A Kanawha County circuit judge denied an injunction request Friday that would have halted changes to West Virginia's reimbursement model for children in long-term psychiatric care facilities - the same day a special Supreme Court commission released a statement accusing the Department of Health and Human Resources of developing those changes "in secret."
Kanawha County Circuit Court Judge Tod Kaufman denied the request for injunctive relief made on behalf of seven youth-services agencies in the state after a hearing held Thursday. In his decision, Kaufman noted that lawyers for the agencies failed to justify their request for an injunction as an "emergency" and, therefore, did not give the required 30 days notice to the DHHR before filing.
Kaufman also wrote that "despite being aware of [the DHHR's] anticipated changes to the state Medicaid plan for months, petitioners failed to provide the state with pre-suit notification."
Susan Fry, executive director of Stepping Stones, one of the private providers involved in the case, said that, although they had been working with the DHHR for more than a year to develop new contracts with the government, the contract presented to them on July 1 was not one they had ever seen.
"Everybody needs to understand that providers did not want to end up in the situation we're in," Fry said. "We all have the same common vision, and we should be able, as adults, to sit down and have conversation, with the kids in the middle of the table."
A timeline of the DHHR's interactions with providers in developing contracts was not presented to Kaufman on Thursday, and DHHR counsel Chris Dodrill argued that the providers had been aware of the changes for a year.
The original deadline for the new contracts, July 25, fell two days before a Juvenile Justice Commission hearing on the changes. The commission issued a news release Friday on its Wednesday hearing with providers, citing testimony from several involved parties that indicated the DHHR had tried to keep the changes secret from the judiciary.
One speaker, Steve Fairley, executive director of Academy Programs in Fairmont, told the commission that DHHR Cabinet Secretary Karen Bowling told providers that the DHHR intended to "blow up" the current system with the proposed changes.
"We were surprised, since the court system is responsible for placing the children in residential care, that the entire residential system would be replaced in secrecy, eliminating judicial discretion and jeopardizing the welfare and safety of children," said commission chairman and Putnam County Circuit Court Judge Phillip Stowers.
Currently, providers who care for children receive a bundled daily rate of $250 from the Bureau for Children and Families and paid for by state funds for room, board and supervision.
The pending DHHR contract would replace bundled rates of $250 a day for residential placements to a standard rate of $178 a day for room, board and supervision, while requiring residential care facilities to bill separately for other services provided to each child on a fee-for-service basis.
It also would eliminate the three classifications of children based on level of treatment needed. Instead, children would be classified as either "standard" or "enhanced."
Additionally, reimbursement for room, board and supervision would be at two rates that have not yet been determined, according to Charles Johnson, a lawyer representing several of the residential treatment facilities.
The changes also include a 180-day limit on treatment, Johnson said.
Linda Watts, deputy commissioner of the Bureau of Children and Families, testified Thursday that the changes would not interfere with judges' oversight of children remanded to state care. She also said the providers' contention that the new contracts prevent providers from discharging children with serious behavioral or medical issues is unfounded.
"What this says is that, once a provider has accepted a child, if that child has behaviors, such as the child was bullied in school and comes in very angry and upset and is threatening to hurt others, we're expecting them ... to de-escalate the situation and assess it," Watts said. "If you look in the next section ... it's very clear that, if they have a serious behavioral issue, a medical issue, if they're committing a crime, the provider can contact law enforcement, get that child into the hospital, and do whatever it takes."
In a statement, Bowling said the changes were intended to promote community-based services and enhance the services residential facilities provide.
"The West Virginia Department of Health and Human Resources respects the role of the judiciary system in the care of all children placed in our custody," she said. "The changes in contracts with providers have been an effort to continue to promote community-based services, while enhancing the individualized behavioral health services offered in shelters and residential facilities.
"The DHHR's paramount concern is the safety and well-being of children in our care. New contracts will only change processes so that the multi-disciplinary team, along with the judiciary system, knows the specifics associated with care that will be provided."
Nine providers have signed the new contract, while 10 others have not. The DHHR has extended the deadline to sign the contract until Aug. 8, and has terminated its existing contracts. Providers who do not sign the contract by next Monday will receive a 30-day notice of termination, and only those that sign contracts will continue to provide services for the state, according to the DHHR.
Johnson said the providers have not decided if they will continue to challenge the contract changes in court.
Reach Lydia Nuzum at lydia.nuzum@wvgazettemail.com, 304-348-5189 or follow @lydianuzum on Twitter.