Mental-health rules are being amended

Published 10:06 am Tuesday, March 4, 2008

By Staff
What happens when you follow the rules and you lose?
That’s what the leaders of some community support mental-health agencies are asking themselves.
Twenty providers in a three-county area are being told to reimburse the state about $2.7 million they earned for counseling services. The state now says that the work the agencies did wasn’t eligible for payment. Agencies in Beaufort, Martin and Washington counties weren’t the only ones affected. Statewide, agencies are being told to reimburse $59 million.
Daphne Hemby, the owner of Coastal Behavioral Healthcare in Washington, said last week she is concerned that providers like hers are being victimized. Now that the state has reviewed its guidelines, it is asking for reimbursement of money for services the state says it shouldn’t have approved in the first place.
Now Coastal Behavioral Healthcare is being told to pay back more than $550,000.
Clearly there has been abuse of the system. A series of stories published in the News &Observer of Raleigh showed how start-up groups were billing the state $65 an hour to take clients to the movies or a swimming pool under the guise of providing mental-health services. Many of the health-care providers had only high-school degrees.
Potter’s House of Beaufort County owner Darwin Woolard told the Washington Daily News that his agency is “blessed” to have been hit with a bill for $115,915 and not hundreds of thousands of dollars like many agencies. The agency has already reimbursed the entire amount to the state, according to Woolard, who also maintains that Potter’s House followed the rules.
When Beaufort County aligned itself with East Carolina Behavioral Health in the summer of 2007, Woolard said, many of the community-support services approved for clients under the agency’s former local management entity, Tideland Mental Health Services, were no longer approved.
The state’s handling of mental health services has been fraught with problems since Raleigh decided to focus more on community-based mental-health care and less on traditional methods. The warning bells should have started sounding in the third quarter of 2006 when the state saw Medicaid claims for community support jump from $50 million to $141 million, almost a three-fold increase. They then shot up to $168 million in the last quarter of 2006 and $252 million in the first quarter of 2007.
Washington County Manager David Peoples said county commissioners there became concerned about community-support agencies in the county because of the cost of those services “exploding” in the county from $40,000 in 2005 to almost $400,000 in 2007.
Washington County had 53 mental-health service providers, of which 16 were licensed by the state. One of them has been told to repay $370,088.
We believe that some of the agencies providing mental-health services were well-intentioned and did provide needed services. We also believe that at least some of the providers saw a way to cash in on a system that had lax regulations.
Some agencies seem to have been caught in the middle. They played by the rules. They got state approval, and only later did the state say the rules weren’t written well and it wanted its money back. How do you punish a provider if it was following the state guidelines? The answer is you probably can’t.
The General Assembly can’t wash its hands of the issue. Lawmakers played a role in creating the mess. Now, our elected officials need to roll up their sleeves and get to the business of cleaning up the situation. If parties can be held accountable, they should be. If people need to go to jail, so be it.