DENNIS FITZGIBBONS: I'm going to spend a little bit of time reviewing an overview of fee-for-service programs, perspective from the Alpha One perspective.

I would like to offer that, for both Kathie and I, this is our experience.

It's not necessarily going to be your experience, where you live, where your center is, there are many influencers.

Geography, the community you live in, the community you live in, your state, politics, policy, rules regulations, and of course your local economy, whatever that might be.

So I start by asking a question here, why bother?

Why are we going to go this direction?

Alpha One was founded in 1978.

We were one of the, Maine was one of the first ten states to receive direct funding from the Rehab Services Administration.

We have been at this a while.

The founder of Alpha One, from day one, believed that the funding should never rely on any one source.

From the very beginning, he was entrepreneurial.

In how he looked at the world, how he looked at services and programs and believed that Alpha One's survival depended on spreading out that revenue stream so if any one of them was pulled away, you wouldn't be left dead in the water that and out of business.

That was his approach and that continues to be our approach.

Now, to ensure the sustainability of any business, and we are all businesses.

We're not just a funky non-profit somewhere in the willy whacks.

We are a business.

We should operate like a business.

And we should be looking for new opportunities, especially new revenue sources.

We want to develop them and explore them at all times.

And it becomes sort of a mindset of the organization, at least it does for us.

We expect that to be from top to bottom from the board of directors, even to consumers, not all of them are interested in that, some of them are, to our staff and therefore we try to repeat that all the time about staying on track with looking for new resources.

What's the next adventure, what's the next innovation we can look at?

What can we develop that's going to improve the lives of people with disabilities.

The big why for us is self-reliance is hard-wired into independent living.

That is what we're promoting Independence, choice, self-reliance.

If we don't model that as an organization, then we are missing something important.

We have to be self-reliant so that we're here not only today, but we're going to be here tomorrow as well.

What I love, not everything, a lot of things that I love about RSA and government regulations.

One thing I do love is the independent living money, Part C money, is like a big golden egg that is delivered to us every year and very few strings attached when you think about it.

And this money can be used to develop all kinds of programs and resources.

Now I know you get into using them for general operations and services, core services, et cetera, but there's nothing that says that money has to be used for those things.

Yes, we're supposed to provide the core service, and yes, we're supposed do other things, but there are very few strings attached to that money, as long as when you file your annual report and your annual funding report, you have used the money appropriately. 

It's a great resource to have.

And we actually secretly call it funny money.

Because it has so few strings attached to it.

We want that fiscal security for an organization and we think that we have a duty to the people we serve to have that security in place for Alpha One.

We are modeling that behavior and a Center for Independent Living as a successful business, operated by and for people with disabilities actually serves as a peer model of different sorts over and above that 1 to 1 relationship we might have between peers.

Now we have an organization operated by and for people with disabilities that can be a model for others as well.

Works on many levels.

Some of the foundational principles around how we operate.

First of all, making money is not a bad thing.

If you do it right and do it ethically.

And reinvest those resources back into the community and back into the business.

We don't have stockholders that have to be rewarded and haven't received dividends on a regular basis.

Those so-called rewards and dividends go back into everything that we do.

We have a mantra At Alpha One that I'm going to ask you to repeat after me.

You'll see it up on the board.

No margin, no mission.

Repeat after me.

No margin, no mission. All right?

If you don't have more revenue than you need, you can't give people pay raises, you can't explore new opportunities, you can't necessarily pay all your bills.

If you're going to do everything flat funded all the time, it doesn't work, just like in our personal lives.

We have an individual home budget.

If you don't get a raise, you are going to always be pinching pennies and making things work.

It's when you get more money, then you can start to plan to do more, might want to take a vacation, et cetera.

It's the same thing in business.

You got to have that extra margin to put aside to reinvest, to do the things you want do to improve the state of independent living in your community.

An expanded revenue stream also means more opportunity.

Now, when you have got those resources, you can look around to the great ideas posted already here, some real places to begin to look.

Okay.

How can we look to the community, to meet some of the unmet needs of people with disabilities to generate new services that will meet those needs and at the same time return revenue to the center?

And if someone is going to make revenues providing goods and services to people with disabilities, why shouldn't it be a CIL?

I have heard criticism in the past, one time, I was at a New England CIL conference.

It was a crowd like this from all the CILs around, good gathering to meet old friends and new friends at the same time.

And it was a guest speaker who came in from another part of the country, big name in independent living.

I won't share the name, but they stood in front of the crowd and said, none of us are ever going to get rich in independent living.

Paused a moment and said, except for Steve Tremblay, up in Maine, the founder of Alpha One.

And then referred to him as the Donald Trump of independent living, okay?

Steve wasn't at that conference, but I remember going back to him and telling him about that and he laughed and he thought it was the best thing he ever heard.

He believed in what he did and believed in what he established in the organization and I believe in it as well.

And he didn't really become rich.

But he made a great living.

I'm not rich either but I'm making a great living, and I love what I do.

As all of you do too.

No reason why we shouldn't be doing these things.

Now consumers have a choice where they receive services.

Many consumers come to us because of our approach to the world and self-direction and empowerment.

But they can go elsewhere and we need to as we develop these things, make sure they're choosing us.

We want to give them a reason to choose us.

There's no guarantee just because Alpha One or ILR start something, they're going to use our service, they're looking for quality and they want the best product there.

And if we don't deliver that, we should be careful about what we're doing when we move in this direction, I believe.

And I'll keep giving that caveat.

Again, it's my opinion.

Not necessarily the opinion of NCIL.

Who knows disability better than we do?

We live it and breathe it.

We are, many of us, people with disabilities.

We are the experts about our lives.

We know what we need.

Why shouldn't we be in the business of meeting those needs with that give and take with the consumer community about how to proceed in that direction?

I'll say, use what you know.

We have another saying at Alpha One.

Stick to the knitting.

We know disability.

We know IL.

We know self-direction.

The further we stray from those things, we have what we call mission drift.

We start to try to get, someone said it earlier when I was going around meeting people, see that shiny object somewhere, has nothing to do with independent living and looks appealing, you chase after it and could easily pull you in a direction that will expend resources that you can't afford to give up and you want to be careful of that.

And I can say that because I know we've done it.

Been there, done that type of thing.

Another thing about independent living is that many of us in the movement have taken the approach that we give things away.

We say these services are free.

And we take that approach that there's no cost involved, don't have to worry about those things.

As you know, nothing is free.

Everything has a cost.

Costs money to keep the lights on, pay the staff, pay the rent, whatever the things are.

Even though we may get a grant and that goes right to the consumer and they don't have to pay for it, we emphasize with our staff, that we never tell people things are free.

We tell them there is no charge to you.

The cost of this are paid for by X, Y, and Z, so that they realize there's value there.

They may not have to pay for that value, but it's not free.

No such thing as free.

No free lunch.

And I know in our own lives, I know it's true too.

If we pay for something, we value it more because we earned the money to buy that good or service we want.

Not looking for a handout.

Things that are given to us, we may not appreciate it as something as we worked hard to earn.

That's how we approach that.

This is sort of an aside here, but as we've gone through this process for almost 36 years, we have established what I believe in Maine is a fantastic reputation as an organization.

It is one of our greatest assets.

And as we move along, your reputation is gold.

If you let that reputation be tarnished, you will have a lot of trouble getting out of that and getting back to establishing that positive and great reputation as an organization.

Be careful with it. Protect it.

Deliver fantastic services that the funders like and receivers like.

You have more than one customer here.

Consumers will be your customers and whoever is paying for the service will be your customer as well.

Some small business basics.

Know the market, meet the market.

You have to know what's out there. You have to know the landscape.

Listen to consumers.

The programs and services we've developed over the years that are most successful have come directly from the consumer feedback that we received on an ongoing basis.

And when we stray from that, we're not as successful.

So it really is all about responding to the people we serve.

A couple of examples that I will review in more detail later, are our consumer-directed personal assistance service programs, we developed those way back in the late 1970s and early '80s, based on the expressed needs of people with disabilities.

The same thing is true with our adaptive equipment loan program, and our adaptive driver education program.

So all those things happened, we decided to go forward with because consumers were saying, there's nothing here or this doesn't work for me.

And we got into it because of the expressed need.

At the same time, we also got into the durable medical equipment business long ago, based on consumer feedback.

And I'll tell you, that was a decades-long disaster.

And you learn a lot from your disasters and mistakes.

We have learned a lot from that too.

Markets are cyclical.

Even the best products don't last forever.

I'm sure you can name many products in the commercial market that have disappeared.

The easy one is New Coke.

That didn't last too long.

Look at some of the old products around.

Ipana tooth paste?

Anyone remember that?

If you're old enough.

A lot of things that have come and gone.

And they continue to come and go.

If we want to be around for this century, the 21st century, we need to be able to stay fresh and able to be responsive to what the market is really ready for.

Compete where you have the best opportunities.

Don't compete when it's not an opportunity.

Don't try to stretch too far.

Sometimes, when it's out of your reach, no matter how much you want it,

Sometimes, when it's out of your reach, no matter how much you want it, you can taste it, you don't want to go there if you can't afford it and don't have the resources.

You can taste it, you don't want to go there if you can't afford it and don't have the resources.

Some factors are beyond our control.

The economy is a great one.
We have all been through the last recession.

Thankfully, we're all here in this room.

I'm sure you've had some pain.

I know we have had some pain at Alpha One because of it and the economy will always be a challenge, no matter what.

When the economy went south, there's another thing we say at Alpha One is that a crisis is a terrible thing to waste.

You can always find the sunny side in something and look for opportunity when everything looks dark, there's still something there that may work.

There's a need that is going unmet.

Third party payers, government policies, they can change.

I talked about the consumer-directed programs, personal assistants, been in that since 1979ish.

Here it is, 35, 36 years later.

That's been like a roller coaster.

At times, been a cash cow, bringing in lots and lots of revenue.

That enabled us to lots of other things.

At other times we have been taken to the woodshed and beaten by the state because they thought we were making too much money and they were going to punish us as a result, so it's been up and down along the way.

It depends on who's in office, what party is strong and not strong.

Even though we try to walk the balance between, trying to be apolitical so to speak.

Nevertheless, you're still viewed one way or another.

We are viewed by the way, as Republican kind of entity.

I don't know why that is, other than the fact that we, I guess some of our themes are Republican in nature.

Self-reliance, independence.

You can hear that coming out of the Republican party a lot.

We are viewed that way in the state of Maine, even though we're not one way or the other.

Watch the innovations by competitors.

They can leave you in the dust sometimes.

I made a little note here to myself.

Technology is a big differentiator in the marketplace.

And if we don't keep up with technology, then we can be left in the dust pretty quickly.

Because the efficiencies that are gained that way are really just amazing.

Now, opportunities based on recurring revenue are the strongest.

What I mean by that are, you are going to start delivering the service and come in day after day, week after week, month after month.

Not the kind thing you of got to get out and market on a regular basis and hope you find a customer here and there.

And we compare this to the boutique type of business, versus a commodity type business.

A boutique is like a locally owned, clothing store.

Made locally, sold locally, probably going to cost more, because the costs are higher.

But you go there because you believe in shopping locally, like the product, you like the people, you get something of value, you value it, that is why you go there.

Commodity, might be more like a utility company.

We all need electricity, we complain, maybe, about the bill, but that doesn't stop us from turning the lights on in the morning or plugging in 50 electronic devices around the house.

That's there.

Utilities costs, even though we complain about it, really are probably are shockingly low when you compare it to maybe other places in the world what those things may cost.

Our consumer-directed personal assistance services would be the example of a commodity.

Years ago, we developed a rate with the state, where we bundled everything together.

And we convinced the state by combining case management, fiscal intermediary, skills training, the whole thing into a unit rate for service.

They looked at it, had the numbers person crunch the numbers and come back and and we negotiated a single rate that probably tripled our revenues from the program over the next couple years.

When they finally, realized what was going on, that is when we took the beating.

But it was a great two or three years at the time.

But what we did though is we sold that on, here, we built in the cost of every unit of service.

And built in some contingency, which would be when they come to beat you.

Because you get audited, they have audit findings against you, you have to pay penalties, so the contingency was sort of a savings account for that.

And there was two percent on top of that for just, money to reinvest in programs, IT and things like that.

Wasn't like we were trying to get rich.

But, we were trying to build in wiggle room.

Really was nothing wrong with what we did, except when they realized that we had outsmarted them in the deal process, they weren't happy.

But still, we try to look at that when we are creating services, built in the contingencies that you can never know about and build in a little wiggle room for reinvestment; if it's a unit rate type of thing.

Get in when the time is right; get out when the time is right.

Have to have an exit strategy and you have to know when that time is, which includes knowing how much money you may be willing to lose.

You can lose money doing this fee-based thing.

And we have we lost a ton of it over time.

And we made a good amount.

And so far, made more than we lost, which is good.

Another way of looking at some of the investing of monies and things like that, how do you do that?

Sometimes we have excess resources in something.

And other programs give us opportunities.

Consumer-directed personal assistants services, which I know many of you already do, has given you some expertise and some strengths that you may be able to take advantage of.

I would say about ten years ago, a lot of states were putting these programs out to bid.

And Robert Wood Johnson years ago, had a program, call Cash and Counseling anybody heard of that?

They were developing fee-based, home-based care programs around the country.

We actually competed in Arkansas, Florida, and New Jersey back in those days.

I remember attending bidders' conferences, learning all about what they were looking for and looking at who the competition was, et cetera and looking back on it, thankfully we didn't get the programs.

Most of them stumbled along with great difficulties.

But we learned a lot in the process and eventually did land a contract with the state of Vermont to do their fiscal intermediary work for two or three of their programs.

And it was because we had excess capacity in our payroll department for fiscal services, that those same people had time do the work in addition to that.

We didn't have to hire anyone else.

Didn't have to invest in any other software or anything else.

We already had the means to do it.

Sometimes the excess capacity can lead to an opportunity.

Similarly, three years ago, we started collaborating with the Maine affiliate for the National Alliance for the Mentally Ill, NAMI Maine.

They lost their financial director in the middle of our discussions for how we can collaborate.

So they asked if we could take over their financial management for them.

Which we did for a year, because we had excess capacity in our financial team to do that.

We had no hiring expenses, we had no other expenses and brought in extra revenue as a result of that.

Wasn't big revenue, we gave them a deep discount.

And it was a good way of collaborating, building a partnership, but also making use of what we had in-house.

I know one thing that is often in the forefront of people's minds around fee-based services is, is there a conflict of interest here, trying to be an advocacy organization and also a service provider?

And based on what I have heard, many of you are already offering services of some kind or another that have, you've questioned that already.

So you may already be there.

And we've certainly had to do the same.

From time to time, our advocacy may be questioned, But I do believe we're still a very strong advocacy organization with our roots in that civil rights movement for people with disabilities and we intend to stay there.

But perception of other people is not always the same.

And you have that perception versus reality challenge, their reality may be, you're not an advocate, you're a service provider, or you're an advocate, you're not a service provider and making that clear one way or the other and being comfortable with that yourself is important.

But remember that we all know, perception is reality.

How someone perceives you is how they perceive you.

And you can work to change that.

But first and foremost, you have to be comfortable in it yourself.

That you can be can be both, an advocate and a service provider.

And you can deliver fee-based services.

I think I mentioned, but focus on fee-based services can get us off the mark and make us drift away from mission.

I caution you on that.

The board of directors is a good sounding board on that.

Consumers are great on that and it's important that the staff be good on that as well.

And an atmosphere of questioning things is always there within the center so you're getting that multidirectional input about, is this okay?

But, once you're in it, you shouldn't stop questioning it.

But don't let it bog you down, this questioning thing too.

Commit to what you're doing.

Commit to doing it well and better than anyone else.

And next to last bullet, I can't repeat enough.

Indemnify, indemnify, indemnify.
.

AUDIENCE MEMBER: I had to look that up.

DENNIS FITZGIBBONS: You need insurance.

Okay?

We've more insurance that literally would choke a moose.

You need to just be aware that you need the director's and officers' protections for the board of directors.

You need that same insurance for the organization, we have, we provide worker's compensation, not only for our employee base, but also for direct care workers, so that's a huge cost to manage.

When you're managing, essentially, a workplace that you have nothing to do with consumers' homes.

How you manage that distant relationship with a worker that works for the consumer, not for you, how do you convince a worker's comp insurer to provide that insurance when you have that kind of relationship.

That's been a big challenge for us all these 30 plus years.

We have done that very effectively.

But those kind of claims can really be destructive to the entire process.

We had a consumer and a personal attendant driving somewhere ten years ago, they were in a car accident, the consumer died and the attendant ended up in the hospital for months and months.

Severe injuries, ongoing surgeries, huge medical bills.

Through the roof.

Amounted to the multimillion dollars.

And the workers' comp insurer came back to us, after a year plus, cause it takes a while for things to start showing up in their charts.

They wanted to raise our premium from $300,000 a year, which we have been managing fine, because it's included in the rates we're reimbursed from the 300,000 to a $1 million a year premium.

The rates are paid by the state of Maine, they're not paid by us.

So they're part of our agreed rate.

We couldn't go back to the state of Maine.

And say, well, we need a $700,000 raise.

We certainly weren't going to get that.

Long story short, we had a long discussion with this carrier and eventually left them and thankfully found a group in the community that was self-insuring and we joined that group.

We became the elephant in the room, because we would have had the biggest insured group there.

But ever since that time, we have been controlling our own fate, managing these claims with these other members so that, there are years we actually get a rebate on our workers' comp claim, this year, last month, actually, we received a check for $137,000 paid back to us because of the good claims market that we managed over the previous couple of years.

So there was a reward for doing a good job with these things, but important on these things to manage.

Last on my list is, Will fees-for-service require a different staff mix.

And I think you understand, it probably will.

For us, it does.

Began with us with the CD pass programs, state of Maine requires that nurses be part of the mix, as well occupational therapy professionals.

We have actually employed both of those types of professionals since the early '80s.

As you can imagine, if you're running a large program, and you have to employ a number of people with those kind of certifications or licenses, it skews your numbers when you're trying to meet your federal regulations, in terms of number of employees with disabilities.

Hard to find a disabled nurse or an occupational therapist who has a disability.

We've had a couple along the way, but it does skews the numbers.

And it then impacted how we structured the organization.

But I'm not going to go into those details.

I'm happy to talk about it off to the side if anyone is interested in it.

We actually created from one company, when we were done with restructuring, we had five companies.

It was rather an interesting process to go through back in the late '90s.

That ends where my speech is on that.