State's mental health reform may ease Linn's budget woes

County still faces a deficit around $400,000 for the current fiscal year

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CEDAR RAPIDS — Linn County will likely see some financial relief from the reworking of the state’s mental health system, but whether it’s enough to completely cover its budget gap remains an open question, according to one lawmaker in the middle of the reform effort.

There’s general agreement the state should take over services required but not fully funded by the federal government, said Rep. Renee Schulte, R-Cedar Rapids. Legislation is still being written, but Schulte expects the state will take over funding five programs for the mentally disabled this year, leaving some services for the mentally ill as the counties’ responsibility for another year.

“What the state’s offering to do is to pick up some of those mandates, leaving the counties to use property taxes in a more flexible manner for those mental illness (programs),” said Schulte. “That proposal has been consensus on both houses, both sides of the aisle.”

Taking over all the services would cost the state about $42 million a year, a level that Schulte doesn’t expect to be reached this session.

“We were hoping to do that in one year, but the department (of Human Services) and the governor were not able to get to that,” she said.

Still, the shift will mean some relief for Linn County, where the mental health budget still faces a deficit around $400,000 for the current fiscal year. Initially $5.3 million, gap was closed through cuts, an injection of emergency state aid, and a one-time increase in the state’s limit on the county’s property tax levy for mental health services.

County supervisors requested another $1,394,045 this week from the state’s “risk pool” for counties facing deficits in their budgets for the mentally handicapped and developmentally disabled (MHDD).

Service changes at the county-owned Abbe Center for Community Care residential facility will save about $180,000 through June, according to Dan Strellner, president of Abbe Services, the non-profit that operates the center under contract.

Rather than large institutions such as Abbe, Medicaid prefers to fund small, three-or-four bedroom neighborhood group homes for the mentally handicapped, Schulte said.

“Abbe was too large for Medicaid,” she said. “Everything (there) was 100-percent county funded, and that’s why it became such a crisis point when you had the deficit.”

Abbe will still have a role in the state’s reform plan with different services, Schulte said.

“We’ll be diversifying the things they can do,” she said. “We’re not looking to get rid of any levels of care — we’re looking to beef them up and give consumers more choice.”

Supervisors also expect to draw down the MHDD fund balance to an uncomfortably low 3 percent or less, but they’ll have company, said Linda Hinton, government relations manager for the Iowa State Association of Counties. She said up to 50 counties may be in a similar position by this summer.

“In my world, Linn County is not an anomaly,” Hinton said.

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