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Originally published: 2012-09-15 20:58:09
Last modified: 2012-09-15 20:58:09

Housing crisis looms for the mentally ill

by Anna Oakes

Although a recent agreement with the U.S. Department of Justice will provide more community-based housing choices for persons with serious mental illness in North Carolina, new state Medicaid requirements may force others into homelessness.

Unless the state acts before Jan. 1, changes to Medicaid enacted by the General Assembly in the 2012 legislative session will result in discontinued funding for personal-care services for thousands of mentally ill and developmentally disabled individuals living in adult-care homes, group homes and other residential facilities, officials say.

At the root of the matter is North Carolina’s longstanding practice — since deinstitutionalization began in the 1960s — of placing persons with serious mental illness in adult-care homes.

Following a 2010 complaint by the organization Disability Rights North Carolina, the U.S. Department of Justice launched an investigation and concluded that placement of mentally ill persons in adult-care homes is, in effect, a form of institutionalization and a violation of the Americans with To avoid litigation, the DOJ and state reached a settlement agreement Aug. 23 that requires North Carolina to provide 3,000 community-based housing slots for citizens with serious mental illness by 2020.

Related to the issue are inconsistencies in North Carolina’s funding, via Medicaid, of personal care services.

For a disabled person living in a community setting to receive Medicaid reimbursement for personal care services, North Carolina requires that person to need assistance with two or more daily living activities, such as taking medication, bathing, eating, etc. But persons living in adult care or group homes have only been required to need help with one of those daily living activities to receive the same financial assistance.

The federal government said the state cannot allocate funding differently for those receiving personal care services in their own homes versus adult care homes, however.

To address this, the General Assembly enacted new rules in House Bill 950 requiring persons to need limited hands-on assistance with three qualifying daily living activities — including eating, dressing, bathing, toileting and mobility — or two daily living activities in which one requires extensive assistance to receive Medicaid personal care services reimbursement, no matter where they receive the services. The law takes effect Jan. 1, 2013.

“The General Assembly’s way of dealing with it is just to raise the bar on eligibility,” said Debra Dihoff, executive director of NAMI (National Alliance on Mental Illness) North Carolina. “They just made it harder.”

What this means is thousands of people currently living in adult care homes and group homes may no longer qualify for a Medicaid reimbursement; those people will receive termination of service notifications before the end of the year. As required by House Bill 950, independent assessments are currently being conducted to evaluate Medicaid recipients’ degree of functional disability and level of unmet needs for personal care services.

“People with mental illness do have the ability to do these tasks. They just can’t always do the tasks because of their mental illness, and that may not show up in a functional eligibility assessment,” Dihoff said.

The General Assembly allocated $39 million to adult care homes to assist in the transition and mitigate the loss of income from residents who no longer qualify for Medicaid personal care services reimbursement. But group homes received no transitional funding.

“It’s really a crisis,” Dihoff said. “What has happened in our group homes is they now (are) not having enough money to meet their budget. These places are really close to the edge financially anyway.”

Three thousand housing slots in apartments or homes with roommates will provide options to some displaced from adult care homes and group homes, but the state is only required to provide between 100 and 300 of those slots by July 1, 2013.

“I also am pretty scared and nervous about it, particularly in the first year,” said Dihoff.

Boone-based Watauga Opportunities, Inc. operates two group homes for persons with developmental disabilities. Watauga Democrat will examine the implications for local providers and group home residents in a future article.