In this issue:
Budget Update
Preferred Drug List/Medication Access
Parental and Student Involvement Bill H 218(School Suspension Notification)
New DMA Director
New Appointments at DHHS, State Operated Services Director
New plans for CRH, Dix and CRH/JUH adolescent units
Budget Update: The Senate Appropriations Committee voted out their version of the budget on Tuesday and the Full Senate is expected to vote on it on Wednesday and Thursday and send it off to the House. Discussion, including the introduction of amendments was limited and the bill itself has been crafted mainly outside of the public view. The Senate made few changes in the MH/DD/SA and Medicaid portions of the budget from the one introduced by the Governor. Among the changes is the elimination of 12 million in funds for 376 unidentified vacant positions and freezing the inflationary increases for many community Medicaid providers. Items included from the Governor's budget are the closure of Wright and Whittaker Schools, the closure of two 25 bed units in the state psychiatric hospitals, and 100 million in "savings" (i.e. cuts) in Medicaid services, some of which will come from personal care services, community support group hours, and medications. To achieve these savings, including 30 million in drug cost reductions, NC DHHS is given broad discretion to use cost management tools like prior authorization and the development of preferred drug lists for all drug classes, including mental health medications. Twelve million is included for the expansion of community hospital beds, 3 million for the continuation of the Dix unit of Central Regional Hospital, 2.5 million to expand cross area service programs for addiction treatment and prevention, and 1 million for youth substance abuse prevention and chronic disease prevention planning. The Senate budget makes 2 billion in cuts to the overall budget, but it also rests on more than 500 million in revenue increases that have yet to be identified. In an unusual move, the Senate Finance committee may take up a revenue bill next week, following the passage of the budget bill.
The state of North Carolina continues to face a difficult economic and revenue situation. Unlike the Federal budget, North Carolina must enact a budget that balances out its revenues (taxes, fees, receipts, etc) with its spending plan. MHANC commends the Governor and the Senate for sparing major cuts to the Division of MH/DD/SAS seen in previous budget crises. As advocates for people with mental illness, we continue to oppose policies outlined in the budget and those related budget cuts that would negatively impact people with mental illness. As stated in our last update, before services delivered at Wright and Whittaker schools are closed the state must take a hard look at the quality and type of services these children and others like them need and determine if they are available across the state. These programs deliver high quality services to children who have not been able to succeed in other settings, including their schools, other treatment programs and at home. We believe that all children with emotional and behavioral disorders deserve the chance to succeed at home, in schools and in their communities.
For a list of Senate budget items related to mental health, see the end of this report. A larger list of Senate budget items impacting health, human services, justice, public safety, education, and people with disabilities see the MHANC website at http://www.mha-nc.org/ and click on the "Advocacy" tab. To view the full Senate Budget go to http://www.ncleg.net/ (see left hand column).
Preferred Drug List/Medication Access: The Senate budget includes an expected 30 million in "savings" to Medicaid drug costs. Medicaid hopes to find 30 million in savings from enhanced utilization management techniques and increasing rebate collections on generic drugs, but if it does not, the budget authorizes a preferred drug list for ALL classes of medications including those for treatment of mental illness. MHANC has for a long time opposed preferred drug lists, prior authorization, and other drug management efforts when they are applied to medications that treat mental illnesses. Despite how far we have come in research for treatment of disease, we still lag behind in a variety of effective treatments for mental illness compared to those available for physical illnesses. Until we have the wide array of effective treatments for mental illness that we have for heart disease, infections, etc., we need to enact policies that allow for the most flexibility in treating individuals. We need medication policies that prevent inappropriate use, allow for individuals to have informed choices, and recognize the vast difference between treating mental illness and treating illnesses like high cholesterol or acid reflux. Even the Federal government in their Medicare drug plan recognizes that Medicare insurance plans must cover virtually all drugs for the treatment of mental illness; we expect North Carolina should recognize the importance of these medications to reducing crisis, hospitalization and inpatient services and exempt mental health medications from a PDL.
Parental and Student Involvement Bill H 218 (School Suspension Notification): House Bill 218, The Parent and Student Educational Involvement Act passed third reading in the House on Thursday and now moves over to the Senate for consideration. This bill requires schools to notify the legal guardian of the child when that child is recommended for expulsion or suspension of more than 10 days. The notice must now include information about the reasons for expulsion/suspension and the students/parents rights to request a hearing, the time frame for doing so and other information about the school board's hearing process.
New DMA Director: The NC DHHS has announced the appointment of Dr. Craigan Gray to oversee the state's Medicaid program. Dr. Gray is currently vice president of medical affairs and chief medical officer at the Bon Secours Our Lady of Bellefonte Hospital in Ashland, Ky. He was chairman and managing director of Employee Benefit Trust in Asheville from 1995-2002 as well as a physician and medical community leader at Mission/St. Joseph's Hospitals. In 1975, he co-founded and was the senior managing physician of Asheville Women's Medical Center. Dr Gray will oversee the NC Division of Medical Assistance with a 11.3 billion dollar budget (2.9 in state funds) which serves 1.7 million adults and children in NC and funds more than half of the mental health services delivered to individuals in the state. To read the announcement from DHHS on his appointment go to http://www.dhhs.state.nc.us/pressrel/2009/2009-3-26-medicaiddirector.htm
New Appointments in DHHS: Dept Secretary Lanier Cansler has announced several appointments as part of his efforts to improve state hospital administration and quality assurance statewide. J. Luckey Welsh Jr., former president and CEO at Southeastern Regional Medical Center in Lumberton, will serve as director of the state's Mental Health, Developmental Disabilities, and Substance Abuse state operated facilities (hospitals, DD centers, ADATCs, neuro-medical centers). Cecelia Karas, a former mental health consultant with a reputation for quality service, will direct Health and Human Services Training and Quality Assurance Initiative. To read the announcement from DHHS on these appointments go to http://www.dhhs.state.nc.us/pressrel/2009/2009-3-24-mhddsasappointees.htm
New plans for CRH, Dix and CRH/JUH adolescent units: Secretary Cansler announced a new plan for several state hospital units. Adolescents now served at the former John Umstead Hospital will served at both the new Central Regional Hospital and at programs in the Dix unit of CRH. Space at JUH will be utilized for CRH offices. Forensic patients will continue to be served on the Dix campus, and high risk forensic patients will be served at CRH. These changes are dependent on the lifting of a judges order that prevents the transfer of Dix patients to CRH. The 60 bed unit at the Dix campus, a collaboration between Wake County and the state of NC, will continue to operate. To read the announcement on these changes to the state facilities go to http://www.dhhs.state.nc.us/pressrel/2009/2009-4-9-centralplan.htm
Summary of Senate Budget items:
(If you have trouble reading this list due to formatting, please see our PDF version on our website at Senate Budget Summary, April 9, 2009)
Expansion
Department of HHS: Division of MHDDSA : 2009-2010 2010-2011
Crisis Services $12,000,000 R $12,000,000 R
Dorothea Dix Overflow Unit $3,000,000
Training and Workforce Development $325,000 R $325,000 R
Initiatives
Fund Mental Health Leadership Academy $500,000 $500,000
Assists Local Management Entities (LMEs) with improving the delivery of services.
Expand Cross Area Service Programs $2,500,000 $2,500,000
Workforce Development Specialist $50,000 R $50,000 R
Substance Abuse Planning and Services $1,000,000R $1,000,000R
Dental Service for Special Care Populations $200,000
Division of Medical Assistance 2009-2010 2010-2011
Legal Positions in the Attorney $165,566
General's Office to help with the backlog of Community Support appeals cases at OAH.
Medicaid Appeals Process $238,140
Temporary hearing officers in DMA to help with the backlog of Community Support appeals cases.
Reductions
Division of MHDDSA: 2009-2010 2010-2011
Various Reductions at Facilities ($705,659) ($709,100)
Eliminate Vacant Positions ($12,912,934) R ($12,912,934) R state facilities and elsewhere
Close Bed Units at Broughton ($6,027,471) R ($6,027,471) R and Cherry Hospitals
Reduce Operating Expenses ($1,250,000)R ($1,250,000) R
Increase Patient Receipts at Alcohol, ($17 662,867) R ($1,127,895) R
Drug Abuse Treatment Ctrs: Reduces State funds at the ADATCs in anticipation of additional patient revenues collected. This is due to the increased bed capacity available at the ADATCs.
Close Wright and Whitaker Schools ($2,889,991) R ($5,779,982) R
Reduce Cherry Hospital Staffing Levels ($810,049) R ($4,195,178) R
Division of Central Management and Support:2009-2010 2010-2011
Reduce Psychiatric Loan Repayment ($70,000)
Program by 7%
Reduce Loan Repayment Incentives ($400,000)
at State Facilities
Management Flexibility Reserve ($22,962,170) R ($22,962,170) R
Reduces funds for the Department of Health and Human Services at the discretion of the Secretary.
Reduce Operating Budgets ($349,235) R ($349,235) R
Division of Vocational Rehabilitation: 2009-2010 2010-2011
Eliminate Vacant Positions ($329,456) R ($329,456) R
Reduce Basic Support Case Services ($3,612,025) R ($3,612,025) R
Remove Inflationary Increases ($711,283) R ($1,042,189) R
Division of Medical Assistance: 2009-2010 2010-2011
Eliminate Vacant Positions ($559,031) R ($559,031) R
Reduce Prescription Drug Costs ($25,791,264) R ($30,214,013) R
Freeze Provider Inflationary ($73,752,358) R ($77,641,997) R
Increases in FY 2009-10
Continue Provider Inflationary Rate ($27,676,137) R ($30,014,082) R
Freeze from FY 2008-09: The NCGA reduced provider inflationary rates by 67% during the 2008 Session. The division, through a budget flexibility special provision, reduced the rates by an additional 33%.
Enhance Third Party Liability ($20,000,000) R ($20,000,000) R Recoveries and Cost Avoidance through better utilization of technology and other Medicaid cost-containment activities.
Reduce Funding for Community ($15,000,000) R ($15,000,000) R Support - mainly CS group
Eliminates Funding for CCNC ($900,000) R ($900,000) R
-Health Choice- Eliminates the per member per month payment to CCNC networks asso. with Health Choice
Justice and Safety: 2009-2010 2010-2011
Reduce Eckerd Wilderness Camp Rate ($1,435,000) R ($1,435,000) R
Close McCain Correctional Hospital ($9,086,942) R ($15,491,279) R
which has capacity for over 400 inmates, of whom around 66% are chronically ill, geriatric, or disabled.
Re-aligned: 2009-2010 2010-2011
Shift funds from NC Kids $7,000,000 $7,000,000
Care to Health Choice
Other: 2009-2010 2010-2011
Federal Funds Payback for ($8,000,000)
Broughton Hospital: Reduces State funds due to a pay-back of federal funds expected from Centers for Medicare & Medicaid Services.
Medication Assistance Program- $2,745,000 $3,000,000
from the Health and Wellness Trust
Replace State Funds with Federal Receipts ($150,000) R ($150,000) R
Budgets additional funds from the Basic Support Vocational Rehabilitation Grant, and reduces State funds
Charge Fee for Initial Facility License: TBD TBD
Fees would apply to adult care homes, hospitals, home care, nursing homes, and MH facilities.
Federal Recovery Funds: 2009-2010 2010-2011
Federal Recovery Funds for Vocational Rehabilitation Services in the amount of $15,054,221 through September 30, 2010. An estimated amount of $402,340 will be available for the Independent Living Program, which will be shared between DVRS and the Division of Services for the Blind. $7,728,281 is budgeted for each year of the biennium.
Medicaid Management Information $11,071,502 $9,820,68
System (MMIS) Replacement: Appropriates prior-year earned revenue to match federal funds for the MMIS Replacement. Total receipts of $55,357,510 for FY 2009-10 and $49,103,445 for FY 2010-11offset anticipated requirements.
Additional Community Services $21,870,834 $4,374,166
Block Grant from Federal Recovery Act: 1% for benefit enrollment and coordination.
Reduce Funds for Psychiatric ($21,060,455) ($31,662,312)
Hospitals' Electronic Health Records: federal recovery funds will be available to support the development of this technology
Reduction in Medical Assistance ($920,377,105) ($514,514,239) Payments: to be offset by federal recovery funds.
