Designated agencies warn erosion of community mental-health services will increase crisis and emergency use

Amy Johnson, director of government affairs and communications for Vermont Care Partners, told the House Healthcare Committee on Jan. 15 that the state's designated agencies and specialized service agencies provide a broad community-based system of behavioral-health care and that funding and workforce shortfalls are eroding prevention and upstream services.

Johnson said designated agencies cover a range of services'children's mental health, adult services, crisis response, community rehabilitation treatment and residential supports'and that many services are delivered in homes, schools and community settings rather than in office-based therapy. "We are meeting people wherever they need us," she said.

Why it matters: Johnson said the system is primarily funded by Medicaid, making agencies sensitive to Medicaid reimbursement and rate changes. She told lawmakers that reductions in upstream services increase demand for crisis services and emergency departments, which are more costly and disruptive for individuals.

Johnson described the "crisis continuum" as essential but warned that if upstream prevention and community supports are eroded, the state will face higher-cost crisis care. She noted the agencies delivered large volumes of services in fiscal year 2024 and defended the system's local governance (boards and local standing committees with lived experience) and community integration.

Workforce, vacancies and barriers: Johnson told the committee that vacancy and turnover remain a major problem and that recruitment and retention depend on stable, sufficient funding. She said vacancy drivers include low pay relative to cost of living, lack of child-care slots in some regions, limited housing stock, transportation barriers and competition from other employers. Johnson said that without aggressive investment, turnover improvements will be limited.

Johnson also discussed payer mix and said the agencies are largely Medicaid-funded; she said detailed payer-mix slides were being developed with CFOs to share during budget deliberations. She stressed that designated agencies have a "no reject" policy and that specialized service agencies can set service limits for operational reasons.

Ending: Johnson told lawmakers the state is at a tipping point: reduced investment in upstream services will increase demand for expensive crisis services. She asked the committee to consider sustained funding and workforce investments to preserve community-based care and reduce downstream costs to hospitals and emergency departments.