The Districts Dime

Another Victim of Federal Medicaid Cuts: DC Schools

February 23rd, 2017 | by Jodi Kwarciany

New federal proposals to fundamentally alter Medicaid could slash school budgets and hurt vulnerable students. Caps on Medicaid, such as block grants, would squeeze resources that schools use to provide health screenings, mental health services, and special education services.

Kids In CircleWhen children are healthy, they’re better able to succeed. For low-income students and those with significant health needs, Medicaid can connect low-income students to needed services, including direct medical services for those with an Individualized Education Plan (IEP) that require more intensive needs, or preventive health screenings through Early Periodic Screening Diagnosis and Treatment Benefits (EPSDT). Schools can get federal Medicaid funds to provide these services to students who are Medicaid-eligible.

Proposed changes to Medicaid could jeopardize this funding. Federal and state governments currently share the costs of Medicaid through a fixed matching rate, allowing Medicaid programs to reimburse schools as needed for the services they provide. Two commonly floated proposals for Medicaid as a part of Affordable Care Act repeal, block grants and per-capita-caps, would change this. Block grants would mean that school districts would have to compete with other entities like hospitals and health clinics for a fixed allocation of federal funds. Per-capita-caps would provide a set amount per child enrolled in Medicaid, but may still prevent schools from providing unexpected but necessary costs, like if a child experiences trauma and needs mental health services.

A recent survey found that school leaders around the country are concerned that Medicaid changes would harm low-income students and those with special education needs and/or disabilities. A large reimbursement decline would affect the quality of special education programs and the degree to which schools could provide preventive health screenings and services for low-income students, or handle the growing need for mental health services. Some leaders anticipated making staffing cuts to make up for reimbursement losses. And with less funding available for enrollment outreach, leaders worried that it could increase the number of uninsured children.

These changes would be particularly harmful in DC. There are over 118,000 children under the age of 18 in the District, and the majority are covered by Medicaid. Over 11,400 children had an IEP during the 2015-2016 school year, or about 10 percent of all DC children.

Any Medicaid cuts would disproportionately impact schools with higher concentrations of Medicaid-eligible students, like those in Wards 7 and 8. These wards have the highest number of children living in poverty, and are also the home to about 35 percent of DC’s children.

The District has made incredible gains in connecting children to coverage, with just 1.5 percent currently uninsured. When schools have the resources to support student health, they’re able to help students of all backgrounds succeed. DC’s students cannot afford changes that jeopardize their health and well-being.

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As Universal Paid Leave Moves Forward, an Alternative Proposal Is Introduced

February 22nd, 2017 | by Ilana Boivie

You may have heard that DC’s paid family and medical leave program took an important step forward last week—but also that a new paid family leave bill was just introduced in the DC Council. Both are correct. Understandably, you might be a little confused.

pflNever fear—DCFPI is here to break it down for you.

The short story is that while the DC Council approved a bill in December, some members and the business community want to consider an alternative that lowers the tax businesses would pay to support the program. As discussed below, any alternative should be assessed to make sure it is better for workers, as well as businesses.

Last Wednesday, Mayor Bowser allowed the Universal Paid Leave Act (UPLA) to move back to the City Council without her signature. This means the bill will become law after a 30-day congressional review period. Workers will get 8 weeks of paid leave to be with a new child, 6 weeks to care for an ill relative, and 2 weeks for their own health needs. DC employers would pay a 0.62 percent payroll tax ($310 a year for a $50,000 salary) into a fund that would be managed by the city.

Then, just yesterday, Councilmembers Evans and Cheh introduced a new bill that would provide the same benefits, but with a different structure. Smaller businesses (under 50 employees) would be covered by a government-administered program like UPLA and pay a 0.4 percent payroll tax into the fund. Larger employers would be required to provide family and medical leave benefits on their own—without the fund—but would still pay a 0.2 percent tax to help support the cost for small businesses.

Like unemployment insurance and Social Security, UPLA uses a social insurance model, which has been tested and proven to work well. Similar to these programs, a DC-run family leave program can provide benefits to workers with a predictable tax and low administrative costs. For this reason, all of the states that currently offer paid family and medical leave use this structure.

Any alternative structure should be studied carefully. We’ll be assessing it to see, for example:

  • Whether low-wage workers have the same access to benefits,
  • Whether the program is financially predictable and administratively manageable for employers of all sizes, and
  • Whether the program is easy to enforce, and would be robustly enforced

It’s important to note that both the approved bill and the new proposal require DC to set up its own program. This means that policymakers should begin moving forward with implementation, to ensure that workers can begin collecting benefits as soon as possible. First and foremost, $20 million in new funding is needed in the FY 2018 budget for important start-up costs, such as IT infrastructure. This could be funded by changing DC’s fiscal policy to allow spending some of the recent surplus.

Because UPLA stands to help DC residents, small businesses, and the broader economy, we encourage policymakers to fully fund the program in the FY 2018 budget, so that we can get to work on implementing this very important program.

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DC Should Invest in Transportation Subsidies for Adult Learners

February 17th, 2017 | by Ilana Boivie

On any given day, there are adults in DC who can’t get to their GED class or other adult education program simply because they don’t have bus fare. Just as the District helps “Kids Ride Free” to school, the District should invest in transportation assistance to help adult learners achieve their educational goals, leading to better jobs to support themselves and their families.

As Mayor Bowser and the DC Council start their work on the budget for 2018, adding just $2 million for transportation assistance would improve the outcomes of the city’s substantial investments in adult education—and strengthen the DC economy by helping more residents live up to their potential.

The District of Columbia’s economic progress is undermined by an income inequality crisis. Some 60,000 DC residents lack a high school diploma or equivalent,[1] and over half of the students in adult education programs test at a sixth-grade level or below in reading and/or math. Most residents without a high school degree are black, reflecting one of the starkest aspects of racial inequity in DC.

Low literacy and low educational attainment are root causes of poverty, unemployment, poor health and homelessness. Adults without a high school credential are seven times more likely to live in poverty than those with a high school credential. D.C. residents without a high school degree are five times as likely to be unemployed as residents with a bachelor’s degree.[2]

The District invests over $80 million in local and federal dollars in educational instruction for adult learners, yet the results are undermined because many can’t get to their classes. Unlike students under age 22—who ride Metrorail and bus for free—students over age 22 pay the full price, which poses a significant financial burden that often leaves them stuck in a cycle of enrolling and dropping out.

A recent report by the Deputy Mayor for Education recommends “expand[ing] the unlimited bus and rail component of the School Transit Subsidy program to all District residents enrolled in a publicly funded adult education program.”[3]  Serving nearly 7,500 students would cost no more than $2 million. This includes adults enrolled in community-based organizations (CBOs), UDC’s Workforce Development and Lifelong Learning programs (WDLL), and adult charter and alternative education schools. The DME report notes that “the current investment in adult education could yield greater results with a reduction in transportation costs for adult learners.”

We urge the Mayor to include transportation subsidies for adult learners in her proposed budget for fiscal year 2018.

[1] DC’s WIOA State Plan. Available at http://dcworks.dc.gov/sites/default/files/dc/sites/dcworks/publication/attachments/WIOA_DC_Unified_State_Plan_Final.pdf

[2] Lazere, E., and M. Guzman. 2015. “Left Behind: DC’s Economic Recovery Is Not Reaching All Residents.” DCFPI. Available at http://www.dcfpi.org/wp-content/uploads/2015/01/State-of-Working-DC.Final_1.pdf

[3] The DME report notes that certain adult learners may have access to transportation subsidies through other programs, and provides descriptions of these various programs. However, the report goes on to conclude that due to “very narrow, specific eligibility requirements” there remains a very high unmet need in the city.

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To Make Early Learners a Priority Invest More in Child Care Subsidies

February 15th, 2017 | by Marlana Wallace

The District should take a number of steps to improve the care and education of our youngest children, infants and toddlers, but one of the key steps is to make sure providers of this care get the resources they need to offer supportive and stimulating environments. As DC’s leaders gets closer to putting together a budget for next year, they should make it a priority to invest more in the child care subsidy program for lower-income parents.

Access to affordable, high-quality early learning can reduce the achievement gap that begins before children even reach a pre-K classroom. High-quality early education—in a child care center or with a home-based provider—supports school readiness and improves health outcomes later in life, all while relieving hard-working parents.

Raise Child Care Subsidy Over 3 Yrs-01The District demonstrated an impressive commitment to advancing early education by implementing an expansive Pre-K program, with families able to choose among three sectors: traditional public schools, public charter schools, and community-based organizations. But the departure of preschool children for public school classrooms exacerbated the already-considerable financial challenges facing community-providers who serve infants and toddlers, particularly those in low-income neighborhoods.

There is a large gap between the subsidy payments these providers receive from DC’s child care subsidy program and the actual costs of providing high-quality care to infants and toddlers, as noted in our 2016 report with DC Appleseed. As a result, many community-based organizations serving our youngest, low-income learners struggle to provide quality care. Nearly half of the providers in our study operated at a loss, some even going into personal debt to float their Center’s operations. Teachers and staff in DC’s early education centers perform critical and demanding jobs, yet they are among the lowest-paid workers, earning only $26,900 on average, which contributes to turn-over and stress in the workforce. And some providers are reluctant to take the steps needed to meet the city’s highest quality rating because they do not receive enough additional funds to meet their higher costs, according to testimony at a DC Council hearing this week.

Our research found that an increase of $38 million in the subsidy payment rates is needed to cover the actual costs of caring for infants and toddlers. This increase could be phased in over several years, such as $13 million per year over a three-year period. We also recommend the District consider differentiated subsidy rates, such as higher rates for providers in high-poverty neighborhoods, or that serve a large number of children with special needs. Community-based providers can then invest these additional funds in attracting and retaining good teachers, earning higher quality ratings, and better serving the young children in their care.

DCFPI testified on this yesterday, see the full testimony here.

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New Bill Would Untie DC’s Surplus and Put it to Use!

February 13th, 2017 | by Ilana Boivie

A new bill before the City Council would “untie” the city’s hands so that policymakers can spend a portion of the recently announced surplus for 2016 on much-needed services, rather than putting the entire amount into savings. The legislation would allow the District to spend about $90 million now, and give policymakers flexibility to spend the full amount of any future budget surpluses.

general fund balanceUnder a policy the District adopted in 2010, year-end surpluses must go into savings until the city has enough cash in reserve to fund DC government for 60 days. This takes away the choices that policymakers should have—to spend a surplus, save it, or to do a combination. The just-released audit of the District’s finances showed that DC’s General Fund balance grew by $222 million in 2016—to a record $2.4 billion—but none of that is available to be spent because of this rule. (The fund balance represents DC’s accumulated assets, including various reserve funds.)

The new Council legislation, The Reserve Fund Improvement Amendment Act of 2017, would still require the District to have enough cash to cover expenses for 60 days, but would not take out the expense of paying off DC’s bonds, since the District already sets aside money for that purpose. Under this formula, DC’s existing cash balance is $90 million more than needed to meet the reserve requirements. This would mean that some $90 million would be freed up instantly for the city to spend on services.

The additional money would be allocated to two specific programs under the bill—half of the money would go to fund the Housing Production Trust Fund, which finances new affordable housing projects, and the other half would be reserved for school modernization projects.

This proposal makes sense because it increases the flexibility DC’s leaders have when the District has a budget surplus. The bill could be strengthened even further by broadening the allowable uses to include other important one-time costs, such as start-up costs for paid family and medical leave.[1]

In fact, the proposal is very much in line with one of the recommendations made by DCFPI at the Progress Amidst Uncertainty: Making the Most of DC’s 2018 Budgetevent. DCFPI outlined three policy proposals in response to the growing city surplus: delay the tax-cut triggers, spend the surplus, and set up a reserve fund.

 

[1] Because a year-end surplus is not guaranteed every year, the District cannot use the surplus to fund programs or services that have ongoing costs, like hiring more teachers or providing permanent supportive housing to residents experiencing chronic homelessness.

 

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