Federal officials renew state disabilities program after two years of delays, questions

COLUMBIA – The federal government has approved South Carolina’s renewal of a key disabilities program after delays of more than two years.

Federal officials had declined approval of the state's renewal application 10 times over the past two years and raised nearly 600 questions in the process, The Greenville News previously reported.

The intellectual disabilities and related disabilities waiver program, known as the ID/RD waiver, is administered by the state Department of Disabilities and Special Needs but the application for renewal is made by the Department of Health and Human Services because it is the state’s Medicaid agency.

Thousands of South Carolinians benefit from the program, which costs more than $300 million a year, most of it federal money. DDSN oversees the care of those with intellectual disabilities, autism, brain and spinal cord injuries through a network of regional centers, county disabilities agencies and private providers.

State Sen. Thomas Alexander, a Walhalla Republican and chairman of the Senate panel that oversees DDSN’s budget, said he hopes the waiver approval will allow the state to serve more people with disabilities.

“I’m looking forward to the agency maximizing their ability to utilize that,” he said. “I’m sure that the commission will be taking action on that and look forward to following their progress, and hopefully it will be done with haste.”

Beverly Buscemi, executive director of DDSN, said in an email to various officials about the approval that the cap on the number of individuals who can be served under the program has now moved from 7,700 to 9,630.

However, she said, that doesn’t mean thousands more will be now be served.

“While the raised cap provides the agency much needed flexibility, enrollment of additional individuals into the ID/RD waiver must be based on the availability of funding,” she wrote.

There is no new funding for expansion in the program for the upcoming fiscal year, she said. Officials are looking at how best to use funds from attrition in the community supports program, a less-expensive program which has been used by the agency pending approval of the ID/RD renewal, she said.

She said agency staff would be making a proposal at a commission meeting next week.

Deborah McPherson, a former DDSN commissioner and advocate, said she was pleased the waiver was approved “in the sense that there are people who need more services than what that community supports waiver can provide.”

But she wondered how the agency would decide who would receive new services.

Ralph Courtney, executive director of the Tri-Development Center and Aiken County Disabilities Board, said even though the cap on individuals served has risen, “there is no new money.”

“It’s just if somebody definitely needs the ID/RD waiver and there is attrition, like somebody dies or moves out of state or for whatever reason is not using the waiver slot any more, if their name is on the waiting list, they will be able to get a service. But it’s not suddenly going to release a lot of slots. It would if there was new state funding. But there is no new state funding.”

The renewal period runs from January of this year to the end of 2021, said Colleen Mullis, a spokeswoman for HHS.

Among the changes in the program listed in the 235-page waiver document, she said, are allowing personal care providers to offer respite care and the addition of pest control as a covered service.

The document also shows the program will no longer cover psychiatric services, which it says are covered under the state Medicaid plan.

"Placement in an ICF (intermediate care facility) may also be a preferred or necessary option," the document states.

Exactly what went on in processing the state’s waiver application, which provides federal funding for home and community based services for the intellectually disabled, has not been publicly disclosed by federal officials.

Officials with the U.S. Centers for Medicare and Medicaid had previously declined to discuss the application with The News.

And court records show they also have refused to allow CMS officials to testify in a disabilities lawsuit about their handling of requests by the state to approve renewal of the program.

In fact, the U.S. attorney’s office has sought a protective order in the case to prevent the depositions of two CMS officials and further production of documents, which federal attorneys say would be “unduly burdensome.” Federal officials argued in court documents that there has not been a “serious showing” that the testimony would be relevant or in the interest of the federal government.

The program, which absorbs much of DDSN’s budget, has been offered in the state for decades.

When the federal government first offered Medicaid, comprehensive, long-term services for the intellectually disabled under the program were largely restricted to institutions such as hospitals and nursing homes. Beginning in 1981, however, Congress authorized the states to offer home and community-based services under Medicaid after concluding such services would be less costly than institutionalized care.

The intellectual disabilities and related disabilities waiver program must be renewed every five years.

The state Department of Health and Human Services contracts with DDSN to provide the services and HHS handles the program’s renewal application.

South Carolina’s last waiver application expired in 2014, according to CMS.

The issue surfaced in a federal court hearing last month when an HHS official testified that CMS has thus far granted 10 extensions and posed almost 600 questions about South Carolina’s application. The court cut off testimony about the issue so there was no testimony as to what the questions were.

Peter Brooks, a spokesman for HHS, previously said the questions concerned multiple issues.

Some of the questions, he said, were due to the fact that CMS for the first time hired outside consultants to review the application, and the consultants posed questions to understand the process.

Other questions, he said, have been used to monitor the state’s progress in preparing to comply with new federal regulations called the “Home and Community-Based Services Final Rule.” The regulations became effective in 2014 but states have another several years to develop and implement a transition plan to comply.