KHN Morning Briefing

Summaries of health policy coverage from major news organizations

Mental Health Care Suffers As Recession Hurts State’s Bottom Lines

Mental health budgets are suffering as a lingering recession affects state bottom lines in America, Stateline reports. "States have taken the lead role in publicly funded care for the mentally ill, and paid the majority of the expenses. Even through recessions, the states have steadily increased their mental health budgets every year to meet increasing demand. Now, as states face their biggest fiscal challenge in modern history, the trend has reversed." Programs typically include a wide array of community-based services such as suicide prevention, drug and alcohol abuse treatment, work support, counseling and violence-prevention programs. "Now, for the first time, states are pulling back mental health spending. These unprecedented cuts - nearly 4 percent as a national average between 2008 and 2009 - come at a time when other public agencies such as child welfare, law enforcement and housing also are experiencing budget cuts and can ill afford to handle the overflow. According to the National Association of State Mental Health Program Directors, 2010 spending appears to have fallen nearly 5 percent compared to 2009. Early indications are that 2011 mental health budgets may sink by 8 percent or more" (Vestal, 7/19).

Crain's New York Business: The closure of St. Vincent's Hospital in New York has left a gaping hole in care there. "Although some employees and nearly all of the residents have found new positions, a number of staff physicians and scores of others are now on unemployment or in temp jobs, scrambling to find work. Doctors face an additional blow - many of them have lost the malpractice insurance that had been protecting them from potential future suits brought by former patients at St. Vincent's, which could send them into bankruptcy. … Scott Shapiro, a staff physician in the HIV clinic at St. Vincent's, had been developing his new organization, MilestonesNYC, before the hospital went under, but the closing convinced him to speed up his plans. The nonprofit, which launches Oct. 1, will match unemployed workers with therapists and psychiatrists who are willing to offer their services pro bono. 'There is a huge gap in mental-health coverage,' Dr. Shapiro says. 'Many people aren't going to be able to afford their Cobra payments, and very often insurance excludes mental health anyway'" (Kreinin Souccar, 7/18).

This is part of the KHN Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.