies moving forward.

[Jenney Samuelson (Secretary, Agency of Human Services)]: Would you say, Sean, that the resources that we had during the unwinding continue to be in place, and so what we did was we based our calculations based on that unwinding process, And again, those resources are already in place from the unwinding process, which just concluded.

[Speaker 0]: Sure. I guess what I'm seeing is I'm seeing a recognition that there's going to be additional pressure on diva staff as a result of this. And it doesn't seem to recognize the additional pressure on community staff that are also going to experience that same kind of similar work, frankly, but with the individuals. So I think that's a bit of a problem. You have a question?

[Anne B. Donahue (Ranking Member)]: Two questions. So I'm assuming so the intention or the plan is for these 12 staff to do the work for all the people that need the redetermination? Okay. And then second question, has there been any effort in looking for federal grants that help states prepare for this change? And is there any money out there for So

[Matt Levin (Vermont Early Childhood Advocacy Alliance)]: to answer your first question, yeah, so these 12 are not taking all the paperwork, the administrative side paperwork.

[Speaker 0]: That's just the paperwork, not the actual So with trying

[Jenney Samuelson (Secretary, Agency of Human Services)]: to have eligibility and work with them through that process. Your second question of have we looked at federal grants? In the HRY, the medical reconciliation bill, there was a small amount of money that the feds did give us to help us with that enforcement. And that's primarily technology, do upgrades in technology for the agency. For the rest of the committee, just as a reminder, what we're talking about here is that there were two major changes to Medicaid. One are requirements for community engagement or work requirements. The second one is clients in the Medicaid program need to enroll right now annually. In this process, they're going to need to re enroll every six months. And so this reflects the staff that are the enrollment staff. We've gained some efficiencies already. So these enrollment staff that are going to be needed to actually do the enrollment for those individuals.

[Speaker 0]: And so have there been any so this is looking at staffing as pressures. What's the net increase or decrease in AHS staff in terms of classified positions that we're looking at? I have a spreadsheet that I can come up

[Jenney Samuelson (Secretary, Agency of Human Services)]: with to show all the pluses and minuses. And related to re enrollment, at this point, I think Diva's going be coming in and doing their budget in a lot more detail. And so we can take some of those detailed questions for most of the specifics in the departments, And we can definitely dig into them more when David comes back to go through the detail. Okay, thank you.

[Speaker 0]: We have Representative Bishop and then Representative Donahue.

[Doug Bishop (Member)]: I apologize if I'm missing something, but while we are still on it, just a quick clarifying question. So those 12 positions are forward facing interacting with Vermonters to help them with enrollment or doing enrollment work for the agency on the back end?

[Jenney Samuelson (Secretary, Agency of Human Services)]: Those are individuals who, they do both, actually. They are interacting with Vermonters to do the actual enrollment into Medicaid. Okay,

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: thank you.

[Anne B. Donahue (Ranking Member)]: So this is probably part of that follow-up that you just referenced, but I'm interested or concerned about any investments in outreach to enrollees to make them aware that they have to enroll a second time a year. We may all know that from the headlines, but that does not mean these folks are aware.

[Jenney Samuelson (Secretary, Agency of Human Services)]: I think when the Veeva team comes in, both in their budget or in follow-up testimony, they can go into depth with their deputy commissioner who does the enrollment eligibility on what efforts are being taken, because there are significant efforts being taken. There's a lot of communication that happens between the department and community providers, between the department and the enrollees. Well, let's go ahead, if you don't mind, Representative, I think that the ZVES staff who are coming in and the Deputy Commissioner can that. Yes, that's

[Speaker 0]: the place for that. And we hadn't actually scheduled Diva, I've changed my mind. So many Medicaid questions now around changes, so I think that that will be.

[Jenney Samuelson (Secretary, Agency of Human Services)]: I also want to note, it is primary, the re enrollment, just for committees of jurisdiction, is healthcare re enrollment. It is only for a subset of the population. Right, not all Medicaid recipients. It's not all Medicaid recipients and it's for primarily the medical services in the Medicaid program. It does not cover all of the Medicaid program. So particularly the other items that are in this community's jurisdiction, including home and community based services. But we'd be happy to do, if you want something special on that, a joint with you and the health care.

[Anne B. Donahue (Ranking Member)]: So again, for maybe a future detail, is part of that subgroup older folks or disabled folks who are on SSI and who are eligible for Medicaid, the dual enrollees basically, who are, I assume they're also required biannually or not?

[Matt Levin (Vermont Early Childhood Advocacy Alliance)]: No, so there's what we call the new adults. Those are the adults that are childless adults who

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: are 130 of the federal poverty level.

[Matt Levin (Vermont Early Childhood Advocacy Alliance)]: And then on that, there are exceptions, a number of exceptions, that

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: you will see exempt them from having to it. We get the details. So

[Jenney Samuelson (Secretary, Agency of Human Services)]: again, this is medical services, not home and community based services, and it's for a very much smaller subset of the Medicaid population, not those with disabilities, typically they're carved out, and not those individuals who have families with children. They're carved out work. And then we have $6,500,000 for operating. The majority of that is because of internal service funds that's billed back to us. We have BGS, HR, ABS.

[Speaker 0]: We've asked a question and they said you need to talk to AHS, so this is where

[Jenney Samuelson (Secretary, Agency of Human Services)]: I'm going. How do internal services work?

[Speaker 0]: Yes. Don't know know what it is, and I don't even know if you're going to be able to have the answer to the question, but it's mostly around ADS. There are big jumps in ADS. And I realize it was allocated to AHS, and then it's now allocated to individual departments. But we're just seeing big jumps. Do you know how that is calculated? I

[Jenney Samuelson (Secretary, Agency of Human Services)]: can see the movement. So what they did was they reduced our service level agreement, which was around $13,000,000 down to about $8,000,000 But a portion of that was then reintegrated into the core enterprise services allocation. And that would just be billed back annually as an annual allocation. It's not service driven like the SLA was. Right.

[Speaker 0]: So service driven is like I'll use CCWIS as an example. That's a specific project that they're working on that they would have billed for under a service level agreement?

[Jenney Samuelson (Secretary, Agency of Human Services)]: Yes, but not that $13,000,000 That's even separate from That was more like on the service level agreements, more like your Microsoft licenses, desktops, support, stuff like that. That they move into the allocation. So

[Speaker 0]: that makes me feel a little bit better. I mean, are things that are needed on an ongoing annual basis. I was just trying to figure out if they were project level stuff that was then getting built into the base and then, IT has become a big issue here. For sure. Okay, thank you. For you departments who we're coming after, you don't have to worry, won't ask you that question.

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: So

[Jenney Samuelson (Secretary, Agency of Human Services)]: in contract 17,000,000 general fund, many of these are the same pressures we've just saw on budget adjustment. The one new one would be the last one on the list, DOC transitional housing. The Burlington Housing Authority experienced a loss of some federal funds and so this helps backfill, seeks to maintain their funding, but it's an increase to DOC, 147,000.

[Speaker 0]: So the youth crisis stabilization at DCF, I'm just looking at Are these Well, we need to have DCF back in for additional information. Guess I'll just wait Just for as an FYI, we need to have a much more clear understanding of what crisis stabilizationsecure residential is looking like on base budget and ongoing, not just through this continuation of one time and BAA stuff. But I think they know that. All right.

[Jenney Samuelson (Secretary, Agency of Human Services)]: Then our budget also includes the annualization of multi year programs. So in previous years, these programs were either built just a portion of the year. For example, the Medicare Savings Plan since that kicked in January? Yeah, it's been live in January. And so this annualizes it another six months. And then also the alternative to emergency departments, this is backfilling the loss of the HCBS funds that were exhausted. They're just about fully expended. Spended some of that. But we anticipated that those funds would end. Yep. And so this is maintaining the programs that have been successful in that space. And then shelter investments, the cold weather investments for shelters, 1,300,000.0, and then hot shelter expansion, dollars 6,200,000.0, goes into the base.

[Speaker 0]: We'll talk more about that this afternoon. Representative Donahue had a question.

[Anne B. Donahue (Ranking Member)]: Yeah, thank you. In terms of the Medicare Savings Plan, which because it affects elder abuse.

[Speaker 0]: They grow to everybody, we can ask any My

[Anne B. Donahue (Ranking Member)]: somewhat vague recollection is that the bill that passed last year was more than one year, it was phased with filling up or am I correct? And therefore the question is, does this include a next step up level?

[Jenney Samuelson (Secretary, Agency of Human Services)]: Are we talking about at the FPL level? Is that what you're just questioning? This is the

[Anne B. Donahue (Ranking Member)]: annualization of the program that the legislature passed last year. It is not necessarily an increase in the FPL level, it's what the FPL level that the legislature said last year. Okay, and so I'll have to check this statute again. My vague recollection, Dan may recall, is that the statute is passed, set, you know, new new levels and then also first year, second year. Was there not a second year? I can go back and check. We don't need to discuss it now. Just look at

[Jenney Samuelson (Secretary, Agency of Human Services)]: the legislation, we can get answer on that. You.

[Speaker 0]: And so just before, oh, I'm sorry, you haven't talked about provider rates yet.

[Jenney Samuelson (Secretary, Agency of Human Services)]: And so the provider rate increases, as Tracy goes into them, these are primarily provider rate increases that are mandated federally or by regulation here in PALA. Correct. With the exception of NFI, the FQHC and Rural Health Center increase, the PNMI and CCBHC and the nursing home are all inflationary increases that we are required to do, either by federal rule or state rule. And then we are seeking $252,000 to assist Northeastern Family Institute.

[Speaker 0]: And is that, I guess, I would call, is that more under financial relief as opposed to providing rates? This is

[Jenney Samuelson (Secretary, Agency of Human Services)]: an organization, the majority of the rest of the mental health system, the designated agencies, the SSAs for the last few years have received significant increases. This program is a diversionary program. It was carved out of both the PNMI increases and carved out of the other increases. And we have been getting requests from them for emergency financial relief. This is a way to make sure that their rate and process addresses the financial shortfalls after a significant review of their finances and puts them at parity with the rest of the mental health system of care. This is an important program. It assists us in keeping children and youth out of the hospitals and out of the higher levels of care, and yet we know that they were significantly unstable, and yet they've fallen as well between what the rate increases have been

[Speaker 0]: for the rest of that system of care. And so I guess my question is, because this popped up for us here with AAAs as well this year and BAA, I guess when we're looking at and maybe it's our joint fiscal office needs to be maybe more specific when we're asking the question about COLA increases, which I don't know if we're going to be asking that question this year. They provide Medicaid services? I'm just trying

[Jenney Samuelson (Secretary, Agency of Human Services)]: to figure out why they weren't included if they're Medicaid. Because the rate increases that have happened, the 8%, 5%, 3%, 2% rate increases for the designated agencies that most of the rest of the providers haven't received, do not apply because they're not a designated agency. They're also not a PNMI. I could see Commissioner Haas, you might That have been

[Speaker 0]: would be great. On our side of the track, didn't just do designated agencies. We did it by service. So that's

[Jenney Samuelson (Secretary, Agency of Human Services)]: In the way that it is, the rate increases were for designated agencies and the SSAs. And so this is an organization that doesn't fall in the same bucket.

[Speaker 0]: I get that. I'm familiar with the organization.

[Emily Hawes (Commissioner, Department of Mental Health)]: Hi. I understand. It's essentially for their children's hospital diversion specific approach.

[Speaker 0]: Yeah, I think I just honestly need to speak to our sister committee that when they're considering rate increases, they need to understand be more specific about things that should be included. And I realize not everything's included.

[Jenney Samuelson (Secretary, Agency of Human Services)]: And the entire system of care doesn't all private providers, others don't necessarily get the same rate This one falls a space between the two. Okay,

[Speaker 0]: we have a couple of questions. Representative Bishop and Donahue.

[Doug Bishop (Member)]: Just trying to clarify discrepancy between the slides we were provided in this slide, the DMA. Yes,

[Jenney Samuelson (Secretary, Agency of Human Services)]: this is the correct one. Laurie, I subsequently sent it to Laurie and it will be posted It's a typo.

[Doug Bishop (Member)]: Gotcha.

[Speaker 0]: Okay.

[Anne B. Donahue (Ranking Member)]: This may also be a kickback by department for details, but when I looked at the book and I'm looking at provider rates and so forth, a couple of years ago there was huge urgency about needing to open the PT, forget the initials, at the retreat. I don't see any budget piece. Is that deferred temporarily,

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: indefinitely? I'm happy to talk about the BRT up just on When the

[Anne B. Donahue (Ranking Member)]: we get to your-

[Jenney Samuelson (Secretary, Agency of Human Services)]: It is fully budgeted. So we're ready to go.

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: I didn't see It be going in 2026.

[Anne B. Donahue (Ranking Member)]: Okay, I didn't see it in the budget. Thanks. We can

[Jenney Samuelson (Secretary, Agency of Human Services)]: It is budgeted and it is included in the base budget. And so we anticipate that as a core part of the program. Okay, now to get into some of the areas of savings or reductions. So we needed to reduce about $41,000,000 in general fund and so these are the areas that you see savings. And I'll get into the details here. So on the revenue side, there's some adjustments for additional federal funding. So while I talked about the base FMAP changing not in our favor, the utilization for this child plus new adult group at 90% FMAP, we continue to see increased utilization in that space. And so that allows us to save $3,000,000 by drawing down 90% FMAP.

[Speaker 0]: So the numbers that we see here in red means that you've replaced that general fund with federal funds. Is that right? Correct. Yes.

[Jenney Samuelson (Secretary, Agency of Human Services)]: The CCBHC, the Certified Community Behavioral Apopal Clinics,

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: That

[Jenney Samuelson (Secretary, Agency of Human Services)]: we can draw down at an enhanced FMAP rate, I think 70%. And so that allows us to free up $6,600,000 general fund by drawing down the extra federal share. There's a revenue adjustment in BDH for substance use treatment, where there's additional funding that can be spent towards the block grant, the substance abuse block grant. And so that frees up general fund there. And then the Medicaid billings at BPCH, we anticipate being able to bill for Medicaid stays that are eligible that fit within the sixty day length of stay at BPCH, we can bill that for as Medicaid instead of general fund or global commitment. And then DIVA is proposing to increase prescription drug co pays. This would offset global commitment by about $461,000 general And it's consistent with the federal requirements in HR1. That's correct.

[Speaker 0]: And what's going to be the increase in co pays?

[Matt Levin (Vermont Early Childhood Advocacy Alliance)]: Various, I don't remember.

[Speaker 0]: Various by drug. We

[Jenney Samuelson (Secretary, Agency of Human Services)]: can get some more information.

[Speaker 0]: Okay, I'm just curious how that's going to impact. Again, this is something you said.

[Jenney Samuelson (Secretary, Agency of Human Services)]: Yeah, it's $1 $2 or $3 in the range. So it just gives folks a sense of what that cost is. We're not talking about $20 $30 or $40 It's in the single dollar range. In addition to that, it's a federal requirement in HR1.

[Speaker 0]: That's all the information I needed. I just wanted some semblance of the size, magnitude.

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: Okay,

[Jenney Samuelson (Secretary, Agency of Human Services)]: caseload and utilization savings. Level one beds at Rutland Regional, they are not being fully utilized. And so we're seeing the savings in that space. And then in the Recheck program, the caseload projections show $3,300,000 in savings as well as substitute care. And then in adult day health and rehab services, 419,000 in caseload and utilization savings. And so in Dale, when we're looking

[Speaker 0]: at $4.19 in GF, I'm presuming those were all Medicaid matched. Yes, about

[Jenney Samuelson (Secretary, Agency of Human Services)]: 1,000,000 gross.

[Speaker 0]: Is that from just adult day providers?

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: Yeah, they are really below where they were.

[Jenney Samuelson (Secretary, Agency of Human Services)]: It's taking and aligning what we're actually seeing spend on the ground in those programs with what the budget is. So it's outlined with those. Administrative efficiencies, just travel equipment supplies, just looking at what we've been spending and operating over the last few years and aligning it with actuals, The DMH and DOC vacancy savings we spoke of earlier, that increased. And there's a technical adjustment in Dale Other Personal Services.

[Doug Bishop (Member)]: Just a quick question on the adult days. Do we know why the underutilization there and Is that what you're saying, right, in that it's not people aren't going there?

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: So, and I visited several and talked to people. It's just harder to attract people to come in since the pandemic. The program I was just at in Springfield the other day, for example, they used to have more like 40 people, now they have more than 20 a day, and they've been working that to try. People are just not choosing to come back or come in, even though they're doing a whole bunch of efforts. There's plans in place to try to encourage people to come back, and then go to the transportation and marketing and all, but right now the cost alignment was necessary just to adjust the actual overall, both to the port and service, to have folks return to that. They're making use of other parts of the continuum. It's still an active and important part of the services provided, socialization, community, lunches, etc, but it's just not at

[Jenney Samuelson (Secretary, Agency of Human Services)]: the levels that we've had. And you've been working really closely with them to look at, evaluate, and address it. It's just at this point we have to align reality with the new model.

[Speaker 0]: Right. It's not a cut in actual revenue to those providers because it's only billed when the people are there. It's

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: not going impact the providers or to the individual.

[Jenney Samuelson (Secretary, Agency of Human Services)]: But you would see this as a caseload and utilization pressure on your house. We've identified some programmatic efficiencies. The school based services program, if you haven't heard, we were proposing for that to be transferred over to DIVA. Right now, AOE administers that program as well as VDH, a portion of it for school based Medicaid administrative planning. And so by moving it over to DIVA, we're going to build some efficiencies and run it out of one area. DEMA is also going to implement utilization management for durable medical equipment. We have the ADA coding compliance that we proposed in budget adjustment. And this next item, we begs some conversation. VPCH beds, we're proposing to reduce from 25 to 21 beds, which will result in positions being eliminated. I will follow-up on that full list. And this aligns with what actual utilization has been for the last number of years. As we talked about earlier, there's been significant workforce shortages. There's also been utilization pressures haven't been as strong as they've been in the past. So what this is doing is actually the same thing as with

[Speaker 0]: the adult days, is this is aligning actual utilization with the budget. Well, just of course, as a concerned Vermonter, I'm interested. It's not our jurisdiction, but the

[Jenney Samuelson (Secretary, Agency of Human Services)]: Individuals are not getting services, chair, I wanna reinforce that. Individuals are getting services, and they continue to get services. This is just in terms of who we have served at Vermont Psychiatric Hospital, this represents the actuals. And so we're not seeing a gap in surfaces. What this is, is more of a caseload and utilization pressure at the hospital and the reality of what staffing looks like. We've been watching very closely some of the other measures around this, including individuals waiting in hospitals, individuals looking for discharges, and those measures have been consistent, and they have not, they've been going down instead of going up. And so this doesn't reflect a lack of service to providers. This actually just again reflects a caseload utilization.

[Speaker 0]: I was gonna ask my hospital, so you just addressed that. Although they still do complain about waiting for option care services in nursing facilities. I want

[Jenney Samuelson (Secretary, Agency of Human Services)]: to be clear. There is no space in which there is zero waits. And so, again, at the pandemic, we saw significant numbers of days that people were waiting for mental health services. That has dropped down significantly. There are some individuals, individual by individual, have complex healthcare and mental health needs that need to be served at a hospital where they can get both of those. BPCH doesn't provide that service necessarily. And so for some of those clients with more complex, we are seeing they may have to wait a day, sometimes longer. But this does not represent a decrease in services to promoters.

[Speaker 0]: And I just want to back up one to the ABA, what's being called coding compliance. And just as a reminder that we've asked for some information as this rolls out effective January 1. But as we see whether or not it's impacting access for services for individuals, youth, children, because it's one of those EPSDT services. We saw threats of providers withdrawing, but I don't know if we'll see actual providers withdrawing. So that's just an interesting thing that we hope to get more information about. And then what's going on with the ARRIS payroll benefit thing? So this is

[Jenney Samuelson (Secretary, Agency of Human Services)]: where there's excess cash on hand at ARRIS for the direct service providers?

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: Was the benefits hold that they have, which people are receiving what they need, so you just pull it back. Or

[Speaker 0]: people receiving services. I'm sorry, just before. So I didn't see anything here in terms of investments or changes for a forensic facility. I'm just making an observation. Am I being accurate or is buried in here someplace?

[Jenney Samuelson (Secretary, Agency of Human Services)]: Yeah, I think that the timeline in terms of implementation of that is not in this year's budget. It would be in forward year budgets. Thank you. I have a list of program and service reductions or eliminations. This is only a snippet of the list, so I would encourage you to look at that other long list that I've supplied. I will talk just because I think we're running short on time. I'll talk about the Secretary's office, refugee transitional housing program. So a couple of years ago, $900,000 general fund was built into the base to support refugee transitional housing. But due to the changes at the federal government, we are seeing about a 75% decline in refugees coming to Vermont. And so we're seeing not as great a need for it to support transitional housing. And so there still remains $400,000 in that budget that we would like to use towards some transitional housing, but also for support services, legal services, case management, just wraparound services to help the refugees that are. Do you want me to continue going

[Speaker 0]: through this? No, we're gonna go through. We're gonna take a close look at it. I'm just gonna call out because I don't know if I'll have the opportunity to have Commissioner Haas here again. But I am just gonna call out the Chittenden County Community Outreach contribution there because, and this is something that local communities also contribute to. Is that right? Yeah. And it's also tied into the homelessness work and the housing work that I know we're gonna talk more about this afternoon, but we received some pretty compelling testimony from community partners about the importance of having that, particularly with regard to individuals who are homeless and the challenges that they're seeing at community libraries, at other communities faces that they call on this team a lot. So I would be really concerned about that particular one as we try to address the holistic homelessness issues.

[Jenney Samuelson (Secretary, Agency of Human Services)]: We do have new initiatives that we'd like to highlight. I think the housing one will be

[Speaker 0]: We'll talk more about that this afternoon. And

[Jenney Samuelson (Secretary, Agency of Human Services)]: then we also are proposing the Opioid Recovery Employment Program, dollars 874,000 general fund. This was previously funded with OSAP funding, but that is, to our knowledge, is not going to be part of the recommendation. And this is a very effective program that we're seeking based general funds for.

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: So it's a higher ability program?

[Jenney Samuelson (Secretary, Agency of Human Services)]: Yes, exactly the higher ability program. So for every, we do have, we've only got a few more minutes here, but for this program, what this is, is this takes individuals who are struggling with substance use and provides, links them up with higher ability to get higher ability supports and employment supports. And this has been a very successful program. And it does highlight some of the challenges for funding things with OSAC that are ongoing programs. It was great to get this up and going and started, it has been very effective and needs to

[Speaker 0]: To be fair, was started as a pilot to see whether or not it was going to be effective.

[Jenney Samuelson (Secretary, Agency of Human Services)]: We'll have to keep going. We've got only a few minutes and we need to be in communication. The next few slides of the presentation are specific to central office and the areas that we serve and that mission. Yeah, so the central office at the Agency of Cancer Services includes the secretary's office, which oversees the financial and policy and operations, includes health care reform, field services on the ground. Many of you see, feel, and touch them every single day in the work that they do in the sense that they're representing their communities and the agency on the local level. The refugee resettlement program SIR Vermont, and then we also have budgets for The Developmental Disability Council on the Human Services Board. Because we're short for time, I think we'll keep going. Okay, it's been three Yep, you just highlighted some prior year accomplishments for those areas in the secretary's office. Shows the funding changes.

[Speaker 0]: I want you to skip ahead to the budget changes.

[Jenney Samuelson (Secretary, Agency of Human Services)]: Changes. The ADS service level agreement, this is the general fund share of reduction we spoke about earlier. The 158,000 for general operating expenditure reductions, refugee transitional housing I just spoke of, and then two other reductions. One is a $17,000 two grants for field service coordinations. These were only in two districts, and so we are proposing those to be eliminated. Supported service coordination for complex cases, but the field service directors feel like they can take that work in house. And then $19,000 reduction for a foster grandparent program that ended at United Way. This money was used towards match on their federal program, our understanding is they no longer applied for that program starting this year. So that program has ended.

[Speaker 0]: It started way back at Brandon Training School. It's a work. Yeah. Okay. We don't need to do the next one. Let's just skip ahead to the global commitment.

[Jenney Samuelson (Secretary, Agency of Human Services)]: Global commitment, so I'm sure folks know that is the $2,200,000,000 mixing bowl appropriation that's both the state and federal match to support global commitment. Again, the FMAP change, it's SNAP 58.07, state share 41.93. We will be seeking a renewal to the eleven fifteen waiver in this coming year. It's due by the end of calendar year '26, so work is underway to start framing that application. And then we will negotiate all of calendar year '27 with CMS to renew that. And there's language in the big bill that authorizes that labor renewal.

[Speaker 0]: Madam Chair. Yes.

[Doug Bishop (Member)]: Are there any indications under the current administration from states that are going through that renegotiation process whether things whether the landscape has changed?

[Jenney Samuelson (Secretary, Agency of Human Services)]: I think the landscape has changed. There are some items in our current labor, like the ability to support housing that they have made clear will not continue, but we won't know until we actually get into negotiations, any additional changes. We are very different from other states, and if I were to hypothesize, I believe that they will try to help have Vermont align more closely with other states. We have significant dollars that go into investments in our states that other Medicaid programs don't because of the waiver that we I think it's a valid concern.

[Speaker 0]: And at some point, that we don't see the eleven fifteen go away completely, but it would be helpful to have an understanding, not right now, of what you consider to be the risks so that we can have sort of some advanced notice about the potential risks for things that people experience now. Think

[Jenney Samuelson (Secretary, Agency of Human Services)]: And we can illuminate for the committee what are required Medicaid services of all states, and that's part of the evaluation that we did this year, and I think folks will be surprised, what are things that are investments that Vermont has chosen. And so, again, we're happy to come in and do that. Know that we will be negotiating, and what we talk about in the committee room, we wanna make sure doesn't impact our overall negotiation.

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: Yeah, yeah.

[Speaker 0]: Okay, thank you.

[Jenney Samuelson (Secretary, Agency of Human Services)]: Yeah, and I think these are just all the other changes that I've highlighted.

[Speaker 0]: You've already talked about.

[Tracy O'Connell (Chief Financial Officer, Agency of Human Services)]: Yeah, just

[Jenney Samuelson (Secretary, Agency of Human Services)]: a little snippet on the grants out for the secretary's office, and then it just highlights the supplemental documents that I've provided. So we have the overall ups and downs packet, the monthly workbook, the summary budget, the list of our state fiscal year 2025 carry forward and reversion list, single audit findings and the month percent community based provider recalculation.

[Speaker 0]: You. And thank you for the overview and looking at some of the specifics. We are obviously going to dive deep into the budget areas that we have responsibility for, and we always have opinions about other things too, as you kind of got a glimpse about today. And I appreciate we've seen some of the work from AHS, in particular, I'm going to call out DCF because we've seen their budget book, and it's a great document that all of our committee, regardless of whether they have a DCF assignment, they're all sort of digging into and appreciate the background information, the looking at where things it helps us to have a better, broader understanding of the depth and breadth of each department. And I know each department is doing their sort of own version of trying to meet the appropriations committee's request. And so just wanted to extend my thank you. We're reading it, and it was a nice photo of you. We weren't expecting the bios of every commissioner and division lead. You guys got to look at the DCF book. I'm just telling you.

[Jenney Samuelson (Secretary, Agency of Human Services)]: We are gonna have to head down to the

[Speaker 0]: next Yes, I realize you're due there at 10:30.

[Jenney Samuelson (Secretary, Agency of Human Services)]: I do wanna appreciate the committee for your insightful questions. Thank you for having us today. And more than anything, I wanna thank the commissioners and the executive leadership team. It's hard to describe, but the process this year really did look at the agency as one agency. And it's not just the commissioners and the executive leadership team, but it's the policy staff, it's the budget staff, it's the program staff who really supported those commissioners in making decisions. They're also the ones that do your budget book. So I just want to formally thank them and the work that they do, because I do think it supports both us and the legislature in making clear decisions. Well, and I

[Speaker 0]: think it's incumbent upon us to have a similar approach. So if we have differences of opinion with certain recommendations for programmatic or administrative efficiencies or cuts, then it's incumbent upon us to make sure that our sister committees understand the implications of that for them and likewise them for us, if we're looking at this and AHS is such a broad department and process, I mean, broad agency across over several different committees. So I think that will be important work for us as well. So thank you and thank you to you all for being here and I'll see most of you this afternoon. And we are gonna be in Room 11, just in case you hadn't gotten that word this afternoon. Thank you so much. Okay, committee members, we're going to take a break right here until 10:30. And then what is going to be expected then is that you start to dive into some of this budget information, understand it better. Looking at all the ups and downs, it will be helpful. But some of the background materials as well, finding you, if you haven't already looked at the housing proposal that's in the book from DCF, please do so before this afternoon. Okay, Gloria, we're