Immediate action required to protect safety net behavioral health system 

By Kara Johnson-Hufford 

We’ve all seen and heard a lot about the challenges we face as a state around our mental health and substance use disorder treatment systems. An increasing number of people in need of services and supports, a declining number of people working in the system and funding for all of this that is also on a steep downward trajectory.  

If it’s not a recipe for real trouble, it’s certainly also not a recipe for real progress.  

Our community mental health centers (CMHCs), which provide the 24-7 year-round infrastructure for these needs as well as care for Coloradans living with the most serious mental illness, are looking at genuine budget instability in the coming years—an instability their clients and the communities they serve can little afford.  

And now there’s an immediate challenge that complicates things still further. These safety net providers anticipate a minimum $24.4 million shortfall in their budgets this fiscal year due to the end of the COVID public health emergency, which has meant the loss of Medicaid coverage for a significant number of the individuals they serve.  

This reality squeezes already tight budgets in a few critical ways: 

  1. Providers’ budgets were built based on state projections that anticipated a much slower and less steep enrollment decline. The rate of enrollment decline has been significantly faster and more severe than originally projected.  
  1. While some of those individuals are able to secure commercial insurance coverage, CMHCs’ experience is that the vast majority of them become uninsured. But that doesn’t mean they don’t still need or seek care. As a result, the amount of uncompensated care being rendered by safety net providers has increased significantly as Medicaid enrollments have declined. In addition, the population that has been losing coverage tends to have more acute needs than historically seen in Medicaid populations, meaning they need more, and more costly, services. But the state funding for non-Medicaid services has not been increased to reflect this new reality.   
  1. CMHC reimbursements are calculated based on retroactive costs. Because those don’t reflect the current reality of the Medicaid population, they haven’t kept up with the cost of care.  

What these realities mean is that without financial solutions and support, the providers whose mission is serving our most vulnerable may be forced to make significant reductions to critical services such as crisis care, residential programming, assertive community treatment and others—or to lay off staff. Services such as these help our neighbors living with SMI experience recovery on their terms in the community of their choice. And our state can ill afford to have safety net providers lay off staff in the midst of a behavioral health workforce shortage—staff who will be difficult to lure back to safety net work in a competitive market.  

Each one of these choices is the antithesis of the mission of our community mental health centers. Not a single center or provider would choose these independently. But neither can these centers and providers sustain this level of budgetary decline while still maintaining programs that have consistently operated at a deficit.   

The real and urgent individual need for treatment doesn’t fluctuate with funding. We risk deepening our behavioral health crisis by creating a vicious cycle of continued demand and decreasing access to care. That’s a math equation Colorado acknowledged didn’t work when it embarked on system reform nearly two years ago.  

It's a cycle we can break if we acknowledge the funding challenges and prioritize funding stability. Our mental health and substance use disorder safety net cannot survive in its current form if we don’t fervently pursue sustainable solutions.