Homeless New Yorkers with serious mental illness keep falling through the cracks despite billions in spending

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Driven by mounting hospital expenses and growing support for community-based care, state lawmakers encouraged counties to develop local mental health service plans. The state instructed hospitals to start slashing beds. Eventually the federal government jumped on the bandwagon and in 1963 committed funding for community mental health centers across the U.S.

The shift was facilitated by the discovery of antipsychotic drugs, such as chlorpromazine in the 1950s. The new class of medications revolutionized the approach to patients with serious mental illness, a designation that covers any disorder that substantially interferes with someone’s life and ability to function. Instead of exiling patients to faraway state institutions, doctors could instead use medications to quickly stabilize patients and send them home. There, the new community-based programs would take charge of their care.

Buoying the deinstitutionalization movement was a series of legal rulings that bolstered patients’ protections against involuntary hospitalization and affirmed their right to refuse treatment. States are now required to treat mentally ill people in the “least restrictive” setting.

Yet some newly discharged patients found little success with the new, unstructured and still sparse outpatient model. The new drugs didn’t always work, and insurance didn’t always cover treatment. In many places not enough programs emerged to fill the void. Those that did often focused on patients with less serious forms of mental illness.

Single-room-occupancy housing was plentiful, so tens of thousands of patients discharged in the initial deinstitutionalization wave flocked to them. But supply plummeted in the 1970s as longtime residents fled their new neighbors and developers converted the units into apartments. Former state hospital patients very rapidly found themselves without a home. The crises of mental health and homelessness had not so much intersected as collided.

General hospitals, meanwhile, saw their psychiatric admissions rise as state institutions emptied. The venue had changed, but the dilemma had not.

It would not continue for long. Those hospitals also began cutting beds. Officials pointed to the new focus on community care; the beds, as it happened, were also deeply unprofitable.

Today New York operates about 3,300 beds across 22 state mental hospitals. But the patients didn’t disappear. Instead, a grueling cycle in and out of hospital emergency rooms, shelters, jails and other facilities—the institutional circuit—took off with full force.

Access denied

David Diaz showed up at Mount Sinai Beth Israel’s emergency room in 2021, saying he wanted to hurt himself or somebody else and asking for help. He had access to a weapon, he said.

Diaz’s medical history by then would have shown bipolar and schizoaffective disorders, a history of suicide attempts and frequent hospitalizations since he was in grade school. At the hospital this time he was given an antidepressant with sedative effects, then a doctor told him the hospital had no reason to admit him. So the hospital didn’t. He was there for a matter of hours.

“They just hold you, pump you full of medicine and hope for the best,” Diaz said.

Hospitals are supposed to admit psychiatric patients who pose a risk of harming themselves or others. Instead they often dole out sedatives or other calming medications, then cut the patients loose as quickly as a few hours later. That can have disastrous effects for people in crisis and the others around them, particularly when patients are homeless and have no place to go. In some cases, the consequences are life-changing.

Komla Agblami, an assistant Assertive Community Treatment team leader with Services for the UnderServed, a nonprofit, described one client who showed up at the emergency room in early July during a psychotic episode. He was denied admission. Five days later he went to a different emergency room. It happened again. The ACT team’s psychiatrist evaluated him and determined he needed to be hospitalized, this time sending him to Health + Hospitals/Kings County—to no avail. The third hospital cast him out, too, but never told Agblami’s team. By the time he found out, his client had disappeared.

Then, at the start of August, Agblami got a call from Weill Cornell Medical Center. His client had fallen into the subway tracks and was electrocuted. He was intubated with third-degree burns and remains in the hospital.

“We tried our best,” Agblami said, “but the hospital didn’t listen.”

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Buck Ennis

Komla Agblami with Services for the UnderServed maps out the location of the clients on his ACT team.

Current and former hospital psychiatrists said the decision to admit a patient typically falls to the emergency department’s attending psychiatrist. When someone shows up at a hospital asking for help, federal law dictates that hospitals must stabilize them, but it does not specify how or to what extent. Psychiatrists said they tend to admit patients only if they are a danger to themselves or others, yet nothing holds hospitals accountable to that standard.

As a result, community providers said hospitals do the bare minimum to send patients on their way. Many said hospitals rarely notify them when their patients show up at the ER or are discharged. A state-run database tracks psychiatric hospitalizations, but providers said much of the information is three months out of date, rendering it useless to search for missing patients or find out what happened during a recent hospital stay when patients lack discharge paperwork.

The situation has reached such a crescendo that state Attorney General Letitia James’ office has started investigating hospitals’ treatment of psychiatric patients.

Dozens of providers and experts who spoke to Crain’s pointed to underfunding, limited bed capacity and staff shortages as reasons why hospital care is often out of reach.

Alison Burke, vice president of regulatory and professional affairs for the Greater New York Hospital Association, a hospital lobbying group, said hospitals have long been underpaid for treating the psychiatric patients they admit.

Medicare covered approximately 75% of hospitals’ costs for a psychiatric stay as of 2019, according to the most recent available data. Medicaid, which foots the bill for most psychiatric hospitalizations in the city, covers about 64%.

“It’s safe to say that it’s been a loss leader for a long time,” she said.

Burke said hospitals only slashed empty beds, but mental health care advocates blame financial incentives for the cuts, amid a broader trend of hospital consolidation. New York hospitals earned about $88,000 in net revenue per psych bed in 2018, according to an analysis by the New York State Nurses Association. Across all areas, they made about $1.6 million per bed.

Today there are 5,749 hospital beds for psychiatric patients statewide, not counting state-run institutions or residential treatment centers. But the state said 15% are offline due to repurposing during the pandemic, construction, staffing shortages or other reasons, whittling the number of available beds down to about 4,900—a decrease of roughly 18% since 2000. Fewer than half of those are in the city.

Dr. Gordon Frankle, chief of psychiatric services for NYU Langone Hospital–Brooklyn, said its 35-bed inpatient psych unit is typically at capacity and needs more beds. He said patients have been staying longer than they did before the pandemic—just over two weeks, on average.

Psychiatrists said one factor squeezing capacity is the monthslong wait for a bed in one of the state’s mental institutions, which typically only take referrals from hospitals.

“The standing line, or joke—although it’s not funny—is that it’s easier to get into Harvard than it is a state psychiatric center,” said Bob Hettenbach, who previously was chief executive of two state mental hospitals and a regional director for the state Office of Mental Health.

Asked for the average wait time for a state hospital bed, James Plastiras, a spokesman for the Office of Mental Health, did not provide a specific figure.

“The target time frame for admission is two weeks or less, and most are admitted during this time,” he said.

Capacity constraints are amplified by widespread staffing shortages. A psychiatrist for an inpatient unit in a city hospital said she was the unit’s only doctor on the day she spoke with Crain’s. The unit had 23 patients at the time. An employee at Health + Hospitals/Lincoln said it could only operate one of its two inpatient psychiatric units because of understaffing.

In cases when hospitals consider a patient dangerous, whether from evidence or stigma, the hurdles to care rise even higher.

Hospitals can nonconsensually admit patients who are a risk to themselves or others, but psychiatrists must get approval from a judge in their borough’s dedicated mental health court. NYU Langone’s Frankle said the process often takes weeks; Brooklyn’s court meets just once a week. Some hospitals are unwilling to wait.

One patient, whose story was shared with Crain’s by someone familiar with the case, was denied admission by a city hospital even after Department of Homeless Services officials called him an “imminent risk” to others in his shelter. A hospital official said in writing that the patient was resisting treatment and that the hospital could not risk endangering staff and other patients by holding him for the weekslong wait for a court order. He was discharged, and his whereabouts are now unclear.

A social worker who works with psychiatric patients at another city hospital said it keeps a short list of patients to not admit because they stalked or attacked specific workers there.

“If we had to admit them, we would, but we would first try to transfer them out,” the person said.

Hospitals can expand access to care and ease the strain on inpatient units with specially licensed psychiatric emergency rooms, which can hold patients for observation for up to 72 hours. But few have opened one.

Some providers described hospitals’ failures as willful neglect. During meetings this year that the state held with stakeholders to discuss the matter, a nonprofit executive familiar with the conversations said ER doctors acknowledged not admitting homeless patients because they felt it would be useless—that the patients would just end up back on the streets and deteriorate further.

“I think a lot of it is by choice,” said the former chair of psychiatry at a hospital that operates a psychiatric emergency room. “And let’s be real: Nobody wants to deal with a psych patient.”

Waiting game

Long before he snagged a spot on an ACT team, Andrew, who asked that his last name not be used, said he contemplated committing a mass shooting, then killing himself. He had been in and out of the hospital dozens of times for schizophrenia. His mind was so scattered that he kept losing his keys and would sleep under the BQE.

What changed? Last year Health + Hospitals/Kings County kept him for four months to get an AOT order for him. That won him priority for a spot on an ACT team, entitling him to six monthly check-ins and a team of professionals to advocate for him.

That is what the team did after he ended up at New York-Presbyterian Westchester, which attempted to discharge him. The ACT team fought back. As a result, he spent seven months there, in a program for people with psychotic disorders and a history of frequent hospitalizations. The hospital had resisted referring him to the program, insisting it wasn’t a good fit. Andrew said it was a godsend.

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Buck Ennis

Andrew, who asked that his last name not be used, lives in a Brooklyn building with on-site services that his assertive community treatment team helped him. He moved there in August, after a seven-month hospital stay.

By the time he was released, his ACT team had found him an apartment, where on-site staff members make sure he takes his medication.

“This is like a new beginning for me,” he said.

New York has spent decades building out a system of specialty programs designed to keep patients with serious mental illness in the community and out of hospitals. Ironically, patients rarely get a spot without a hospital’s help.

Social workers, case managers and other providers who work at shelters or elsewhere in the community said they rarely have the bandwidth or the required medical records to complete the burdensome referral process. Some incorrectly stated that they cannot make referrals. One psychiatrist, who previously worked for a nonprofit that runs shelters, said caseworkers rarely made referrals because they said they didn’t know how. Adding another wrinkle, many programs list multiple hospitalizations as one of their eligibility criteria.

There are exceptions. Shelter ACT teams, for example, can take direct referrals from specific homeless shelters, but there are just 10 among the state’s 113 teams.

Hospitals also file the vast majority of AOT petitions, which require substantial medical records. Patients on a court order jump to the front of the line for services they might not otherwise get.

Securing a spot on an ACT team or intensive mobile treatment team otherwise takes six to 12 months, according to a recent report by BronxWorks and the Center for Urban Community Services. The city Health Department, which oversees local waiting lists for those programs, was unable to provide current data before publication. One provider briefed on recent waiting list numbers said more than 700 adults were waiting for ACT team spots earlier this year. The program’s total capacity is just over 8,000 statewide.

One hospital social worker said she has largely stopped referring patients to ACT unless they have a court order, because it has become a fruitless endeavor.

It is unclear how much more capacity New York needs, because there is limited data on the number in need. The city estimates that 250,000 adults have a serious mental illness, or 3% of the total population. Among the homeless population, which totals about 60,000 living in city shelters or on the streets, the National Alliance on Mental Illness’ New York chapter estimates that 1 in 6 lives with serious mental illness.

Under Gov. Kathy Hochul, mental hygiene spending is expected to hit $10.8 billion this fiscal year, up 30% from what the state budgeted last year and twice what it spent the year before that. The state is adding 26 new ACT teams, increasing its spending on the program from $82 million to nearly $95 million. But staff shortages are so dire that one nonprofit executive said most of the city’s ACT teams are temporarily barred from enrolling new clients. Other nonprofit officials said new teams would suffer the same issue, because the state did not provide enough funding per team. One person said the proposed budget per team was $90,000 under cost.



Last year the city earmarked $65 million to launch 25 more intensive mobile treatment teams, which visit clients twice weekly and are specifically designed to serve people with “a high degree of transience,” such as those living on the street. Officials said the new teams would be enough to serve 675 more people, eliminating the program’s waiting list. A new pilot program is supposed to serve as a “step down” for IMT clients ready for a lower level of care. But IMT teams are still struggling to meet demand amid a staffing crunch and limited capacity of just 837 spots citywide, according to data from June.

Bielkis Santos, a social worker with the Institute for Community Living, said her Bronx-based IMT team is two employees short, so it could not enroll its full 27-person caseload. Santos said pay is staggeringly low and turnover exceptionally high. (Advocates said salaries for social workers and mental health counselors are about $45,000 to $60,000.) She works at a restaurant on the weekends to help make ends meet.

“Most of us have second jobs,” she said.

Nonprofits’ wages for mental health providers, which depend on government funding, are so low that some cannot afford housing and live in shelters, said Amy Dorin, president and CEO of the Coalition for Behavioral Health. The state recently approved a 5.4% pay increase for the social services sector, but providers said inflation effectively negates it.

Chronic staffing shortages are already unraveling the existing system, as nonprofits are forced to cut services and remaining workers accumulate even larger caseloads.

The chief executive of a nonprofit that operates mental health shelters, who requested anonymity, said its staff vacancy rate is so high that it may reduce on-site psychiatric and primary care services to raise salaries for open roles.

One psychiatrist, who worked for a nonprofit that provides homeless and mental health services, said shelter staff members were overburdened and ill prepared to work with residents with serious mental illness. Instead, they were quick to call 911 and pass the buck, increasing the risk that residents in crisis are incarcerated rather than given the treatment they need. The psychiatrist quit after the nonprofit’s shelter staff refused an offer to get training in crisis management and de-escalation.

Even when homeless New Yorkers manage to jump through the mental health care system’s many hoops, they run up against the city’s shortage of affordable housing. The situation is even tougher for those with serious mental illness, many of whom need more support than the city’s supportive housing units can provide. Community providers such as Santos, the IMT social worker, help clients apply for housing and vouchers to pay for it, but the indefinite wait for an apartment erects yet another barrier to treatment.

“For you to be stable,” she said, “your whole life has to be stable.”

Home, at last

The men who hang out at Longwood and Southern Boulevard in the Bronx all know Santos, the social worker. That’s where she meets with Tyler, who has spent seven years in a nearby shelter. He spends his summer on that corner, outside a tax services agency where the shade keeps him cool and the occasional whoosh of the door opening sends a breath of air conditioning.

The men also know to call Santos when Tyler gets hospitalized, because they know the hospital will not. It’s as if they too are part of his treatment team.

On a sunny day just after the Fourth of July, Tyler has gone four months without a hospital visit. Before Santos started working with him late last year, he had been hospitalized 20 times in a two-year span. Now she is paying the corner one of her final visits.

Edward Funches

Buck Ennis

Bielkis Santos at right, a social worker on one of the Institute for Community Living’s Bronx-based intensive mobile treatment teams, helped her client, Tyler, find an apartment in supportive housing.

Tyler had been approved for a housing voucher and a Bronx apartment in a complex for residents like him who struggle with substance use.

Santos asked him if he wanted to take anything with him from the shelter. No, Tyler said. He wants to start over.

“I hope to be part of the new you,” she said. Santos offers to take him to dinner after he’s moved in. She said they will talk about budgeting, so he can make rent each month. Tyler isn’t concerned. He uses a hand to hoist himself up in his motorized wheelchair, the one Santos’ team got him.

“I ain’t going back, no,” he said. “I’m going forward.”



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