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Lori Elam (copy)

Lori Elam, director of the Eastern Iowa Mental Health/Disability Services Region, said she is suspicious of the regions ability to generate enough money to take on the new services required by the legislature's S.F. 2456.

MUSCATINE — When Gov. Kim Reynolds signed H.F. 2456, she added several new required services to the purview of the mental health regions across the State of Iowa.

As a way to save money, mental health services are shared across regions of counties. Muscatine sits in the Eastern Iowa Mental Health/Disability Region. 

Director Lori Elam said Friday that she is worried about the quick implementation of these new services.

"All of the services are great ideas but we don't really know the true need, the costs for 24 hour services are high, and we don't know how much Medicaid will pay or if they will pay," Elam wrote in an email. "It's wrong to build and start new services if you can't guarantee funding going forward. (It's) unfair to individuals and families as well as providers."

She said that her concern is that the initial cost will be a shock to the budget and that overtime it will prove unsustainable. Currently, Elam said these new services are difficult to project. She ballparked anywhere from $500,000 to as high as $1 million. 

"We have no idea what the costs of some of these new services will be nor how many people will access them," Elam wrote.

As of yet, there has been no word from Medicaid whether or not they would sustain all or any of the costs associated with the new services. 

"We know Medicaid has a rate, but it will not cover the true cost of the service, so providers won't be able to make it," Elam wrote.

By true cost, Elam means not just what it costs at the point of sale for the patient, but all the costs associated with access. 

A workforce shortage for positions like psychiatrists create more challenges for implementation of new services like the intensive residential service homes. 

Making matters more difficult, H.F. 504 capped the maximum amount counties could levee for. According to Elam, if all five counties in Muscatine's region were to levee at the maximum mount of $30.78, the region would generate $9.2 million. The budget for this year was $15 million for the region. 

The budget was so high this year because of the legislative imperative, also created by S.F. 504, to draw down the region's fund balance. By June 30, 2020, the region's cash flow amount in excess of 20 percent of the gross expenditures of the region "shall be used in whole or in part to fund the payment of services provided under the regional service system."

The region needs to simultaneously spend down its excess fund balance and make plans to take on costs that the director doesn't believe it has the ability to generate money for.