As Medicaid waiver system changes, Lynchburg nonprofit struggles to make shift

Like many of her coworkers, Felicia Johnson’s favorite part of her job at Lynchburg Sheltered Industries is the paycheck.

The 28-year-old is one of about 25 people with intellectual or developmental disabilities at the nonprofit facility participating in the prevocational service being phased out as the state restructures its Medicaid waiver system.

“I like the work, not sitting at home,” said Johnson, who has worked at LSI for five years.

The Medicaid waivers system uses state money to draw matching federal dollars to help support people with disabilities through a range of services. LSI staff is worried they no longer will be able to provide pay through work after the redesign goes into effect July 1.

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Will Sullivan sorts through envelopes for Mail American at Lynchburg Sheltered Industries. Photo by Jill Nance

Many nonprofits are in the process of figuring out how to adapt their programs and shift with the bureaucracy.

“It’s in flux right now, and I think a lot of providers are not sure what’s going to happen. Obviously, we’re one of them,” LSI Executive Director Cecil Kendrick said.

The redesign is meant to address a backlog of more than 10,000 people waiting for waivers as well as meet the settlement Virginia made with the Department of Justice in 2012 after failing to reach standards of federal law.

DBHDS Director of Community Services Heather Norton is working her way to organizations affected by waiver restructuring. She said LSI is on the list.

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Pam Herring (right) and Tiffany Dixon sort mail for Mail America at Lynchburg Sheltered Industries. Photo by Jill Nance

“They have to do business differently than it previously has been done, so we’re working with them to navigate what services are going to look like in the future,” Norton said.

Kendrick said his understanding is LSI will not be able to provide work and a paycheck to these individuals. LSI is trying to get certified to provide day services. Norton said the day service section will cover work-for-paycheck programs.

“There are some misconceptions out there for people, but there is nothing under day services that prohibits somebody from getting paid,” Norton said.

ARC of Central Virginia, which provides day services for people with disabilities, is in the process of adapting to meet new requirements and keep waiver money coming in. ARC Executive Director Karen Wilder is set for training through DBHDS next week.

“We don’t have the complete regulations on how exactly it’s going to work for day support, so that’s kind of up in the air. We’re just trying to figure out how that’s going to affect us,” Wilder said.

Each plan must meet a 2014 rule by the Centers for Medicare and Medicaid Services requiring people with intellectual and developmental disabilities to be as integrated into communities as possible. CMS is reviewing the waiver redesign.

The same shift in philosophy resulted in the DOJ agreement and plan to close the Madison Heights Central Virginia Training Center in 2020 by gradually moving residents into group homes. Many guardians for people at the center contest it works for everyone.

“It’s all about environment. They want folks with disabilities to be out in the community and be doing things out in the community, whether it’s work-related or volunteer-related or just getting out do things and interact with the community,” Wilder said.

Kendrick said he is concerned LSI might not meet requirements for community integration, although the facility is in the industrial park off Odd Fellows Road.

Most of those in the prevocational program sit in tables of three in one area of the warehouse. Across the high-ceilinged room a mix of long term employees who are disabled and those who are not convert cardboard boxes.

“Because we have a large congregate of people with disabilities, they view that as not necessarily totally integrated into the community like I guess working for Areva or Centra Health or even The News Advance,” Kendrick said.

Johnson examined a wire hanger with her hands and straightened out a dent. She set the bottom against the table to verify it was appropriately flat. After she and others return hangers to shape so they may be fed through a machine, the hangers will return to Bedford County uniform service Cintas with which LSI contracts.

Each person with a disability has a service plan with skills they need to work, such as focus or behavior issues. The people in the prevocational training program — the middle tier of three — have varying degrees of verbal ability. Many don’t speak in sentences.

“The service we provide them are job supports,” Kendrick said. “Some individuals with disabilities, they require more supervision, different kinds of supports for them to be able to maintain employment.”

LSI uses a Department of Labor formula allowing pay lower than minimum wage for people with disabilities depending on the amount of work they are able to do.

“There are people who love coming to work here every day. They may not make a ton of money, but they enjoy coming to work. They enjoy hanging out with their friends, and that may be going away,” Kendrick said. “Not to say they’re going to be left out in the cold, but it’s not going to be the same.”