DOJ sues Mississippi, says mentally ill are unnecessarily institutionalized

The federal government emphasized its stance on the importance of using home- and community-based services (HCBS) by filing a lawsuit against the state of Mississippi over its mental health program. The Department of Justice (DOJ) alleged that the state ran afoul of the integration mandate of the Americans with Disabilities Act (ADA) (P.L. 101-336) and forced thousands of people to be institutionalized when the services could be provided in a community setting.

Integration mandate and lawsuit

In Olmstead v. L.C., 527 U.S. 581 (1999), the Supreme Court found that the ADA requires public entities to provide services to the disabled in home- and community-based settings as much as possible. The ‘integration mandate’ states, “A public entity shall administer services, programs, and activities in the most integrated setting appropriate to the needs of qualified individuals with disabilities” (28 C.F.R. section 35.130(d)). According to the Olmstead Court, unnecessary institutionalization diminishes patients’ abilities to interact socially,  pursue education and employment, and find cultural enrichment.

The suit against Mississippi alleges that state-run hospitals are segregating mentally ill patients who could be successful in community treatment. The Justice Department believes that patients are regularly cycling through the state’s four mental health facilities because they are not able to thrive in their communities due to a lack of services. The cuts to the DOMH have limited its ability to offer HCBS services and activities, and State Attorney General Jim Hood expressed his displeasure toward the state legislature following the filing of the suit, blaming them for offering corporate tax cuts instead of serving the population. The state attempted to settle with the federal government, but negotiations failed. The DOJ wants a consent decree, but Hood objects due to expense and perpetual oversight. The state is now in the expensive position of defending itself against the DOJ.

Mississippi budget cuts

The state of Mississippi’s budget woes have turned into what some are calling a crisis, resulting in significant budget cuts. The state government admitted in June that at the close of the state fiscal year, there would be unpaid bills and a $50-60 million shortfall. Although some representatives disagreed on the impact of the amount, overcoming the shortfall would have required collections in the $725-750 million range in the month of June.

Significant budget cuts and dipping into funds failed to ward off the shortfall. Governor Phil Bryant (R) already cut $60 million from the budget and spent $50 million out of state accounts, making use of the Rainy Day Fund. The cuts impacted  state departments, such as the Department of Revenue, which was forced to dismiss temporary workers during tax season. In July, this blog covered some of these budget issues, including an editorial written by the director of the Mississippi Public Health Association that highlighted the Department of Corrections’ generous allocations, nearly nine times more than what the Health Department will be able to use (see Highlight on Mississippi: Budget crisis has health pundits grumbling, July 1, 2016).

Health impacts

Health agencies were not immune to the budget cuts, although there are arguments that they only lost a small chunk of money and, in one case, ended up on top. According to, in the latest round of cuts, the Department of Health (DOH) lost $5.8 million and the Department of Mental Health (DOMH) lost $7.3 million, which amounted to 1.53 percent and 1.17 percent of their budgets, respectively.

Departments heads note that these cuts are only the latest in a line of issues. The Dr. Mary Currier, head of the DOH, said the agency closed six clinics, failed to fill 89 positions, and has cut 64 employees. Diana Mikula, who directs the DOMH, said their reserves are tapped after absorbing a total of $8.39 million in cuts. The agency cut some of its workforce or transferred employees to other positions, but was still forced to eliminate a significant amount of facility space that psychiatrists used to determine if criminals were able to stand trial. Other closures include the Acute Medical Psychiatric Service unit at a state hospital,  Male Chemical Dependency Units, early intervention services, and psychiatric beds.

Health centers encouraged to become medical homes, receive HHS grants

Nearly 250 health centers are the proud recipients of grants that will allow them to reform the way they provide care by shifting to the Patient-Centered Medical Home (PCMH) model. These centers are located in 41 states, D.C., the Northern Mariana Islands, and the Federation of Micronesia, and will share in the $8.6 million in funding provided by HHS.


Medical homes offer patients an opportunity to have additional input in their care, as well as a central location for care coordination. Primary care providers are able to better coordinate with specialists through this model, and patients are encouraged to participate in the decision-making process along with the providers. The PCMH model also encourages providers to take into account each patient’s unique conditions, circumstances, and preferences when coordinating care (see Medical homes change primary care, but reimbursement questions remain, Health Law Daily, May 3, 2016).


This grant funding is provided through the Community Health Center (CHC) fund, established by section 10503 of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) and extended in the Medicare Access and CHIP Reauthorization Act (MACRA) (P.L. 114-10). HHS Secretary Burwell stated that these grants will allow better coordination of a broad range of health care services, including dental services and behavioral health care along with primary care. Although 65 percent of health centers are recognized as having some PCMH qualities, the Health Resources and Services Administration (HRSA) believes that this funding will allow more health centers to better focus on coordinating care. Health centers provide care for about 23 million patients across the country and territories.

Advocates say Medicaid can shelter the homeless in Pennsylvania

Pennsylvania could use Medicaid to address its homelessness problem, according to advocates that believe the state’s Medicaid program should include additional supportive housing services. Those individuals assert that additional supportive housing services can be included in Medicaid as a “wrap-around support service”—a type of service that CMS endorses and described in a Center for Medicare & CHIP Services Informational Bulletin last year.

Housing services

CMS expressly does not provide Federal Financial Participation (FFP) for room and board as part of additional support services. However, states are permitted to assist individuals through coverage of certain housing-related activities and services. Some of the housing-related services and activities that Medicaid can cover include: (1) services designed to support an individual’s ability to prepare for and transition to housing; (2) services aimed at supporting an individual’s ability to sustain tenancy; and (3) services dedicated to assisting a state in identifying and securing housing options for individuals. Specific examples of each of those services are covered in the Informational Bulletin. The Open Door is an example of an organization that provides housing support services.


In Pennsylvania, advocates like The Housing as Health Campaign are asserting that, for many Medicaid enrollees with substance abuse problems, additional support is needed to keep beneficiaries in their homes. Advocates argue that without a consistent funding stream, Medicaid beneficiaries wind up homeless. The Corporation for Supportive Housing (CSH) created a blueprint, or “Crosswalk,” to serve as a map to assist the Pennsylvania Department of Health and Human Services with aligning Medicaid-eligible services with supportive housing services.


The Crosswalk was designed to guide the state of Pennsylvania, managed care entities, and service providers towards resources that can improve access to substance use treatment and mental health recovery, with a focus on housing. According to the report, individuals with unmet housing needs are often particularly vulnerable due to the high occurrence of low incomes, chronic health conditions, and behavioral health challenges among the population. The report proposes several methods to improve housing and care access for at-risk individuals. CSH started its analysis by considering the services that the state already provides through several Medicaid waivers. While Pennsylvania does have mechanisms to provide some housing support services for elderly individuals, beneficiaries with traumatic brain injuries, and individuals with a physical disability, CSH noted that additional individuals could benefit from supportive housing.


The report identified potential opportunities for alignment, where services that are already covered under the state plan could be aligned to better address housing support service needs. For example, the report suggested that, because the Pennsylvania state Medicaid plan covers Individualized Service Plans (ISPs) for the treatment of individuals with severe mental illness, an individual could, possibly, identify housing goals as part of his or her treatment plan, thereby including housing support services through an ISP. The report lists several other types of services with potential for alignment to reduce or eliminate gaps in housing service coverage.

Rethinking Medicaid

Advocates are not directly asking for a change as to the kind of services covered by the Pennsylvania Medicaid program. Instead, the CSH report and other efforts are asserting that housing problems can be best improved through a better application of existing services under the Medicaid state plan. Advocates hope that such a rethinking of Medicaid will improve health by putting a roof over the head of more individuals.

Hearing hits Obama Administration over Cost Sharing Reduction funding

The Obama Administration unlawfully funded the Cost Sharing Reduction (CSR) program under the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148), according to a House Ways and Means Oversight Subcommittee hearing led by subcommittee chairman Peter Roskam (R-Ill). The hearing included witness testimony from agency officials regarding the propriety of the Administration’s spending on a program with disputed appropriations. The hearing was accompanied by the release of report containing the findings of a 17-month oversight investigation into the Administration’s funding of the CSR program.


Ways and Means Committee Chairman Kevin Brady (R-Texas) emphasized what he called an unprecedented level of obstruction by the Obama administration and described the hearing as an important step towards transparency. Representative John Lewis (D-Ga) expressed concern that the hearing was another partisan attempt to “roll back health care reform.” Lewis asserted that because the CSR funding issue was being decided through ongoing litigation in federal court, it was not the place of a congressional committee to litigate the issue. Chairman Brady contested assertions that the hearing was improper as a result of ongoing litigation, noting that the power of the purse is not limited by ongoing litigation between Congress and the Executive branch. Additionally, he noted that the dispute was not about health care but, instead, the separation of powers.


Mary Wakefield, Acting Deputy Secretary of HHS, explained that the CSR program was designed to defray the cost of health coverage for low-income individuals. She explained that it limits out-of-pocket costs for low-income individuals because, in many cases, out-of-pocket costs are the factor that prohibits access to care. She explained that, often, those costs serve as a barrier to care because low-income individuals are forced to choose between two essential expenditures—for example, housing and health care. She testified that 6.4 million people are benefitting from the CSR program as of 2016. Roskam objected to her characterization of the program, noting that the CSR subsidy is a subsidy for insurance companies and not “poor people.” Representative Joe Crowley (D-NY) called Roskam’s characterization unclear, explaining that the CSR program benefits patients “at the point of care.”


Roskam asserted that, by law, the CSR program requires an annual appropriation. However, he said, in the absence of a congressional appropriation, the administration decided to fund the CSR program with a permanent funding appropriation (31 U.S.C. §1324) that was designed to support the ACA’s premium tax credit. John Koskinen, Commissioner of the Internal Revenue Service, acknowledged that under the IRS’ charge to implement the tax provisions of the ACA, the IRS decided to use the Section 1324 appropriation for the CSR program. The agency officials asserted that the funding decision was appropriate, in part, because the CSR program is integrated with the other ACA subsidies like the premium tax credit. In response to requests for further legal justification for the funding source, all of the agency officers referred lawmakers to the briefs of the ongoing litigation between House Republicans and the Obama Administration (see Court sides with House Republicans, finds no appropriation for cost-sharing reductions, Health Reform WK-EDGE, May 18, 2016).


In response to questions regarding obstruction and agency compliance with subpoenas, Mark Mazur, Assistant Secretary for Tax Policy at the Department of Treasury, Michael Deich, Senior Advisor for Budget at the Office of Management and Budget, and Wakefield testified that they have responded to subpoenas and will continue to work with Congress regarding requested documents.