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The Affordable Care Act is expected to save Michigan hundreds of millions of dollars annually in mental health costs, but there’s a growing dispute over whether the money should be immediately reinvested in mental health programs, or banked.

As part of major changes associated with the health care overhaul, also known as Obamacare, Michigan opened Medicaid to nearly 500,000 additional residents. That moves their health care costs — including mental health — off the state’s books and onto the federal government’s.

In anticipation of those savings, the state trimmed mental health spending for the current fiscal year by about $75 million, and Gov. Rick Snyder wants to cut it further for the budget year beginning Oct. 1.

But mental health care advocates say some people now getting state-funded mental health services still won’t qualify for Medicaid; many who are newly eligible haven’t signed up; and some mental health services needed by people on Medicaid aren’t covered by the program anyway. They’ll still need to turn to the state for mental health services.

Among those who are worried are agencies that provide adult foster care for people who can’t live on their own, because of severe mental illness or developmental disabilities.

“Our analysis is that the state’s not going to save as much as they think they are,” said Michael Vizena, director of the Michigan Association of Community Mental Health Boards. “Those are general funds that are needed as we transition (to expanded Medicaid).

“We have a number of people who currently access mental health from (state) general funds. We still will need general funds for those people who do not qualify for expanded Medicaid, or for those services that are not funded under Medicaid rules.”

State lawmakers are in the middle of deliberations over the state budget. Senate Appropriations Committee Chairman Roger Kahn, R-Saginaw, said negotiations have become so contentious over mental health funding that he planned to work through the Memorial Day weekend to come up with a plan acceptable to everybody.

While lawmakers are under no obligation to accept his recommendation, the governor has proposed a total mental health budget of $97 million, a reduction of $186 million from 2013.

Snyder wants to save most of the annual mental health care savings under the health care overhaul to cover future Medicaid costs, because the state eventually will have to pay up to 10 percent of the program, starting gradually in 2017.

Last year, the administration estimated this year’s savings at $200 million.

Kahn said the Medicaid expansion is bringing in more people — and therefore more savings for the state — than expected. More than 200,000 people have signed up since April 1.

The administration estimates that the Medicaid expansion will reduce state-paid mental health costs by as much as $260 million in the 2015 budget year that starts Oct. 1.

But local mental health boards disagree. Vizena said his members estimate, based on their actual costs, the boards will need at least $140 million to avoid cutting services.

Said Kahn: “I’m not very sympathetic. I think they’ve got enough money. They’ve been hanging out at my office with their tale of woe. The government is supposed to be a hand up, not a handout.”

Karen Schrock, president and CEO of Adult Well-Being Services, which has clients in adult foster care homes in Detroit, Grosse Pointe, Romulus and other locations, said most people in adult foster care are on Medicaid or expanded Medicaid. But outpatient services must be available in the community if people are to move into jobs and toward independence.

She said people already linger too long in adult foster care, and some may be forced to stay longer if outpatient services are trimmed further.

Alan Brown, 63, lived in adult foster care for almost three years because of a mental health condition, but was able to become independent with the help of community-based mental health services that depend in part on state financial aid.ÌýBrown now works for Adult Well-Being Services, as a “peer counselor” to people living in adult foster care.

“I never wanted to live in an adult foster care home forever. I had other things I wanted to do with my life,” Brown said.

Michael Garrett, president and CEO of Community Network Services of Oakland County, said many community mental health agencies have not yet received any money from the Medicaid expansion.

“We’ve been able to bridge the gap with other funds we have available, and those funds are quickly dwindling,” Garrett said. “If the (state) dollars don’t begin to flow, there will be cuts.”

Garrett is particularly worried about care for mentally ill people who might not qualify for the Medicaid expansion, but depend on state-funded programs for their medications.

“A lot of people we serve are on medication,” Garrett said, “and there could be a scenario where certain people will not be able to get their prescriptions filled.”

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A new study shows more Michigan residents are depressed than those in other states, and mental health care workers are using telephone and video conferencing to reach out to patients in areas without psychiatric services.

Already overburdened with high case loads, mental health professionals statewide are expecting increased demand under the federal Affordable Care Act, which requires insurance companies to provide mental health coverage that is equal to what’s provided for physical-health conditions. Health advocates worry that the load will keep some patients from getting mental health care, despite their new benefits.

Efforts are under way to provide more psychiatric training to family practice physicians, pediatricians, physician assistants and nurse practitioners who increasingly are prescribing psychiatric medications — often for patients with immensely complex cases. And telemedicine, such as patient evaluations conducted through video-conferencing, is playing an increasing role in the delivery of mental health care.

“We’re not trained specifically in psychiatric care,” said Kim Michaels, a nurse practitioner with K-Town Youth Care in Kingsley, just south of Traverse City. The Grand Traverse County Health Department program treats patients that are 10 to 21 years old.

“We need psychiatrists to help us with the more complicated or riskier medications. The patients are becoming more and more complex, and it’s getting to the point where we need help.”

In a recent study by the University of Michigan Center for Healthcare Research and Transformation, 1 in 5 Michiganians surveyed reported being diagnosed with depression at some point in their lives — 20 percent in the state, compared with the national average of 18 percent. Asked if they’d ever been diagnosed with depression, an anxiety disorder or both, 26 percent answered “yes.” The percentages were even higher among those with Medicaid or without insurance.

“Economic stress, poor access to health care, unemployment, are all risk factors (for depression) and Michigan unfortunately is saddled with those burdens more than other states, so I wouldn’t be surprised that it’s at the higher tier among states (for depression),” said Dr. Gregory Dalack, chair of the University of Michigan Department of Psychiatry, which is beefing up support for primary care clinicians through pilot projects offering psychiatric consultations and evaluations via telephone and services like Skype.

Mich. has shortages

Michigan is short on both outpatient mental health services and inpatient psychiatric beds. It’s not uncommon for physicians to send patients a hundred miles away or further for inpatient treatment.

“When I have somebody that’s suicidal, they go primarily to Mount Pleasant or Grand Rapids,” said Dr. Cindy Smith, a pediatrician who practices in Traverse City and Kalkaska.

More needs to be done to expand outpatient services, which were never expanded to the extent needed to replace psychiatric hospitals that were closed down in the ’80s, said Marianne Udow-Phillips, director of the Center for Heathcare Research and Transformation. At the same time, too few medical students are choosing to go into psychiatry, which pays less than medical specialties like dermatology or surgery.

“We clearly have a mismatch in demand and capacity,” she said. “We need more psychiatrists coming out of the pipeline.”

Michaels is assisted by psychiatrists with the Michigan Child Collaborative Care program (MC3), a University of Michigan program that connects her with psychiatrists via phone and teleconferencing.

Dr. Sheila Marcus, director of child and adolescent psychiatry at U-M, leads a team of four psychiatrists who answer calls from primary care physicians in need of advice. If needed, they evaluate patients via video-conferencing.

Commercial telemedicine companies also are increasing access to psychiatrists and other medical specialists. Teladoc, which claims to be the nation’s largest telemedicine provider, says more than 100,000 Michiganians subscribe to its service, which in most cases is paid for by their employers.

The U-M program has patient care coordinators in parts of the state that don’t have enough psychiatrists. The program’s psychiatrists carry pagers so that coordinators can reach them by phone if a local physician is in need of advice.

‘Needs are overwhelming’

Dr. Jennette Gaggino is one of 33 Kalamazoo County pediatricians participating in the U-M program. Physicians in Kalamazoo have received more than 250 phone consultations from MC3 psychiatrists over the past 18 months, she said. The program is funded by a combination of grants, so there is no charge to patients or physicians.

“(Primary care physicians) need much more support as the demands and needs are overwhelming,” Gaggino said. “The availability of just-in-time help is amazingly helpful.

“Not only are we able to review difficult cases, but we gain confidence in assessing and treating more difficult cases down the road. The reality is that there are not now, nor will there be in my lifetime, enough psychiatrists to care for all these children.”

Finding help, advice

Suzanne Coleman, a psychotherapist from Kalamazoo, is guardian for two grandchildren with psychiatric issues. Her daughter is unable to care for them due to psychiatric problems of her own. Coleman said U-M’s program has provided psychiatrists for her patients, and even her own grandchildren.

Coleman’s grandson, 11-year-old Ben, has attention deficit hyperactivity disorder but had side effects from traditional ADHD medicines. So Gaggino, the family’s pediatrician, got advice from an MC3 psychiatrist.

“One medication kept him from eating, and one made him hear voices,” Coleman said. “Dr. Gaggino consulted with a U-M psychiatrist, and they steered him to a medicine (that has been) very helpful for him.

“As a professional, I’m constantly needing psychiatric care for my clients, and … the patients are left hanging many times. This has really been a lifeline.”

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