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State hospitals accredited; lawmakers probe rising civil commitment and competency restoration costs
Summary
Committee heard that all three state hospitals are now accredited, which allows Medicaid billing, but civil commitment costs have increased and restoration-to-competency admissions have risen sharply, driving supplemental requests.
Alex Leanson (LSO budget and policy analyst) and Alex Adams, director of the Department of Health and Welfare, briefed the Joint Finance-Appropriations Committee on the psychiatric hospitalization budget, state hospital accreditation, and rising civil commitment and competency-restoration costs.
Leanson said the division budget covers community hospitalization and three state hospitals: State Hospital South (Blackfoot), State Hospital North (Orofino) and State Hospital West (Nampa). He described a fiscal 2025 supplemental request of $2,600,000 (one-time, General Fund) to cover increased costs for mental holds and commitments following statutory changes in 2022.
Leanson told the committee, “Senate Bill 1327 of 2022 changed where the responsibility fell to pay for these mental holds. As a result, the Department of Health and Welfare is now footing the bill for these services,” and the supplemental request would help fiscal 2025 costs.
Director Adams confirmed that all three hospitals are accredited and explained the relationship between accreditation and Medicaid billing. “State Hospital West…so far billed $1,600,000; they've received $1,300,000,” Adams said, describing that federal receipts reduce the general fund burden and that receipt authority was requested to capture those receipts.
Adams outlined a federal billing rule tied to length of stay that affects reimbursement: Medicaid reimburses only for stays of 60 days or less; stays longer than 60 days may be ineligible for federal reimbursement and thus fall fully to the state. The department reported an increase in longer stays: admissions exceeding 60 days grew from about 17% to 37% of admissions, increasing state cost exposure.
Ross Edmonds, administrator for the Division of Behavioral Health, told the committee the workload driving state hospital demand has shifted. “What we've seen over time…year over year is the number of holds that exist from law enforcement and health care professionals goes up,” Edmonds said. He noted that civil commitments have stayed fairly flat while restoration-to-competency commitments have risen dramatically; Edmonds said restoration cases have increased roughly 600% over a ten-year period and currently occupy a large share of beds (about 75% at State Hospital North).
Committee members asked about staffing and vacancy rates. Adams said vacancies at State Hospital West and South were low (0% and 2.8% reported) while State Hospital North had higher vacancy (11.5%), which affects bed availability. He told the committee the nexus of staffing, licensing and accreditation affects the ability to move patients quickly from community hospitalization into state hospitals, which influences community hospitalization costs.
The department presented a transfer-exemption request and fund shifts (moving federal funds to dedicated receipts in some cases) to align billing and receipt authority. No committee vote on the supplemental or transfer requests was recorded in this hearing; committee members asked for additional data on billing, savings from Medicaid billing since accreditation, and exact fiscal numbers.
Edmonds and Adams were asked to provide follow-up documentation on incidence of long stays, trends in restoration-to-competency cases, and historic billing receipts to help the committee evaluate supplemental requests.
