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Health Dept. outlines cuts to non-mandated services

With much of its budget locked in by federal and state mandates, the Arizona Department of Health Services would have to reduce crisis services and cut back on treatment for the mentally ill, substance abusers and sexually violent offenders in the state hospital if it had to chop 15 percent from its budget.

The department on Oct. 19 submitted a report to the Governor’s Office of Strategic Planning and Budgeting, outlining the impact of a 15 percent budget cut that would cost the agency about $68.7 million. Last month, Gov. Jan Brewer asked each state agency to submit such a report.

As one of the largest and most expensive state agencies – its general fund budget this year is about $458 million – the Department of Health Services put some major programs on the chopping block to reach its 15 percent goal. The largest chunk would a potential $29 million cut in behavioral health services, including services for 6,500 adult substance abusers, 12,900 adults with general mental health-related illnesses and 14,700 seriously mentally ill adults, according to the report.

The reductions would lead to scaled back inpatient, outpatient and residential treatment for those patients, as well as cutbacks in medication. The report stated that such a cut likely would result in the increased use of services such as emergency room visits, crisis services and uncompensated care at hospitals. Unlike many of the department’s other services, those things are not mandated by Title XIX of the Social Security Act.

“Non-Title XIX members who are currently stable as a result of services would potentially regress and require more intensive and expensive treatment, which may eventually qualify them for AHCCCS as a result of (the) spend-down,” according to the report. “Elimination of these services could cause additional court sanctions against the state in the ~Arnold v. Sarn~ lawsuit, since court orders require all (serious mental illness) members receive certain services regardless of Title XIX eligibility.”

Another $17.3 million could be cut through the elimination of crisis phone lines and mobile teams, as well as 24-hour psychiatric care walk-in centers, according to the report, which indicated the phone lines get about 10,600 calls and the mobile teams respond to about 3,200 situations every month. Again, the agency reported that a reduction in those services would likely correspond with increased use of hospital emergency rooms.

A number of Title XIX services that are not required of the agency by the U.S. Centers for Medicare and Medicaid Services likely would be eliminated as well, including changing medication coverage to eliminate most non-generic medication, according to the report. The elimination of that service and several others would save roughly $12.2 million in the agency’s budget, though the report warned that every dollar taken from the programs would cost the state about three dollars in federal matching funds.

The agency also would look to shift the cost of treating violent sex offenders at the Arizona State Hospital to cities and towns, which already pay 25 percent of the cost of the Arizona Community Protection and Treatment Center. The report proposed shifting the remaining $7.4 million for the secure facility to local governments.

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