Department of Mental Health seeks recurring funds to close deficits, expand community care and meet DOJ Olmstead concerns

Dr. Robert Bank, interim director of the Department of Mental Health (DMH), told the Senate Finance Committee Health and Human Services Subcommittee on March 27 that the department faces rising costs and capacity pressures across its inpatient hospitals, forensic services and community programs and requested a series of recurring appropriations to stabilize operations and expand community-based care.

Bank told the committee that DMH aims to sustain the 988 call center, telepsychiatry services, inpatient hospital care and several state-mandated programs. He reported that DMH and partners answered 88% of 988 calls in January and February this year and project roughly 40,000 calls this fiscal year, with less than 1% of calls requiring EMS or law enforcement dispatch.

On mandated forensic programming, Bank said referrals have increased about 40% in five years and the wait list remains high despite a 27% increase in completed competency restorations. DMH requested approximately $13,700,000 in recurring funds, of which about $6,000,000 would cover the current deficit at the Columbia inpatient facility and the remainder would fund 50 additional beds and expanded jail-based restoration services.

Bank identified other top recurring requests: $2,000,000 to support the state’s violent-predator program (current census 239, capacity 268 before double-bunking), $4,500,000 to continue the statewide alternate transportation program that moves psychiatrically committed patients from emergency departments without law enforcement involvement, $500,000 to reach full census at a new psychiatric residential treatment facility for detained youth, and $3,000,000 to advance Olmstead-related community services.

Bank described the Olmstead context to the committee: the U.S. Department of Justice notified South Carolina in January 2022 of an investigation alleging unnecessary institutionalization of people with mental illness in assisted-living facilities; a DOJ report in July 2023 found evidence of violations, and settlement negotiations did not succeed. DMH said additional funding would expand assertive community treatment teams and other services intended to help people live independently in the community.

For inpatient services, Bank said both civil hospitals are operating at a deficit and requested $12,400,000 in recurring funds to eliminate deficits at Harris Hospital and Bryan Hospital. DMH also requested $4,800,000 in recurring funds for community support programs across 16 mental health centers, including community hospital bed days and a new eight-bed community crisis stabilization unit in Columbia (the unit is planned to open in May and would require $1,000,000 in recurring funds to continue operations). DMH requested $1,000,000 for therapeutic out-of-home placements for children and recurring funds to continue and expand jail-based programs in Berkeley and Orangeburg counties.

Agency staff described capital needs for aging inpatient facilities and said that DMH has covered deferred maintenance from reserves but now seeks additional capital funding. Committee members asked about program costs, usage and billing for the alternate-transportation program; Mark Binkley of DMH said the program averages about 450 transports per month and uses a mix of hourly, staffing-based and mileage payments to contractors, while some transports for insured patients may be billed to Medicaid or private insurers. Senators asked DMH to provide additional breakdowns of costs and hospital usage data.

Ending: DMH presented its recurring funding priorities to the subcommittee and said the requests are aimed at eliminating existing operational deficits, expanding community care in line with Olmstead obligations and maintaining statewide crisis and telehealth services. Committee members requested further financial and utilization details; no votes were taken on the DMH request at the March 27 meeting.