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State hospitals accredited; committee hears rising civil commitment costs and 60-day Medicaid billing risk
Summary
Analysts told the Joint Finance-Appropriations Committee that all three state psychiatric hospitals are accredited and able to bill Medicaid for eligible stays, while department officials warned that rising civil-commitment costs and an increase in long stays are shifting more costs to the general fund.
Alex Leanson, a budget and policy analyst with the Legislative Services Office, briefed the committee on the Division of Psychiatric Hospitalization, which includes Community Hospitalization and three state psychiatric hospitals (State Hospital South in Blackfoot, State Hospital North in Orofino, and State Hospital West in Nampa).
Leanson said the division has 467 authorized FTP and is primarily driven by personnel and operating expenditures. He flagged one-time and ongoing enhancements in recent years, including electronic medical record updates, facility alterations, accreditation updates and a FY2025 request related to civil-commitment expenditures.
Director Alex Adams confirmed all three state hospitals have received accreditation; he said State Hospital North was the most recent and that accreditation enables the hospitals to bill Medicaid for eligible patients. "State Hospital West has billed $1,600,000 and received $1,300,000," Adams said as an example of federal receipts reducing general-fund burden.
Leanson told the committee the department requested a $2,600,000 one-time General Fund supplemental for increased civil-commitment costs that the department now bears after Senate Bill 1327 (2022) changed which entity pays for mental holds. Adams reiterated that the policy change shifted responsibility away from counties to the state and that civil-commitment costs are effectively an entitlement: health-care professionals and law enforcement place holds under statute and the department must pay for the care regardless of how many people are placed on hold.
Committee members asked about the 60-day Medicaid rule that affects reimbursement. Adams explained that federal Medicaid rules permit reimbursement for stays of 60 days or less; stays exceeding 60 days are not reimbursed by Medicaid and become state general-fund costs. He told the committee that the percentage of admissions exceeding 60 days has increased from about 17% to about 37%, which increases state costs. Adams said clinical decisions drive length of stay and the department cannot force clinical discharges solely for billing reasons.
Ross Edmonds, division administrator for behavioral health, gave a historical perspective: holds from law enforcement and health-care professionals have risen year over year; civil commitments have been relatively flat but restoration-to-competency commitments have grown substantially. "Over the last 10 years we've seen about a 600% increase in restoration-to-competency cases," Edmonds said, and he added that nearly all restoration cases are restored (he estimated roughly 95% restored).
Clarifying details the committee recorded included: $2,600,000 one-time supplemental request for civil-commitment expenditures; accreditation enabled additional Medicaid billing (State Hospital West billed $1.6M and received $1.3M); and the Medicaid reimbursement risk tied to stays over 60 days.
No formal vote was taken at the hearing.
