Southeast Kansas Mental Health Center defends integrated model, warns Ashley Clinic services could end without FQHC designation

Nathan Fossen, chief executive officer of Southeast Kansas Mental Health Center, told the Committee on House Health and Human Services that his organization has expanded into integrated, whole‑person care across six rural counties and that recent state guidance has jeopardized the center’s ability to fund primary care services at its Ashley Clinic.

Fossen outlined the center’s growth: more than 65 years serving Allen, Anderson, Bourbon, Linn, Neosho and Woodson counties; a 6‑county service area of roughly 3,400 square miles and about 63,000 residents; nearly 25,000 individuals served in 2025; provisional CCBHC certification in 2022 and full certification in January 2024. He said the CCBHC model expanded services to include 24/7 crisis care, outpatient psychiatry, substance‑abuse treatment and integrated primary care screening and monitoring.

The center acquired Ashley Clinic in February 2023 and Yates Center Dental in February 2025 to provide co‑located medical, dental and behavioral health care, Fossen said. FQHC look‑alike designation is being pursued to secure sustainable funding for primary care in areas without existing federally qualified health centers; Fossen said the application review could take about a year.

On billing, Fossen described how CCBHC reimbursement typically uses a cost‑based prospective payment system (PPS) for Medicaid when CCBHC services are provided. He said KDADS recently advised the center to stop billing the PPS rate for primary care medical services at Ashley Clinic and to bill those services as fee‑for‑service instead, and that the state requested a resubmitted cost report. "They asked us to discontinue billing the CCBHC code for those primary care screening and monitoring services and... to resubmit a new cost report," he said.

Committee members pressed Fossen on governance, utilization, and compensation. Representative Gardner asked how the center would reconcile state CCBHC board appointments by county commissioners with federal FQHC governance requirements that boards be composed of a majority of patients; Fossen said the center engaged FQHC consultants, believes its bylaws can meet both sets of requirements and that more than 51% of board members in the targeted FQHC area already receive care from the center.

Several legislators questioned executive and administrative compensation after reviewing Form 990 filings. Fossen said the center engaged a third‑party wage analysis and raised wages from below the 25th percentile toward the 50th–75th percentile to recruit and retain clinicians. He said competitive wages helped increase therapist staffing from a historical low to more than 60 therapists across the region.

Fossen highlighted crisis work as a key metric, saying the center expanded mobile crisis response and reported a high diversion rate from institutional care: "we've demonstrated an 80, rate of keeping them home rather than referring them to an institution for care," which he described as evidence of impact from integrated, community‑based crisis services.

Committee members requested documentation and data, including KDADS/KDHE guidance on billing and cost reporting, utilization and service‑intensity data, historical compensation charts, and patient counts before and after Ashley Clinic integration. Fossen agreed to provide the requested documents. He warned that if federal designation or an alternative funding approach is not secured, "we may have to discontinue the delivery of those primary care services" at Ashley Clinic because such medical services are no longer supported under the center's current CCBHC cost‑reporting model, as KDADS has advised.

The committee took no formal vote on the matters raised and adjourned for the day.