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Illinois could save millions by reforming developmentally disabled services

by Emma Jackson
March 10, 2010

Note to Ill. Gov. Pat Quinn: If you want to trim that bloated state budget, take a page from Indiana’s book. The state has saved hundreds of millions of dollars by shutting down its state-operated institutions for the developmentally disabled and financing more community care services.  

But, advocates and policy analysts say, politics may be driving policy in Illinois more than fiscal considerations, or even what’s generally agreed upon as best practice for the developmentally disabled.  

A week before the February primary, Gov. Quinn struck a deal with the American Federation of State, County and Municipal Employees in which he agreed not to close any more state facilities for the developmentally disabled for a year. Illinois has closed one of its ten state facilities and is in the process of closing the Howe Developmental Center, after a Justice Department's recommendation that Howe violated the constitutional rights of its residents. 

Gov. Quinn's move, which helped protect union jobs while delaying the push to close state institutions and move the disabled to less costly alternative community care settings, has its critics.

"The State of Illinois needs to follow what's in the best financial as well as quality-of-life interest of its citizens and not hold those jobs and those institutions above the needs of its citizens," said Laurence Msall, president of the Civic Federation.   

“It’s very much like prisons. In state-operated developmental centers those are really good jobs that people want to keep and that’s the politics of it,” said Elizabeth Powers, professor of economics at the Institute of Government and Public Affairs at the University of Illinois in Champaign-Urbana.  

“If you contrast the pay and benefits of people that would be leaving a state-operated development center to the private sector, there is no comparison,” she added.

It costs $142,533 annually to house a developmentally disabled individual in an Illinois state developmental center.  By comparison, the annual cost of community care is about $53,291, for a savings of nearly $100,000, or 63 percent, according to a report by the governor’s Taxpayer Action Board. 

Roughly $547 million was spent on private and public institutional care in Illinois in 2006.  The state ranked fourth in the nation in the number of disabled in state institutions, with 2,385 individuals in 2008.

“Illinois wastes hundreds of million dollars by funding institutional options when what families want are community living arrangement options,” said Tony Paulauski, president of the Arc of Illinois, a nonprofit advocacy group for the disabled.

When states concentrate resources on institutional spending, fewer disabled are served due to the high cost, added Richard Hemp, a research assistant at the Coleman Institute for Cognitive Disabilities.

The trend toward deinstitutionalization of the developmentally disabled has steadily accelerated, following passage of home- and community-based service waivers under the Americans with Disabilities Act of 1990.  

But Illinois is an outlier in that trend. It ranked sixth nationally in public and private institutionalization in 2006, with 63 per 100,000 developmentally disabled individuals living in institutions.  It ranked last in the proportion of persons served in residential settings that support one-to-six people.

Mary Kay Rizzolo, associate director at the Institute on Disability and Human Development at the University of Illinois at Chicago, said Indiana provides a great model for what Illinois could do to provide better support for the disabled.

“Indiana made drastic improvements in the past eight years in investing in supported living options in the community versus the institutional model of care,” she said.  “Illinois can certainly learn some lessons from them.”

Indiana joined nine other states and the District of Columbia in no longer financing state-operated institutions. States can use the estimated 60 percent in cost savings to spend in other areas or to provide more disabled services.  

A joint report by David Braddock, Ph.D. and Richard Hemp, M.A. recommended that Indiana use the considerable savings from closing its institutional facilities to finance more community services and family support for the developmentally disabled.

Community services spending in Indiana, adjusted for inflation, grew by 85 percent between 1999 and 2008, while institutional spending declined by 81 percent.  In 2006, Indiana committed 88 percent of its total developmentally disabled resources to community services, compared with 64 percent in Illinois.  

Marcus Barlow, a spokesman for the Indiana Family and Social Services Administration, said moving completely to a home- and community-based waiver system for the developmentally disabled has been a win-win for both the state and the disabled.

“Being able to go into the community increases their quality of life, they tend to take advantage of work support services in the community care settings,” he said. “It has also led to significant cost savings for the state.”  

But union officials say estimates of huge cost savings are overblown.  Anne Irving, director of public policy at AFCSME, said moving the developmentally disabled from institutions to community care doesn’t save that much money, because many need a high level of medical care or a high level of behavioral care, regardless of the setting.    

“There isn’t going to be a huge pool of money if you close down the state developmental centers,” Irving said.  “What you’re going to have are people who need a serious level of care in the community.” She added that a union workforce in community settings is essential for improving the quality of care.

Rizzolo counters that the community care setting is cost-effective since each individual gets a package of services based on his or her needs.  “Individualization of the services is what makes it more cost effective since they typically only receive the support that’s necessary,” she said.  

Barbara Pritchard, president of the Campaign for Real Choice in Illinois, said Gov. Quinn’s one-year moratorium on state institutional closings is depriving the disabled of the opportunity for more independent living and more opportunities to go outside, over institutional settings that tend to confine the disabled.  

“Maybe having individuals in his ears that are voters might have more of an impact than individuals with disabilities that can’t speak,” she said.