I moved to North Carolina almost 11 years ago to take a job as health reporter for the Citizen-Times. Soon afterward, I began covering mental health “reform,” which pretty much involved the implosion of a system that had been working OK.
Even before the new system went live it was easy to see where it would fail, and it did. It was poorly planned and policies were poorly written. It depended on private service providers who were supposed to be eager to take on this population but who never materialized in big enough numbers to meet the need.
Rules and regulations changed so quickly it was impossible for service providers to keep up. There was no standardization of forms so providers found themselves filling out dozens of forms with the same information for various state and federal agencies.
Where people knew where to go for help and services before the change — the area program was one-stop — no one seemed to know what to do afterward.
Former state Department of Health and Human Services Secretary Lanier Cansler declared reform over three years ago and began to work on rebuilding the system, but there was no funding, and he couldn’t coax anything out of the GOP-led General Assembly in Raleigh. Eventually, he stepped down rather than preside over the gutting of DHHS.
Then last year, the federal government sent word it would enforce a Medicaid rule about adult care homes that has been on the books for more than a decade, and which North Carolina has been flouting.
Under the rule, facilities knows as IMDs (Institutions for Mental Disease) are not eligible for Medicaid — residents’ Medicaid is suspended while they live in the home. An IMD has more than 16 beds, with half or more of those beds occupied by people whose primary reason for being there is a mental illness.
But residents of adult care homes do get Medicaid, so homes want to be classified as adult care rather than IMD. The problem is that if more than half of the home’s residents are there primarily for mental illnesses, the home has to be reclassified, and it loses Medicaid funding.
There are other methods of payment, including billing residents, who get money for living expenses each month from Medicaid, and from state and local funding sources. They are still eligible for personal services such as medication management, food planning and help with everyday tasks such as dressing or bathing, as long as they need help with two or more of these daily tasks.
People who live in adult care homes get the same services, plus Medicaid, and there is no responsibility for treatment of the mental illness other than issuing medications, so it is more profitable to be an adult care home.
But the federal government expects North Carolina to comply with the “50 percent rule,” and it is ready to come down on the state for noncompliance.
“The federal government expects North Carolina to comply,” said Vicki Smith, director of Disability Rights NC. “There’s a lot of shuffling around of residents to get homes into compliance, but that won’t work for long.”
The state has to move to fix this problem, Smith said; otherwise the federal government could demand the return of all Medicaid funds that went to homes that are not in compliance.
“Believe me, the state will be aggressive on this because they don’t want a payback,” Smith said.
On June 1, a letter went out to a home in Madison County, informing the owners that the home was being reclassified and would no longer be eligible for Medicaid funding. That would mean the residents who are not in the home for mental illness also would be cut off from Medicaid funding, affecting the viability of the home and the well being of all the people in it.
Twelve more homes got the same notice, and were able to get a temporary restraining order as they move residents around to get under their number of people with mental illnesses down to below 50 percent. One home has moved several people to Virginia.
Counties’ departments of social services and local management agencies are working to find placements for people who are being moved out of homes, but it is a scramble, and people will fall between the cracks.
“The owners of these homes are good at gaining sympathy,” Smith said. “They talk about taking people out of the only homes they know and how sad that is — and it is — but they are not in compliance with federal regulations.”
Unfortunately, the victims of the state’s noncompliance are the people who have mental illnesses. It’s likely many adult care homes will stop taking any people with mental illnesses, and we will see even more people on the streets.
The entire situation could have been prevented if the state had planned and put in place the services people need instead of trying to do mental health on the cheap.
The solution is the same one that the state seems to have rejected all along: help people with mental illnesses manage this chronic condition before there’s a crisis, before they become sick enough so they can’t maintain themselves in a home.
“The state finally, finally will have to start developing appropriate services,” Smith said. “But in the meantime it’s the person with a mental illness who will suffer.”