- NC Policy Watch - http://www.ncpolicywatch.com -

Close your eyes and privatize

The disturbing revelations about the state’s mental health system continue in the ongoing series in the Raleigh News & Observer, with the latest installment focusing on the abuses of for-profit companies that charged the state millions of dollars for community support services that were either improperly billed or never provided.

Implicit in the story and throughout the series so far is the role that privatization has played in the mental health disaster. It’s an issue that was a central part of the 2001 reform efforts that Governor Easley silently opposed, but one that never received serious public debate.

Most of the histories of the mental health reform of 2001 focus on the consensus that people with a mental illness, developmental disability, or addiction would be better served by programs in their local communities than in large state institutions.

The plan was to downsize hospitals and use the savings, along with the newly created mental health trust fund, to help pay for community programs, but admissions at hospitals continued to increase and Easley took most of the trust fund money to balance the state budget and it was never fully replaced.

That’s all true and there were plenty of other problems with the way the reform plan was developed and administered. But before 2001, services were provided by government, including area mental health centers and the state.

The reform set up a new creature, the unartfully named Local Management Entities (LMEs), and the decision was made that the LMEs would not provide services, but would instead contract with private for profit companies and nonprofits that would actually work with patients.

Nobody hid the fact that mental health reform included the massive privatization of services that the state was then providing, but nobody talked much about it at the time either.

So the much-heralded market forces that do so well selling shoes and DVD players was unleashed in the system that is supposed to provide care for some of the most vulnerable people in the state, many with complicated diagnoses and widely different needs.

Chaos ensued, a situation that a thorough debate about the consequences of privatization could have predicted.

State mental health officials have tried repeatedly to intervene, adjusting reimbursement rates, changing regulations month to month, which has only made things worse.  The law’s absurd protection of the market doesn’t help either.  

Anthony Pugh, a Randolph County man with schizophrenia and bipolar disorder, told an audience last November about his problems finding care when his local mental health center went private. He was given a list of potential companies to see and not recognizing any of the names, he asked the folks he knew at the newly created LME for help.

They told him they were prohibited by law from making any recommendations. Wouldn’t want to interfere with the sacred market. Anthony chose a provider at random and suffered because of it, before being guided to a better company by activists he knew.

Despite some notable exceptions, mostly nonprofit providers who are taking care of people properly, the pursuit of profit that drives private companies made much of the current crisis inevitable.

Mark Sullivan with the Mental Health Association summed up why in a recent newspaper column.  “Private providers pick and choose which services they will provide, based on what will best meet the needs of the agency, as opposed to public entities whose first responsibility is to meet the needs of the citizenry.”  

And the “needs of the agency” in this case are to maximize profits, which is why companies wanted to provide community support services  

The perils of putting profits before patients are only recently being mentioned by political leaders.

Republican gubernatorial candidate Bob Orr told a mental health forum this week that “this might sound strange coming from a Republican but I do not think this has worked. There needs to be some convincing of me that privatization was the most effective way to deliver this type of service.”

Orr’s not the only one pointing to privatization as part of the problem. Health and Human Services Secretary Dempsey Benton cited it too in a January news conference, implying that the rush to privatize caused many of the problems with the system.

Benton also seems to agree with many mental health advocates who believe that at the very least, the state must provide a safety net of services for people in crisis. The state, not a profit-driven corporation.

Privatization is not the only problem with the state’s mental health system, but it remains the least questioned and least examined aspect of the disastrous reform effort. Too bad there aren’t more state leaders willing to admit it.