The landscape that special education providers have been operating in continues to be a difficult one. The rate-setting unit has yet again undergone leadership change with Tracey Coleman taking over the helm in place of Hal Matott and Brian Zawistowski being promoted to Assistant Director. Hopefully, they will be able to add a little stability to a department that has seen significant turnover in the past few years.
The sector continues to see shrinking numbers, with several more schools closing during fiscal 2019. This brings the number of provider closures over 60 statewide in the last five years, with approximately half of them in New York City. This has resulted in a swell in regional need with approximately 500 children without an appropriate placement in NYC alone.
Teacher and teacher assistants are still at a premium, especially in NY City, where the NYC Department of Education has been poaching staff in an effort to fill vacancies in their classes. It has been very difficult for special education providers to compete, as the pay disparity between providers and the school districts is approximately $36,000 per year, districts only have 180-day years, and the fringe rate statewide is now over 66%. This has significantly contributed to a 28% teacher vacancy rate. Programs should continue to maintain open communication with their regional associates regarding these vacancies so that there are no issues upon programmatic reviews.
While the ability to attract and retain staff is down, we see an uptick in the intensity of the children that are being served by special education providers. Students are requiring increased levels of related services and/or have a greater likelihood of needing behavioral intervention plans. Programs should monitor their costs for related services, counseling, and behavioral support staff. If they are experiencing increases in these areas, that may be a trigger to file for a waiver… There’s a new form for that.
A new waiver form has been implemented by RSU, who has been working to try to reduce the tremendous back-log of nearly 100 waiver requests. The new form is meant to summarize the request and helps to ensure that RSU understands the nature of the request, which program it is for, and the type of request (waiver vs. rebasing). If you have a waiver request in, and haven’t completed a waiver request form, you may want to follow-up with your line accountant at RSU to make sure that they are working on your request.
The Division of Budget approved rate increases of 3.6% for 853 schools and 2% increases for 4410 programs, including SEIT. This is less than the 3.6% proposed by SED. SED also made recommendations to increase teacher retention funding by an additional $4 million. The DOB has not yet made any decision on the additional teacher retention funding.
While many providers continue to lose money on SEIT services, some providers have underspent their rate. Keep in mind, that while you are paid on a fee for service basis (each unit of service you deliver), SEIT is still a cost-based reimbursement system. Any unspent SEIT funds are restricted and must be used for future SEIT services or to fund prior loses within SEIT.
At the NY City level, the OAG has started doing reviews of providers’ IDEA funding. These reviews commenced during March 2019. In addition, we are aware of at least one provider that the OAG is doing a review of their entire program. This is a provider that has already undergone an OSC audit. We are also aware of a provider that previously underwent an OAG review that is now being audited by the OSC. In these instances, the OSC and OAG are reviewing different years. So when it comes to auditing, I guess piling on is definitely allowable.
On the EI front, the 2019/20 enacted budget included a 5% increase for approved rehabilitation services provided by licensed speech pathologists, licensed occupational therapists, and licensed physical therapists, including supplemental evaluation services. The rate increase is effective April 1, 2019 and is applicable for services provided on or after that date. You do not have to rebill for this, BEI will make retroactive adjustments for any applicable services once they have the necessary system requirements in place. Providers should track these amounts to ensure that they are fully reimbursed for the rate increases.
By now most of you should have received instructions from SED on how to renew your Corporate Practice Waiver. This allows you to continue to provide medical services within an educational environment. Those notices were sent to the name and address on record. If there are changes or questions, they should be forwarded to 4410Waiver@nysed.gov. For most agencies with a waiver, it needs to be renewed by June 30th. If you have not received any communication from SED, I strongly recommend that you contact them at that email address above, attention Ruth.
Kenneth R. Cerini, CPA, CFP, FABFA
Ken is the Managing Partner of Cerini & Associates, LLP and is the executive responsible for the administration of our not-for-profit and educational provider practice groups. In addition to his extensive audit experience, Ken has been directly involved in providing consulting services for nonprofits and educational facilities of all sizes throughout New York State in such areas as cost reporting, financial analysis, Medicaid compliance, government audit representation, rate maximization, board training, budgeting and forecasting, and more.