Behavioral Health - Adequacy


Memo from Sheila Schuster

to Fellow Blue Ribbon Tax Commission Members - 2012


BACKGROUND:  Kentucky was the first state in the nation to implement President John Kennedy’s Community Mental Health Act, putting into place in the mid-60’s a statewide system of 14 Community Mental Health Centers (CMHCs) which are responsible for planning and providing the full range of behavioral health services.  These services include treatment and recovery supports for individuals and families dealing with mental illness and substance abuse/addictive disorders and those with developmental and intellectual disabilities.

Unfortunately, Kentucky has fallen from first in the nation in having that statewide behavioral health system in place to 42nd in funding for mental health & substance abuse services and 49th in funding for mental retardation/developmental disability services.

The BUDGET is the strongest priority-setting public policy statement that the Commonwealth can make.  Over the past dozen years or more, the Commonwealth’s behavioral health budget has been inadequate to meet Kentuckians’ needs.

Ø In 2001, the Statewide HB 843 Commission – made up of key legislators, every state Cabinet and Department dealing with behavioral health services, consumer, family members and provider representatives – attempted to address this underfunding issue.  The Commission made a recommendation that state funding for the CMHCs be increased by $25 million/year for each of the next 10 years to move Kentucky from the bottom 10 states in funding to a national ranking of 25th in funding.  Unfortunately, this recommendation was never implemented.

Ø While the CMHCs have been largely protected from cuts, their services have been flat-funded (with no increase) for more than a dozen years, and their Medicaid rates have been frozen since 2001 at the 1999 cost-report rate.

Ø The number of Kentuckians served by the public-sector behavioral health system has plateaued at 179,000 over the past five years.  There has been increased demand for behavioral health services, but the stagnant funding dollars simply cannot be stretched any further.

Ø Every aspect of the cost of doing business has increased and the demand for services continues to escalate.  Everything is going up except available funding and resources! 

Ø A Legislative Research Commission report completed in 2006 noted that “The lack of funding to meet the growing cost of doing business in providing quality behavioral health care challenges the sustainability of services across the Commonwealth.”

Ø The National Alliance on Mental Illness (NAMI) has graded all of the states on the capacity and funding of its behavioral health system.  In both 2006 and in 2009, Kentucky’s system was given an overall grade of “F”, the only state to receive a failing grade on both report cards.

Ø And now, there is an overwhelming crisis looming on the horizon.  The CMHC employees are part of the KY Employee Retirement System (KERS), and the CMHCs have been fully responsible for their employer costs.  State-mandated employer contributions have risen dramatically over the past few years, from a rate of 5.89% in FY 2006 to 11.61% in FY 2010 to 26.79% in FY 2014.  Now, the Pension Task Force recommendation calls for an estimated employer contribution of 42.6% for FY 2015 to FY2031!  If the Commonwealth does not give the centers some relief from this mandate or help in meeting this increase, Kentucky’s behavioral health services safety net will suffer devastating damage – or will be destroyed altogether.  We will see widespread layoffs of staff, closing of service sites, particularly in rural areas, and fewer Kentuckians receiving the behavioral health services and supports that they need.

Ø What happens when individuals do not receive needed behavioral health services?  They become caught in the revolving door of repeated hospitalizations, involvement with the criminal justice system, homelessness and, sadly, in some cases, suicide.

           We know that treatment works.  We know that recovery is possible…but only if services and supports are available.  And they are available only if they are adequately funded!

Sheila A. Schuster, Ph.D.      502-894-0222

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