Wednesday, October 8, 2008

AMHC funding shortfall forcing cuts

State official blames agency’s management
Staff Writer
Saturday, October 04, 2008

Albemarle Mental Health Center has already exhausted its state funding four months into the fiscal year, prompting the regional agency to reduce staff and cut funds for at least one mental health service.

An official with the N.C. Division of Mental Health blamed AMHC’s funding shortage on the agency’s management.

But AMHC officials placed blame on state officials for reducing reimbursement rates and “service authorizations,” the amount of a particular service that state funds will provide for a patient.
AMHC, which provides mental health services in 10 area counties, released a statement Thursday explaining that the agency no longer would provide Community Support Services because of reductions in state funding. The decision would result in a reduction in staff and the movement of patients to private care providers, the press release states.

“Because ensuring that everyone in our community receives the quality care they need, we are transitioning patients to the care of private providers of their choice already working in our community,” the press release states. “For consistency of care, all existing Albemarle Mental Health Center Community Support Services staff have been given the opportunity to seek employment with the private provider as well. Patients receiving Community Support Services should have a seamless transition as they continue to receive care from staff they know and trust....”

But several of the private providers said this week they might have trouble providing the services to AMHC’s former patients given state funding cuts.

Dick Oliver, team leader for the Local Management Entities Performance Team of the N.C. Division of Mental Health, acknowledged last week that there has been some reduction in state funding to mental health service providers. But management at AMHC had made the funding shortfall worse, he said, because of a lack of proper oversight.

The reduction in state funding is “a statewide issue” but “no one else has run out of funds because of it,” Oliver said. “They (AMHC) have appeared to have run out of state money eight months ahead of schedule, which usually points to failure of their financial system internally.”
AMHC’s shortfall will mean “very limited funding if any at all for state-funded services, the money that helps those consumers not funded by Medicaid,” Oliver said.

He estimated AMHC’s non-Medicaid clientele is about 40 percent of those receiving services.
“When we see this happen it usually means that the local management entity doesn’t have a system in place to connect the authorizations and payments.” Oliver said, explaining that if a patient is authorized to receive 10 units of service, the local management agency must keep track of the relationship between those 10 authorizations and how much is being paid out.
He said it wasn’t unheard of for local management entities or LMEs to deplete their state funds in the spring.

“Typically this occurs in April or May of a year,” Oliver said. “I have never known it to occur in October. It’s pretty serious for the consumers who are not Medicaid-eligible in these counties that are managed by Albemarle.”

But Cecil Perry, chairman of the Pasquotank County Board of Commissioners and a member of the AMHC board of trustees, believes state funding cutbacks are to blame. The AMHC board has not received any information suggesting any misappropriation of funds or overspending in last year’s budget, he said.

“I think just needing more funding for services is basically what has happened,” Perry said. “More money is needed. There’s no question about that.”

Charles Franklin, AMHC’s longtime director, could not be reached for comment for this story.
The local mental health board has not discussed a need for tighter internal controls, Perry said.
“This is really the fist time that I have heard that,” he said.

Perry said he thought Oliver’s analysis might be overlooking the differences between regions of the state — especially the prevalence of poverty in northeastern counties.

“I don’t know that (AMHC is the only LME in the state already out of funds) is all accurate, because people are doing all different things throughout the system,” he said. “Providing community services has always been an issue in eastern North Carolina. ... Trying to provide the services in the 10 poorest counties — as long as (the state funds LMEs) all the same — it will always be an issue.

“People down here experience more poverty than they do in other areas of the state of North Carolina.”
Annie Meloy, executive director of Greensboro-based Central State of the Carolinas, which provides residential services and other programs in about a dozen communities in the state, said AMHC had informed her it would be reducing its state funding to the company as well as to other providers of mental health services.

The reduced funding will affect both patients and employees, she said.

“The reduction in dollars clearly means change in our services,” Meloy said. “We may have to downsize our employee pool. We don’t know yet. Albemarle has not told us yet the exact dollar level our state money is being reduced.”

She said she was “guessing” the cuts might be “in the $100,000 range.”
Those affected most drastically will be two people who don’t live in Central State housing but have been receiving developmental therapy through the company.
Developmental therapy “is completely being cut out,” Meloy said.

Meloy said the company had not run into this type of funding shortage anywhere else in the state.

Central State serves about 17 clients who live in seven community homes in the Pasquotank County area, she said. Another three or four receive services from the firm but don’t live in its housing, she said.

Todd Key, director of Health Services Personnel, which has an office in Edenton, said the company had been told by AMHC that no funds would be released for this quarter until there had been a chance to look more closely at the available funding.
“We’re still looking into how that might affect us,” Key said.

A severe cutback in funds could require eliminating some staff positions, he said.
“Employment for our employees hasn’t been affected just yet,” Key said.

Contact Reggie Ponder at

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