Under new guidelines proposed by the Department of Health and Hospitals, four-person families earning in excess of $58,000 will no longer qualify for free services under the state’s EarlySteps program.

In addition, four-person families earning above $38,000 will be asked to help pay for the services their children receive, with higher-income families sharing more of the costs. Currently the program provides no-cost early intervention services to children up to age three with developmental delays and disabilities.

The cost-sharing proposal is an effort by LDH to introduce cost-controls to a $28 million program that is currently spending $10 million more than it was budgeted.

EarlySteps (Part C) system is a federal entitlement program with eligibility for services determined by need (i.e. disability) rather than income. As a result, many parents who participate in the program have incomes above the limit traditionally used to qualify for state-run health programs.

Dr. Fred Cerise, secretary of LDH, says that without adopting cost-saving measures such as this, the state is at risk for having to stop the program altogether.

“We have two choices,” Cerise said. “The first choice is ask parents who are financially able to contribute to the cost of these services in order to continue providing them. Or, we face the very real possibility of having to tell the federal government that Louisiana can no longer afford to provide this entitlement program.”

The cost participation plan includes a nominal fee for services that are not covered by Medicaid for participants who earn less than 200 percent of the federal poverty level. Families with private health insurance will be asked to use that coverage where applicable. The proposed co-payments will be structured as follows:

Poverty Level

Income Level

(family of 4)


less than 200%

Earns no more than $38,700 annually

No cost to families

(but 10% fee for non-Medicaid services)

200% - 250%

$38,700 – $48,375 annual income

Family pays ½ for services

250% - 300%

$48,375 - $58,050 annual income

Family pays ¾ for services

above 300%

Earns more than $58,050 annually

Family pays full cost

Cerise says this is the second time this year cost-saving measures have been implemented in the EarlySteps program. In February, LDH reduced reimbursements rates to providers by about 25 percent.

Earlier cost-saving measure did not result in actual savings because many providers simply started to administer more therapies and other services to EarlySteps children. Therefore, LDH is adopting the policy of having recipients participate by assuming responsibility for some of the cost of the services. This is a strategy used by many health plans to ensure that only the most appropriate services and treatments are given.

In July 2003, the Early Steps program was moved from the Department of Education to DHH. Since then, outreach efforts have resulted in increased participation in the program, which has led to costs going above those projected for the program.

Cerise added that LDH is committed to managing this program in a fiscally responsible manner.

“We know how important early intervention is to children with special needs,” he said. “We are dedicated to making this program affordable for those it serves, and cost-effective for the taxpayers who fund it.”

Official reports to the federal government show EarlySteps serving 2,483 children as of 12/1/02. On Dec. 1, 2003, that had climbed to 3,498 children served. For 2004, LDH served 4,543 children through EarlySteps.

“We expect our changes in provider reimbursement rates, combined with the family payments will help us close the $10 million gap in the EarlySteps program and keep it operating,” Cerise said. “I am also committed to maintaining a dialog with parents who may have other ideas to reduce costs while still providing these necessary and valuable interventions.”