The hospital serving some of Milwaukee County’s neediest psychiatric patients could be run by a for-profit, out-of-state health care company.
The county’s Behavioral Health Division (BHD), which runs the Milwaukee County Mental Health Complex, asked for bids on a 20- to 35-year contract to run acute care services for adults, teens and children in crisis. The county envisions “getting out of the hospital business” and wants to contract for services from a private vendor. The county’s current facility isn’t in great shape and is too large for its needs and the private contract is one way to provide in-patient services while the county considers building a new facility.
The proposal came from the Behavioral Health Division administration and has the support of Milwaukee County Executive Chris Abele. It had little input from the Milwaukee County Mental Health Board, which under state law is charged with overseeing the county’s mental health and substance abuse services.
As detailed in last week’s Shepherd, the Mental Health Board launched in 2014 through state legislation as a way to put mental health professionals in charge of policy. Act 203, crafted by state Rep. Joe Sanfelippo (R-West Allis) and state Sen. Leah Vukmir (R-Wauwatosa), took mental health policy-making and budgetary decisions out of the hands of Milwaukee County supervisors and put appointed mental health experts in charge.
But the Mental Health Board’s first year of operations shows that the Abele administration and BHD officials seem to be blocking the board from doing its job as an independent check on the administration’s power to direct the county’s mental health services. And the public—including those who are served by the county’s programs—are rarely consulted or heard from as the administration goes ahead with its plans to reorganize mental health services and privatize the hospital.
The request for bids for acute care services is part of that trend.
Regional Public Hospital Nixed
Although privatization of the hospital seems to be a done deal, it wasn’t the county’s only option.
In addition to creating an appointed Mental Health Board, Act 203 also directed the state Department of Health Services to perform an audit of BHD, including the future of the behavioral health hospital. The hospital currently operates a 24-7 psychiatric emergency department with an 18-bed observation unit, as well as a 24-bed acute treatment unit, one 24-bed women’s treatment unit, one 18-bed intensive treatment unit, as well as a unit for those under 18 years of age. It primarily serves patients with “high acuity”—meaning, those with intensive mental health issues—as well as those who are involuntarily detained. Patients are typically low-income or indigent.
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Specifically, the state audit was required to provide recommendations for the state assuming oversight responsibility for emergency detention services and the psychiatric hospital; developing a plan for closing the mental health complex; and developing a plan for state oversight of a regional facility for the delivery of institutional, inpatient, crisis services, and behavioral health services, according to a Wisconsin Legislative Council memo explaining Act 203.
In other words, Act 203 intended to shift responsibility for the county’s mental health hospital to the state, and it would serve patients who live outside of the county who are currently served by the state-run Winnebago Mental Health Institute or the Mendota Mental Health Institute. Legislators didn’t direct county officials to privatize the hospital.
“Part of the bill was looking at if it makes sense to have Milwaukee County have its own public facility that is just for Milwaukee County, and Racine and Kenosha [residents] still need to use Mendota or Winnebago,” said former state Rep. Sandy Pasch, a psychiatric nurse who worked on Act 203. “Or would it make sense to start looking at this regionally.”
The state audit, conducted by Deloitte Consulting, fell short of recommending a state-run regional hospital, but it did provide pros and cons for policy-makers to weigh. For example, if the county were to continue overseeing and operating the facility as a local hospital, then it would need to reduce the costs of operating the large complex. On the other hand, if BHD operated a regional facility, it could take in patients from surrounding communities and reduce its excess capacity. Another alternative would be to allow the county to purchase beds at private hospitals, but private hospitals aren’t currently equipped to handle patients with high needs, some of whom may be violent. The auditors also presented a scenario in which BHD referred its high-need, long-term patients to state hospitals or new facilities in the region while sending low- or moderate-acuity patients to private hospitals.
Comprehensive Patient Services Put Out to Bid
The state nixed the regional, public hospital model and the Mental Health Board voted to explore privatizing the hospital instead. BHD and Abele administration officials responded by drafting a request for proposals (RFP), apparently with the help of Quarles & Brady attorneys, and appointed an RFP review panel that would report to BHD, not the Mental Health Board.
The proposed contract’s 20-year duration—which can be upped to 35 years with three five-year extensions—wasn’t made explicit during board meetings. And despite pleas to slow down and involve board members and the community, especially those who are affected by the plan, the RFP was released to potential bidders in July, as originally scheduled.
The Mental Health Board wasn’t involved in writing the RFP and had little information from the administration about its scope, which appears to be expansive. According to the RFP, released on July 15, the vendor would take over the county’s in-patient services, as well as its emergency department and observation unit.
The county is looking for an entity to provide a facility, either through new construction or repurposing an existing building, that the vendor owns or leases; serve as the legal detention center required by state law; provide clinical services including behavioral health, psychiatry, pharmacy, radiology, physical therapy, nursing, certified nursing assistants, social work and more; be responsible for nonclinical services such as housekeeping, security, executive administration and oversight, medical records, billing and fiscal and food service; and take care of administrative services including information technology, human resources, payroll, legal and risk management.
Written responses to the RFP are due Nov. 15, after which the review panel will hear oral presentations. BHD administration will make its notice of intent to award the contract in January 2016 and present the proposed contract to the Mental Health Board in the spring. The board has the authority to approve or deny the contract.
Future Options
The RFP doesn’t require the vendor to be a nonprofit entity, so there’s the possibility that a for-profit behavioral health system could take over the county’s responsibilities.
Although Wisconsin has a robust nonprofit health care system, there seems to be opportunities for for-profit behavioral health companies in the state.
In April the Green Bay City Council voted to approve selling 10 acres of land and $1 million tax incremental financing for Strategic Behavioral Health, a for-profit, Tennessee-headquartered company. The company proposes to build a 72-bed psychiatric hospital to open next summer that would fill an apparent gap for mental health services in the area, according to the Green Bay Press Gazette. Critics included the nonprofit Bellin Health and the council deadlocked 6-6, with Mayor Jim Schmitt breaking the tie to approve the deal.
Strategic Behavioral Health runs facilities in Colorado, Nevada, North Carolina and Texas, and the Green Bay hospital would be the company’s first in Wisconsin. The Des Moines Register reported in July that the company is looking at building a facility in Iowa.
If the Milwaukee County Mental Health Board does agree to move ahead with a private vendor, that would help to free up space on the 46-acre Mental Health Complex site on Watertown Plank Road. The site encompasses the hospital and administration building, as well as the Child and Adolescent Treatment Center, the Day Hospital and the food service building.
A 2013 county facilities audit from real estate consultants CBRE recommended that the county consider building a new hospital on the site, downsizing or merging the other facilities, and selling the food service building and excess land.
The Mental Health Board doesn’t have bonding authority, making building a new facility near-impossible at the moment. The county itself has that authority.
Thanks to a last-minute amendment to the new state budget, if Milwaukee County Executive Chris Abele decides to sell the Mental Health Complex land, he doesn’t need to get the approval of the Milwaukee County Board of Supervisors, solicit competitive bids or hold any public hearings. Instead, he only needs to get the approval of County Comptroller Scott Manske or a real estate expert and show that the sale is in the county’s “best interests.”
According to a statement from Abele’s spokesman, anything could happen.
“Once the current BHD facilities are vacated, we will be looking at all options for making the best use of that land in the interest of Milwaukee County residents,” Nate Holton, Abele’s spokesman, emailed the Shepherd. “That process will also take into account the interests of the surrounding entities, including the Milwaukee Regional Medical Center and the City of Wauwatosa.”
This article is part of an ongoing series about mental health services in Milwaukee County. The Aug. 6 issue featured the first article in the series, “Is the Appointed ‘Independent’ Milwaukee County Mental Health Board Truly Independent?”
