Budgets Balanced at Expense of Mentally Ill

mental health clinic with 'closed' signA perception persists that people who are mentally ill pose an increased threat of committing violent acts; three-quarters of Americans view the mentally ill as dangerous. Tragic events like the attempted assassination of U.S. Rep. Gabrielle Giffords, D-Ariz., by suspect Jared Loughner in Tucson, Ariz., stoke those fears. Loughner allegedly is mentally ill.

But data collected by the National Institute on Alcohol Abuse and Alcoholism confirm that serious mental illness — such as schizophrenia, major depression or bipolar disorder — alone is not a significant predictor of violent behavior. (Researchers have found that people with serious mental illness who also abuse alcohol or drugs may be more likely to commit violent acts.)

In fact, violent acts committed by people with serious mental illness comprise an exceptionally small proportion of the overall violent crime rate in the U.S. They are more likely to be the victims of violence, not its perpetrators.

In the aftermath of the Jan. 8 Tucson tragedy, the media’s focus on Loughner’s mental state and whether authorities could have prevented the shootings exposed vulnerabilities in the nation’s mental health care system, prompting many to call on states to boost funding for mental health services.

Funding drought

A new report by the U.S. Substance Abuse and Mental Health Services Administration documents a nationwide decline in behavioral health care spending as a share of all health care spending, from 9.3 percent in 1986 to just 7.3 percent, or $135 billion out of $1.85 trillion, in 2005.

Most states — still reeling from the recent economic recession — are looking to make further cuts to their health care expenditures, not increase them. By law, states must balance their budgets, the bulk of which is dedicated to health care expenditures.

In a report titled Grading the States 2009, the National Alliance on Mental Illness said of the mental health care system: “Long fragile, fragmented, and inadequate, it is now in serious peril,” owing in part to the recession’s impact on state budgets.

NAMI’s first attempt at evaluating states’ mental health services came in 2006. At that time, the nation’s grade was a D (“F” being failing). Three years later, that grade was unchanged; although it should be noted that Gifford’s state of Arizona had improved from a D to a C.

The report notes that mental health care is countercyclical — demand for services tends to increase as the economy declines. This is evident in last year’s higher-than-expected enrollment in Medicaid, which pays for more mental health services than any other source.

According to the Kaiser Commission on Medicaid and the Uninsured, for every 1 percentage point increase in unemployment, 1 million more Americans enroll in Medicaid and an additional 1.1 million become uninsured.

“Although research shows that failing to adequately fund mental health services results in a need for significantly greater expenditures down the road, many states are still choosing to cut immediate costs by limiting access to needed services for people with serious mental illnesses,” NAMI’s report says.

Despite demand, state mental health program directors have seen their budgets shrink by more than $2 billion over the last three years. While some states have cut funding for mental health services as much as 20 percent, others might resort to cutting as much as 40 percent, according to Elizabeth Prewitt, government relations director for the National Association of State Mental Health Program Directors.

“What is happening is they’ll make cuts, but the fiscal situation continues to deteriorate and they have to go back in,” Prewitt told NASW News. “This is one of the most damaging periods in states’ history, and we don’t know exactly when it’s going to be over,” she said, noting that historically, states’ recoveries lag behind the nation’s.

Although state mental health programs have tried to make do with less by trying to rein in administrative costs, furloughing staff and instituting hiring freezes, Prewitt said that kind of trimming around the edges hasn’t been enough to avoid an effect on services.

“They’ve had to cut inpatient and community-based services,” she said. “Over the last four years, there’s been a reduction nationally in 4,000 inpatient psychiatric beds.”

Arizona Gov. Jan Brewer has sought permission from President Barack Obama’s administration to eliminate Medicaid coverage for 280,000 low-income adults in her state — a savings of $541.5 million — to help close a projected $1.1 billion budget shortfall in 2011.

Arizona State Sen. Kyrsten Sinema, a social worker, is troubled by that request.

However, Department of Health and Human Services Secretary Kathleen Sebelius informed Brewer in a Feb. 15 letter that a waiver isn’t even required for the specific reductions proposed.

That same day, Sebelius told reporters that she doesn’t have the authority to grant such waivers, which have been sought by several other governors.

“It is not an appropriate option,” Sinema, who is a friend of Giffords, told NASW News. She noted that her state already has been through two rounds of cuts to mental health services. “People who need mental health services in Arizona have to access it privately; there’s just not much left for people who rely on entitlement programs.”

Federal spending on mental health services also is under threat. On Feb. 3, House Republicans, intent on reducing the size of the federal budget, proposed an initial $74 billion in cuts to Obama’s fiscal year 2011 spending request. That includes a reduction by $1.3 billion to community health centers and $96 million to the Substance Abuse and Mental Health Services Administration. More proposed cuts were expected at this story’s deadline.

Also, at his Jan. 25 State of the Union Address, Obama proposed a five-year freeze in federal discretionary spending. It remains unclear how that would affect spending for mental health services.

Spillover effects

“We know that when there’s a reduction in mental health services for people who formerly had access, the potential for individuals to engage in behavior that attracts the attention of law enforcement increases,” Sinema pointed out. “But law enforcement officials aren’t equipped to handle the mentally ill.”

Data compiled by the National Council for Community Behavioral Healthcare corroborate Sinema’s assertion that untreated mental illnesses and substance use disorders increase state spending in other areas.

For example, a lack of spending on substance use disorder treatment accounts for 81 percent of the $51.3 billion spent in 2005 by all 50 states and D.C. for justice-related programs in adult corrections, juvenile, justice and the judiciary. People with untreated mental health illness are 4-6 times more likely to be incarcerated, which increases states’ justice system expenses.

“We used to talk about ‘deinstitutionalization,’ but what we really had was ‘transinstitutionalization,’” where people with mental illness released into the community wound up in prisons because of the lack of community services, said Louis Josephson, a social worker and president and CEO of Riverbend Community Mental Health in Concord, N.H., in an interview with NASW News. “Just because you don’t want to pay for these services, these people don’t disappear.”

Riverbend has had a very tough couple of years, according to Josephson. They’ve lost 6 percent of their funding. “That doesn’t sound like a lot, but we weren’t flush with funding to begin with,” he said.

That has translated to reduced services. Two years ago, Riverbend had to close the doors to one of its residential programs serving 13 people with severe mental illness and they downsized a program for older clients. Josephson has had to lay off 30 employees.

He said Riverbend is doing a lot more “triaging of care” — prioritizing treatment for clients more in crisis. “My concern is that by not being able to be proactive, other clients are becoming more symptomatic in the meantime and will eventually flair up.”

Clients are stacking up in New Hampshire’s state psychiatric hospital “because there is nowhere for them to be discharged to. Every day, there’s 30 to 40 clients ready for discharge but go nowhere, and it costs over $800 a day to keep them there,” Josephson said.

“We don’t know why Loughner did what he did,” Sinema said. “That being said, we do have to have a healthy and robust mental health system that provides for everyone who needs it. Maybe that would lessen the potential for other seriously ill individuals who feel isolated and alone to engage in destructive behavior.”


Arizona and other states could see quite a bit of relief once certain provisions of the Patient Protection and Affordable Care Act — major health care reforms enacted in 2010 — take effect in the coming years. In the meantime, states have few options for maintaining service levels.

To avoid cuts to mental health services in California, which has the eighth-largest economy in the world and an equally large budget deficit of $25.4 billion, Gov. Jerry Brown proposes taking $861 million out of Proposition 63 funds — voter-approved dollars dedicated to the creation of new mental health services — to keep the following existing programs afloat through 2012: mental health managed care; early and periodic screening, testing and treatment programs; and mental health services for special education students.

Those programs would then be realigned to the counties, supported in future years by new taxes and federal Medicaid matching funds.

Brown also proposes increasing funding for mental health services that were supposed to benefit from a 1991 realignment of programs that proved to be fruitless.

This all, of course, depends on whether California voters will approve the governor’s plan that calls for tax increases — something so few seem to have an appetite for these days.

Rebecca Gonzales, director of government relations and political affairs for the NASW California Chapter, said she and other advocates are working to make sure the state doesn’t take money from areas that affect direct services. “We believe it’s possible to do so without harming clients,” Gonzales said.

She is hopeful that the governor’s plan will be a good deal for mental health services in the long run. “Funding for mental health services deteriorated after the 1991 realignment, and then Californians passed Proposition 63 in 2004, but we are playing catch-up,” she said.

Riverbend’s Josephson believes it is a critical time for social workers to advocate on behalf of their clients. Last May he helped organize a rally outside the New Hampshire statehouse, where clients of Riverbend spoke about how they’ve benefited from mental health services and how detrimental funding cuts would be.

“There’s not much compassion in the political arena these days,” he said. “So, it’s important for people to hear that among the loud drum beat.”

Sinema reiterated the importance of the issue: “If we want to have a healthy and vibrant economy tomorrow, then we need to invest in mental health services today.”