Local News

Mental hospital will lose up to $10M in federal funding

Posted October 29, 2008

— The Department of Health and Human Services must reallocate $8 million to $10 million in its budget to cover expenses associated with treating some patients at one of the state's four psychiatric hospitals.

Dr. Michael Lancaster, co-director of the Division of Mental Health, Developmental Disabilities and Substance Abuse Services, said Wednesday the state is expected to pay an estimated $800,000 a month over the next year as Cherry Hospital works to regain its certification to be reimbursed for treating any new patients on federal insurance programs.

The Centers for Medicare & Medicaid Services last month revoked the Goldsboro facility's certification following the death of a patient who died after choking on medication and being left sitting in a chair unsupervised for nearly 24 hours.

Lancaster says the hospital will continue to treat patients and won't cut services associated with patient care, but he would not specify where the money would come from within the $14 billion DHHS budget.

"We're not going to cut back our services or decrease just to save the money that it's going to cost us," Lancaster said. "Now, is that going to put pressure on the rest of the system to come up with that money? Yes, it will."

But John Tote, executive director of the Mental Health Association of North Carolina, says he is concerned that same pressure – coupled with Gov. Mike Easley's recent mandate for all state departments to cut 3 percent of their budgets – will, in some way, have an impact on patient services.

"It's a difficult time to be in state government, right now, and this is a difficult time for this to happen," Tote said.

In addition, DHHS will pay Compass Group Inc. more than $400,000 to help restructure Cherry Hospital's management team and to help get it reinstated.

In a report released earlier this month, the independent consulting firm said that fixing the dysfunctional organizational culture will require time, attention and additional resources.

"This system has been in place for a long time," Lancaster said. "We certainly need to be aware that it's going to take us a long time to change this."

In a two-part plan, Compass Group will bring in a team of experts to work with the hospital's management to design and implement a comprehensive plan to address cultural, operational and developmental needs.

Then, it plans to address the issues necessary to help Cherry Hospital be reinstated by CMS. It's unclear how long that will take.

But DHHS officials are using Broughton Hospital, another of the state's psychiatric hospitals whose federal funding was cut in August 2007. Its certification was reinstated in July.


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  • Seeminglyopposed Oct 30, 2008

    Pay someone $400,000 to replace incompetent people? Pay someone $400,000 to replace incompetent people? Something is wrong with this picture. The person or persons that made this decision should be deemed incompetent, sent for mental evaluation and fired, because WHY would you feel the need to pay out money that the agency is already pressed for, for you or them should be able to handle. That money should be put towards better salaries for competent people, and you may get better. Not some firm to spend the money and expect to get qualified people for pennies on a dollar. Start over with this scenario......

  • Raspberry Oct 30, 2008

    I watched McCrory on NC Spin on Sunday and he said that within the first 100 days he would convene a crisis team on the budget and a crisis team on mental health. He even remarked about the laze faire attitude of the folks in Raleigh when talking about the life and death issues facing mental health. One can only hope ... right?

  • nic Oct 30, 2008

    It's funny they say they will not change services at Cherry yet they have closed down some units and transferred patients to Dix and Central Regional. I also agree with codeblue that if we had competnet people with the right qualifications running things there would be no reason to spend money on consultants. If they would actually listen to some of the employees who work with the patients on a daily basis they might not be having so many problems.

  • dragonmum Oct 30, 2008

    I agree, codeblue. It's not rocket science. It's a matter of compassion versus greed. Sad, no, despicable but true. The mentally ill, the staff at the hospitals & MH workers in the community get the shaft while the administration dances in the aisles of their airplanes and says let them eat pork. I'm sooo angry with the current administration that I, a hardened Democrat & mental health professional, voted for (AAKKKHHH!!) the Republican for Gov. The devil's having snowball fights! We can only hope that the whirlwind of coming political changes (and the clear breeze of reason Obama represents) will drop a house on the Wicked Weasleys of the North (Carolina)...

  • circlecity Oct 30, 2008

    Easley's wife should work at cherry with cherry pay scale and see if she could help them out

  • Oct 30, 2008

    CollieDave, you've hit the nail squarely on the head. What value are the folks running DHHS if they have to pay consultants to do THEIR jobs? All four state psych. hospitals are poorly run, understaffed, and costing the taxpayers millions of wasted dollars. On a clinical level, it's not rocket science. Providing quality patient care would save the taxpayers money. Ultimately, the leadership within DHHS has failed the citizens they're supposed to serve. We need folks with mental health experience and proven success to lead DHHS, not political appointments and back scratchers.

  • its_me_grasshopper Oct 29, 2008

    I guess this means that alot more people will have to see a social worker instead of a psychiatrist. Just like these unfunded local clinics that John Mccain has in his Healthcare Proposal. As for me, I would love to see a Doctor. Just like Mccain does, as would be provided in Obama's Healthcare Proposal! I guess Mccain as never been fortunate enough to go to one of these Government Rip-off Stations! If so he is way out-of-touch! Hello!

  • colliedave Oct 29, 2008

    In addition, DHHS will pay Compass Group Inc. more than $400,000 to help restructure Cherry Hospital's management team and to help get it reinstated.

    And what will the result be from this cash layout? I'll do it for $0.00: fire the entire management team and start over!

  • exwife1956 Oct 29, 2008

    How much worst can it get for nc state employees? Everything is in a mess but easley's wife has still got her job and her big pay raise.