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participants' responses to this interview.
Lucinda Jesson, Minn.
Commissioner of Human Services
Civic Caucus, 8301
Creekside Circle #920, Bloomington, MN 55437
Verne Johnson (chair), Janis Clay, Diane Flynn, Paul Gilje, Sallie Kemper,
Dwight Johnson, Ted Kolderie, Dan Loritz, Tim McDonald
Summary of meeting:
Lucinda Jesson, Commissioner of the Minnesota Department of Human
Services, describes the challenges facing the agency due to potential
budget cuts. Health care comprises the majority of DHS spending, and half
of that spending is funded by federal sources. The state needs to rework
its payment schemes so that people may assume more self-direction of their
care without the state foregoing its responsibility to protect and provide
services to those who need them.
Welcome and introductions
Commissioner Jesson was asked by Governor Dayton to join his team while
she was a professor at Hamline University School of Law, where she also
served as Director of the Health Law Institute. Ms. Jesson has served
government at both the state and local levels: as Deputy Attorney General
for Health and Licensing in the Minnesota Attorney General's Office and as
Chief Deputy Hennepin County Attorney, where she led day-to-day operations
of the office. Ms. Jesson was previously a Partner and of Counsel to
Oppenheimer Wolff and Donnelly, as well as the founder of her own law firm
in St. Paul.
Comments and discussion
- During the
course of the Commissioner's discussion with the Civic Caucus the
following points were raised:
half the DHS budget is federal
accounts for 39 percent of the state budget. That's a figure that puts us
front and center in the budget negotiations. Our budget is about $22
billion for the biennium, and about half of it is federal."
the majority of DHS spending is on health care
People often think
that this department is just about welfare. What people don't realize is
that the majority of the DHS budget, about 80 per cent, pays for health
care. The other 20 percent is for the care of families and children,
nutrition assistance (food stamps), and services for vulnerable adults.
In summary, while the
biggest cost driver in the state budget is human services, the biggest
cost driver within the agency is health care. And the majority of those
dollars spent are on people who are elderly and those with disabilities.
While health care
spending dwarfs the balance of the DHS budget, child protection and child
support are critical functions. "One of the more surprising aspects of
coming into the job was realizing that when a child needs to be removed
from the home I become their guardian-or rather, the agency becomes their
guardian. My husband was surprised when I told him over dinner that I am
now responsible for almost a thousand extra children."
"But, by far, the
biggest cost driver is our medical assistance program. Medicaid-our
program supporting health care for low-income people-is our largest
program and split half and half with the federal government. If the state
appropriation for Medicaid is decreased by 1 percent, our Medicaid budget
is actually decreased by 2 percent, because of the loss of the equivalent
The economic stimulus
package increased this federal proportion even more while it was in
effect. Now that stimulus funds are going away, to get the program back to
where it was, there needs to be an increase in the state contribution.
Prevention is key to cost control
"A major challenge
facing the state, the agency, and the country is how to contain cost
inflation in health care by working to prevent those diseases that cause
the majority of expenditures-particularly heart disease and diabetes."
breadth of the agency is remarkable
What has been your biggest surprise coming in? You've been around
government for some time, but there are always surprises when taking on
such a role.
The breadth of what the agency does is still amazing to me. A few weeks
ago when flooding was at a crisis point, I learned that DHS helps
coordinate the state's response at the
In the event of an incident at one of Minnesota's nuclear power plants, we
run reception centers to assess and register evacuees before connecting
them with the Red Cross. You don't always employ for peak needs such as
this, so you need to be flexible and be prepared to react appropriately
when and if extraordinary needs arise.
Is your department involved in discussions about changing the way the
state pays for services, from paying per service rendered to paying for
We need to rework payment methods in all areas of government. Our current
managed care contracts are based on paying for processes (for tests,
office visits, and procedures), without adequate attention to
effectiveness. We have developed proposals to address this. For example,
we just announced a change to competitive bidding by health plans involved
in our managed care program.
We're also going down
the track of requesting information from provider organizations to see how
they could serve people in ways other than fee-for-service and managed
care. We believe we can make a number of payment methodology changes
without having to request waivers from the federal government.
I'm wondering how your staff responds to the expectation of rethinking how
services are delivered. Are they favorable? Are there pockets of
With 6,800 employees there will be disagreements, but I have learned that
there are very talented, committed professionals at work in this agency.
I have been very pleased to see how strongly motivated the staff has been
in tackling the challenge of reinventing service delivery and creating
more effective ways of meeting needs.
away from services?
Do projections for the state's demographics mean that the state will need
to manage away from services--helping people to move off of services
before they are cut off as a result of budget shrinkage?
"I do not believe there needs to be extensive cutting of services, but
instead there needs to be a focus on getting people to assume more
responsibility for themselves, with the help of services." The
Commissioner pointed to mental health and disability services as two
examples of areas where services should focus on helping people remain as
independent as possible.
observed that Lutheran Social Service is arguing with their "My Life/My
Choices" proposal that, rather than the state assuming all the risk for
people with special needs, more direction needs to be put into the hands
of the individual and their caretakers. "We want more consumer-directed
care," Jesson agreed, "but we can't lose sight of the fact that we are
still responsible for protecting vulnerable people. As commissioner, that
is an important responsibility."
There seems to be some interest out there in the counties to take some
initiative to rearrange some of the ways things are done. In a way, the
counties are asking for a waiver from having to request waivers in order
to do things differently. Are you beginning to feel this?
The agency does much of its work through and with counties.
There are two ways
that county reform has been discussed-allowing counties to be more
autonomous in making decisions, and streamlining. There are 87 counties in
Minnesota, and with so much state spending being administered through the
counties we must be able to assure that these dollars are being spent
well. Here, too, we have to balance between oversight and autonomy."
Leadership comes from the executive and agencies
If the state is going to redesign services, where will leadership come
The Governor and his Chief of Staff will no doubt lead the
Administration's efforts to seek new, effective and efficient ways of
meeting public needs. The agencies have many talented, experienced people
that can help improve services as well.
chair expressed thanks to the commissioner for visiting with the Caucus.