"Our state’s Medicaid program is supposed to protect our most vulnerable residents, disproportionately impacted by mental illness. Yet its reimbursements cover on average only 60% of the actual cost to provide the care. In fact, the Medicaid rate setting methodology intentionally underpays mental health providers with a target set at 83.9% of the Medicare rate," the writer says. (iStock/The Minnesota Star Tribune)

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We remain in an ongoing mental health crisis. Persisting for years, it’s a crisis marked by increasingly complex health needs and exacerbated by inadequate funding to an already fragmented and fragile system.

Our state’s Medicaid program is supposed to protect our most vulnerable residents, disproportionately impacted by mental illness. Yet its reimbursements cover on average only 60% of the actual cost to provide the care. In fact, the Medicaid rate-setting methodology intentionally underpays mental health providers with a target set at 83.9% of the Medicare rate.

As a result, we have a worsening workforce shortage that has left 80% of our counties without necessary access, providers refusing to participate in the Medicaid program. Entire organizations have closed due to insolvency directly related to poor reimbursements.

PrairieCare is one of the region’s largest psychiatric care providers for all ages. We specialize in acute care for youth in the state’s largest inpatient psychiatric hospitals, supported by several community-based outpatient programs. We provide care to all patients in our hospital, regardless of their ability to pay. This is part of our mission, and our responsibility to the communities we serve.

Each time we bill Medicaid for the lifesaving care we provide, we lose money — often thousands of dollars per episode of care. Imagine a restaurant where half of all the customers only paid 60% of their bill. That restaurant would eventually go out of business, or stop serving those customers.

We rely on better paying commercial insurance rates to offset our losses, but those reimbursements are also lagging. An increasing percentage of those commercial plans are prepaid medical assistance plans (PMAP) that have the advantage of commercial plan administration and network access, but with similarly underfunded reimbursements to providers with Medicaid as the underlying source.

Two years ago, on the heels of a devastating pandemic, the state had a record $18 billion-plus surplus and did nothing to increase Medicaid rates. Last year, despite more pleas from languishing providers to increase rates, again nothing happened. More organizations closed, and we now have decreased capacity in day treatment, residential programs and psychiatric hospitals.

Last week the Minnesota Department of Human Services published their second rate-study report on Minnesota Health Care Programs Fee-for-Service Outpatient Services. The complexity of the analysis is telling, and the recommendations are resounding: Medicaid rates must increase significantly, it must happen now, and the rate-setting methodology that has failed our systems needs to change (”Mental health costs beg a financial fix,” Jan. 25).

While this critical issue is being discussed among policymakers, deaths by suicide and drug overdose are at a record high. Emergency department visits for youth in mental health crises continue to skyrocket. Kids in need of mental health services are stuck on waitlists and are boarding in hospitals for weeks and even months at a time. According to a statewide survey of mental health providers this month, 66% reported shrinking current services, 38% reported closing services and an additional 22% anticipate closing additional services in 2024. There are many ways in which we could expand access within our current infrastructure — but providers won’t be due to the volatile and risky reimbursement models across payers.

Fixing Medicaid mental health rates must be a high priority. Our systems will pay for it one way or another.

Todd Archbold, of Maple Grove, is CEO of PrairieCare.