The problems of the psychiatric hospital grow, in the arbitration of millions

The Daily Sentinel reported in mid-April that West Springs Psychiatric Hospital could close within weeks due to continued financial losses, it claimed. The facility is still open, but Mind Springs Health CEO John Sheehan says it will close in June without successful arbitration or substantial additional outside support.

Sheehan said this crisis is because RMHP has shortchanged them on Medicaid reimbursements and sent patients from the Western Slope to the Front Range, while several state agencies refuse to provide substantial help.

The state is trying to say that somehow they have provided us with additional funds to help us overcome our financial difficulties, they have not provided anything, not one thing that we have asked them to do, Sheehan said. The idea that they have somehow exhausted all their resources helping us is a load of bullshit.

The agencies, the Behavioral Health Administration (BHA), the Department of Public Health and the Environment (CDPHE) and the Department of Healthcare Policy and Financing (HCPF) denied all of the Sheehans’ claims, sending the Western Slope legislators a letter detailing their efforts along with RMHP to support West. Springs Hospital and its parent company for more than $20 million in just one fiscal year.

According to the letter, the departments have exhausted their ability to provide financial support to West Springs. We are also concerned that Mind Springs has consistently demonstrated financial mismanagement and an inability to develop a transparent sustainability plan.

According to Sheehan, however, the nearly $4 million that Mind Springs received from the BHA was payment for contracted services, which is essentially a balance given the expenses incurred by providing additional services. He added that the $23.8 million Mind Springs received from RMHP were prepayments to compensate for the significant cash flow problems they caused, and are essentially nothing more than a loan that Mind Springs must repay.

They may say we owe them money, but in reality that money was being billed and reduced every month, he said.

In their letter to Western Slope lawmakers, the agencies estimated that Mind Springs has provided only $15.3 million in services as of April 16, despite getting $21.8 million in prepayments. Sheehan said the final amount owed cannot be calculated until the end of fiscal year 2024; Mind Springs received its final prepayment ($2 million) on May 1.

The agencies added that their financial support is the most they can provide within the limits of state and federal laws. RMHP CEO Patrick Gordon wrote in a Sentinel op-ed last week that his decision to make prepayments was a voluntary and unprecedented commitment to ensure the community has mental health care.

Despite having to pay the money back, Sheehan said the prepayments are critical to funding treatment for Medicaid patients, who make up about 65 percent to 70 percent of the facility’s patients. After receiving the final down payment, he said West Springs will definitely be out of business by the end of May.

That is, unless Mind Springs is successful in its $7 million arbitration and negotiates different terms in its new contract with RMHP.

ARBITRATION

Arbitration is a less expensive and complex alternative to litigation where a neutral third party, or arbitrator, determines the resolution of disputes. That arbitration concerns $7 million that RMHP said it overpaid Mind Springs in fiscal year 2023.

According to Sheehan, the dispute began in September 2022 when RMHP sent a letter to most of its members advising them not to seek care at Mind Springs because of complaints of noncompliance, which it said led to a notable drop in outpatients and – patient volume. He added that Mind Springs has had compliance issues in the past, but RMHP had no findings to support its claim when it sent the letter.

RMHP representatives were not available to comment on the letter or the arbitration.

At the end of fiscal year 2023, RMHP reported to Mind Springs that it owed about $7 million in advanced funds for Medicaid care that the lower suggested patient count was not delivered. The money was spent, according to Sheehan, but on maintaining the facility’s infrastructure, not on Medicaid care.

I’m contracted to provide all the care in the 10 counties on the western slope for a fixed amount that I pay each month, so when my volume goes down, I’m not paying as much attention and I’m not making as much money, he said. . That means I’m expiring some of those dollars, but I have a good reason: I haven’t fired anyone; I have not dismantled the network; I do not deny the cure to anyone; I’m keeping the doors open and (is) incurring all this expense.

When RMHP reduced the claims payment to Mind Springs the following month by $1 million to recoup the leftover funds, Sheehan filed for a temporary restraining order and initiated litigation, which eventually went to arbitration. Arbitration is ongoing, but Sheehan said they are trying to resolve it as part of their contract renegotiation, hopefully before the end of May.

The BHA, HCPF and CDPHE said in a joint response to the Sentinel that they cannot comment on the arbitration; however, they said that as the regional accountability entity for Medicaid, the state requires RMHP to recover overpayments because they are acting on behalf of the state government and using its Medicaid funds. They added that reimbursing facilities for maximum capacity rather than patient count could be problematic for several reasons:

A model that pays a provider based on their maximum capacity, regardless of utilization, would allow providers to limit admissions for Medicaid members, prioritize commercially funded patients, or leave hospital beds empty while the hospital receives payment regardless of the care provided to Medicaid members who need it. , they said. Such a model would not be in the best interest of Medicaid patients, their families, the state, or the federal government.

They added that West Springs historically has not operated at full capacity, and Mind Springs is the only one of the 6,000 Medicaid behavioral health providers with whom they have been in arbitration or had difficulty reconciling overpayments.

Recovering excess funds is also a federal requirement, so if RMHP and the state were to ignore this requirement, Colorado’s Medicaid program would suffer a significant denial.

COLLECTION FOR A SOLUTION

While state agencies said they have supported Mind Springs in almost every way possible to no avail, some discussions have continued at the county level.

Mesa County Commissioner Janet Rowland had looked into how Western Slope cities and counties could support West Springs, but options are slim.

We looked at the breakdown of hospital use by county and municipality and Mesa and Grand Junction had the lion’s share, Rowland said. Asking others for such a small amount would not have helped much, and it would probably have been difficult for these smaller communities to contribute.

He added that the funds would likely have been a loan, which he worried would only add to Mind Springs’ long-term financial struggles.

In the agencies’ correspondence with the Sentinel, they said that regardless of the arbitration and the potential closure of West Springs, RMHP will continue to be proactive and creative in finding ways to support Mind Springs and the psychiatric hospital.