News: CJ Exclusives

Budget would end CON mandate for new mental health beds

Negotiators also add money from sale of Dix property to fund new mental health facilities

Budget writers working on the state’s 2016-17 spending plan received the OK to increase the amount of money to open new psychiatric beds around the state from $12 million to $18 million, using proceeds from the sale of the Dorothea Dix campus in Raleigh, while eliminating a controversial regulation that makes the goal of adding new beds more difficult.

“It’s in the budget,” said Sen. Louis Pate, R-Wayne, who co-chairs the Senate Appropriations subcommittee on Health and Human Services, and the Health Care Committee.

“I think that there are some health care providers that are interested in putting in some beds that will be for mental health,” Pate said. “They’ll have to submit proposals, and somebody will have to go through them to see who’s got the best deal.”

“We agreed to $18 million for crisis beds, $2 million for pediatric beds,” said Rep. Chris Malone, R-Wake, chairman of the House Appropriations Health and Human Services subcommittee. “The important thing about this bill is it handles all three areas — the west, the east, and the central part of the state.” The proposal allocates $6 million to each region.

In addition to the mental health and substance-abuse provisions, the compromise package includes “a small mandate” to reopen a “free-standing emergency room” and potentially some mental health beds at Franklin Regional Medical Center in Louisburg, Malone said. Novant Health closed the hospital last October. Residents seeking those services now must drive to hospitals in Wake County or New Bern.

“These funds would be predominately addressing the major complaints we get from hospitals about individuals being stuck in [emergency departments], and not having a bed to transfer them to,” said Sen. Ralph Hise, R-Mitchell. “This is generally dealing with individuals that are not stable” because of behavioral health issues.

“Since this is money that is set aside in a special fund, I feel pretty confident” about its passage, said Hise, who co-chairs the Senate Appropriations subcommittee on Health and Human Services, and the Health Care Committee. He acknowledged budget writers could change the proposal.

Expansion of mental health and substance abuse facilities would be achieved with one-time money the state received from the sale of Dorothea Dix hospital to Raleigh. The money could be used to build new facilities or upgrade and convert existing beds at underutilized hospitals.

The proposal also aims to carve out psychiatric facilities created with proceeds from the Dorothea Dix sale from the state’s certificate-of-need program.

Certificate of need requires applicants to undergo a lengthy, costly, and often litigious process to get approval for new facilities or high-end equipment. Based on research from the Mercatus Center at George Mason University, North Carolina has the nation’s fourth-highest level of state regulations under CON.

“It is my intent that there’s no point doing any of it if you don’t get rid of CON,” Hise said of creating the new psych beds. “We’ve not had a lot of disagreement” between House and Senate health appropriations subcommittee chairmen over that issue.

“I think this is just another example we’re seeing that even projects or investments that we want to make can’t happen, or can’t go forward because of the complexities we put on ourselves with the CON process,” and that’s why psychiatric facilities need to be exempted from CON, Hise said.

“I do think it’s important that we repeal all of CON. I’m not backing down off of that,” said Hise, a strong advocate for that action.

“I think that CON is something that would have to be done large, not small,” Malone said. Creating small exemptions here and there in a patchwork quilt is “the one thing I will always be against.”

Yet he conceded he was swayed from that thinking on the psychiatric facilities because of the dire situation facing the state with continually rising behavioral health cases.

Because behavioral health has “personally impacted” his family, Malone said. Last year, he sponsored House Bill 923 to create a pilot program converting unused acute care beds in rural hospitals to inpatient mental health beds.

It made it into the budget as a study to be conducted by the state Department of Health and Human Services, requiring a report to be submitted to the General Assembly. It then became part of Gov. Pat McCrory’s mental health task force assessment.

Malone’s wife works at WakeMed Hospital, where mental health patients have overwhelmed the available space while waiting for a crisis bed to open somewhere in the state.

“I saw the hallways where people were lined up 50 strong, and recently 100 strong, and they last in there for weeks, so we certainly need to do something regarding mental health,” Malone said.

“I think that we put the cart before the horse, even if somebody had the right things in mind,” Malone said of closing and selling Dorothea Dix before a plan was put in place to deal with the state’s growing number of mental health patients.

“We’ve got to get the people out of jails, and out of the emergency rooms, [who] are there with mental health problems,” Pate said.

While Pate believes mental health issues and funding have not been given “the amount of attention necessary for the last several years … I think it’s probably going to gain some traction” as the culture becomes more aware of the seriousness and scope of the problem.

The state created regional agencies, known as local management entities/managed care organizations, to address developmental disability, substance abuse, and mental health problems, but legislatively they have been “kicked around for a long time,” Pate said.

“I think they’re doing good service, good work,” he said, but he envisions some changes to the LME-MCO system in the future. That might include some mergers, and integration with physical health services. “I think they are tied together.”