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A Convoluted Appeals System For Mental Health Patients

Last year, North Carolina changed how it provides mental health care for those on Medicaid. The state put 11 regional organizations, called MCOs, in charge and gave them less money to work with. So, cuts to care were expected.

About half of these MCOs, including MeckLINK in Charlotte, have denied upward of 20 percent of requests for care, according to self-reported data from the organizations. Patients can appeal, but North Carolina has made the process far more difficult.

In a former life, Mary Short was a legal secretary. Now, she’s always working, but not in her trained profession. Instead, Short says she is on the job 24/7 as her daughter’s caretaker.

"She does walk and feed herself," Short says. "She doesn’t talk and she can’t do anything else for herself."

Short’s daughter is 34, but has a developmental disability where she functions at the level of an 18-month-old. She also has physical impairments, including scoliosis and seizures. So, Katie Short needs constant care. A few years ago, Short tried sending Katie to a group home, but says that didn’t last long.

“After the third set of unexplained bruises and overmedication of 14 tegretol tablets in seven days, I pulled her out of the group home,” says Short.

Mary took her daughter back into her home in Taylorsville, in western North Carolina. There, Mary fills two roles: she is her daughter’s guardian, but also her mental health provider, so Medicaid pays her $14 dollars an hour, 17 hours a day to give Katie care.

That also means Mary earns $85,000 a year, making her perhaps an understandable target for an MCO, or managed care organization, looking to cut costs.

And, last year, that happened. Her MCO, Smokey Mountain Center, cut her Medicaid hours by nearly a third. Mary appealed. She says Smokey Mountain is telling her to work four hours a day for free.

“They act as if I gave birth to this child in order to collect a paycheck,” says Short.

The appeal has become much harder, since the state put MCOs in charge of managing care.

“They want to discourage people from appealing,” says John Rittelmeyer, director of litigation for the non-profit Disability Rights NC.

One way they do that, Rittelmeyer says, is to first force appeals through the organization that already denied the initial request. That can add 45 days up front to a process that already takes months. Mary Short is still waiting for a ruling 10 months after filing an appeal.

It used to be that the state continued to pay for services while an appeal was underway. That errs on the side of the patient. In another change, MCOs deny the service until ordered not to. Rittelmeyer says the new system creates a vicious cycle.

“They can continue to deny you services as long as they can pay their lawyers to string this out,” he says.

Federal law, and not the MCO, is to blame, says Richard Topping, the general counsel for another MCO, Cardinal Innovations.

“Federal law requires us to [deny service], and our contracts require us to do that,” Topping says. “It’s pretty clear when a service can and must continue, and when it does not.”

Topping points out that the federal rules for MCOs are different than what North Carolina has had previously. This is a classic legal battle. MCOs interpret the law to mean they have to deny service, while lawyers for patients say the MCOs are gaming the system, and those new rules are not supposed to change a patient’s rights to appeal.

Up until now, the judges that hear appeals have been siding with patients. They have required the MCOs to keep paying, so Short has continued to get the 17 hours she is lobbying for. That will not happen anymore. Governor Pat McCrory signed a bill last week that specifically stops judges from making MCOs pay during an appeal.

There is one other big change in the new law: it makes the patient the prosecutor. Smokey Mountain’s lawyers don’t have to prove why the service Katie Short has received for four years should be cut—her mother has to prove why it shouldn’t.