Committee: Joint Appropriations Subcommittee #2
South Dakota Department of Human Services
Mr. Bill Pike, LRC, presented the committee with budget information (Documents #1, #2, #3).
Mr. John N. Jones, Secretary, Department of Human Services, presented the committee with a
budget summary (Document #4) and other information (Document #5).
Secretary Jones introduced his staff members and presented an overview of the budget. The
Department is requesting an inflationary increase and salary increases for direct care, entry-level
staff, but no FTE increase. The Office of Legal Counsel is a new position and is working well.
Secretary Jones presented figures on number of clients served within each division. Senator Dennert
inquired whether those figures reflected any double-counting of clients. Secretary Jones indicated
there could be a small amount of double-counting, possibly in the Drug and Alcohol Abuse Division
if clients are dual diagnosed.
Secretary Jones presented an overview of the South Dakota Developmental Center at Redfield Division. He noted the new Turtle Creek program for children with some level of disability and who are in custody of the Department of Corrections or the Department of Social Services. The Department recently received a federal grant to hire a transition coordinator for the program. Recommended major budget items include an increase for food service and for pharmacy.
Representative Putnam inquired whether only federal funds were expended under the food service
increase. General funds were reallocated and federal funds added.
Senator Frederick asked how long the Department has belonged to the Minnesota Compact for the
purchase of pharmaceuticals and what is being done to consolidate pharmacy services. A consultant
has been retained to review operations, and pharmacy technician positions are helping to cut costs.
Senator Hainje inquired about the status of Doctor of Pharmacy position. A Doctor of Pharmacy has
been hired to work at the Human Services Center in Yankton and is available to the Redfield facility
by phone.
An overview of the mission, goals, and activities of the Division of Developmental Disabilities was
presented by Secretary Jones. Senator Fredrick questioned if the 30 new families on line for home-
based services would have been totally forgotten about otherwise. The services are keeping some
children at home who would have been placed in out-of-home services.
Secretary Jones noted the Department doesn't know how many children with developmental
disabilities are not acknowledged by the system because they do not access programs within the
Department. Each year a few children previously unknown to the system enter it. The Department
is requesting funding for half of the 38 individuals 21 yrs old next year and served by the
Community Adjustment Training Centers; funding for the other 19 individuals and those not known
to the system will be taken care of by attrition. Senator Dennert requested a 5-yr projection of the
number of individuals turning 21 yrs old. Most children are serviced through special education in
the school districts until they are adults; therefore, it is difficult to predict how many need care as
adults. The Adjustment Training Centers are seeing children enter the system later and later.
Senator Frederick requested a brief outline from Mr. Fred Romkema, Community Based Services
Association, regarding issues for the meeting tonight. The main issue is funding for the 38
individuals turning 21 yrs old.
Secretary Jones outlined the mission and goals of the Division of Human Services Center in
Yankton. He noted the Center is now licensed as a specialty hospital, but not a full-service hospital.
This license enables the facility to bill third parties. The Department also is working on an agency
bill to determine actual costs based on services offered, so that individuals can be billed per service
rather than per diem. The Department will still need a per diem rate for some individuals in which
the state pays the costs incurred by the patient.
Senator Bogue inquired how patients able to pay are currently being charged. They are charged per
diem, $246/day. He also inquired how the Department determines ability to pay. Secretary Jones
responded that has not been addressed yet. Additional funds generated by billing per service will
automatically go back into the General Fund.
A new service offered by the Division is a long-term adolescent psychiatric program, with a 16-bed capacity and a minimum stay of 1 year. The Department is aggressively searching for a child psychiatrist. Senator Lange asked if adolescent was defined as 10- to 18-year-old children. Secretary Jones replied that it is 12- to 18-yr-old children.
Major items recommended for budgeting include an increase in funding for food service and for
pharmacy services. A regular budget has been created for medical staff. Representative Putnam
asked if there has been an increase in general funds for food service. The Department responded that
more general funds than federal funds are used at the Human Services Center in Yankton, but more
federal funds than general funds are used at the facility in Redfield.
Senator Frederick inquired into the status of the food service vendor Best Foods, owned by Fine
Host. Secretary Jones responded that the parent company has filed for reorganization but the vendor
has assured the Bureau of Administration it will not affect service. Bureau of Administration is
responsible for the vendor contract. Representative Putnum asked whether a plan is in place if the
vendor does not provide service. Secretary Jones responded that there is not, but the Department
will work on putting one in place.
Representative Putnum inquired whether the movement of FTEs at the Yankton facility means
program changes are being made. There are no program changes; the movement is on paper only
to allow the Department to capitalize on federal funds.
An overview of the Drug and Alcohol Division was presented. The Department recommends moving
the $200,000 for gambling addiction from the Mental Health Division to the Division of Alcohol and
Drug Abuse, which will stretch the dollars. The Department will continue to assess the move.
The Department requested and received a Substance Abuse, Prevention, and Treatment block grant.
Part of the funding will be used to increase the rate paid to the alcohol and drug abuse providers.
The money will also be used to fill gaps by purchasing additional services and prevention activities.
No matching funds are required, but the Department is required to spend the same amount in the
current year as in the previous year. Mr. Gibb Sudbeck, Director, Alcohol and Drug Abuse
Division, noted that there was a 9% growth from last year in the number of people receiving service.
Representative Klaudt asked about current rates paid to providers. Individual counseling, $32/hr;
group counseling, $7.50/hr; prevention services, $25- $44/hr. The Department is now conducting
a cost analysis to determine costs by service area.
Senator Frederick inquired if the block grant would cover program cost increases due to inflation.
The Department was not sure. Senator Frederick also asked how clients will be obtained. Secretary
Jones indicated the courts make referrals as well as families. Senator Frederick inquired if the block
grant allows funds to be banked year to year. The block grant allows one year to obligate and two
years to spend.
Mr. Sudbeck noted the Department serves those in the Department of Corrections related to alcohol and drug prevention. There is no line item in the Department of Corrections for alcohol and drug prevention. Representative Putnam inquired how the Department knows it will need to serve 1400
more clients. The figure is a raw number projection. Drug and alcohol programs for the Department
of Corrections are not paid for with the block grant money. Eighty-four percent of people entering
the corrections system have a drug and/or alcohol problem. There is no ability to transfer money
with this block grant, and there is a 5% limit for administrative costs.
Discussion followed on referral sources for drug and alcohol abuse. Only 7% are self referrals; 93%
are from other sources. Representative Klaudt requested and Mr. Sudbeck provided an overview of
the west river program.
Secretary Jones provided an overview of the Division of Mental Health and highlighted two
expanded initiatives: 1) funding the purchase of medication for indigent who have no other way of
purchasing pharmaceuticals; and 2) combining treatment of mental illness and chemical addiction
for those clients who need it. The initiatives are designed to tackle a high re-admission rate problem.
The Human Services Center in Yankton has a 58% readmission rate. The Department is also
becoming more aggressive in the area of forced medication compliance.
Secretary Jones highlighted major budget items including the Title XIX match rate change, inflation,
and expansion areas. Mr. Hal Birch, Member, National Alliance of the Mentally Ill - South Dakota,
expressed his concern regarding the importance of indigent medical management.
Representative Klaudt inquired as to the average length of treatment in the Severe and Persistent
Mental Illness program. Acute care averages 25 days, and rehabilitation averages one year.
Secretary Jones overviewed the Division of Rehabilitation Services and noted the status of medical
insurance for individuals at the time of application and the time of closure. He highlighted the
annual income of clients rehabilitated, their average hourly wage, and the percent of clients who are
able to rely on their own income at the closure of their cases. The Department is looking to increase
the salary of the primary care providers in this division. Secretary Jones noted the change to the Title
XIX match rate, which is to the benefit of the state.
Discussion followed on telecommunications relay services (TRS) and how it is funded. Secretary
Jones noted that the Attorney General, the Department of Revenue, and the Department of Human
Services is aggressively pursuing accounts receivable due to the state for telecommunication relay
services. The Department of Human Services would support adjustments to codified law or rule
permitting the state to charge interest and/or penalties for accounts past due. Senator Frederick
assigned Senator Hainje to look into the matter. Senator Frederick inquired into the TRS fund
balance. Department staff believe it is approximately $100,000 and will provide the actual figure
to the committee at the next meeting.
An overview of the Division of Service to the Blind and Visually Impaired (SBVI) was presented
by Secretary Jones. Mr. Grady Kickul, Director, SBVI, explained the client service expansion,
which is for case services. A higher percentage of clients are requiring assistive technology.
Seventy-five percent of SBVI clients are being employed; the average starting salary is $9.00/hr.
Seventy percent of the clients are also receiving medical and dental benefits. The Department
explained vending dedicated revenue and noted the set aside balance for the program is $73,000.
The meeting adjourned at 11:44 am.
Deborah Rumrill