Sacramento County expects to spend $16 million this year on hospital costs for the severely mentally ill, almost three times more than originally budgeted for care at area hospitals.
The rising costs have led the county to re-examine the way it provides mental health services. When county supervisors approved another budget increase for psychiatric hospitalizations last week, they also directed the Health and Human Services Division to come up with a plan that puts greater emphasis on community-based, outpatient treatment and less on expensive hospital beds.
The plan, expected within three months, will include services that help the mentally ill before they reach a full-blown crisis, alternatives for those in a crisis and better assessments to avoid unnecessary hospitalizations.
Preliminary estimates peg the cost of those services at around $9 million a year, much of which would be offset by federal and state funds and reduced hospitalization costs.
Advocates say the changes are long overdue.
“We’re throwing good money at bad policy,” said Dawniell Zavala, assistant director at NorCal Mental Health America.
“We’re creating more and more hoops for people who are in psychiatric distress. This is unconscionable,” said Susan Gallagher, executive director at NorCal Mental Health America. “This has been going on for the 18 years I’ve been in the system.”
The increase in hospital costs is for service at three county contractors, Heritage Oaks Hospital, Sierra Vista Hospital and Sutter Center. It does not include the cost of inpatient care at the county’s Mental Health Treatment Center. The county pays the hospitals $950 a day for each patient.
Patient advocates say the cost increase exposes the county’s over-reliance on hospitalization and suggests more mental health care should be available that can prevent patients from suffering crises in the first place.
The current budget spike is not due to more people being hospitalized, said County Health and Human Services Director Sherri Z. Heller. Instead, it is the result of the state’s effort to sign up more people for Medi-Cal to take advantage of the federal Affordable Care Act.
Indigent patients who once received care at no charge from the hospitals now have Medi-Cal, and counties are financially responsible for psychiatric hospitalizations under Medi-Cal. The county anticipated costs would go up as a result of the changes, but not as quickly or as much as they have, Heller said.
Still, Heller agreed that changes are needed. She said the reasons for the system’s problems are complex, but the county is committed to providing “prompt access to appropriate care.”
An independent expert called for less reliance on inpatient care in 2011, when she reviewed the county’s mental health system as part of a class-action lawsuit against the county over proposed cuts to the system.
A majority of clients received outpatient care, according to the report. Yet, in an $83 million annual budget, only 47 percent of funds went to outpatient care, with the majority paying for inpatient and other expensive therapy.
By the county’s own admission, the mental health system has long struggled to meet the demand for service, and the situation got worse in 2009 when the state cut $16 million in funding. That year, the county reduced the number of beds at its Mental Health Treatment Center from 100 to 50 and limited use of its crisis stabilization unit, which had been the primary place patients entered the system.
Psychiatric admissions at area hospitals increased following the cuts, and emergency rooms remain one of the few options for people in severe distress, according to county officials and medical providers. Patients can wait long periods for placement in a psychiatric hospital.
Efforts to relieve pressure on emergency rooms have led to more psychiatric hospital stays, according to a county staff report.
In a letter to supervisors last week, the Mental Health Improvement Coalition, which includes area hospitals and nonprofits, said: “The system of behavioral health care is fundamentally broken. People in crisis have little option other than to access services through hospital emergency room departments, which are the least conducive environments for behavioral health patients to become well and receive appropriate services.”
Dr. Seth Thomas, medical director of Mercy San Juan Medical Center’s emergency department, told supervisors last week that it is “quite scary” to watch the mentally ill in the ER suffer without medication or consultation.
The emergency room “is not capable of taking care of the patient,” he said.
The county’s improvement plan is expected to include more assessments of the mentally ill by county staff. These workers would assess patients at hospitals, the Mental Health Treatment Center and other locations.
The plan is also expected to include a proposal for two new crisis residential facilities. The county has one such facility now. By contrast, San Joaquin County has 37, Heller said. The county will apply for a state grant for an estimated $5.7 million in startup costs for the centers.
Call The Bee’s Brad Branan, (916) 321-1065. Follow him on Twitter @BradB_at_SacBee.