County may spend $1.5 million more on mental health system

From the Oregonian, November 1 2008

County may spend $1.5 million more on mental health system – Multnomah officials want to ease Cascadia’s burden

Multnomah County leaders may spend another $1.5 million to stabilize the mental health system after the near-collapse of the state’s largest provider of mental health services.

The money would help with the transfer of two county-funded mental health clinics and a residential housing program for people with mental illness to smaller providers to reduce the scope of the struggling nonprofit, Cascadia Behavioral Health Care.

Cascadia was on the brink of collapse in May, when the county provided an emergency loan of $1.5 million — with the state chipping in another $1 million — to keep services running for the thousands of residents who depend on its services. Mismanagement and inadequate government oversight had allowed risky financial practices to continue for years.

County leaders immediately pushed to reduce the dependency on Cascadia — then responsible for providing 80 percent of the county’s mental health services.

Cascadia agreed to transfer control of two of its five clinics as well as some smaller programs to other nonprofits: The downtown clinic to Central City Concern, the Gresham clinic to Lifeworks Northwest and Bridgeview, transitional housing in Portland that helps seriously mentally ill transition to independent living, to Luke-Dorf Inc.

“It allows us to strengthen our relationships with multiple providers in the mental health system rather than just relying on Cascadia,” said Joanne Fuller, director of the county’s Department of Human Services. Fuller said she doesn’t expect the county to put any more extra money into shoring up the mental health system.

The county Board of Commissioners will vote on whether to approve the money at its meeting Thursday, although some of the money has already been spent. Under the proposal by Human Services, the county would provide $914,000 to help pay the startup costs associated with the transfers, such as computer upgrades, photocopying medical records and hiring former Cascadia employees.

The other $554,000 would be loaned to Central City Concern to make up for any lag in cash flow as it takes over the downtown clinic, which has been losing over $500,000 a year, Fuller said. The county may loan another $441,000 next year, according to the plan. The loans will be repaid, Fuller said.

Cascadia has stabilized in its smaller form, though county leaders continue to closely monitor its fiscal health. Cascadia has not repaid any of the $2.5 million it was lent.