Legislators Receive Update on Restoration of General Fund Reductions to Community Services Boards

September 24, 2019

Acting Commissioner of the Department of Behavioral Health and Developmental Services (DBHDS) Mira Signer briefed members of the Joint Subcommittee on Health and Human Resources Oversight last week about the Department’s actions to provide assistance to Community Services Boards (CSBs) with reductions in General Fund (GF) support incorporated in the 2018 Appropriations Act.

The biennium budget enacted in 2018 reduced state GF support to CSBs by $11.1 million in FY 2019 and $25 million in FY 2020, with the expectation that CSBs would replace these dollars with Medicaid reimbursements for services for CSB clients who were newly eligible for Medicaid under the expansion of eligibility that took effect January 1, 2019. VACo, VML, the Virginia Association of Community Services Boards, and several local governments raised concerns last fall about whether the CSBs would be made whole with Medicaid reimbursements, especially in FY 2019, as newly-eligible CSB clients needed to be enrolled in Medicaid, and CSBs needed to perfect billing processes with the managed care organizations that administer most of the Medicaid-funded services in Virginia. In order to respond to this concern, the Governor’s introduced budget authorized DBHDS to make $7 million in special funds available to CSBs if their Medicaid reimbursements did not reach at least 90 percent of the assumed GF reductions. VACo worked with VML, VACSB, and other stakeholders to include some additional reporting language in the budget, so that the GF reductions for FY 2020 could be revisited, if necessary, and to allow this assistance to be provided to CSBs earlier in FY 2019.

Acting Commissioner Signer reported to the Joint Subcommittee that DBHDS worked with the CSBs over the spring and summer to develop a methodology to measure Medicaid reimbursements relative to GF reductions, and determined that the aggregate shortfall was $7.8 million for FY 2019, which would allow DBHDS to release the $7 million in special funds. DBHDS and the CSBs agreed upon a methodology to distribute these dollars, which are expected to be provided to CSBs by the end of the month. CSBs will submit additional data this week, which will be included in DBHDS’s next quarterly report to the legislature; Acting Commissioner Signer suggested that this data will provide a clearer picture of how Medicaid reimbursements are stacking up relative to the FY 2020 GF reductions. She cautioned the Joint Subcommittee that the $7 million in GF restoration used one-time funding from departmental balances.

VACo’s Finance Steering Committee discussed this issue at its August 15 meeting and provided preliminary approval to language in the draft legislative program in support of keeping CSBs whole in FY 2020. VACo will continue to monitor the reports on Medicaid reimbursements relative to GF reductions as the 2020 General Assembly approaches.

Acting Commissioner Signer’s presentation is available at this link.

VACo Contact: Katie Boyle

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