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The Executive Budget Request for Mental Health 2006-07

Major Strategic Initiatives for OMH

The Governor’s Budget Request for The Office of Mental Health for 2006-07 reflects a number of major strategic initiatives that the Governor has set in motion at the end of his last term including:

Civil confinement of sexual predators
Increased housing via NY, NY 3 and increased rates for supported housing
Expansion and reshaping community-based children’s mental health services
Start-up of service demonstration programs in geriatric mental health
Expanded efforts to prevent suicide

The budget also calls for a cost-of-living adjustment for most community-based mental health services of 2.5% per year for three years.

Major Strategic Initiatives Outside OMH Budget

Outside the OMH budget there are additional major strategic initiatives that affect people with mental illnesses including:

Continued expansion of home-based and case management services for older adults
No additional funding for adult homes
Medicaid wrap-around of part D, for six months only except for psychiatric, retroviral, and transplant meds
No Medicaid coverage of Medicare Pt. D. co-pays
A mandate that older adults receiving EPIC drug coverage enroll in Medicare Part D
Changes in the preferred drug program that might limit access to psychiatric medications
Mandates that SSI recipients enroll in Medicaid managed care, limited to health-only for people with serious and persistent mental illness

Most mental health advocacy groups have enthusiastically supported the budget requests for the cost of living adjustment, for new child mental health services, for geriatric services, and for suicide prevention.

Advocacy Groups Concerned About Medicare Part D

However, most mental health advocacy groups are very concerned about the 6-month limitation on the Medicaid wrap-around of Medicare Pt. D, despite the fact that psychiatric medications would be covered. There is also concern about whether changes in the Preferred Drug Program will result in limited access to psychiatric medications.

Many advocacy groups are disappointed about the lack of an increase for a variety of community support programs that have had one cost of living adjustment in the past decade and were cut approximately 2% over the past two years. They are seeking a $10 million increase for these programs so as to partially make up for the erosion of the past decade.

There is also disappointment about the failure to provide additional funding to address adult home problems as well as the failure to provide new housing outside of NYC.

The most controversial part of the budget request for OMH is the Governor’s decision to civilly commit to state psychiatric centers those sexual offenders who are at high risk of committing sexual offenders when they leave prison (referred to as “sexual predators.) Many mental health and civil rights advocates have opposed this measure because of concerns about civil rights, about the safety of vulnerable people with serious mental illness in state hospitals, and because of concerns that in the long run funding for the core services of the Office of Mental Health will suffer.

The following provides highlights of the elements of the Governor’s Budget Request that have an impact on people with mental health problems.

The Office of Mental Health (OMH)

Executive Budget Request 2006-07
New York State Office of Mental Health Operating Funds (No Capital)

2005-06 2006-07 Change %Change

State Operations $1,205,536,000 $1,302,099,000 $96,563,000 8.0%

Aid to Localities $897,933,000 $968,736,000 $70,803,000 7.9%

Total $2,103,469,000 $2,270,835,000 $167,336,000 8%

OMH’s operating budget for 2006-7 shows an increase of $167 million, from $2.1 billion to $2.3 billion.

OMH’s operating budget is divided into two sections

State operations, which is the funding provided for the operation of state facilities and for administration,
Aid to localities, which is funding which is distributed by OMH to support local services.

State Operations

No bed reductions: The Governor’s Budget Request does not propose a reduction of beds in state hospitals.
No new hospital closures: The budget also does not call for the closure of any state hospitals. The closure of Middletown, included in the current year’s budget is moving ahead.
Reinvestment of Middletown Savings: As promised last year, all savings from the closing of Middletown PC ($7 million) will be reinvested in state-operated community mental health services in Orange and Sullivan Counties.
Expansion of Binghamton Children’s PC: 14 beds will be added.
Reconstruction of Bronx PC: Bronx PC Bronx and Children’s PC will remain open and be reconstructed. Capital costs = $226 million.
Managed Care for Co-Occurring Mental and Addictive Disorders: OMH will use $1.5 million for demonstration programs providing managed care for people with co-occurring mental and addictive disorders. (OASAS will provide an additional $.5 million.)
Evidence-Based Treatment Dissemination For Children and Adolescents: Provides $600,000 for an evidence-based treatment dissemination center.
Civil Commitment: Provides $26.8 million to operate inpatient units at state facilities for sexual predators who have completed their prison sentences. Also provides $165 million in capital to renovate temporary facilities and to build a new unit that will open in 2009.
Medicare Collections: Medicare coverage of prescription drugs will result in savings to state facilities. $4 million will be used to establish an infrastructure to benefit from Medicare Pt. D.

Aid to Localities

2.5% COLA: The Governor’s budget request calls for a 2.5% cost of living adjustment in each of the next three years. However, since New York State does not have a multi-year budget, COLAs in 2007-8 and 2008-9 will depend on the next administration.
Increased Funding for Supported Housing: $6.5 million for rent stipend increases.
NY, NY 3: Over the next ten years 5,500 units of housing will be added in New York City.
Child and Family Clinic Plus: $33 million (annualized) will be made available for increased screening, assessment, and treatment services for children and adolescents.
Expansion of Home and Community-Based Waiver Program: 450 new slots will be established. 300 will be funded within the OMH budget. 150 are funding in the budget of the Office of Children’s and Family Services. ($21.5 million annualized.)
Rural Telepsychiatry for Children: $450,000 requested to provide telepsychiatry in rural areas.
Suicide Prevention: $1.9 million added.
Geriatric Mental Health Act: $2 million is recommended to begin funding for services demonstrations grants pursuant to the Geriatric Mental Health Act.
Adult Homes: No additional funding is requested to improve quality of care in adult homes.

The Department of Health

Medicaid

Cost containment of $1.3 Billion: The Governor’s Budget Request calls for slowing the growth of Medicaid spending by $1.3 Billion. This includes:

Hospital Reductions: $327 million
An anti-fraud initiative: $301 million projected savings
Changes to Preferred Drug Program: $259 million savings
Nursing Home Reductions: $238 million savings
Medicare Part D: $216 million savings
Changing Eligibility for Medicaid: $82 million savings
Expansion of Managed Care to SSI: $57 million savings
Reducing Rates for Adult Medical Day Care: $50 million
Changing Eligibility and Co-Pays for Health Plus: $44 million
Reduction of services for illegal aliens: $15 million

Reduce Medicaid eligibility for long-term care: Efforts to decrease Medicaid expense for long-term care include plans to reduce financial eligibility such as eliminating the right of spouses to refuse to pay for nursing home care and extending the time between transferring assets and becoming eligible for Medicaid from three years to five years. The latter is now a federal requirement.

Increase community-based alternatives to nursing homes: The Governor’s budget also calls for increases of case management, $5 million additional for ACCESS to provide funding for renovations to make the homes of people with disabilities accessible and safe.

Preferred Drug Program: The Governor has proposed eliminating several components of the compromise reached last year that led to the establishment of the Preferred Drug Program in NYS including:

Elimination of physician over-ride
Inclusion of cost as a criterion in the selection of drugs in the Medicaid formulary
No coverage of erectile dysfunction drugs.

The Office for the Aging

COLA of $2.5% for 3 Years: The Governor’s Budget Request calls for cost of living adjustments of 2.5% in each of the next 3 years for community services for older adults—EISEP, CSE, and SNAP.
$15 million increase for EISEP: As part of the long-term care reform efforts, the Governor proposed last year to double funding from $25 million to $50 million for the Expanded In-Home Services for the Elderly Program over two years. $10 million was added last year. $15 million is proposed for this year.
Increase of $250,000 for Elder Abuse: The Governor has also proposed a modest, sub-inflationary increase ($250,000) for Community Services for the Elderly, which is currently funded for $16.3 million.
$150,000 added for a Greenhouse Pilot: The Greenhouse model is an alternative structure for nursing homes including a home-like environment and the elimination of routines about sleeping and eating that leave residents with no choices. The Governor has proposed a pilot project using this model in NYS.

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