County reports 2025 spike in out-of-home and inpatient costs, cites high-acuity Mendota placements
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Summary
Washington County’s Health and Human Services Committee learned that out-of-home care and inpatient hospitalization were the department’s largest budget drivers in 2025, with high-cost Mendota Mental Health placements and shelter-care changes cited as key causes of higher expenditures.
Presenter (Health and Human Services department) told the committee on Feb. 25 that out-of-home care and inpatient hospitalization were the department’s two biggest budget drivers for 2025 and that the county closed the year “in the black” though with slimmer margins than in prior years.
The report identified two main cost drivers. First, residential care daily rates have risen sharply since 2020 and the remaining placements tend to be the highest-acuity youth, which require more intensive—and more expensive—placements. "Since 2020, we have seen the cost the daily rate of residential care rise exponentially," the Presenter said. Second, several high-cost placements drove up spending in 2025: the Presenter said two youths were placed at Mendota Mental Health and one adult remained at Mendota after August 2024, producing a year-long cost impact.
The Presenter emphasized these are treatment placements rather than criminal placements: "those are not criminal they're not placed there because of criminal needs they're placed there because their behavior is so significant, that that's where they need treatment now." Committee members asked how reimbursements are accounted for; the Presenter said reimbursements are recorded as revenue in the year they are received, and that reimbursements can lag six to nine months or longer, which complicates year-to-year budget comparisons.
Shelter-care spending also rose in 2025. The Presenter said the county closed its shelter in 2026 and is contracting with Waukesha County for those services; that contractual change will shift where and how those expenditures appear in future reports. The Presenter said staff continue efforts to reduce residential placements through community-based services but noted that when residential placements are required they are often for the highest-acuity cases and therefore costly.
The committee did not take formal action on the report. The Presenter said the department will continue to monitor placements, pursue step-down options with providers, and reflect contractual changes in the 2026 financial reports.
