Cost of Providing Care Coalition

A coalition of over 500 non-profit and private organizations in the community providing care for people with developmental disabilities, mental illness as well as families and children who are at risk.

Crisis: Funding from New Jersey is not sufficient for the cost of providing care to the state’s most vulnerable citizens.

Services to the Most Vulnerable Citizens

For over thirty years, the New Jersey Department of Human Services has contracted with community provider organizations to provide care for the state’s most vulnerable citizens. These citizens rely on critical services, which are provided in their communities by these organizations. Essential services are provided in the community at a lower cost than similar services run by the state. Community provider organizations offer care for over 500,000 individuals with developmental disabilities, mental illnesses and families and children who are at risk. The partnership between the State of New Jersey and these provider organizations has provided vulnerable individuals with quality care and services. These programs include: residential facilities; care in group homes; treatment homes; transitional housing; day programs; respite; family support programs; outpatient treatment and support programs.

Crisis in the Cost of Providing Care

While the partnership between New Jersey and community provider organizations has resulted in excellent care for thousands of the state’s citizens, there has been an undue burden placed on these agencies. The cost of providing care to our most vulnerable citizens has grown significantly while funds provided from the state have not increased accordingly. Even as the cost of providing care rose by 16% last year alone, community providers received no increase to their contracts and still maintained their level of services. Without suitable state increases to help finance these and other costs associated with providing services, community providers will face serious obstacles in maintaining quality services.

Over the last 12 years, the Consumer Price Index in the northeast increased an average of 3% annually while the contracts of community provider organizations have increased by only 1.5%. In fact, the total increase for the CPI over the last twelve years was 38.7% while provider contracts rose by only 19.5% in the same time period (see graph).

Last year, the cost of providing care to vulnerable citizens increased by 16% percent while community providers received no increase in their contracts with the state. The average increases, last year alone, were:

Health Insurance Premiums 18% increase

Transportation Costs 20% increase

Utilities 10% increase

Workman’s Compensation 15% increase

Without any increases, New Jersey is placing over 40,000 vulnerable individuals at risk of not receiving services in a timely manner. This would not only be devastating to the individuals and families these organizations serve, but would also result in millions of dollars of increased tax burden on New Jersey citizens through escalating hospital admissions and a high demand for alternative, more restrictive and expensive programs.

Solution

The Cost of Providing Care Coalition is requesting a 4 percent increase to community provider contracts in the FY 2005 budget. Without this increase, services to New Jersey’s most vulnerable citizens will be at risk.