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F I S C A L I M P A C T R E P O R T

SPONSOR Salazar

ORIGINAL DATE

LAST UPDATED

01/24/08

HB 341

SHORT TITLE HSD Intermediate Care Cost-of-Living Increase

SB

ANALYST Weber

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY08

FY09

$217.0

Recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

REVENUE (dollars in thousands)

Estimated Revenue

Recurring

or Non-Rec

Fund

Affected

FY08

FY09

FY10

$530.0

$530.0 Recurring

Federal

Medicaid match

SOURCES OF INFORMATION

LFC Files

Responses Received From

Department of Health

Human Services Department

SUMMARY

Synopsis of Bill

House Bill 341 appropriates $217 thousand from the general fund to the Human Services

Department for a cost-of-living increase for staff at intermediate care facilities for the mentally

retarded to improve staff recruitment and retention and to meet increased costs of employee

benefits and rising programmatic and operations costs to maintain quality services to recipients.

FISCAL IMPLICATIONS

The appropriation of $217 thousand contained in this bill is a recurring expense to the general

fund. Any unexpended or unencumbered balance remaining at the end of FY09 shall revert to

the general fund.

House Bill 341 – Page

2

SIGNIFICANT ISSUES

HSD notes that SFY09 is a “rebasing year" for ICF-MRs, which means that their rates will be

adjusted according to their costs and other factors. These rates will be effective September 1,

2008. The estimated increase for the rebasing is an average of approximately 12 - 13%. In

addition, Medicaid providers received rate increases for fiscal years 2007 and 2008. ICF-MR

providers received increases in both of those years, although less than the three percent the $217

thousand included in the bill will allow.

DOH adds that the agency’s Los Lunas Community Programs operates a four bed ICF-MR at

full capacity. ICFs-MR serve individuals with mental retardation and other related conditions.

Most have other disabilities as well. Many of the individuals are non-ambulatory, have seizure

disorders, behavior problems, mental illness, visual or hearing impairments, or a combination of

the above. Costs are high due to the multiple complexities of staffing, medical, clinical,

transportation, residential and service coordination issues.

Additional funds would improve staff recruitment and staff retention, resulting in a more

qualified, stable workforce. For the well being of the individuals served, it is imperative that a

qualified, stable and consistent workforce be maintained. Quality, consistent staffing deescalates

and reduces behavioral, clinical psychological and medical issues with individuals. This

provides a better quality of life and transition to the community via employment and self worth.

This stability in the provision of care and services is critical to an individual’s ability to become

as independent as possible and live the highest quality of life attainable.

MW/bb