REAL Services to lay off 65 as state funding rate drops for waiver services

SOUTH BEND — The nonprofit agency REAL Services will lay off 65 of its staff who help to coordinate services for local clients of the state’s Aged & Disabled Waiver in five counties.

CEO Karla Ann Fales said it is because of a reimbursement rate that the state proposed in early April that was 41% below what Indiana’s 16 Area Agencies on Aging are currently paid. The work would also take 30% more hours than in the past. She said it would have meant that REAL Services would have had to subsidize the program with close to $2 million per year.

The REAL board decided recently that it could not afford that. Employees were notified in a staff meeting on Wednesday, April 24 that the layoffs will go into effect July 5. They include 57 staff in the Aged & Disabled Waiver program itself, plus eight administrative and support staff.

This comes in the midst of the Indiana Family & Social Services Administration’s cost-saving shift to three for-profit managed care companies to manage the waiver program.

And over the past several months, Fales said, REAL Services has been hiring more staff and investing in training and technology to prepare for a new program, Pathways for Aging, starting July 1, to manage the Medicaid waivers along with Medicare benefits.

While REAL and other Area Agencies on Aging worked on their Pathways contracts with the three private firms, Fales said, the state notified it of the low rate.

The Aged & Disabled Waiver allows senior and disabled clients to tap into home- and community-based services, rather than having to live in a nursing home. Services for them will continue.

The staff who will be laid off currently work with 2,000 clients who are age 60 and older in St. Joseph, Elkhart, Marshall, LaPorte and Kosciusko counties. Those clients will transition to the private companies. Another 850 clients who are 59 and younger in the same counties will remain with REAL Services. Forty employees in that program will keep their jobs.

Meanwhile, Fales hopes that the laid off workers can gain jobs at the for-profit companies to continue doing the same work locally — only with a new employer.

“We have the best staff around,” she said.

South Bend Tribune reporter Joseph Dits can be reached at 574-235-6158 or jdits@sbtinfo.com.

This article originally appeared on South Bend Tribune: REAL Services says 65 layoffs in state Aged & Disabled Waiver program