It will take new leaders at the top, a new culture or attitude among employees in Beatrice, and more options and better oversight in community-based programs before the state can fix the problems at the Beatrice State Developmental Center, according to a legislative report.  

And just in case the state-run institution doesn’t pass federal muster, the Legislature should set aside the $28.6 million to replace  lost federal Medicaid funds, according to the report released Monday from a special committee investigating BSDC issues.

But with the right changes, the state institution could become a center of excellence for the residents and for community-based providers, according to the report.

Specifically, the legislative committee said it had no confidence in three leaders: Chris Peterson, Health and Human Services Department CEO; John Wyvill, Division of Developmental Disabilities director; and Ron Stegemann, CEO at the Beatrice institution.

The leaders have demonstrated a “mentality of ‘what do we have to do to get CMS ( Centers for Medicare and Medicaid Services) off our backs’ rather than vision and leadership,” the report said.

Peterson said her announced retirement last week to spend more time with her family has nothing to do with this report.  And Wyvill  said he has no plans to leave.  

The committee’s no confidence statement “does hurt, but it comes with the territory,” Wyvill said in a telephone interview Monday afternoon.

“My job is to stay focused and implement the plans we have at BSDC,” he said.

The entire senior staff has been replaced since September 2006 when the first of nine federal inspections took place, he pointed out.  

The management has also been able to reduce overtime by 25 percent and the much criticized mandatory overtime by 95 percent, Wyvill said.

The special legislative committee was appointed last spring to look into problems at BSDC.

Nationally recognized for its quality in the 1990s, the institution is in jeopardy of losing federal Medicaid funds that pay for more than half the $50 million annual costs.   

It is also under Department of Justice scrutiny, with an independent expert hired to follow the state’s efforts and report to a judge.  

HHS will not win its appeal on the Medicaid funding, and instead is working toward getting BSDC recertified by Medicaid next spring, according to Sen. Steve Lathrop, of Omaha, chairman of the committee.

However getting recertified will be very difficult, because the federal inspectors “will be looking for perfection” and the remaining clients at BSDC will be the most difficult to care for, said Lathrop.

The state has already fallen short of its goal to get BSDC “right-sized” to 200 clients by Jan. 1, one of the potential prerequisites for recertification, he noted.

There are about 250 people living at the state-run institution, about 50 less than one year ago.   

But Peterson and Wyvill said they still hope to move 50 more people into community programs before the spring so BSDC will  have enough staff to meet federal requirements.  

Currently, there are 92 individuals at BSDC who could easily move to community programs except for guardian opposition to moving, said Wyvill.

Many guardians do not believe that communities have the kind of programs their family members need, according to the report.  

And the state has not provided sufficient incentives so that community agencies can develop homes and programs for these BSDC clients, according to a Department of Justice report quoted in the committee report.

Gov. Dave Heineman and the two HHS leaders said they agreed with much in the committee report, including changing BSDC employee attitudes and culture, greater oversight of programs in the community and increased funding for agencies that offer the community programs.

Though many of the recommendations will require spending more money, the report does not specify how much money will be needed.

The only dollar amount is the $28.6 million the state will lose if the Beatrice institution is not recertified by Medicaid.

In a letter to the committee Monday, Heineman said his budget proposal will provide funding for the possibility that BSDC fails to be recertified.

Heineman also said he will seek money for additional inspectors so that community-based programs will be inspected more than once every four or five years, as is now the case.

Lathrop said the state will have to spend more money for adequate  services  or pay to fight lawsuits.

Reach Nancy Hicks at 473-7250 or nhicks@journalstar.com.

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