Subcommittee keeps early intervention payment model, directs audit and federal-compliance report

The Nevada Legislature's Human Services Subcommittee on Thursday voted to reject the Governor's proposed change to how early intervention community providers are paid, approved additional service funding and directed the Aging and Disability Services Division to report on federal compliance and provider sustainability.

The action came after Kimber Ellsworth of the Legislative Counsel Bureau's Fiscal Analysis Division outlined the governor's recommendation to replace the current monthly per-child capitated payment with a fee-for-service model and to reduce general fund spending by $23.7 million over the 2025'27 biennium by making that change. Ellsworth said the capitated monthly per-child payment currently in place is $794.88 for children on community providers' caseloads, and fiscal staff presented alternatives and federal maintenance-of-effort concerns during a February work session.

The subcommittee instead approved a motion, made on the record by Senator Wynne, to "recommend not approving the Governor's recommendation to change the community provider's payment model in decision unit E266 and instead recommend additional general fund appropriations of $10,900,000 in each year of the 2025-27 biennium to maintain the current payment model for early intervention services community providers." The motion also included a direction that the Aging and Disability Services Division report to the Interim Finance Committee by July 1, 2026, on federal compliance, the state's maintenance-of-effort baseline methodology, and any recommended policy or statutory changes, and to prepare a provider transition plan if a payment-model change is later recommended.

Senator Wynne's motion further asked for legislative language to require a performance audit by the Legislative Auditor of the Early Intervention Services Program, "including, without limitation, an analysis of the program's state and community providers' reimbursements from Medicaid and private insurance, an evaluation of the claims submitted for reimbursement, and an assessment of the adequacy of the program's internal controls." The subcommittee approved the motion unanimously.

Fiscal staff also noted an additional add-on payment the governor recommended be funded from the Fund for a Resilient Nevada (opioid settlement transfers): $88.94 per child per month in FY 2026 and $120.72 per child per month in FY 2027. The subcommittee's motion explicitly did not approve separate opioid-settlement add-on funding of $2.0 million in FY 2026 and $2.7 million in FY 2027 for those add-ons; instead members asked that any technical adjustments to move previously recommended add-on dollars into the early intervention budget accounts be addressed later if needed.

Why it matters: The committee's decision preserves the status quo payment model for community providers while directing staff and the agency to address federal maintenance-of-effort rules and provider sustainability before any structural payment change. The committee also ordered a performance audit, which could identify billing, reimbursement and internal-control issues affecting state and provider cash flow.

The subcommittee closed the agenda item with authority for fiscal staff to make technical adjustments to reflect the committee's directions.

Evidence from the hearing: Kimber Ellsworth summarized the governor's recommendation and the March 2025 caseload update; Senator Wynne made and read the alternative motion instructing the reporting and audit requirements; the committee voted to approve the alternative motion.