County, PeaceHealth part ways on mental health partnership

From the Longview Daily World, August 16, 2011

Saying federal requirements mandate a change in providers, Cowlitz County is ending its 10-year partnership with PeaceHealth to offer outpatient mental health care to 950 low-income county residents.

The move means that up to 24 PeaceHealth employees might be laid off as the county switches to other providers — including its own county-run clinic.

PeaceHealth officials are working with the county on the transition but said they were surprised at the change.

“We had been talking about improving our relationship,” said Josiah Johnson, CEO and chief mission officer at St. John Medical Center. “We’ve been trying to pursue a different outcome for awhile… I assume (Cowlitz County) has a different vision now.”

PeaceHealth officials also said the hospital had been losing money on the county-contracted services for the past several years.

St. John officials said the program was operating at a deficit of several hundred thousand dollars each year, but stressed they continued it due to the need in the community, adding that money was not at the core of the split.

The change does not affect the 22-bed, in-patient at St. John Medical Center in Longview nor the A Child’s Place, Peace of Mind clinic.

PeaceHealth’s existing contract with the county will expire Oct. 1. Hospital officials have said they will work with the county over the coming months to complete patients’ transitions by the end of December.

“We’ll collaborate with (Cowlitz County) to make sure the patients have the care they need,” Johnson said.

County officials said the change is needed because the increasingly stringent federal Medicaid contracts are no longer hospital-friendly. Carlos Carreon, the county’s director of health and human services, said it will be easier to serve patients with a smaller organization with less overhead in a time of declining state and federal funding.

Cowlitz County was the last county in the state still using hospital-based providers, he said, adding that national and state requirements since 2004 have been geared for community-based treatment rather than hospital based.

“It’s really important that people understand that PeaceHealth is really a benefit to our county, but it’s a hospital,” Carreon said. “We’re talking the difference between an ocean liner as opposed to having a speedboat.”

Over a 21-month period, the county receives $3.9 million from state and federal funds to provide the services to low-income residents. That money will now be split between two other contractors currently involved with the program and the new clinic the county hopes to create.

Starting in October, officials will begin transferring some patients from PeaceHealth doctors to those at Lower Columbia Mental Health Center and Youth and Family Link. In addition, the county plans to provide its own services in a clinic for patients with the most acute mental health problems, Carreon said.

Services for these patients will focus on mental health as well as overall health care, which Carreon called a key to improving both the patients’ mental health and overall quality of life. Some of the details of the county provided services are still being ironed out, he said.

County Commissioner George Raiter said officials also are working with health department partners in Clark County. The Medicaid money is provided to a regional agency and then dispersed to counties.

Despite the change, county officials said it’s possible patients could continue to see their same doctor. Some laid-off PeaceHealth workers also may be hired by the county clinic or the two other existing contractors, according to Raiter and Carreon.

The affected patients are 950 low-income residents who receive mental health treatment through Medicaid. The patients receive individual, couples, family and group counseling, psychiatric evaluations, medication management and vocational assistance..

Asked if the change had anything to do with the quality of care provided by PeaceHealth, county officials said there were several reasons – the most pressing of which was increasing federal restrictions in how the money can be used.

“Part of the reason is the rigor of this (federal) contract,” Carreon said. “When you’re taking federal dollars, it’s not just strings but ropes attached to them.”

PeaceHealth officials noted that its outpatient mental health services recently received “excellent scores” from the Joint Commission, an independent national health care organization