Redirected Funds (from N&O)

REDIRECTED FUNDS:Money that legislators approved for treating mentally ill people is instead being redirected to cover administrative costs at local mental health offices. State administrators have rerouted $20 million to pay administrative bills, reducing the state budget for services by about 5 percent, to $369.7 million. Legislators knew the state division of mental health didn't have enough set aside to pay the entire administrative bill, said Mike Mosely, director of the agency. "We were going to have to take those dollars from within the budget," he said. "The only other place was from the services side." The local offices are getting $128.5 million for administration -- $75.4 million in state money and $53.1 million in Medicaid funds. Even with the money transfer, no local office will get less than it did last year for patient treatment. Frank Edwards, president of the Wake County Chapter of the National Alliance on Mental Illness, said the move frustrates him, especially because leaders at the state Department of Health and Human Services are emphasizing a need for efficiencies. The focus should be on consolidating the 25 regional mental health offices rather than giving them more money, Edwards said.

County and regional offices, which operate somewhat independently of the state mental health division, have pushed legislators to give them more oversight of patient treatment. More local responsibilities resulted in higher administrative costs. Rep. Verla Insko, an Orange County Democrat who helps lead a legislative mental health oversight committee, said the budget changes are the outgrowth of the yearly problem of local offices ending up short of cash, while some money budgeted to treat mentally ill people in or near their hometowns goes unspent. Last year, the division had to find $18 million in its budget to cover local administrative expenses. "It's hard to get new appropriations for administration," she said. (Lynn Bonner, THE NEWS & OBSERVER, 11/22/07).