Cuts to mental health funding leaving the most vulnerable behind

by Kim Krisberg

Joy Jay has the sweetest Southern accent you'll ever hear. It's the kind of accent that makes her news about the state of mental health services in South Carolina harder to hear than usual.

"Mental health has taken some of the biggest (funding) cuts of any agency in the state," said Jay, executive director of Mental Health America of South Carolina. "It's really affected the number of people who can be served -- the door is very narrow now for people with chronic, persistent (mental) illness. And for people with temporary problems, they can't even get into the system; there's no money for them to be served. It's a major, major problem."

From fiscal year 2009 to 2012, South Carolina decision-makers enacted some of the largest reductions to mental health services in the nation, cutting funds by nearly 40 percent, according to a November 2011 report from the National Alliance on Mental Illness (NAMI). In 2009, more than 95,000 South Carolina residents seeking mental health services were served; in 2011, that number dropped to about 90,000 -- and not because demand went down, Jay said. Jay noted that her organization is now busy building a 14-unit housing project for adults living with mental illness, and 46 people are already on the waiting list. It's the biggest waiting list they've ever had for their housing services, Jay told me.

"I believe we have an obligation to serve our elderly, our children and our disabled and when we don't do that well, we end up with lots of problems," she said. "If we don't spend money on one end, we'll spend it on the other."

Since fiscal year 2009, states have cut more than $1.6 billion in general funds from mental health agency budgets, the NAMI report states. The cuts come at a time when significantly more people are seeking mental health services. Many of those looking for help have never sought such services before, but have been hit hard by the recession, job losses and foreclosures. The state cuts also coincide with recent declines in federal Medicaid funds (which were boosted through a stimulus measure that's now expired ), forcing many states to shift existing resources into their Medicaid programs. This leaves little for residents who don't qualify for Medicaid and have no insurance. For example, in the summer of 2010, Arizona eliminated nearly all services for 12,000 residents diagnosed with serious mental health illnesses who weren't eligible for Medicaid, NAMI reports.

"What we've seen in a number of states is across-the-board cutting of programs without really having regard for what's being cut or whether one area is more meritorious than another," said Ron Honberg, NAMI's director of policy and legal affairs. "Hopefully, we've seen the worst of it...there's not a lot more to cut and states are having to come to grips with that. Eventually, you start cutting the heart and soul of the system."

Shifting costs
Typically, when mental health service cuts of this magnitude are enacted, money isn't really saved -- costs just shift, Honberg told me. Costs and care are shifted to correctional systems, homeless agencies, hospital emergency departments and police, whom Honberg said are often the first responders to people in crisis. In reality, "large city jails have become the country's de facto psychiatric hospitals," he noted. On the brighter side, Honberg said the Affordable Care Act (ACA) does have the potential to expand access to mental health services. For example, millions of people living with mental illness could benefit from ACA's Medicaid eligibility expansion starting in 2014, and insurance plans offered via state-based health insurance exchanges will have to abide by federal parity laws that require equal coverage for mental and physical health services. Though Honberg added that "what parity actually means is still the source of some debate."

"People with mental illnesses are among the poorest of the poor," he said "Even with parity, only about 15 to 20 percent of people with serious mental illness are able to work, so many people will still rely on the public mental health system."

In Chicago, mental health funding cuts are being exacerbated by changes in how services are paid for. Previously, mental health providers received annual grants that let them serve a wide range of vulnerable community members, but starting in fiscal year 2011 these providers have to file claims for treatment of uninsured clients with the state mental health agency. Sharon Kayser, executive director of Chicago's Counseling Center of Lake View, called the changes "euphemistic cuts" -- in other words, it may not look like funding cuts on paper, but it has a considerable impact on services. The changes mean that the counseling center must either absorb the cost of services that don't fit into the new fee-for-service model or simply turn people away.

"When you make it harder to access funding, that's a cut," Kayser told me. "It takes productive time out of a clinician's day because they have to engage in the billing process, it ups our administrative costs...a grant allows us to focus on the work."

Overall, the Counseling Center of Lake View has had to cut more than $1 million from its budget, eliminate some services and lay off more than a dozen staff members, Kayser said.

"In the end, it does cost more money, especially if people end up in the criminal justice system," she said. "You begin to criminalize mental illness and poverty."

Sarah Steverman, director of state policy at Mental Health America, said she's worried that the mental health safety net is "seemingly disappearing." With services and staff being cut and community mental health centers shutting down, even people with insurance coverage "may not have access to care because there won't actually be any providers available," Steverman told me.

"We were hoping that legislatures would attempt to protect services for their more vulnerable populations, but in many states that wasn't the case," she said.

On the west coast of Florida -- a state near the bottom in per capita mental health spending, according to NAMI -- demand for services at the Crisis Center of Tampa Bay has doubled since 2008, according to David Braughton, the center's president and CEO. In that same period of time, government dollars have declined by more than 40 percent, he said. So far, through fundraising, operating efficiencies and moving to a more fee-for-service model, the center hasn't had to cut core services or turn away people in need. Nonetheless, more funding problems are on the horizon: Later this year, the center will lose funding that supports counseling for sexually abused children. That's a $350,000 hole that will have to be filled to continue what can often be life-saving care, said Braughton, who cited research showing that early identification and treatment of childhood trauma can help lessen the chance of related risky behaviors and health problems in adulthood.

"I guess we're all eternal optimists and I thought 2011 would be the worst of it, but 2012 is still worse," Braughton told me. "Reality is starting to temper my optimism. With the erosion of government support and the erosion of our tax base...people are going to have fewer resources to turn to and what the long-term consequences of that may be, well, only God knows."

For a copy of the NAMI report, "State Mental Health Cuts: The Continuing Crisis," visit www.nami.org.

Kim Krisberg is a freelance public health writer living in Austin, Texas, and has been writing about public health for almost a decade.