Federal funds for Vermont State Hospital to be eliminated in two years

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(Host) By early winter, the Douglas administration expects to win back about four million dollars in federal funds for the Vermont State Hospital. But that solution is only temporary. The federal government has told Vermont it will eliminate funding for the hospital entirely within two years.

VPR’s John Dillon reports.

(Dillon) The 54-bed Vermont State Hospital in Waterbury cares for the state’s most seriously mentally ill. It’s under two separate federal investigations related to quality of care issues.

In response, state officials have changed treatment policies and added staff. Vermont Health Commissioner Paul Jarris says he expects the hospital to be re-certified soon and the federal funding restored within a few months.

(Jarris) “On a monthly basis, about $330,000 in federal dollars we expect to flow beginning in December.”

(Dillon) An even bigger financial problem looms over the next two years. The federal government has decided it will no longer fund mental institutions like the state hospital. The money will be cut over the next 18 months.

A group of state officials and health care providers is looking at options for the future. Jarris says the challenge is to find both a new place to care for those patients, and to make sure that the new setting qualifies for federal Medicaid payments.

(Jarris) “The futures group has to look at both what is both the most appropriate clinical setting for hospital services to be provided in, and which setting will allow us to draw down the maximum amount of federal dollars.”

(Dillon) Ken Libertoff is executive director of the Vermont Association for Mental Health, which two decades ago called for the State Hospital to be closed. Libertoff says the futures group is off to a slow start.

(Libertoff) “We really have to transfer a lot of this conversation back into the community. And that’s why there is a Vermont futures group that has made very slow progress to date in trying to define and proscribe what a system will be in Vermont to treat folks with serious mental health conditions that would have been sent to the Vermont State Hospital.”

(Dillon) Health Commissioner Jarris says officials will have an outline of a plan to replace the hospital by mid-October, and a detailed proposal for the Legislature in January.

For Vermont Public Radio, I’m John Dillon in Montpelier.

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