Nonprofit mental health provider Youth Home Inc. will lay off more than 10 percent of its staff because of losses linked to stagnant Medicaid reimbursement rates, CEO David Napier said Wednesday.
The staff learned that 31 of 227 Youth Home employees will be laid off by March 1 in a restructuring that will close a residential cottage and eliminate 12 of the facility's 60 beds.
A "rate freeze" on some Medicaid reimbursements, including for residential mental health services, has made the provider's financial situation increasingly precarious, Napier said.
"We had just finally reached the tipping point," he said. "We needed to stop the financial losses so we can have resources to move in a different direction if we need to."
Mental health advocates viewed Wednesday's announcement as indicative of larger challenges in mental health care in the state, which they said are often connected to financial issues, including Medicaid payments.
"It worries me that Youth Home is in the position they are, because they're so well-respected, and people support what they do wholeheartedly," said Luke Kramer, executive director of mental health advocacy group The STARR Coalition.
The difficult fiscal climate means mental health professionals affected by the layoffs might not be able to find work, he said. Lots of providers aren't hiring, and the layoffs also could put pressure on people who need services.
"Honestly, a lot of other providers are just not taking new clients in, because they can't. They can't afford to take new people," he said.
Overall, he said, area providers have recently been worried by shifts in payments for services such as case management and group therapy, as well as expenses from ancillary services -- such as transportation -- that are not typically reimbursed by the state.
Youth Home's layoff decision, made just before Christmas, won't completely right the center's finances, Napier said, but will stem losses "considerably" and offer a chance to reorganize. Among those affected by the layoffs are people who worked in administrative and direct care roles, such as residential counselors.
"The emotional response really centers around the good people who are having to take the brunt of this today. ... All I could think about is the fact that it's not just jobs, or positions, it's people who have played such an important role," Napier said.
"It's painful. There's no way around it."
Founded as a girls home in 1966 by Carol Smelley, Youth Home is one of the largest providers of its kind in the area. In addition to its adolescent residential treatment center on Colonel Glenn Road, it runs a Little Rock outpatient clinic offering counseling for children and adults.
While Napier, who joined the Youth Home board in 1992 and has been on staff since 2006, doesn't expect the layoffs to affect current patients, "what it does mean is there will be less capacity for residential mental health care in the system," he said.
In an email, a Department of Human Services spokesman said residential care reimbursement rates haven't increased because the agency has focused on home- and community-based care for children and teens, to "hopefully prevent the development of chronic long-term mental health needs that residential services often serve."
A "continuum of care" offered under departmental programs, including the developmental disability and behavioral health service Provider-Led Arkansas Shared Savings Entity (PASSE) program, also aims to remove the need for residential care, the spokesman wrote.
Dianne Skaggs, executive director of the Mental Health Council of Arkansas, said that group's 12 community mental health centers also have been scrambling after a round of Medicaid changes that went into effect in July.
She says there has been financial strain and reports of layoffs or reductions in force through attrition at some facilities, including at Counseling Clinic in Benton, where CEO Jim Gregory says he's laid off one person and not filled about 13 positions as staff members have left over the past four or five months.
That staffing situation isn't unusual among mental health providers in the current environment, he said. "We're all trying to make adjustments [in operations]. ... If you don't, you're really going to just die on the vine."
Skaggs praised an announcement that Youth Home distributed Wednesday about the layoffs, which explained its specific Medicaid-related issues, alluded to "a challenging health care climate" and stressed that the need for its services is not going away.
"[Napier] did a beautiful job in explaining what we're facing. ... I could just say ditto to everything that he said," she said. "We're struggling every day with it. ... We are working very hard to survive and serve our clients."
Metro on 01/24/2019