Senate's proposed mental health funding bill takes aim at local government

Apr. 26—State mental health funding may be the latest in a long line of proposed changes to Iowa's mental health system.

Under Senate File 587, which now is in committee in the House, would fund mental health throughout the state at a set rate. Since 2014, Iowa's mental health has been funded by property tax dollars. That amount is set for each of Iowa's 13 mental health and disability regions on a per-capita basis.

"It's been seven years of perpetual change," said Ryanne Woods, CEO of Southeast Iowa Regional Link, a Mental Health and Disability Services Region serving the counties of Des Moines, Henry, Jefferson, Keokuk, Lee, Louisa, Van Buren and Washington.

Woods said she believes the move to regions was for the better and that the resulting collaboration between counties has allowed better control over crisis situations.

The problem, Woods said, is that mental health regions don't have time to reflect. By the time SEIL has had time to figure out how to implement changes made to Iowa law, the Legislature rolls out a new bill. Just last year, the regions were ordered to begin serving children with mental health needs. Previously, the state provided children's mental health services.

As a result of the constant changes, Woods said, the region can't dig into which services are cost effective.

"Are the investments giving the wanted returns?" Woods asked.

This new bill, which Woods described as an appropriations bill, is aimed at equalizing mental health funding, an issue which often is lamented by Des Moines County Board of Supervisors Chairman Tom Broeker, who is a member of the SEIL governing board. The state sets how much each region can ask its member counties to pay into the system, and these numbers are different for each mental health region.

Under SF 587, SEIL would lose some of its funding. Currently, the state allows counties to pay for SEIL using a $42.60 per capita levy. The new bill would drop the levy to $38 per capita.

SEIL still is trying to figure out how it will fund mental health with its current levy, and Woods fears the region will have to drop some of its non-mandatory services, such as jail diversion and supplemental housing, to begin offering services that have been mandated by the Legislature over the past several years, such as advocacy services for people who have been court-ordered to receive mental health services. Woods said it is unclear whether the region would be able to apply for grants to fund its non-mandated services.

SEIL's funding would not be fully restored until at least five years after SF 587 is passed, with funding being stair-stepped up to $43 per capita. After that mark is reached, funding will increase alongside sales tax, but only up to 1.5%.

However, Woods pointed out, even this is not fair comparison. In five years, costs will have increased significantly, meaning those dollars will not stretch far.

"When you have major fluctuations, it becomes a big deal," Woods said.

While mental health funding will be level across the state, the bill also recognizes certain regions sometimes may need more funding. It is for this reason the Legislature wants to establish a mental health risk pool that would provide grants to regions in need of more money.

Broeker, however, is critical of the move.

"It seems like a slush fund for the big regions," Broeker said.

Woods shares that opinion. Des Moines and other large cities, Woods explained, have unique situations, as well as more people in need of mental health resources. Woods said the differences sometimes make it easier for those in large metropolitan areas to get services.

In Polk County, which is its own region, the region can buy a service user a bus pass to get to their appointments. However, that is not always an option in the SEIL region.

Mental health is a tough subject for southeast Iowa. Great River Medical Center's behavioral health unit, which has eight beds, is the only mental health hospital in the region. While someone needing to go to a hospital generally can be transported to wherever there is a bed, those who are under a court order only can be treated at hospitals in Iowa.

Another major change is that the bill all but eliminates the ability of regions to maintain an ending fund balance. For Fiscal Year 2022, the regions would be allowed to have an ending fund balance of only 40%, which is halved in FY23 to 20% and then is cut down to 5% in FY24 and onward.

Under the change, counties no longer would have their own mental health bank accounts and would not levy mental health taxes. Instead, the state would provide payments for the mental health region. Woods is not opposed to the state taking over the funding of the system, and in the past, the region has complained about the state imposing unfunded mandates upon the regions. However, Woods is concerned about how secure the money from the state will be.

It is possible Woods and her colleagues throughout the state will become employees of the region or the region's fiscal agent instead of employees for their respective counties. Des Moines County is the fiscal agent for SEIL.

Woods also is concerned this bill could pave the way for privatization of the mental health system. The state already privatized Medicaid.

"Mental health and disability services is not a profit gains arena," Woods said.

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