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Breakdown: A once-effective system spins out of control

Photo by Ava Barlow. Nicholas Stratas advocates for a unified approach to mental health care.
By Taylor Sisk
Staff Writer

This story is the second in a series about mental health care in North Carolina.
[Breakdown series main page]

As the mental health care system in North Carolina began unraveling, many critics focused on the new private providers, arguing that most of them are in the business foremost for the money.

John Mader, who worked as a mental health therapist for 18 years for the OPC Area Program prior to privatization, disagrees. While a vocal critic of the state’s reform measures, he says he believes that most providers genuinely want to provide quality services.

That said, though, Mader questions whether it’s possible to provide comprehensive mental health care services when certain services are profitably compensated for with state and federal funds and others aren’t.

You have a situation, Mader continues, where the service provider, whether a for-profit or nonprofit organization, has to report to its board of directors or parent company, whose interest is in seeing to it that the organization is able to stay in business.

The question Mader and many other mental health care advocates ask is: Should such critical services – mental health care services – potentially be victim to internal fiscal concerns?

Mader says: “You don’t hear the fire department saying, ‘Sorry guys, it’s October 31; we’ve run out of money. Good luck over the next two months.’”

“Can you imagine doing away with the local STD clinic, privatizing it?” asks Nicholas Stratas, a psychiatrist in private practice in Raleigh and former state deputy commissioner of mental health. “Can you imagine the well-baby program being privatized? I can’t. The neonatal program being privatized? I can’t. So what the hell are we doing here?”

As part of reform legislation passed in 2001, state government began privatizing mental health care services. Area programs such as OPC that in the past had provided services were now ordered to divest of those services and to contract them out to private providers. The area programs, now called Local Management Entities (LMEs), were tasked to oversee those providers. Under the reform, more services would now be provided in communities and, in theory, the state institutions would be less crowded and better positioned to treat the more critically ill.

Most everyone now agrees these reform efforts have miserably failed. Private providers are going out of business; the mentally ill, most particularly those un- or underinsured, are falling through the cracks; and our state institutions are in crisis.

Finding a solution, Stratas believes, will require once again taking what he calls a systems approach.
“Mental illness is a fragmenting problem and our system needs to be unified,” he says. “We can not treat a fragmenting problem with fragmented services. Piecemeal won’t get it.”

‘Making hay’

At one time, North Carolina had what was considered to be a model mental health care system. Stratas – still active in psychiatry and actively advocating for the mentally ill – was one of the architects of that system.

Stratas came to North Carolina in 1960, recruited by a progressive-minded cadre of mental health care experts, led by Eugene Hargrove, a co-chair of the UNC department of psychiatry who became the first head of the state Department of Mental Health, created in 1963.

Hargrove’s vision was to train mental health care professionals within the state to run the system and Stratas was selected as the statewide director of professional education and training.

These were “exciting days; really exciting days,” Stratas recalls. “It was all new. It was like a blank blackboard; there was nothing except the state hospitals.” Licensing standards for personnel within those institutions were upgraded and Charles Vernon, the newly appointed director of community programs, and Stratas began traveling the state, to all 100 counties, meeting with local officials.

About this time, the federal government got interested in improving public state mental health institutions and initiated two types of grants: Hospital Improvement Program grants and In-service Training Program funds.

Vernon and Stratas met with every county commission in the state, held town meetings and generally laid the groundwork for local involvement in mental health care.

They also had solid support in the Legislature, led by John Umstead.

In 1963, the Kennedy administration pushed through the Community Mental Health Act, and, says Stratas, who at the time had been named deputy commissioner of mental health, “man, we made hay with that.”

Local mental health facilities were built across the state. Programs were set up to provide inpatient, outpatient and 24-hour emergency care. Consultation and education was provided to schools, courts and sister agencies that due to the nature of their work needed guidance with mental health issues. The importance of providing continuity of care through the transition from an institution to outpatient services and among essential community-based services was stressed.

In sum, a systems approach to mental health care.

At the same time, the system became racially integrated. Cherry Hospital and the O’Berry Center for those with developmental disabilities (then referred to as the mentally retarded), both in Goldsboro, had previously been the only institutions in the state open to blacks.

Meanwhile, admissions to the state institutions were declining through the ’60s and ‘70s.

In addition, says Stratas, there was a research and a data processing department. If a county official wanted to know where the county stood in terms of, for example, outpatients seen, Stratas says, “You could get that data within 24 hours.”

That kind of accounting, says Stratas, is a thing of the past: “Nowadays, I can’t get that data if I’m waiting for two or three months. They’re not even keeping coordinated, unified data anymore. It’s criminal.”

‘Benign neglect’

Stratas points to the Bob Scott administration of 1969-73 as the beginning of the deterioration of the mental health care system in North Carolina.

“Scott decided there were too damn many state agencies, and I agreed with him,” Stratas says. Scott set about reorganizing state government and Stratas was one of two physicians on an advisory commission to plot that reorganization.

The state Department of Mental Health had been created to provide visibility and access to the governor and the Legislature.

“We had total free access, and we encouraged free access to our staffs,” Stratas says. The reasoning was: “If legislators want to talk to you, talk to them. We need all the help we can get; we don’t need secrecy.”

The department now became a division within the Department of Human Resources, which eventually became the Department of Health and Human Services (DHHS).

At the time, Stratas agreed with the rationale of moving mental health care into one department to include all human services. But Scott was succeeded by Jim Holshouser, the first Republican governor of North Carolina since 1901, and, says Stratas, communications between state mental health care administrators and the governor and the Legislature deteriorated.

Jim Hunt was next in office. Hunt’s approach to mental health care, Stratas affirms, was one of “benign neglect.”

While Scott had appointed a doctor, Lennox Baker, to head the newly created DHHS, the Holshouser administration began a trend of appointing nonmedical directors – the beginning of what Stratas calls the de-medicalization of the state office, which would subsequently happen at the local level as well.

Meanwhile, Stratas says, the area programs became quasi-governmental agencies with autonomous boards. Stratas says communications between the programs and the state institutions began eroding; liaison teams were discontinued.

By the mid- to late ‘90s, programs were falling on hard days financially due to both state and federal cutbacks; they were letting people go and were cutting back services.

“So the Legislature started talking about reform,” says Stratas; “they decided the whole system was sick.”

Cutting corners

In a unified, systems approach to mental health care, liaison teams are deployed so that when a patient gets admitted to Dorothea Dix, for example, the area program in the patient’s community knows about it and can immediately begin to plan for the discharge of that patient.

Under our current system, that doesn’t generally happen.

Marilyn Ghezzi, who for some 20 years worked as a therapist for OPC, says that throughout her tenure the liaison between the institutions and the area programs wasn’t great, but that prior to privatization at least the process was relatively straightforward.

“It used to be that a social worker from Umstead would call us when one of our patients was being discharged,” Ghezzi says. “Now, with so many different providers, there’s uncertainty about who to call.”

And, she adds, with patients being let out after such short stays due to overcrowding, “it’s hard to handle so many.”

Then, once out, services for the more seriously mentally ill are limited.

In a privatized health care system, says John Mader, “compromises have to be made.”
As private providers have continued to struggle to make ends meet, they’re inadequately prepared to deal with those more seriously ill and, in most cases, are unable to provide 24-hour emergency care.

“And when you cut those two things out,” Stratas says, “everybody goes to the hospitals” – an ugly cycle.

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  1. Nick Stratus understands what has taken place like no one else given his previous position. It does make me think/ wonder that perhaps the entire system needs to be blown up, again, and re-vamped. I don’t see it happening however. So, this being said, if we could simply have some standardization of services across the states, a matter which issues from the Utilization Review departments of the LME’s—-that would move forward matters in a positive manner. As it is, in western NC, the UM Departments of the 2 LME’s that oversee 25% of NC 100 counties, have vastly different criteria for outpatient therapy, a lynchpin service. It’s terrifying to think of these LME’s overseeing Medicaid which is probably going to happen re: jerking Value Options contract in 2009.
    Marsha V. Hammond, PhD

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