Opinion: Carolina Beat

No. 879: Mental Health Costs: A Mean Game of Fetch

If you’ve ever played fetch with a dog, you know that once in a while, you’ll fake a throw just to watch the dog run off waiting for the ball to land somewhere. Most dogs figure out pretty quickly what you’ve done, especially if you’ve done it before. Such is the case with the current consolidation of county level mental health operations and state funding. Counties went forward as mandated (most of them) and then were left looking back for the money to land — and $28 million of it won’t.

Three years ago when the state began implementing mental health reform, counties were told to merge with other counties if their serviced populations did not exceed 200,000. In other words, if a county had only 150,000 residents, it needed to find a mental health partner. The state was insistent and promised repercussions if the newly formed “local management entities” were not created.

Many counties merged with their neighbors. The goal was to simplify the administrative functions, work with private providers, and save tax money. The Outer Banks area (Albemarle) and some regions of the mountains, such as the five-county New River local management entity fell well below the population mandates, but were exempted because of geographical difficulties, such as in the mountains, or population sparseness, such as at the Outer Banks.

The goal was to ultimately have only 20 limited management entities statewide. When that happened, service would be better and money would have been saved. But as of this writing there are still 39 limited management entities because many areas haven’t merged yet. Some counties, such as Pitt and Johnston, have defied the state by not attempting to merge. Each county has fewer than 200,000 residents and thus didn’t meet the mandated service population.

The situation has caused a minor crisis of funding. Counties set their budgets July 1, and now they’re being told that their mental-health programs will eventually be $28 million short with continuing shortages thereafter. Because the formula was based upon 20 limited management entities and they still have 33 out there, the savings didn’t happen.

Lee County Manager David Smitherman summarized the situation: “Mental health reform is supposed to be a vehicle for improving efficiency and services delivered in local communities. It’s hard to believe that $28 million of forced cuts furthers that aim. Is it fair for the state to expect the LMEs to absorb these cuts mid-year without affecting services?”

His angst is shared by the N.C. Association of County Commissioners, and rightly so. According to them, “the $28 million represents nearly 18 percent of the local mental health offices’ administrative budget.”

Bear in mind, there have been no cuts in required services, just cuts in money to fund them. Counties are now looking for ways to find the money in budgets that are already tight. In most cases, they’ll have to cut services or take the hits directly out of fund balances. The cost is recurring, according to the proposal by N.C. Health and Human Services Director, Carmen Hooker Odom. That means that counties could be looking at higher property taxes to pay for mental health services that the state should be covering. We’ve seen this before with Medicaid funding.

In the end, this was a bad call by Odom’s office. The situation was caused by a lack of compliance by some counties, but those that have complied will be paying the price. Counties that complied, reformed, consolidated, and created new limited management entities should be rewarded for their leadership, not punished.

The solution is to fund those that have complied and to deal with the lack of compliance on funding shortages. Leadership is really the issue at hand. Counties are waiting for the owner to throw the ball; they’ve grown tired of watching the state throw a fake. A good dog owner throws the ball eventually, not doing so is just plain mean.

Chad Adams is vice chairman of the Lee County Board of Commissioners and director of the Center for Local Innovation.