The Collaborative — which consists of the Association for Behavioral Healthcare (ABH), Association of Developmental Disabilities Providers (ADDP), Children’s League of Massachusetts (CLM) and the Providers’ Council — hosted an informational session in late May for its joint membership on the history of Chapter 257 and how the landmark rate-setting law passed almost 20 years ago works to ensure access to quality human services.
To download the slides from the presentation, click here.
Chapter 257 of the Acts of 2008 is the historic act that reformed how the Commonwealth funds essential social services for its most vulnerable residents. It was passed unanimously by the Legislature and signed into law by Gov. Deval Patrick to address more than 20 years of chronic underfunding of the human services sector.
The webinar began with Providers’ Council President/CEO Bill Yelenak highlighting the history of Chapter 257 and the need for the landmark legislation to provide clarity and stability for community-based providers on reimbursement rates. Stephanie Costa, president and CEO of the Association for Developmental Disabilities Providers (ADDP), provided further context on the implementation of the law along with how the advocacy efforts of providers led to the creation of the system most organizations rely on. For 20 years (1987-2007), the Commonwealth did not adjust reimbursement rates to reflect actual costs, leaving providers underfunded for essential expenses like salaries, rent, heat, and health insurance.
In 2007, the Executive Office of Health and Human Services (EOHHS) released a report highlighting a looming financial crisis for the state’s human service providers, describing a service delivery system deteriorating under inadequate reimbursement rates. While the law was signed in 2008, it took an additional six years for the law to be implemented.
In 2014, thanks to the advocacy efforts of The Collaborative, organizations began to see the benefits of the legislation. Association for Behavioral Health (ABH) President/CEO Lydia Conley highlighted the continued challenges of full and fair implementation of Chapter 257 and discussed how the legislation has benefited the sector since it went into effect. Chapter 257 established a transparent, uniform and evidence-based process for the establishment of rates “which are reasonable and adequate to meet the costs which are incurred by efficiently and economically operated social service program providers.”
Over $2 billion in new funding has been added to the POS system, the majority of which was added after the full and fair implementation of the law in 2014, according to the Massachusetts Taxpayers Foundation. The Secretary of EOHHS holds sole responsibility for setting reimbursement rates, guided by testimony received during public hearings on each proposed rate. Chapter 257 mandates that contracts be adjusted to reflect economic conditions and requires full rate reviews at least every two years. The state must implement a Cost Adjustment Factor (CAF) to account for cost-of-living increases. The law also ensures that contracts cover all reasonable costs needed to deliver effective and efficient services. Chapter 257 also provides permeant rate adjustments, as they are annualized in the purchasing agencies’ budgets.
Rachel Gwaltney, executive director of the Children’s League of Massachusetts, shared that through the infusion of ARPA funds, Chapter 257 rates continued to climb to the 53rd percentile in accordance with the Bureau of Labor Statistics (BLS) data. Currently most rates continue to be funded at the 53rd percentile, which does not provide enough funding to meet the need of organizations, which has caused The Collaborative to push for the use of the 75th percentile to be used when calculating rates.
For any questions, contact Bill Yelenak at byelenak@providers.org.
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