124th MAINE LEGISLATURE
		LD 1741		LR 2550(02)
	Resolve, Regarding Legislative Review of Portions of Chapter 101:  Maine Unified Special Education Regulation, a Major Substantive Rule of the Department of Education
	Fiscal Note for Bill as Amended by Committee Amendment "   "
	Committee: Education and Cultural Affairs
	Fiscal Note Required: Yes
Fiscal Note
Current biennium savings - General Fund
Fiscal Detail and Notes
	Amending certain provisions within Chapter 101: Maine Unified Special Education Regulation, a major substantive rule of the Department of Education, will result in General Fund savings to the Department of Education totaling $224,629 in fiscal year 2009-10 and $442,349 in fiscal year 2010-11.  The programs affected are described below.  This estimate is based on analysis of the fiscal impact of certain proposed changes within Chapter 101 where sufficient data was available to project savings and does not include estimated savings for those proposed rule changes within Chapter 101 where sufficient data was not available.  Savings achieved as a result of this legislation are to remain within the department and local school administrative units to partially offset the impact of reductions in funding in the 2010-2011 biennium.
	Of the total savings amounts provided above, it is estimated that General fund savings of $124,629 in fiscal year 2009-10 and $242,349 in fiscal year 2010-11 will be achieved in the General Purpose Aid for Local Schools program by reducing the reimbursement rate for contracted services to 140% of the MaineCare rate.  Savings to local school administrative units are estimated to be $130,080 in fiscal year 2009-10 and $300,183 in fiscal year 2010-11.
	Additionally, General Fund savings of approximately $100,000 in fiscal year 2009-10 and $200,000 in fiscal year 2010-11 are projected to be achieved in the Special Services Team program within the Department of Education as a result of eliminating the requirement for on-site reviews.
	The following summarizes the methodology used and assumptions made to estimate the savings for certain proposed rule changes within Chapter 101:
	1)  Reimburse rates for contracted services at 140% of MaineCare rates.
	- Utilized survey information of certain school administrative units of current rates for
	contracted occupational therapy, physical therapy and speech and language pathology.
	Survey was conducted by telephone by Department of Education.
	- Calculated average cost per therapy for all SAU's surveyed and compared that cost
	to MaineCare rate from MaineCare Benefits Manual (10-144 Ch. 101, Chapter III)
	Determined that changing reimbursement to 140% of MaineCare rates would result in an estimated 7%
	reduction in rates, on average.
	- Based on information provided by Department of Education, assumed contracted services for OT, PT
	and Speech/Language Pathology comprised approximately 85% of total contracted services.
	- Adjusted FY 2007-08 costs by an inflationary factor to estimate costs for FY 2008-09 - FY 2012-13.
	- Applied 7% reduction to adjusted cost of contracted services to SAU's in FY 2007-08 to estimate savings.
	- Adjusted estimated savings to recognize the state's share and the local SAU's share of the annual savings
	- Appled State's share % as proposed in Governor's 2010-2011 Supplemental Budget request.
	- Assumed 6 months of savings in fiscal year 2009-10.
			2009-2010	2010-2011	2011-2012	2012-2013
	Approved contracted services (S&L)		$ 8,561,669	$    9,118,177	$ 9,710,859	$ 10,342,065
	% OT,PT, Speech		85%	85%	85%	85%
	Est. exp. For contracted OT, PT, Speech		$ 7,277,419	$    7,750,451	$ 8,254,230	$   8,790,755
	Estimated cost (savings) @ 7%		$  (509,419)	$     (542,532)	$  (577,796)	$    (615,353)
		State Share	$  (249,259)	$     (242,349)	$  (317,788)	$    (338,444)
		Local Share	$  (260,160)	$     (300,183)	$  (260,008)	$    (276,909)
	State share 6 month savings in FY 2009-10		$  (124,629)
	2)  Eliminating the requirement for on-site reviews
	- This fiscal note accepts the Department of Education's estimated savings projection of $200,000
	per year by eliminating the requirement for on-site reviews.
	Estimated 6 month savings in FY 2009-10		$  (100,000)
	Summary of savings:		2009-2010	2010-2011	2011-2012	2012-2013
	Reimburse rates for contracted services @ 140% of MaineCare rates.		$  (124,629)	$     (242,349)	$  (317,788)	$    (338,444)
	Eliminating the requirement for on-site reviews		$  (100,000)	$     (200,000)	$  (200,000)	$    (200,000)
	Total estimated savings		$  (224,629)	$     (442,349)	$  (517,788)	$    (538,444)
	Additional costs to the Department of Education associated with establishing the required stakeholder group to examine the federal and state rules and laws pertaining to certain portions of Chapter 101 and to conduct the required review of the MaineCare rate schedule can be absorbed within existing budgeted resources.