Cuts hit mental health providers

Mental health centers across the state are scrambling to deal with a Medicaid budget shortfall of at least $3.2 million — a decrease that could leave at least 1,500 people untreated.

Advocates for the mentally ill predict that many of those people will wind up in jail or will turn to hospital emergency rooms during a crisis.

"We've been told in no uncertain terms there is no money, there is no money, there is no money," said Vicki Cottrell, head of the Utah chapter of the National Alliance for the Mentally Ill.

"As the money diminishes, we will have to drop the less serious cases," said Jack Tanner, executive director of the Utah Behavioral Health Network. "That is the tragic part of it. There is no safety net behind us. We treat the sickest and the poorest, and there is nobody behind us to pick up those who are not served in the public system."

Valley Mental Health, the state's largest contract provider of mental health services, will see its funding decrease under new federal payment guidelines by a minimum of $1.6 million by the end of this fiscal year, June 30,

As a result, 813 "indigent" and non-Medicaid eligible patients are being cut off from services.

The decrease is a result of a federal rate change imposed last year by the Federal Balanced Budget Act, which changed the formula for how mental health centers are reimbursed with Medicaid dollars.

Centers used to be able to collect one Medicaid dollar for services for Medicaid patients, even though it only cost a center 93 cents. The resulting 7 cents of "profit" could then be used to expand the reach of services offered to the community — including to those people not Medicaid eligible.

That ineligible population includes the recently released criminal offender who has been cut off from Medicaid benefits because of the jail time as well as people with private insurance that won't adequately cover mental health services.

"It is going to create a crisis in our mental health system like we have never seen before," Cottrell said. "People are not going to get any help and there will be nothing for them to fall back on. People will live their lives from mental health crisis to mental health crisis, and I think that is just unconscionable."

Tanner says the $3.2 million shortfall centers will grapple with over the next few months is the "best case scenario" and represents a transitional rate that actuaries have proposed in Washington, D.C.

The transitional amount represents half of the actual reduction in dollars — which could be $6.4 million from now until July 1. Early estimates indicate the loss could be as much as $12.2 million over the next two years.