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Buckeye State passes the buck on behavioral health costs

May 27, 2011
by Brian Albright
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Ohio’s county boards, taxpayers bear the brunt as legislators mull fourth straight year of behavioral health funding cuts

With a vote by Ohio’s General Assembly on Governor John Kasich’s biennial budget proposal looming next month, the state’s behavioral health advocates and providers see a budget that gives with one hand and takes away with the other.

On one hand, Kasich has asked that the state’s share of match funding for mental health and alcohol/drug abuse services be “elevated,” or rolled into its general Medicaid budget—part of a larger plan to restructure and reform Ohio’s Medicaid system. This move would free county behavioral health levy dollars that have, increasingly, been used to pay Medicaid match obligations as state revenues fell, explains Cheri Walter, CEO of the Ohio Association of County Behavioral Health Authorities (OACBHA).

Earlier this year, OACBHA advocated the idea of funding Ohio’s Medicaid match funds for behavioral health not from general revenue funds, but from the same budget line that pays the state’s Medicaid match for physical healthcare services. That budget line is 525, the budget line for the Ohio Department of Job and Family Services (ODJFS), which is currently the largest line item in the state budget.

"It's time to integrate physical and behavioral health," Walter says, adding that if the Medicaid match funds for behavioral health move to the ODJFS 525 line, “our match would be less than 2 percent of that line item. In 2010, the JFS underspent by two times what it would have cost to cover our entire match."

OACBHA also advocated for two other budget provisions: the first would prevent local levy dollars from being used for the state’s Medicaid match. The second would protect behavioral health funding for non-Medicaid eligible Ohioans within the budget process.

But, here is where the other hand took away. To pay for elevating the Medicaid behavioral health matching funds into the general Medicaid budget, the Governor’s 2012 budget calls for additional cuts to community mental health and substance abuse treatment funds, continuing a trend of major cuts that began under the previous Governor, Democrat Ted Strickland.

Plenty of problems

"What was already a stretched-thin safety net of services is starting to break," says Walter. "Unless there is a reinvestment in our system, there will be bigger problems."

Ohio’s got plenty of those as it faces an $8 billion budget deficit. Kasich, a new tax-cutting Republican governor, has promised to fill the budget gap through across-the-board state budget cuts. And, although Ohio’s mental health budget has already endured three years of cuts, (totaling 35 percent), the state’s Department of Mental Health (ODMH) is braced for more in the new Governor’s budget.

"The Governor has recognized publicly that mental health has received a significant volume of budget cuts, but I don't think that means cuts are off the table for this agency," says Tracy Plouck, the new director at the ODMH.

In fact, Kasich's budget would reduce the ODMH's general revenue fund by 4.6 percent between fiscal years 2012 and 2013; the "all funds" change (which includes federal and state rotary funds, in addition to general revenue) would fall six percent. Since these reductions are attributable to Medicaid cost containment measures, Plouck says that the the department's non-Medicaid community subsidy would actually increase by $10 million in the same period.

Big cuts in real dollars

But Walter doesn’t see it that way. Due to the proposed cuts in community services funds (the offset for the elevated Medicaid match funds), Walter says that the for the 2012 budget to be at a “break even” level with the previous budget, an increase of approximately $19 million in non-Medicaid funding for the ODMH and $9 million for the ODADAS would be needed.

"If you go back from 2002 up to the 2012 budget proposal, and look at non-Medicaid funding for the Department of Mental Health, there's been a cut of 76 percent in real dollars. That's not adjusted for inflation," Walter says adding that Ohio Department of Alcohol and Drug Abuse Services (ODADAS) alcohol and drug abuse treatment funds were cut 51 percent.

In testimony before the state legislature, Plouck acknowledged the impact of the Governor’s 2012 state general revenue funding cuts for community services, saying that “to manage within this constraint, it is necessary to reduce proportionately the amount of GRF non-Medicaid community resources that had been available this year on a board-by-board basis," Plouck said. "The goal for Fiscal Year '12 is stabilization: We are elevating Medicaid to take better control of the future and doing the best that we can to provide resources to communities on the non-Medicaid side of the house."

Critics of the budget argue that by continuing to slash community services funding, the state will end up paying millions more. "If we don't have the funds to keep people in community-provided services, we'll have no choice but to increase the number of hospital days," Walter says. "The state is asking us to do more to help with the ongoing opiate epidemic, and they want to release more people from the Department of Corrections into community care. We're just not going to have the money to serve them."

Counties raise more, spend more, serve fewer

As Ohio’s community-focused general revenue funding for behavioral health has dropped, county boards have had to dedicate greater amounts of locally raised levy moneys to meet the state’s Medicaid match. While the Governor’s pending biennial budget will, if passed, essentially protect the those funds, the offsetting cuts that paid for this protection mean that, in more and more cases, counties will come up short in helping non-Medicaid recipients who seek services.