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Mental Health Funding Gaps Foreshadow Crises in Michigan

The summary report predicts homelessness, poverty, increased incarceration and deaths

 

FOR IMMEDIATE RELEASE: MARCH 29, 2019

The Community Mental Health Association of Michigan (CMHAM) today released a new analysis, “Systemic Underfunding of Michigan’s Public Mental Health System,” which studies the longstanding underfunding of Michigan’s public mental healthcare system. The study cites a $150 million gap between the cost of health care and the funding provided to Michigan’s public mental health system. The need and cost for services provided by HealthWest (the Community Mental Health for Muskegon County) has been increasing each year. HealthWest is serving an average of 15% more people each year, over the past five years. The intellectually and developmentally disabled population served by HealthWest grows by an average of 7% each year. This population requires the highest-cost services. Despite extensive growth in the demand for services, revenue over the past five years has only grown by an average of 1.67% per year. In addition to the growing population served by HealthWest, expenses per person served have also increased by an average of 2.75% annually.

 

CMHAM’s analysis makes five concrete recommendations to address the current crises in unmet mental health and substance use disorder needs – recommendations that, if followed, will stem homelessness, poverty, incarceration and the premature death of Michiganders with intellectual and developmental disabilities, mental illness, and substance use disorders.

 

“Michiganders do not face the same mental health and substance use disorder needs that they had 20 years ago,” said Robert Sheehan, the CEO of the CMHAM (formerly the Michigan Association of Mental Health Boards). “There are new demands, new crises and new conditions in every community throughout Michigan, which the original financing structure did not account for. These include the opioid crisis, incarceration of those with mental health needs, the recognition of the prevalence of autism, increased homelessness and more—yet the system is still operating from a decades old funding structure. This is the reality that the public mental health system in Michigan has faced for decades. Without moving toward the ambitious vision outlined by the Association and addressing this outdated funding structure, Michiganders will continue to live without the mental health care that they need and expect.”

 

“HealthWest is doing more with less. We have reduced expenditures by increasing caseload size and cutting administrative costs.” said Julia Rupp, HealthWest Executive Director. “Our staff are working hard to provide the best quality care to everyone who comes through our doors.” HealthWest spent an average of $14,372 per consumer in FY2015. That decreased 26% to $10,576 in FY2018. HealthWest has seen significant increases in service requests for Muskegon County youth as well as individuals with substance use disorders.  Muskegon County is home to 13% of the region’s population, but accounted for 38% of the region’s Substance Use Disorder admissions last year.

 

The vision CMHAM outlines as a solution for a world class, public mental health system in Michigan through the report, “A Vision for a World-Class Public Mental Health System,” includes a five-point financial modernization plan to revise and prioritize funding for the public managed care plans. These public managed care plans have demonstrated financing practices best-positioned to meet community demands and real costs of care.

 

The plan is as follows:

  1. Set Medicaid rates to match demands and costs
  2. Make it so that Medicaid rates include contributions to risk reserves
  3. Allow for the public mental health system to hold sufficient risk reserves
  4. Remove the local match draw-down obligation, Section 928, in the appropriations boilerplate
  5. Restore General Fund dollars to the public mental health system

 

Since 1997, Michigan has been the only state in the nation to have a publicly managed care system for all four major behavioral health populations regardless of income levels (adults with mental illness, children and adolescents with emotional disturbances, persons with intellectual/developmental disabilities and those with substance use disorders), which reach:

 

  • 172,188 people in Muskegon County.
  • About 300,000 people with mental healthcare needs
  • 50,000 people employed by the public mental healthcare system
  • 2 million people statewide who are impacted by one of the 300,000 people served (family, friends, neighbors and co-workers)

 

The public community mental health centers (CMH) in Michigan (HealthWest in Muskegon) strive to serve as many individuals as possible, but only four percent of the funding provided to the CMH system is available to serve Michiganders without Medicaid who need mental health services.

 

In addition to new service demands, the state has not complied with the federal requirement for state support for the development of risk reserves – a key component in the design of any managed care system, especially one that is built to serve the most vulnerable residents and maintain community safety nets. Lawmakers and community members may argue the public system has been functioning well despite funding gaps, but CMHAM warns that the current underfunded system is not sustainable long-term.

 

For more information on the reports mentioned, visit https://cmham.org/systemic-underfunding-of-michigans-public-mental-health-system/ . To get involved in your local community visit www.healthwest.net