Letter from FSSA's Secretary
Should state government make or buy inpatient mental health care? That was one of the first questions facing me as the new secretary of Indiana’s Family and Social Services Administration (FSSA).
FSSA employs nearly 10,000 people, yet it currently spends just seven percent of its total budget on salaries and benefits. That means that the vast majority of our $6.3 billion budget goes to not-for-profit and for-profit corporations that provide health services to needy Hoosiers.
Last year FSSA funded treatments for more than 100,000 Hoosiers for out-patient mental health care and substance abuse, yet none of those people were treated by FSSA employees. In addition, FSSA pays for long term care for the elderly, training for the developmentally disabled and well baby care. FSSA is truly a health care financing agency – we buy health care, we don’t provide it.
The only exception is inpatient mental health care. FSSA currently owns and operates several state mental health hospitals. Indiana, like many states, has gradually reduced the number of those hospitals thanks to the outstanding progress in mental health care in the last 20 years. New treatments and drug therapies allow millions of people to live less painful and more productive lives that may not require long-term hospitalization. Because of this, Indiana has chosen to transfer a substantial amount of patients and dollars to community-based not-for-profit healthcare providers.
However, government models of care tend to stagnate. They are overseen in Indianapolis while the actual care is often delivered far away. Our state hospitals should be free from the shackles of a bureaucracy which is cumbersome and benignly neglectful at best, and at worst meddling and contradictory.
When state government decides that a hospital’s care model has so clearly stagnated that it has become politically or financially embarrassing, someone in Indianapolis becomes responsible for downsizing or closing the hospital. This is typically done with little regard for the effect such action has upon the local community, not to mention the trauma to the families, and most importantly, to the patients. Frankly, this is the history of the closure at Central State and Muscatatuck. Now, sadly, Fort Wayne may face a similar future.
But I believe we have a unique opportunity to stop this devastating cycle. Currently, FSSA’s state hospitals in Madison, Richmond and Evansville are needed and likely to be relevant for the foreseeable future. These facilities have recently been re-built and the model of care they employ is current.
The communities housing these facilities, along with the employees who operate them, should be given – or better yet, have a role in developing – a governance model that keeps pace with clinical and operating changes. Hospitals that stay current stay in operation, and therefore, remain a vital part of the local economy.
This is why I have proposed “localizing” state mental health facilities. By this I mean that locally chartered not-for-profit providers are awarded the contracts to run/operate the facilities. It is also my intention that current employees will be offered jobs at or even above their current wages and with retirement and healthcare benefits equal to state government.
Localization is not privatization, which generally involves turning a state asset over to a private sector operating vendor in an effort to realize immediate cost reductions and/or performance improvements. Privatization often is the best solution for a government structure so riddled with costly and inefficient systems that it is no longer meaningless and costly bureaucracy that it can’t possibly stay financially viable. We intend to employ this tool in several places at FSSA; but not here.
Cost reduction is not the ultimate goal for this effort. This initiative may or may not enable hospitals to realize cost savings, but localization will enable communities to exercise control over their own economic destinies. And by focusing our efforts on not-for-profit corporations, I believe we ensure the continuation of compassionate and service-oriented care. Not-for-profit corporations have established a long and exemplary history of service in the mental health community which provides a management model well worth emulating in state hospitals.
In the weeks ahead FSSA will begin outlining the processes for localizing its facilities. We will hold community meetings in each of the cities which currently house a state mental health hospital to invite community discussion and input. In addition, we will issue requests for information to seek as many ideas as possible by vendors who may offer creative solutions.
During this process, we will keep the lines of communication open with each of these communities, state employees, potential vendors and the general public. In this way, I believe Indiana will be home to a system which meets or even leads in mental health best practices while allowing communities to make the best local decisions about vital human and capital resources.
Sincerely, 
E. Mitchell Roob, Jr.
Secretary, FSSA
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