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Nebraska programs for addiction, mental health facing cuts

Gov. Pete Ricketts addresses the media. (NTV News)

LINCOLN, Neb. (AP) — Groups that treat people with addictions, mental health problems and developmental disabilities are bracing for state budget cuts they say could force them to reduce staffing and services for some of Nebraska's most vulnerable residents.

The cuts became final last week when lawmakers fell short of the votes needed to override Gov. Pete Ricketts' line-item budget vetoes.

Now, service providers are scrounging for places to cut in the face of rising costs and unpaid Medicaid claims from the state's new managed care system, Heritage Health. Some providers have said they're still waiting on claims the system should have paid three months ago.

"This could have some very serious consequences," said Annette Dubas, the executive director of the Nebraska Association of Behavioral Health Organizations. "I think it'll be an extreme challenge. It's a piling on of problems."

Behavioral health organizations provide a variety of services for people with drug and alcohol addictions and those who have mental health problems. Many people given help can't afford private insurance.

The vetoes reduced funding for four programs by $33.7 million, returning them to the levels Ricketts recommended in his original budget proposal.

Lawmakers rejected the governor's recommendation and held the funding flat after service providers raised concerns, but Ricketts vetoed that funding and senators couldn't muster enough support to override. Funding cuts to programs vary with the highest being nearly 3 percent.

Dubas, a former state senator, said she understands the budget predicament but argued that the cuts will ultimately cost the state more. Parents who don't get treatment for a drug addiction or mental health problem are more likely to lose custody of their children, putting additional strain on Nebraska's child welfare system, she said.

Additionally, Dubas said service cuts could lead more residents to seek treatment in emergency rooms at a far greater cost.

"These are very difficult decisions," she said. "But what are the unintended consequences?"

Nebraska Department of Health and Human Services administrators said they will work with providers to protect the most critical services. The governor's veto "will not mean providers will receive across-the-board rate reductions," according to a memo released by a department spokeswoman.

Still, leading providers said they're highly skeptical that the department can reduce their funding without having any impact on the people they serve.

Administrators at CenterPointe are looking for ways to cut their budget without hurting their addiction or mental health services, but it's not yet certain they'll be able to do it, said Topher Hansen, the Lincoln nonprofit's top executive. Virtually all of CenterPointe's patients fall below the federal poverty line, and more than half make less than $1,000 a year.

The cut follows two years of rising health care costs and the group's recent switch to an electronic medical records system to keep pace with industry trends. Hansen said CenterPointe recently had to take out a line of credit for the first time since 1989 to pay its expenses.

"We're already down at the bare bones," he said.

Administrators at the Omaha-based service provider Mosaic may have to reduce staffing hours or rely more on part-time employees and contractors to compensate for the funding cuts, said Mark Matulka, the group's lobbyist. They're also considering cuts to their transportation budget and eliminating therapy services for its clients with mental and intellectual disabilities.

"But that can only get you so far," Matulka said. "It's going to put us in a very sticky situation."

Mosaic works with about 750 Nebraska residents and is part of a network of providers that will see a 2.2 percent reduction in their overall funding. The group has 1,000 employees scattered throughout the state.

The budget cut "doesn't serve the people that we support well, and it doesn't support their communities well," Matulka said.

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Follow Grant Schulte on Twitter at https://twitter.com/GrantSchulte

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