Policy Position Statements
MACMHP adopts formal position statements on key legislative and administrative issues to guide advocacy and lobbying activities. In addition to the position statement links and citations to relevant background information may be referenced.

Position Statements on Key Issues in the 2003 Legislative Session
Approved as MACMHP Position on 1/9/03

Balancing the Budget. The budget shortfall is largely the result of reduced revenue during a faltering economy. While a slow economy reduces state tax revenues, the need for government services increases. To balance the state budget policymakers must use all available tools, reduced spending, improved productivity, users fees, increased federal revenue, taxes, accounting shifts. Tax increases will be needed once legislators become convinced that all potential creative solutions have been considered.

Medical Assistance (MA) . MA has become a principal source of revenue for mental health services for kids and adults. In Medicaid, the federal government matches each state dollar. Medicaid services poor and disabled. A few core benefits are mandatory (MD’s, hospitals, EPSDT for kids, ICF-MR, nursing homes); all other services are optional, including mental health, CD, rehabilitation, dental, etc. Some populations are mandatory eligibility, others are optional. Minnesota has selected just about every optional benefit and eligibility group available. Among the choices for budget cuts are: changes to benefits, eligibility, and payments to providers. Cuts to psychotropic drugs would cost more than it would save. These are very difficult considerations.

Safety-net providers such as MACMHP members play a unique role in their community and, if possible, should be protected from rate cuts. If necessary, more subtle changes may be promising. For example, adjustments to the amount, duration, frequency or threshold for services without prior authorization could be changed without too much disruption. Additionally, if necessary, community providers would prefer limits applied annually, rather than weekly or monthly. Rather than limited clients to xx# of therapy session, arrange with the provider to average xx# sessions per client. This offers more flexibility for adjustments. Providers may be able to test out models such as the MN Disability Health Options (MnDHO), a pre-paid managed care program for people with physical disabilities currently operated by a provider sponsored network in Hennepin County. If designed right, per case payments for clients may offer the state saving, increase flexibility and retain revenue for providers.

GAMC provides health care for single uninsured poor adults. It is a target for cuts. GAMC is an important payer for hospital services and some mental health services. The uncompensated care impact on hospitals, clinics and centers, will have repercussions throughout the health care system. It will be difficult for other payers to off-set these losses. About 40% of those on GAMC have a mental health diagnosis. Many are dual MI/CD. Loss of this program would be a human tragedy. Many people might be shifted to MnCare. However, the cost of a premium will be prohibitive. In addition, it is unclear whether or not it is legal for counties or a provider to pay the premium on behalf of a client in order to access coverage.

Low rates for kids’ and adults’ day treatment, rehabilitation services, and certain outpatient services are the result of a flawed rate setting procedure and should be able to be addressed through administrative authority under 256B.0626.

Community Safety-net Providers. Essential community providers should be protected from budget cuts. In addition, community providers play a key role in providing access to care for a growing numbers of unemployed and uninsured. A patchwork of methods currently exist to cover this uncompensated care. We recommend creation of some type of uncompensated care fund. In addition, it is appropriate for these clinics/centers (not individual practitioners) to receive a disproportionate share adjustment which would help cover the added cost of caring for this population and the uncompensated care the goes with the package. Quality standards may need to be developed to define the capabilities and commitments to the public interest of organizations eligible to receive the enhanced reimbursement rates and payments from the uncompensated care fund.

State Operated Services: In the context of the budget crisis, it is probable that legislators will propose to make significant cuts in this area. Status quo results in a $42 Million increase over the biennium. It is difficult to argue that mental health services should be cut. This program area has been chronically under funded for years. To target this area for blunt cuts would be disastrous. Careful redesign offers the chance to improve services, attract additional third party and federal revenue, and perhaps meet many of the unmet and under-met needs of children and adults affected by behavioral disorders. We are certain that more could be done with less; and, with the same resources restructured and modernized, we could fill the gaps, comply with the Olmstead decision, and lose the waiting lists.

With improved treatment, effective medications, and steady development of community based alternatives through a combination of public and private funding, the role of state hospitals has changed dramatically in the past 10 years. With earlier identification and increased mainstream coverage of mental health services, the relationship between public and private sector services and between acute and long term care have been redefined and now must be re-aligned. Minnesota’s commitment to state hospital facilities is clearly outdated, evidenced by the census dropping to 528 from about 1200 during the mid-90’s. Changes in the mental health financing system are overdue. Too many funds are tied to institutions and state staff. The link between legislative appropriations tied directly to state operated services must be broken. These funds need to be freed up to serve client needs and respond to local community priorities. In local communities, existing services will expand and new services will emerge financed by a combination of private and government sources in a new type of partnership.

First, direct care services must be maintained or enhanced. Second, savings from cuts to state operated services must be re-directed to cover the non-federal cost of improving medical assistance reimbursement rates. Third, savings should be used provide grants to non-profits and counties to respond to those in crisis who are uninsured. Each state dollar invested in the Medical Assistance account is matched by the Federal government. Fourth, a host of options are available through MA to treat and support clients in the community. With earlier intervention and continuing care, there are better results, less damage to the brain, social relations remain intact, repeated treatment is avoided and families suffer less. Fifth, how much should be cut? A planned reduction over a 24 months will leave an essential core of services, serving maybe 150-200 patients covered by appropriations. All other facilities and staff positions would be closed and terminated and funds re-directed. Savings due to facility closure (administration, laundry, kitchen, maintenance, heat, etc.) will be acceptable to take toward balancing the budget without direct harm to vulnerable citizens.

With funds uncoupled from facilities, consumers, families, health plans, and the state purchasers will be free to select existing or help develop new services from flexible and efficient nonprofit organizations dedicated to the public interest. Services developed for the public sector and managed by nonprofits will also be attractive to private payers as alternatives against their increasing risk, benefiting health plans and employers. The community hospital “contract beds” (for additional stays up to 45 days) should be expanded to include a way to cover people who have exhausted their insurance or who are uninsured. This is currently done with great success in St. Louis County. This arrangement provides treatment closer to home at less total cost than state hospitals, while helping to increase local community capacity. A policy decision must be made whether to authorize the state to directly operate services in this new marketplace. The playing field would be far too unlevel if the state retains the staff paid by an appropriation and then competes for limited funds from a position of being already fully funded. In addition, would state operated community services be successful in fundraises with the United Way, contracting with private sources and capturing private insurance payments?


County Issues. Aid to local government is a likely target in this session. With reduced aid, counties will argue against state-level unfunded “mandates”. If state categorical grants are cut or threatened, many county commissioners will prefer non-categorical, un-designated funds. However, from a state and advocates’ perspective categorical funds provide a measure of accountability and direction toward priorities. In this context, community providers and units of county government able to do business with other public and private payers are an attractive resource because of the diversification they are less reliant on county funds and make the most of the limited funds available. Most community MH providers earn 2-3 dollars for each county dollar they receive. If the measure is service to the community, this is quite a return on a modest investment. With very limited dollars, service providers need to be nimble, creative, productive, accountable, and entrepreneurial to offer cost-effective solutions to local counties, health plans and clients. It is in the interest of counties and clients to use this opportunity to authorize nonprofit providers to contract to provide certain services reimbursable through MA. This strengthens the local service system and earns needed revenue from non-state sources. The improved service systems are also attractive to private payers.

As Medical Assistance and other sources of revenue have improved, the central role of counties has changed. About 94% of Minnesotans have health benefits and access providers directly, not through the county welfare office. In fact, a relatively small number of clients are referred for mental health services through county social services. Many of those living through a first episode of serious mental illness have had no previous contact with the county system. They emerge from the mainstream. Even though most funds now come through other sources, the core foundation of county support is essential to the current MH system. If there is a significant re-structuring and re-alignment of state operated services, counties may play an increased role as funds are re-directed to local government. It is likely that county’s share of the cost of state operated services will increase significantly, but they will have the money to use to pay for the service or develop an alternative. With a strong county role, inequities emerge statewide. While unequal access to services is troubling under any situation, it is illegal in Medicaid funded services.

Counties contribute millions each year to off-set low MA reimbursement rates. We must find a way to leverage these funds to capture additional federal financial participation. Several mechanisms are possible. Among these are inter-governmental transfers, “certified local match”, “provider taxes”, cost-based reimbursement with an agreement the local providers and counties settle-up each quarter. The severe budget crisis may provide the impetus to find an acceptable strategy that will improve reimbursement rates for the services deemed most important to local communities and their provider partners. As the gap between MA rates and cost widens, county funds are increasingly used to off-set budget short-falls rather that serving expanding number of uninsured in a recession. With improved MA rates, county funds can be directed to priorities such as housing, service for the uninsured, crisis services, and others.