DOBSON — Crossroads Behavioral Healthcare, the local management entity for behavioral and mental health services, plans to merge with two agencies located in different counties due to new requirements from the state.
That was the message Crossroads Area Director and Chief Executive Officer David Swann delivered to the Surry County Board of Commissioners at a meeting on Monday night. The board approved a resolution voicing its support of the merger after Swann explained the situation.
According to Swann, the N.C. Department of Health and Human Services has requested that local management entities in the state apply to operate Medicaid-funded services through a prepaid inpatient health plan under the Medicaid 1915 waiver. To operate under the new system for distributing and managing Medicaid funds, any local management entity must have a minimum total population of 300,000 by July 12, 2012, and 500,000 by July 2013. Though Crossroads oversees mental health services in Surry, Yadkin and Iredell counties, it does not meet the population requirements to continue operations under the new policy. The minimum Medicaid population must be 70,000, and Crossroads only has around 37,000 now, according to Swann.
Crossroads will have to merge with other areas to have a large enough population to meet the requirements, and it has to notify the state of how it will carry out this merger by May 20, the waiver application deadline.
“They gave us very little time to do anything,” Swann remarked.
The proposed merger would join together Crossroads; Mental Health Partners of Burke and Catawba counties; and Pathways of Cleveland, Gaston and Lincoln counties. These agencies, which did not have large enough populations, would come together as one new organization.
Swann said mental health service providers knew this would happen one day, but the policy came along with little notice. The director said merging is a necessity, not an option. Choosing who to merge with is an option. If Crossroads does not choose who to merge with, then the state could choose for Crossroads or transfer services to another agency.
“We like to create our own destiny as much as possible,” Swann remarked. He feels confident that Mental Health Partners and Pathways are good fits for Crossroads.
Crossroads and the other programs will have to submit their application to operate a health plan by Friday. Swann said if the application passes an initial desk review, then the state will look at the agencies individually and let them know by Aug. 1 if the merger has been approved. If so, then the agencies will work to have one new organization by July 1, 2012. By 2013, everything would be in place for the Medicaid waiver.
Of the merger project, Swann said, “This will probably be the largest thing Crossroads ever does.”
Commissioner Eddie Harris asked if the program would retain the Crossroads name, but Swann said it will probably be renamed something more representative of the larger service area. Harris also asked if one person would hold the top executive position and if Swann could lost his job. Swann said, “That may occur.”
But Swann remained positive about the proposed merger. He said the purpose was to promote better services and a better way to use money.
“So trying to achieve economy of scale,” Harris remarked, a statement which Swann affirmed.
The plan is based on capitation, where the state pays management entities a set amount of money per client. The agency will have full risk, being responsible for making the funds last throughout the year. A larger provider can better manage this risk.
Harris also asked if the Crossroads facility in Surry County would be impacted. Swann said it would be, but that there would still be local services. He said some people fear that when an organization gets bigger it loses the ability to answer local concerns, but that is why some management needs to be kept local, he remarked. Swann assured the commissioners that local services has been the driving force behind merger negotiations.
Prior to the meeting, Swann said in an interview that clients won’t notice much of a difference under the new setup.
Commissioner Buck Golding has been through the merger process before. He explained after the meeting that he was a county commissioner in the 1990s when a merger brought together the current county composition of Crossroads. Of the new merger, Golding said, “It’s inevitable.”
He believes the merger is a good geographical fit and remains hopeful that it will not negatively affect local services or agencies. Golding remarked, “The services still have to be performed.”
Swann explained that the state is trying to get ahead of national health reform, which will open up Medicaid to more of the population in 2014. The waiver is a strategy by the state to manage the growth of Medicaid in the state. He said the state piloted this program in five counties over the past six years. Under the new policy, some federal Social Security rules will also be waived, allowing agencies to provide different types of health care not available to Medicaid clients.
“It creates flexibility,” Swann remarked.
Contact Meghann Evans at 719-1952 or mevans@mtairynews.com.
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