Commissioner Terri White, Department of Mental Health and Substance Abuse Services

White said that preventing addiction is the biggest public health problem facing Oklahoma. She expressed concern that the current discussion on allowing sale of strong beer and wine in grocery stores has concentrated on economic development issues without taking into account increased risk of underage access to alcohol.

“The younger someone uses alcohol, the more likely it is they’ll use as adults,” White said.

Over the course of the budget crisis, she said $30 million had been cut from the mental health budget, 90 percent of which goes directly to care providers. On the positive side, she praised new investments of $3 million for a Smart on Crime initiative and $2 milion to Systems of Care, which coordinates services between agencies for children with the highest needs.

“If we don’t make sure the brain health of our children is our highest priority, we’re going to be paying for those problems over and over with more tax dollars than we can afford to come up with,” White said.

Director Howard Hendrick, Department of Human Services

Hendrick said DHS has made progress in recent years in collecting child support. He said Oklahoma is ranked first for paternity testing done to determine who owes child support, and they have tripled support collection over the past few years. Hendrick said for every dollar the state spends on collections, we get a $3 federal match, and that results in another $4 in child support paid.

He said in 2009, Oklahoma for the first time went below the national average for child abuse (though that statistic has been disputed). He said Oklahoma ranks highest in the nation for per capita adoptions of children out of foster care.

However, the agency continues to struggle to meet skyrocketing demand during the recession. Hendrick said 30 percent of Oklahomans are currently on food stamps, and 40 percent have received SNAP food stamp benefits at some time in the last 12 months.

Hendrick said he believes in limited government if the rising tide is lifting all ships, but the “number of ships getting stuck in the harbor is increasing.”

“Work has to pay, and right now work is not paying enough,” he said.

Hendrick said public sector cutbacks also have immediate effects on the private sector, as many private jobs are funded with 100 percent government revenue.

Executive Director Gene Christian, Office of Juvenile Affairs

Juvenile Affairs has been in the news lately due to problems with violence and escapes after youth were transferred out of the state’s only maximum-security juvenile detention center, which shut down in September.

However, Christian argued that a few of the hardest cases should not distract from a bigger picture that is improving. He said OJA worked to promote prevention and community services that reduce the need for high security detention. Five years ago, Juvenile Affairs had 394 secure beds with a 50 person waiting list, while today they use just 150 out 194 secure beds, with no waiting list. That compares to 230 non-secure beds (in facilities without fences or locking doors).

He said they’ve accomplished this shift while dealing with 12 percent budget cuts and a 25 percent staff reduction.

Christian said there has been a 22 percent decrease in overall intake of youth, in part because their community partners have helped prevent crime. However, he said there are still not enough treatment programs for juveniles struggling with substance abuse.

“We should be embarrassed that I have more beds for substance abuse treatment than DMHSAS,” he said. “They have to commit a crime before they can get treatment.”

He said Juvenile Affairs will continue to encourage non-secure facilities when they can but would rather put more resources in reintegration services that help troubled youth find career and education opportunities.

“The better they do, the less I have to do,” he said. “And I’m of the opinion I need to do less.”

Assistant Deputy Commissioner Toni Frioux, State Department of Health

Frioux said the Health Department has not had to totally eliminate any programs due to budget cuts, but they did lose more than 200 full-time employees over the last 3 years. While the Health Department closed more than half of the state’s guidance centers for children with developmental delays, Frioux said the consolidation has made the program less fragmented and now provides better access to a full complement of professionals.

Oklahoma received a $37 million grant award under the health care reform law to fund nurses, social workers, or other professionals meeting with at-risk families in their homes. Oklahoma was one of only three states whose grant proposal was fully funded, with 22 others receiving partial funding. Frioux said the state won the grant because we are “already ahead of the game” with home visitation programs like Children First and Start Right.

On the downside, the most recent State of the States Health Report gave Oklahoma a D for infant mortality rate, F in tobacco use prevention, and a D in obesity prevention.  Oklahoma is predicted to become the most obese state in the nation within the next few years.

The current health improvement plan being pursued by the Department includes allowing municipalities to implement more restrictive tobacco laws; requiring health education in grades 6-8; and banning all electronic devices from use by drivers under the age of 18.

CEO Mike Fogarty, Oklahoma Health Care Authority

OHCA operates SoonerCare, Oklahoma’s Medicaid program. Fogarty said OHCA has made substantial progress in covering Oklahoma children since the agency was created in the mid-90s. In 1997, SoonerCare had 280,000 enrolled, half of which were children. Today there are 700,000 enrolled, of which 2/3rdsare children.

The growth has reduced the percentage of children with no form of health coverage from 25 percent in 1997 to about 12 percent today. He said most of the kids who remain uninsured have parents who make too much to qualify for SoonerCare but still can’t afford access.

Fogarty said growth in early years was due to intentional outreach programs, but more recently the surge is fueled by greater need during the recession.

“Any program that is means-tested is counter-cyclical,” he said.

OHCA is the only major state agency that did not have its budget cut, and in fact received a 12 percent increase in state funding. However, the number of Oklahomans eligible for the program increased closer to 18 percent. Fogarty said he was pleased that Oklahoma has avoided severe cuts to Medicaid that were attempted in other states.

He said that during a budget crisis, it is crucial for child advocates to demonstrate the effectiveness of public programs with quality research.

“There are limits to how many bricks you can make with less straw, and we’re there,” Fogarty said.

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Participants at this year’s Forum will hear a state budget overview from OK Policy Director David Blatt and listen to a panel of state agency directors as they explain how recent budget cuts impact children. The state agency panel includes: Mike Fogarty with the Health Care Authority; Terri White with Mental Health and Substance Abuse Services; Howard Hendrick with Department of Human Services, Gene Christian with the Office of Juvenile Affairs and Toni Frioux of the State Department of Health.

Forum workshops will focus on five policy priorities for Oklahoma’s children selected by an online vote earlier this year: child health; child safety; mental health; early care and education; and maternal and infant health. Participants will work in breakout sessions on the five issues, culminating in a policy/strategy vote. The forum will also include a grassroots coalition training session.

The keynote speaker is Michelle Aguilar, winner of season six’s “Biggest Loser” competition.  Her inspirational speech will motivate others to find their own voice and inner-strength as child advocates, community members and business leaders committed to OICA’s mission in providing strong voices for Oklahoma’s children.

Go to http://oica.org/fall-forum to register and see the full agenda.

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Visit www.reducinginfantmortality.com to learn more about the film and about strategies for reducing infant death.  Visit the Oklahoma Institute for Child Advocacy online to learn about initiatives in the state that promote healthy mothers and babies.

View other clips from OKPolicy’s “Watch This’ video series:

• Panic Nation film trailer
• What is Sharia Law?
  

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Last week, the Department of Human Services announced new co-payment and eligibility rules for the child care subsidy program, which we discussed in this post. By lowering the eligibility threshold for subsidies, the new rules will worsen the “cliff effect” whereby workers with the opportunity to move up the income ladder are penalized by losing work support benefits. Here we rerun a blog post on this subject that first appeared in June 2009; we have also discussed how health care reform promises to significantly improve the situation.

In recent years, whenever I’ve participated in forums on poverty and barriers to self-sufficiency, the single barrier raised most often and most fervently by those who work with low-income individuals and by low-income individuals themselves is the “cliff effect”. A 2007 report prepared for the Women’s Foundation of Colorado and the Women and Family action Network Coalition defined the cliff effect as follows:

Eligibility for work support benefits is typically based on income, so as their earnings increase, families lose eligibility for supports. A benefit cliff occurs when just a small increase in income leads to the complete termination of a benefit. The result is that parents can work and earn more, while their families end up worse off than they were before.

The cliff effect is most dramatic for Medicaid health insurance coverage, which tends to be an all-or-nothing benefit. Children in Oklahoma are eligible for Medicaid up to 185 percent of the federal poverty level, while adults lose eligibility when they make less than 50 percent of the poverty level. Other work support programs, including the earned income tax credit, the food stamp program, and child care subsidies, minimize the cliff effect by phasing out the amount of benefits at higher incomes, or in the case of child care subsidies, requiring higher co-payments. The cumulative effect, however, is that for most low-income workers who are attempting to move up the income ladder, additional earnings can be largely or fully offset by higher taxes and the loss of benefits. At a certain threshold, workers find themselves in a situation where the rational response to an offer of a raise or a better job is to respond, “Sorry, but I just can’t afford it.”

Concern about the cliff effect has been expressed by researchers and policy experts from both the liberal and conservative ends of the ideological spectrum. The Women’s Foundation of Colorado has even filmed a video on the cliff effect, which you can watch on You Tube. At this past year’s Fall Forum of the Oklahoma Institute for Child Advocacy identified the cliff effect as one of their top advocacy priorities for the 2009 session:

The 2009 Children’s Agenda supports efforts to reduce the “cliff effect” that results in an abrupt loss of all work-support benefits when a low-income family earns a small increase in wages by increasing the income eligibility limits for child care subsidies and phasing out benefits more gradually.

OICA and others have been working with the child care division of the Oklahoma Department of Human Services to modify the income eligibility limits for subsidized care to reduce the cliff effect. This would involve raising the eligibility threshold but having higher-income recipients contribute a larger co-payment. DHS proposed new eligibility standards that they estimate would provide subsidized care for an additional 1,600 children in higher-income households (those with incomes up to roughly $29,000 for families with one child in care and $43,500 for families with multiple children in care) at a cost of $3.5 million. The proposal is still under review.

Ultimately, though, any solution to the cliff  effect must begin by filling the chasm between Medicaid eligibility and unsubsidized private insurance. There are reasons to be optimistic. The Insure Oklahoma program already offers subsidized health insurance for adults up to 200 percent of the poverty level, who are required to contribute 15 percent of the cost of the premium up to a maximum of 5 percent of family income. Efforts to expand eligibility for Insure Oklahoma up to 250 percent of poverty for adults and 300 percent for children await federal approval. However, the program currently serves only 20,000 Oklahomans and may run out of funding once it reaches 35,000 to 40,000 people.

Federal health care reform efforts may provide a more comprehensive solution. Most variations of the proposals being developed in Congress involve a “Health Insurance Exchange” that would offer subsidies for those who earn too much to qualify for Medicaid but who are not offered or cannot afford the full cost of employer-based coverage. The Senate Finance Committee recently released a paper that proposed refundable tax credits on a sliding scale for taxpayers with incomes between 100 percent and 400 percent of the federal poverty level (which would exceed $80,000 for a family of four) for those who purchase coverage on the Exchange.

If national health care reform becomes a reality with mechanisms to help low- and moderate-income families with the costs of coverage, the sad refrain of “sorry, I can’t afford that raise” may be heard far less often.

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DHS’ actions were precipitated by budget shortfalls for the upcoming year exceeding $30 million. The Legislature reduced state appropriations to DHS  for FY ’12 by a modest $6.0 million, or 1.1 percent, compared to FY ’11. However, the agency also faces the loss of one-time funding in this year’s budget, expected increases in program utilization, and higher employee benefit costs. To balance its budget, DHS proposed a series of  measures, which included voluntary buyouts of 231 positions, mostly within its field operations division for children and family services, and cuts in contracts for various social services.

However, the largest program cuts are concentrated on the child care subsidy program. Funded through a combination of federal and state dollars, the subsidy program provides assistance to qualifying families by paying all or part of their child care expenses while parents or caretakers are working, going to school or receiving training. Children may attend licensed child care centers or family child care homes, which are paid a daily amount  for subsidized children based on the child’s age and the facility’s quality of care. Families above a certain income level contribute a monthly co-payment. The program currently serves some 37,000 children in just under 24,000 families.

DHS has adopted two major changes aimed at reducing the cost of the child care subsidy program effective August 1, 2011:

• Raising monthly co-payments by 20 to 35 percent depending on income and the number of children in care.  The increase is expected to affect some 13,000 families and reduce annual costs for DHS by $5.8 million.  Families with income below $850 per month will continue not to have a co-payment obligation;
• Lowering the eligibility threshold for families newly applying for child care subsidies. The maximum monthly income for families not currently receiving subsidies will drop from $2,425 to $2,125 for a family with one child in care; from $2,425 to $2,125 for families with two children in care, and from $3,625 to $2,925 for families with three of more subsidized children. Families in the higher income brackets who are currently receiving benefits will remain eligible. DHS projects annual cost savings of $3.8 million from this measure.

These measures can be expected to have a significant financial impact on low-income working families. For example, the monthly co-payment for a single parent working full-time at $9.50 per hour will increase by $41  – from $162 to $203 -  if she has two children in subsidized care. The child care co-payment, equivalent to $1.21 per hour, will now absorb over 12 percent of her wages.  Meanwhile, as a result of the eligibility changes, a two-parent family with two children where both parents make the minimum wage of $7.25 per hour will no longer be eligible for subsidized care.

Coming at a time of rising costs for fuel, health insurance, and other household necessities, increased child care expenditures will squeeze already tight family budgets and place greater strain on public and private safety net providers. Faced with higher child care costs, some parents may choose to pull their children out of the system of licensed and subsidized child care in favor of informal and often unstable care arrangements with siblings, neighbors or friends. In other cases, the higher cost of child care may lead parents to stop working entirely – with a consequent loss of family income and, perhaps, a return to the welfare rolls.

The cuts will also affect the bottom line for child care providers, many of which are small locally-owned businesses that are already economically fragile. Many child care providers will lose clients, as higher co-pays and reduced eligibility lead some children to be withdrawn from the system of licensed care entirely. Others will be left to absorb part or all the higher co-payments themselves when families who are already receiving child care are unable to afford a 20 – 35 percent increase. For some providers, also dealing with rising operating costs and rates that have been frozen for several years, the lost revenue may push them out of business entirely.

Was DHS justified in making this decision? The agency clearly faces a shortfall and had its hands partly  tied by the Legislature, which passed a bill expressly prohibiting DHS from cutting senior nutrition services, home- and community-based waiver programs, and various other services. Still, as  noted by Commissioner Steven Dow, who was one of two commissioners to vote against the agency budget,  the agency still has $15 million in carryover TANF (Temporary Assistance to Needy Families) funds that it could have tapped to mitigate the extent of the child care cuts.  Linda Terrell, Executive Director of the Oklahoma Institute for Child Advocacy, stated:

State agencies are being asked to make tough decisions, but people working directly with children know the impact of their decisions. It is unfortunate that members of the commission see the value of a surplus over the value of ensuring working families have access to high-quality and safe childcare.

Given the available TANF surplus and a long history of actual expenditures coming in below projections, DHS could have adopted more modest co-payment increases and decided during the year whether additional budget-balancing measures were needed. As it is, this decision will be a serious blow for hard-pressed families trying to pay their bills and ensure quality care for their kids.

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The main event will be held on Wednesday,  October 13th at the University of Central Oklahoma in Edmond.  Child advocates will meet for a day-long session to discuss the recent  severe budget cuts and their impact on critical services for children.  In addition to briefings by state leaders and policy experts (including yours truly), participants will develop guiding principles that policymakers can use to measure how legislation might affect Oklahoma’s children. Registration for the Forum is $75; you can register online here.

The Children’s Legislative Forum will be preceded by two events on Tuesday, October 12th:

• In the afternoon (time and location TBA), OICA will host offer a briefing on the 2010 Kids Count databook providing the latest data on child well-being in Oklahoma.  This event will be free but pre-registration is required.
• At 7:00 p.m., OICA will co-host a debate featuring the State Schools Superintendent candidates along with the UCO College of Education and Professional Studies, the Early Childhood Association of Oklahoma, the Oklahoma Child Care Resource and Referral Association, and the Oklahoma Afterschool Network.   The program will be held at UCO; room to be announced.  Free of charge.

Anyone who wants to better understand the challenges facing Oklahoma children and families and make a difference in shaping future policy decisions should be sure to attend the Fall Forum.

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Eligibility for work support benefits is typically based on income, so as their earnings increase, families lose eligibility for supports. A benefit cliff occurs when just a small increase in income leads to the complete termination of a benefit. The result is that parents can work and earn more, while their families end up worse off than they were before.

The cliff effect is most dramatic for Medicaid health insurance coverage, which tends to be an all-or-nothing benefit. Children in Oklahoma are eligible for Medicaid up to 185 percent of the federal poverty level, while adults lose eligibility when they make less than 50 percent of the poverty level. Other work support programs, including the earned income tax credit, the food stamp program, and child care subsidies, minimize the cliff effect by phasing out the amount of benefits at higher incomes, or in the case of child care subsidies, requiring higher co-payments. The cumulative effect, however, is that for most low-income workers who are attempting to move up the income ladder, additional earnings can be largely or fully offset by higher taxes and the loss of benefits. At a certain threshold, workers find themselves in a situation where the rational response to an offer of a raise or a better job is to respond, “Sorry, but I just can’t afford it.”

Concern about the cliff effect has been expressed by researchers and policy experts from both the liberal and conservative ends of the ideological spectrum. The Women’s Foundation of Colorado has even filmed a video on the cliff effect, which you can watch on You Tube. At this past year’s Fall Forum of the Oklahoma Institute for Child Advocacy identified the cliff effect as one of their top advocacy priorities for the 2009 session:

The 2009 Children’s Agenda supports efforts to reduce the “cliff effect” that results in an abrupt loss of all work-support benefits when a low-income family earns a small increase in wages by increasing the income eligibility limits for child care subsidies and phasing out benefits more gradually.

OICA and others have been working with the child care division of the Oklahoma Department of Human Services to modify the income eligibility limits for subsidized care to reduce the cliff effect. This would involve raising the eligibility threshold but having higher-income recipients contribute a larger co-payment. DHS proposed new eligibility standards that they estimate would provide subsidized care for an additional 1,600 children in higher-income households (those with incomes up to roughly $29,000 for families with one child in care and $43,500 for families with multiple children in care) at a cost of $3.5 million. The proposal is still under review.

Ultimately, though, any solution to the cliff  effect must begin by filling the chasm between Medicaid eligibility and unsubsidized private insurance. There are reasons to be optimistic. The Insure Oklahoma program already offers subsidized health insurance for adults up to 200 percent of the poverty level, who are required to contribute 15 percent of the cost of the premium up to a maximum of 5 percent of family income. Efforts to expand eligibility for Insure Oklahoma up to 250 percent of poverty for adults and 300 percent for children await federal approval. However, the program currently serves only 20,000 Oklahomans and may run out of funding once it reaches 35,000 to 40,000 people.

Federal health care reform efforts may provide a more comprehensive solution. Most variations of the proposals being developed in Congress involve a “Health Insurance Exchange” that would offer subsidies for those who earn too much to qualify for Medicaid but who are not offered or cannot afford the full cost of employer-based coverage. The Senate Finance Committee recently released a paper that proposed refundable tax credits on a sliding scale for taxpayers with incomes between 100 percent and 400 percent of the federal poverty level (which would exceed $80,000 for a family of four) for those who purchase coverage on the Exchange.

If national health care reform becomes a reality with mechanisms to help low- and moderate-income families with the costs of coverage, the sad refrain of “sorry, I can’t afford that raise” may be heard far less often.

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