Changes in access to services for NC residents with disabilities after compromise halts long legal fight

North Carolinians with intellectual and developmental disabilities can expect changes in access to community-based services, as the North Carolina Department of Health and Human Services and Disability Rights North Carolina reached a compromise last week after a years-long legal battle. 

Superior Court Judge Allen Baddour agreed to sign the consent order on April 17, a negotiated agreement between both parties that temporarily resolves the case for two years.

During that time, the state will follow agreed-upon solutions and afterwards, both parties will reassess what progress has been made, what more needs to be done and whether the case can be closed. 

Disability Rights North Carolina represents the plaintiffs in the lawsuit, which was filed in 2017. The suit claimed DHHS failed to make sure disabled people could receive essential services in their communities, resulting in many people being institutionalized or at risk of institutionalization.

The suit was filed on behalf of Samantha Rhoney, who was 27 when she was admitted to an institution in North Carolina. She needs care for her disabilities, but the state-contracted agency in charge of her services gradually decreased her care to save money, her mother, Dana Rhoney, told Carolina Public Press.

Her parents tried to fight the service cuts through appeals, but were unsuccessful and had to send her to the institution, her father, Tim Rhoney, said.

Now 35, Samantha is “living her best life” in a home with two full-time caregivers, Dana said. 

“I have nothing against the institute,” she said. “But for my daughter who is very social and loves to be out around people, she just needs help to do that.”

But the fight to get Samantha out of the institution left Dana feeling as though the state doesn’t listen to guardians about what’s best for the individual, she said.

Around 4,000 people with intellectual and developmental disabilities live in institutions statewide, not including those in adult care homes, according to the case. More than 17,000 people are on the waiting list to receive a Medicaid waiver that would allow them to access community-based services, the consent order said. 

Part of the issue outlined in the complaint is insufficient numbers of available direct support professionals, workers who help disabled people go about their lives in the community. 

Around 14,000 people are currently receiving community services, according to DRNC Litigation Counsel Lisa Grafstein.

Grafstein said these types of services are important because they help disabled people live full lives.

“Disabilities really are just a barrier for folks, not because of anything inherent in them, but because our world is just not set up for people with disabilities,” she said.

Benchmarks for the state

The roots of the case go back to the Olmstead decision, a federal case that determined disabled people should be able to access community-based services. But without adequate services in the community, Disability Rights North Carolina said the state failed to provide that option.

The judge issued an order in 2022 for DHHS to fix these issues, which the state appealed. Now that the consent order is in place, the state dropped its appeal, according to Disability Rights.

This means the parties can focus on action instead of battling it out in the appeals process, Grafstein said.

Tim Rhoney said he’s worried the consent order is “watered down” from the more aggressive original order, but understands that if Disability Rights went ahead with the appeal process, the result could be no solutions at all.

From his family’s 30 years of dealing with the state, he said he’s learned the state will not do anything unless forced.

The main things he and Dana would like to see the state do are get people off the waitlist for services and build the workforce to provide services, he said, as well as support existing community-based service organizations.

Among the benchmarks in the consent order is for the state to transition 249 people with intellectual and developmental disabilities out of institutions into community-based services by the end of June 2027.

Increasing access to community-based services and direct support professionals is another benchmark.

The availability of community-based services is the responsibility of North Carolina’s Local Management Entity-Managed Care Organizations, or LME-MCOs, according to the consent order. These multi-local governmental agencies operate as contractors and manage NC Medicaid services for people with intellectual and developmental disabilities, as well as others. 

While LME-MCOs operate under boards appointed by constituent counties, and they have sometimes acted like competitive private business enterprises jostling for territory, DHHS does have oversight authority over them. The consent order requires DHHS to actually use that oversight authority effectively. 

At the end of the two years, the issues likely won’t be solved, Grafstein said, but the parties will have a lot more information about what more needs to be done. 

Tim Rhoney said he’s still not very optimistic about the state adequately meeting the benchmarks in the consent order.

Addressing the waitlist

The consent order came after months of negotiations, Grafstein said, and the biggest thing Disability Rights North Carolina negotiated was compromising the previous order for the state to end the Innovations Waiver waitlist in 10 years.

The agreement waives certain requirements of Medicaid, like income, so more families can access community-based services, she said. Many families on the list have been waiting for decades, she said.

The list is so long because the state controls the number of people who can access the waiver, Grafstein said, as both state and federal funds make it possible. Some states have no limit, she said. 

But the new Medicaid entitlement program may help address this, Grafstein said, because it provides home- and community-based services.

One must qualify for Medicaid to receive it, and the state estimated around 70% of the people on the waitlist are eligible, according to the consent order. 

Still, Grafstein said, many people are “wary” of the community-based service system from stories they’ve heard about long waits and instability.

“It’s changing the culture and building up the system so people will understand this is an option,” she said.

Workforce shortage

Increasing access to community-based services also means making sure workers are available to provide that care, Grafstein said, such as direct support professionals who may, for example, take disabled persons shopping or help them find jobs.

In order to increase the workforce, LME-MCOs may need to raise pay rates, she said. 

Because the agencies have an obligation to provide care, they must pay the rate needed to develop the workforce to do so, she said.

“Under the system right now, we haven’t been holding LME-MCOs responsible by requiring that they adjust their rates to ensure that they have a workforce available for people,” she said.

The legislature gives these agencies a pot of money to provide services, whether it’s a gain or a loss financially, she said. 

The agencies may argue they need more money to raise rates, but that’s up to them to renegotiate with DHHS, Grafstein said. 

While an industry-wide health care worker shortage exists, she said these specific positions don’t require high levels of education and could be good opportunities for rural areas with less job opportunities.

DHHS response

Workforce development in community-based services has been a challenge since the COVID-19 pandemic, according to Kelly Crosbie, Director of the Division of Mental Health, Developmental Disabilities and Substance Use Services. 

The work is not well-advertised and people may consider other employers like McDonald’s and Walmart that offer similar rates without being as emotionally demanding as caregiver work, she said. 

The state has been trying to address this through initiatives such as offering money to employers to use for longevity bonuses, offering apprenticeships and teaching high schoolers and community college students about the career, Crosbie said.

The legislature did establish a rate increase for direct support professionals that was two thirds of what DHHS asked for, she said. 

Some LME-MCOs have raised rates without legislative action, she said, but their money is based on Medicaid base rates and how much utilization Medicaid expects. So raising the rate higher means the money must come from somewhere else, she said.

LME-MCOs are also held to care and quality standards that the state oversees, Crosbie said, such as having an adequate network.

The Medicaid entitlement program is a “huge game changer,” Crosbie said, because it increases access to community-based services. DHHS is working on spreading the word, she said, and pointed to the state program Inclusion Connects that helps connect people with intellectual and developmental disabilities to services.

DHHS and Disability Rights are involved in another legal battle concerning institutionalization of children with disabilities in psychiatric residential treatment facilities. A judge recently allowed that case to move forward after the state tried to have it dismissed.

*Editor's note: This story by Grace Vitaglione was originally published by Carolina Public Press.