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Describing how the service helped a 13-year-old runaway, state Human Services official Erin Sullivan Sutton testified in July before Congress that without it, "Anna would ... have been hospitalized or placed in a residential treatment [center], costing large amounts of Medicaid dollars and placing Anna's life into utter chaos."

Services cut already

Expecting the new rule much earlier, Minnesota counties this year cut services to some of their clients -- mostly to children and families.

For 2007, Hennepin County slashed $9 million from its health and human services budget, which meant that 700 clients got no targeted managed care and the other 20,000 received partial or delayed services, Huskins said.

The Legislature last session set aside $32.7 million to help counties cope. The state money may replace less than half the lost Medicaid money, and the one-time appropriation won't help in future years.

That could change if the Legislature decides that the state -- now providing 14 percent of the money for child welfare programs -- should pay a greater share. That's not likely next session, although counties will ask for action. The state now estimates that it will face a $373 million budget shortfall for this biennium.

In fact, the first $3.8 million from that $32.7 million pot may go back to the Medicaid to replace money it says counties improperly spent. In an audit released last month, Medicaid found that seven of 118 county claims from 2003 and 2004 were "insufficiently documented or unsupported by case records." The state may appeal.

Senators try to help

In an attempt to blunt the effect of the new rule, a bill sponsored by Minnesota's U.S. senators would delay implementation for six months. So far, it hasn't gained traction.

"We've worked for years to integrate services so that a child in a troubled family can get the help that makes sense," said Huskins, the Hennepin county official.

"We know this works," she said. "From what we can
 
 
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