State DHS head hoping to spare layoffs, beds

It appears that state Department of Human Services institutions will be spared employee layoffs, bed closings or service interruptions between now and June 30, the new DHS director told state legislators tosday.

“The staffing level that we had as of Jan. 1 we will try to retain. By doing that, there should be no layoffs,” said Chuck Palmer, Gov. Terry Branstad's choice to lead the state's human services agency. “None of the reduction in beds or the layoffs are going to go forward. The goal is to maintain where we were on Jan. 1.”

Palmer said the new governor is studying possible internal DHS funding reallocations and a “fast-track” supplemental appropriation request to the Legislature for Iowa's four mental health institutes and two youth facilities to get the agency through the current fiscal year. Overall, Palmer said some of the previously announced savings were already factored into the department's operation and he expected that the funding gap that needs to be addressed by June 30 likely would be in the $10-million range.

Charles Krogmeier, the former DHS director in Gov. Chet Culver's administration – which ended last Friday - announced last week that the agency could face layoffs of up to 136 employees, the elimination of 129 institutional beds, service cutbacks and program eliminations to meet the additional $27.3 million reduction in DHS spending needed yet this fiscal year. That was the human services' agency's share of the overall $83.7 million in general-fund savings the Legislature mandated state departments find in fiscal 2011 as part of a massive government reorganization effort.

Krogmeier had proposed cutting the number of beds and halting some admissions at MHIs around Iowa, as well as reducing capacity or cut beds at facilities serving vulnerable or at-risk youth in Toledo and Eldora. Possible alternatives also included phasing out some beds and shifting funds at several facilities to accomplish short-term savings.

But Palmer said today that none of the contemplated changes at mental health institutes in Cherokee, Clarinda, Independence or Mount Pleasant that had been proposed would move forward and their would not be changes at the Toledo juvenile home for the current fiscal year. Beyond that, Palmer said DHS programs and services would have to be looked at in the context of comprehensive mental-health reform and what funding level is needed to accomplish the agency's priorities.

“Our goal is to sustain these individuals in the settings that they're in, and the staffing,” he said. “These beds right now are necessary. You wouldn't have people in these beds if there were alternatives in many cases. Many of these people have been through multiple community-based services. They need these services.”

Palmer made his comments during and after today's joint House-Senate Health and Human Services budget subcommittee meeting, where lawmakers will be looking to close a $600 million gap in state Medicaid funding for the fiscal 2012 budget year that begins next July 1.

State Sen. Jack Hatch, D-Des Moines, a committee co-chairman, last week called for legislators and Branstad to consider using a share of the projected surplus ending balance to supplement DHS programs for the rest of the current fiscal year. At Wednesday's meeting, he told Palmer he appreciated his quick response in addressing the agency's short-term financial needs.

Sen. Bob Dvorsky, D-Coralville, chairman of the Senate Appropriations Committee, said he expected to see Branstad include a supplemental spending request for the current fiscal year when Branstad presents a two-year proposal for the fiscal 2012 and 2013 budget years to the Legislature next week.

“I think we need to get through this fiscal year before we move forward in the next fiscal year,” Dvorsky said. “It would be useful if we had some sort of supplemental. We need to keep these agencies operating.”

Palmer said the Branstad administration is committed to keeping financing level for the facilities at least through this budget year. After that, he said longer-term questions about the facilities – including revisiting the prospects for closing DHS facilities - should be discussed as the Legislature considers reforming the entire mental-health system.

The overall question of what are the services that we need to have to serve vulnerable Iowans and the role of MHIs needs to be looked at in that context.