Budget-driven policy may shortchange Iowa’s most vulnerable

The 2010 General Assembly convenes next week, and with even the most optimistic budget estimates showing the state facing record deficits, legislators have vowed to put everything on the table when considering cuts.

For the groups that provide services to the state’s most vulnerable populations — from those with disabilities to those most affected by the economic downturn — the hard reality is setting in. Without real leadership in Des Moines more cuts could be inevitable and services could be at risk.

“Historically we have been able to get by with putting our finger in the dike,” explained Dale Todd, a Cedar Rapids resident who serves as chairman of the Iowa Mental Health, Mental Retardation, Developmental Disabilities and Brain Injury Commission. “We’ve seen in the last year that when we plug one hole, another piece pops out. It is becoming apparent to me that we are going to need real leadership to make change happen.

“The problems [emerging now] have been out there, but they are becoming more visible,” he continued. “They’ve always been out there, but now it has gotten to the point that you can’t hide them anymore. It’s obvious that things are happening, and that social services for those with disabilities or those in need of assistance are taking some hits — hits that we really can’t afford because we have a moral and ethical obligation as Iowans to make sure that we do the best we can to help the folks that need help the most.”

Organized groups like the commission Todd leads attempt to speak on behalf of and advocate for safety net policies for segments of society not in a position to hire lobbyists or personally rally at the statehouse.

“One of the problems, at least in my eyes, is that when it comes to mental health issues there really seems to be no unified voice that can speak to the degree that other special interest groups speak,” he said. “I’m the father of a kid with a disability and, I’ll be honest, when we meet as a group — those folks that provide care for someone with special needs or those who are coping with mental illness — there simply isn’t a lot of political clout in that room when you compare it to a room filled with lobbyists for the insurance companies or other special interest groups.”

Lutheran Services in Iowa is one of the state’s largest nonprofit human service agencies that provides preventative care, crisis intervention, education and outreach to tens of thousands of Iowans. According to Amy Juhnke, director of marketing communications, the organization’s total revenue and support stream was $34.4 million prior to budget cuts mandated by Gov. Chet Culver. More than 90 percent of the money it receives comes from payment for the services it provides, and roughly 8 percent is received through donations.

“I want you to know that we have amazing donors,” Juhnke said. “We have been able to, even during these economic times, increase our donations this year over last year. That’s amazing, but it is not enough to cover the reduction in payment rates. And, as we look ahead to the 2010-2011 state budget it is pretty likely that we are going to see another dip.”

Impacting the state’s most fragile

Lutheran Services, like many providers in the state, receives its payments through the Iowa Department of Human Services, an agency that is the heart of most safety net programs. Roger Munns, a department public information officer, said the department has “bent over backwards to provide the needed cuts in a way that would least impact the state’s most fragile.”

The department was able to lessen the impact of mandated cuts during this fiscal year by shifting funds, including monies earmarked for next year. Despite the fact that Iowa already has one of the lowest Medicare/Medicaid reimbursement rates in the nation, the department has also decided to reduce the rate it pays local providers in an attempt to keep as many Iowans as possible with health and other coverage.

The DHS, like most state agencies, elected not to fill existing employment vacancies, but still had to terminate more than 50 employees, Munns said. The agency also made other “basic” reductions, such as limited travel, and streamlined department duties and oversight.

The governor’s office also intervened and was able to offer certain programs a 50 percent backfill from the originally mandated reductions, Munns said, adding: “The legislature could decide that there is something so out of proportion that they must act to rectify the situation, but the truth is that not very many [of the cuts already made] will be visited again. What we do want to stress is that, despite the cuts, all eligible people will receive full benefits. The criteria hasn’t changed and the benefits haven’t changed. If you need help and you are eligible, you’ll receive the benefits.”

At least for now, full benefits do remain available through Lutheran Services and other providers because they are continuing to offer those services despite payment decreases. Exactly how long they can continue to operate in that fashion, or, more aptly, how long the same level of service can be provided, is one of the big unknowns these groups face.

“As far as gaps in services go, we worry about that every single day,” Juhnke said, noting that nonprofits in general and LSI in particular has become very good at filling such gaps. “But when your financial resources get slimmer and slimmer how much can you continue to do? We absolutely are worried about the children that won’t have access to certain services — and we don’t just treat the child. When we have a child in one of our residential treatment programs, for instance, it is a family approach. We are bringing those families on campus and teaching them how to deal with situations and environments. So not only will that child not be getting services, it could be the entire family.”

In order to continue to offer a full range of services, LSI has cut internal expenses, including letting go of its paid lobbying staff, a move that could have ramifications on future funding.

“We continue to have organizations like the Coalition for Children and Family Services in Iowa, but they have to make their priorities and can’t advocate on behalf of or watch over all the programs,” Juhnke said. LSI will continue to hold its once-a-year rally day at the statehouse and legislative advocacy forums at service sites throughout the state.

“We invite legislators to come in, and we try to communicate directly with local legislators,” she said. “We need all the organizations, and not just LSI to do that. … When someone isn’t talking about this, we aren’t the squeaky wheel.”

Todd agrees, and believes it will come down to “how much political muscle” the organizations can muster.

“Talking about a mental illness or taking care of someone with a behavioral health issue is a often very personal, complex and delicate,” he said. “But now more than ever, we need to be able to talk about these issues with members of our legislature and the people responsible for the decisions that impact our loved ones.”

Revenue problem

According to a December survey commissioned by nonpartisan Iowa Fiscal Partnership, six out of 10 Iowans favor using some tax and fees mix in an effort to resolve the state’s current budget crisis, with 51 percent favoring a combination of spending cuts and revenue increases. Charles Bruner, executive director of the affiliated Child & Family Policy Center, said this means that “voters understand the state budget includes both spending and revenues, and that we need to address both to meet our challenges.”

Taking a balanced approach to the budget crisis by addressing both revenue and expenditures is one that not only makes sense to Peter Fisher, research director at the Iowa Policy Project, but one that he believes can help stem the flow of revenue away from programs viewed as necessary by the majority of residents.

“One of the things that we’d like to see is the maintenance of services to people who are already hurting because of the recession — those who have lost their job and fallen into poverty,” Fisher said. “It will be difficult to to continue to serve those groups because the demands for social services and child care are going to go up as the recession drags on.”

In the past year, according to figures from the Iowa Department of Human Services, the number of residents seeking assistance through the Family Investment Program has blossomed. Of the current enrollment of roughly 17,000 Iowans, which is higher than even one year ago, most of those new to the program have never previously needed public assistance.

“We’ve had cuts two years in a row and everybody is saying that this year will be even worse,” Fisher said. “It is hard to see how we are going to get by without further cuts unless the legislature shows some willingness to do something on the revenue side in closing loopholes and cutting tax credits. I’m optimistic that they will do something to rein in that part of the budget. Hopefully that will patch some holes in other parts of the budget where the expenditure cuts might be coming, but that remains to be seen.”

Both Todd and Juhnke want to be clear that they understand the financial realities faced by the state, and that they also understand that legislators can’t appropriate what they don’t have. They are also cautiously optimistic that the inability by some groups to have a consistent presence at the statehouse won’t place them at a disadvantage during the budgeting process. Todd, specifically, says he will be asking Culver to show leadership on this issue.

“It is like a stool with four legs — organizations and commissions with similar goals, the department, the legislature and the governor’s office,” Todd said. “All of these entities need to be on the same page. Deep down inside I think that everyone wants to see that we make progress on this issue, but we have not yet reached a consensus on what progress is or how to get there. January will be an interesting month.”