Children’s Health and Potential Are Maximized with Services Planned by Care Management Organizations

June 9, 2017

Access to healthcare services for children who are covered by Medicaid and, therefore, their health and opportunities to flourish in all aspects of their lives, will be at great risk if the Affordable Care Act is repealed and replacement by the American Health Care Act. Throughout the course of one year, 23,000 New Jersey children enrolled in Medicaid are served by Care Management Organizations (CMO's), for which funding was cut by 50% in 2013, resulting in an average 400% increase in staff's workload and withering down their ability to provide high-quality services. As a result, children and their families are at risk of experiencing health complications requiring much more costly care, for example in emergency rooms and hospital inpatient units, which could otherwise be prevented with ongoing access to CMOs' life-saving and life-enhancing services.

"CMO's reimbursement rates need to be increased from $550 to $850 per child/per month to ensure we can continue to provide quality services that have been proven in New Jersey and many other states to be highly effective," said James Parauda, LSW, Chair, of the New Jersey Coalition of CMO Boards and Executive Director of Tri-County CMO in Branchburg, NJ. "This rate will cover the essential services required by our contracts with the New Jersey Department of Children and Families and enable us to pay competitive salaries, which will help reduce turnover and keep staff's workloads manageable."

"We are proud to have the CMO's as members and we join them in advocating for this much-needed rate increase," said Debra L. Wentz, Ph.D., President and CEO of the New Jersey Association of Mental Health and Addiction Agencies (NJAMHAA). "As with all of NJAMHAA members, the CMO's provide invaluable services that not only enable children and adults with mental illnesses, substance use disorders and/or developmental disabilities to lead the healthiest and most fulfilling lives possible. Furthermore, these services are cost-effective and prevent common, high-cost consequences of not receiving treatment, including emergency room visits, inpatient hospitalizations, homelessness and incarceration."

The low reimbursement rates have led to an average turnover rate of 25% at CMO's, and remaining staff commonly hold second jobs to make ends meet. "Few jobs are harder than working with children and teens with severe emotional and behavioral problems. Yet, many care managers leave this field not because of these challenges, but because of inadequate pay," Parauda said, adding that New Jersey's rate is significantly lower than in other states (e.g., Maryland, $1,170 per month; Pennsylvania, $12,000 per episode; Rhode Island, $85 per day; Massachusetts, $1,510 per month (by 15-minute increments). "We need to support this dedicated workforce with decent living wages," he stressed.

CMO's have been serving youth with mental illnesses since their inception. In recent years, they have taken on additional responsibilities for youth who have substance use disorders or develop-mental disabilities, many of whom also have mental illnesses. "These interventions have prevented unnecessary hospitalizations. They also reduced the need for out-of-home treatment by 60%, which has provided a psychological boost to children and their families, in addition to saving the State $6 million dollars per year," Parauda said. 'Although hard to quantify, the reduction in incarceration saved New Jersey, at both the state and county levels, millions of dollars each year. These results were possible because CMO's were able to offer and implement effective plans."

"The wraparound model that CMO's follow has been proven to save and improve lives. It is tragic that this model - and especially the children and families who are benefiting from it - are at risk due to inadequate funding," Parauda said.

Care Management Organizations (CMO's) are one of many types of behavioral health providers represented by the New Jersey Association of Mental Health and Addiction Agencies, Inc. (NJAMHAA). Between 2001 and 2006, the State of New Jersey established 15 CMO's to coordinate and monitor provision of services for youth with the most severe mental healthcare needs. This wraparound model has been supported by many administrations due to its effectiveness in saving and changing lives.

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