Penny Wise, Pound Foolish, Disabled Say

MADISON, Wisc. (CN) - Hundreds of developmentally disabled people could lose their homes "and the services that maintain them there" because of Wisconsin's discriminatory budget cuts, according to a federal class action.

The class claims the Wisconsin Department of Health Services is reducing its daily rates paid to Wisconsin's Family Care program - which pays Managed Care Organizations to care for the developmentally disabled - because expenses for these disabled people are higher than average.

But the cuts will be more expensive in the long run, as they will exacerbate problems of the developmentally disabled and force them into institutions, lead plaintiff Michael Amundson and his guardians says.

The problem with residential care rates is "most acute" for people with developmental disabilities because of the high level of care they require, the class claims. Many need extensive assistance with day-to-day activities, or round-the-clock care, which costs more than other disability groups require.

"This has resulted in a coordinated effort by DHS and all of the managed care organizations to reduce payment rates and the level of services provided to individuals with these disabilities," the complaint states. "DHS has been making and intends to make further cuts in payments to the MCOs, but the reductions are not being imposed equally across the various disability groups. With DHS's approval, the MCOs [Managed Care Organizations] have been reducing payments to providers that serve individuals with DD [developmental disabilities] below the level necessary to safely maintain these individuals in the community."

The class claims it is in immediate danger.

"Hundreds of individuals with disabilities across Wisconsin are in immediate jeopardy of losing their homes and the services that maintain them there. Thousands more will follow as DHS and the Family Care MCOs continue to reduce payments for residential services below sustainable levels."

The threat of reduced service rates is not new. A class action filed in 2004, Bzdawka v. Milwaukee County Case, was settled, and the DHS "increased the level of funding to the Milwaukee County MCOs and residential providers were able to negotiate acceptable daily rates," the complaint states.

But today's problem is more widespread than in 2004. Three large Managed Care Organizations in Wisconsin - defendants Community Health Partnership, the Northwest Long-Term Care District (operating as Northern Bridges), and Care Wisconsin - have already made or announced "drastic cuts" to providers' daily rates.

"Other managed care organizations have submitted business plans to DHS which target individuals with developmental disabilities and other similar disabilities instead of imposing equitable rate reductions on all Family Care members," according to the complaint.

The class claims the discriminatory and inequitable targeting of the developmentally disabled violates the integration requirements of the ADA and the Rehabilitation Act; violates the Due Process clause of the 14th Amendment by failing "to provide notice of any internal financial decisions that affect the level or quality of the services provided to individual Family Care members;" and violates the First Amendment rights by denying people the right to choose where and with whom to live.

The class seeks declaratory and injunctive relief to compel the DHS and the Managed Care Organizations "to utilize accurate and non-discriminatory rate-setting methods that will safeguard these vulnerable individuals."

It is represented by Robert Pledl and Victoria Davis, with Pledl & Cohn.

Similar class actions have been filed in states around the country. The classes frequently claim that cutting costs now will cost the states and federal government more in the long run, because of the expensiveness of institutional, as opposed to home care.

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