OMH’s Mental Health Services Restructuring: A Commentary

The Coalition of Behavioral Health Agencies has been gratified to be an active participant in the stakeholder process established and nurtured by the New York State Office of Mental Health (SOMH). For close to five years, we have maintained that restructuring of clinic reimbursement and attendant program design is long overdue. In fact, we have seen the closing of large numbers of Article 31 outpatient clinics in the New York City area, a consequence of the gross imbalance between the costs of running clinics and the inadequate Medicaid and other reimbursements for services. The closing of clinics is threatening the fabric of community care, the continuity of service delivery, especially for hospital discharges, and to the welfare of consumers who have depended on them for stability and predictability of care.

Properly alarmed, The Coalition, in 2005 convened a workgroup of its providers and hired a team of consultants. Members engaged in a long process of review, analysis of clinic operating data and consideration of alternative models of service delivery. The Coalition produced a conceptual framework for reimbursement and clinic reform that was presented to the newly appointed NY State Office of Mental Health’s (SOMH) Commissioner Michael Hogan at a meeting in his first week in New York. We are mindful still of his auspicious response: “I know that clinics are the portal to the mental health system.”

Now we have been engaged for two years in an intense and meaningful SOMH/DOH process that is heading down the road towards major reform, scheduled to begin in January, 2010, a scant five months away. We have seen considerable accomplishments: 1) a pool of dollars established to cover those people who are not covered by insurance (the uninsured); 2) the measured phase-out of a Medicaid rate add-on called COPs, the previous mechanism for covering these people; 3) a new reimbursement mechanism that will be compliant with federal HIPAA law, guaranteeing confidentiality to consumers of service; 4) a broadened range and flexibility of services for recipients (although recent rumors about last minute unilateral changes in procedures by State authorities may belie this accomplishment); 5) increasing the base Medicaid rate (although, the exact rate and the rate for supplemental services is still in discussion and providers await the outcome of the deliberations before assessing the impact on community clinic service delivery); and 6) regulatory changes that are designed to promote more integration of care, both within behavioral health and with primary care (although the sector is still unsure how these services will be reimbursed).

The work has been intense and SOMH must be applauded for all its hard work. So too do the stakeholders deserve plaudits for determined participation that has required data collection and analysis, many meetings within each group, uncountable trips to Albany, conference calls and webinars. Many good results may be observed.

Yet there remain a variety of unaddressed issues on which the future of New York’s clinics depends. Let me state unequivocally, that although The Coalition represents community-based providers; we believe deeply that quality care and continuity of care are at stake here. These are crucial issues for recipients of care. Clinics provide access to care for many needy and distressed residents of communities all around New York. If clinic programs cannot find the wherewithal to survive, many consumers will be deprived of care; if clinics cannot afford the most qualified professional staff, consumer care will be compromised. If consumers cannot access the “gold standard” of care that our clinics provide, then care will be shifted to more costly (in fiscal and human terms) providers of care, such as hospital emergency rooms, inpatient wards, and jails.

Issues that Remain Unaddressed in Clinic Restructuring

1)    We all would benefit from more transparency. As of the date this article is written (July 26, 2009), we do not yet know the SOMH proposed base rates nor the weighted amounts that will be provided for specialized services. Agencies are way past their deadlines for developing FY 2010 program budgets. SOMH must quickly move to provide reasonable models that show impacts on providers, by type and location, using fair assumptions of service demand and costs of doing business. Without this analysis, we won’t be able to determine how many consumers may be dislocated from their services due to clinic closures;

2)    Currently, and for decades, a full Article 31 clinic visit has been defined by the State and permitted by federal Centers for Medicare and Medicaid Services (CMS), as 30 minutes in duration. Many interventions, particularly new evidence-based therapies, can be delivered in 30 minutes. Many children with serious emotional disturbance and other fragile and seriously ill consumers have difficulty concentrating for more than 30 minutes or decline to participate in longer sessions. Moreover, many poor and minority communities have limited provider capacity and access to services. The unfortunate consequence of lengthening the visit duration is that it further stretches inadequate capacity and resources, commensurately lengthens waiting lists, and even would deprive some consumers from accessing clinic care. Ominously, many clinics will not be able to survive the lessened reimbursement and may have to close, even further depriving community residents of clinic care. By contrast, Article 28 community health clinics that are licensed by the State Department of Health may provide comparable behavioral health services in increments of 30-minute sessions or less for full reimbursement. We seek parity in this matter for SOMH licensed Article 31s.

3)    Professional licensing requirements under New York State laws threaten the implementation of the reform endeavor. SOMH asserts this very problem in its article in the current issue of MHN. The legislature and other State authorities must be convinced to enact a longer exemption from the provisions of the law for the community-based provider workforce. We also must work in tandem with SOMH (and the other impacted State agencies, including OASAS) to seek more flexibility in the application of the training and licensing requirements or many of our programs will be deprived of licensed professional staff. This will have negative consequences for service delivery and reimbursement for care.

4)    Many of our agencies provide full time salaries and benefits, including health care, to their workforce. Many of these clinics are unionized and have signed agreements governing the terms of employment. Other clinics use a model of care that relies heavily on “in locum tenens,” or part time consultant professional staff. These workers are paid an hourly fee, dependant on consumer attendance (they are not paid for “no shows,” a widespread problem in clinics). Only the staff model approach provides health care benefits to professional staff. At a time when the nation’s attention is focused on universal health care delivery, it is even more troubling that New York State would be implementing a clinic system that would, in effect, deprive professional staff of health benefits.

The Coalition believes that a model of care based on a preponderance of full time clinical staff is preferable as it promotes case conferencing and mutual help among staff that brings more expertise to bear on consumer issues, more consistent supervision, a greater guarantee of continuity of care, and not to be discounted, it strengthens the economic viability of communities whose residents we employ in considerable numbers. The new reimbursement system does not distinguish between these two models of care and is likely to push the clinic system to reliance upon the in-locum tenens model. We believe that shift to be against the interests of consumers, particularly those with multiple and very high needs. We believe that it is ethically wrong to promote a system of care that will not pay health insurance to the professionals that devote themselves to this life saving work.

5)    SOMH has not addressed the impact of significantly lower rates paid by commercial insurance. Many of our clinics treat working adults and children who have significant behavioral health problems, including serious mental illness and co-morbid problems. Without adequate reimbursement from these payers, many adults and children will be deprived of care by community-based clinics that cannot afford to treat underpaying clients. In many communities, there are no alternatives to community-based clinics, making Timothy’s Law and federal parity laws, a myth for these adults and children who will be unable to access care. This has major ramifications for individuals and communities as the nation and the State are undergoing economic stress, growing unemployment, housing loss and other family pressures. At a time when demand for access to quality mental health care is growing, SOMH seems to be receding from the imperative of providing care for all State residents in need. The resultant emotional and practical disinvestment in the public mental health system by working and middle class voters will have grave implications for future public mental health policy and funding.


The Coalition joins SOMH in wanting meaningful and implementable clinic restructuring and reform. We believe in cost effectiveness in service delivery. Community based care is prevention-based care and person-based care. Our clinics join with other community-based services in helping consumers stay on the path of recovery. We intervene to help keep consumers functioning in the community and away from costly intensive hospital-based services.

More time is needed to make the changes that will help improve the system. Both time and money are needed to bring IT systems up to date, especially to function in the era of electronic records, yet federal and State stimulus monies are available only to hospitals and physicians.

More attention and political pressure is needed to address all aspects of the payer systems. Bring on change; but change that is adequately planned; change that will help community-based providers transition without interrupting care; change that provides technological underpinning for moving forward; change that puts into place new replacement services before the elimination of existing services. Responsible change will bring consumers of care into the new paradigm without losing any of them to care in the transition. This is the reasonable way “to move New York toward a more accessible, person centered and cost-effective clinic system.”

Mental Health News note: We welcome other perspectives on this important initiative. Please contact Ira Minot, Publisher at (570) 629-5960 or email All articles will be considered for publication in our next issue—deadline, November 1, 2009.

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