Closing Illinois institutions: Cost savings or cost shifting?

December 5, 2011

By Benjamin Yount
Illinois Statehouse News

SPRINGFIELD, Ill. — Closing mental health and developmental institutions in Illinois will save at least $50 million a year — eventually.

Lawmakers ensured last week that the Tinley Park, Singer and Chester mental health centers and the Mabely and Jacksonville developmental centers will stay open by shifting nearly $300 million inside of the state budget.

But as workers and families of those in the institutions breathe a sigh of relief, Illinois Gov. Pat Quinn’s administration is making plans to close some of those institutions within two-and-a-half years.

The governor’s office has proposed closing two mental health centers and up to four developmental centers by June 2013, which is the end of the 2014 fiscal year. However, the names of those centers were not known.

As many as 600 patients will be moved from state-run facilities to community care settings.

Developmental centers

The savings potential from closing half of the state’s eight developmental centers is huge.

A study from the University of Colorado states that Illinois, on average, spends $182,000 a year to keep someone in an institution. Moving that person to a community-care setting would cost $53,000 a year.

Tony Paulauski, executive director at the ARC of Illinois, an organization that lobbies for people with developmental disabilities and helps them find care, said $53,000 is a bit on the low side.

Illinois has not raised rates for community-care providers in years,” Paulauski said. “It’s understanding that the rates will go up a bit as people are transitioned out of institutions.”

Figures from Quinn’s office confirm that. The governor puts the cost for transition at $7,000 per person per month in the next budget, or $84,000.

Even with that increase in spending, Illinois could save more than $50 million.

Of course, as you transition from an institutional system and you invest in a community-care system, there is going to be some cost overlap,” Paulauski said. “So, initially it is going to be more expensive.”

Brie Callahan, spokesman for Quinn, said those cost duplications come mostly from keeping the state facilities open.

You have salaries, but also you have to turn on the heat and water. You need food, medicine and other stuff just to keep the doors open,” Callahan said.

Once the facilities close, those costs go away.

Callahan said the number of lost jobs depends on the number of shuttered facilities.

Mental health centers

The savings from closing two mental health centers will be much harder to track, and may be more of a cost shift than an actual savings.

While developmental centers have residents, mental health centers treat patients, usually for no more than 48 hours.

Callahan said that as the state moves to close the doors at Tinley Park Mental Health Center and one other facility, which the state has not identified, by the summer of 2013, hospitals will absorb those patients.

The federal Patient Protection and Affordable Care Act eliminates mental illness as a pre-existing condition. Callahan is quick to say that would allow many people who are treated in state facilities to turn to local care networks.

But a report in May from the Illinois Hospital Association (IHA), which speaks for more than 200 hospitals statewide, points to a lack of beds.

The number of licensed psychiatric beds has decreased from 5,350 in 1991 to 3,869 in 2010 — a 28 (percent) drop,” the report states.

The IHA report also points out that 74 of Illinois 102 counties either do not have psychiatric care at their hospital, or do not have a hospital at all.

Mental health advocates and lawmakers are concerned that some patients, who are being treated in state hospitals, will end up in local jails or state prisons because they have no other place to go.

The state may think it’s going to save money, but they will not,” said Marianne Bithos, president of the mental health advocate group, National Alliance on Mental Illness of the South Suburbs. “How can you save money when these people sit in an (emergency room) for three days or in jail for months?”

Bithos said the state needs to realize it cannot simply shut the doors of its institutions and consider the problem solved.

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