This document identifies the issues for which NAMI North Carolina will advocate in 2003-2004 and the positions we will take. It provides background and briefing information on the issues to encourage members to talk with and educate their legislators about the issues in their home communities.

NAMI has proposed the Omnibus Mental Illness Recovery Act (OMIRA) to establish across the country a baseline of care and to spur a national movement toward improved care for individuals with mental illnesses (to view the whole act go to the NAMI Web page at www.nami.org ). The act has eight sections and reflects a model system of care based on the most effective standards and programs demonstrated to empower individuals on the road to recovery. The sections are:

• Consumer and Family-member participation in Mental Illness Service Planning
• Equitable Healthcare Coverage—Parity
• Access to Newer Medications
• Assertive Community Treatment
• Work Incentives for Persons with Severe Mental Illness
• Reduction in Life-threatening and Harmful Actions—Restraints
• Reduction in the Criminalization of Persons with Severe Mental Illness
• Access to Permanent, Safe and Affordable Housing with Appropriate Community-based Services

Below are ways North Carolina, through legislation and policy changes, can achieve the goals of OMIRA. While all issues will receive attention, some will be considered priority issues due to their timeliness, urgency, and/or our opportunity to effect change.

• NAMI North Carolina will work with allied organizations to develop legislation to allow individuals who qualify for Special Assistance to use these funds to maintain their own residence.

• NAMI North Carolina will support the Coalition 2001 budget request to increase funding to the MH/DD/SA Trust Fund to support the development of housing options, provide bridge funding for start up costs for new community support services, and provide ongoing funding to expand community services. NAMI North Carolina will support the Coalition 2001 budget request to increase funding to the MH/DD/SA Trust Fund to support the development of housing options, and provide bridge funding for start up costs. But there also is a need to provide ongoing state support for community based services. Current levels of state funding cannot be reduced any further and, in fact, support needs to grow substantially if services are to be offered to those who are waiting for help. NAMI North Carolina supports the Coalition 2001 request to increase state funds for community services.

• While NAMI North Carolina supports the action taken by the state of North Carolina to assess individuals living in state facilities and developing service plans for these individuals, we will monitor Olmstead implementation of these plans to ensure that individuals are not discharged from institutions without services being available in the community at the time of discharge and that individuals currently in the community are not displaced from or lose access to services in order to accommodate the needs of individuals with Olmstead service plans. Services must be expanded to meet the needs of all.

• We believe that individuals with mental illness must have access to treatments that have been recognized as effective by the FDA and/or NIMH and opposes measures that limit the availability of "new generation" medications. Professional judgment and informed consumer choice should determine the choice of medications based on knowledge of the effectiveness and side effects of the medication and consistent with treatment guidelines. We support the state’s efforts to manage the Medicaid pharmacy budget through physician education on medication effectiveness and prescribing guidelines. We oppose any efforts to impose a restricted formulary or a "fail-first" policy that requires trials of older, less expensive medications before prescribing newer medications.

• NAMI North Carolina will work with the Division of MH/DD/SA to make changes in the State Plan to clarify and support the role of families and consumers in local service planning and monitoring. The State must identify criteria for local programs in the operating and support of these committees and develop procedures to monitor compliance.

• NAMI North Carolina will continue its leadership role in advocating for the adoption of best practice services in North Carolina. This includes not only defining these services, but providing training, adequate funding, and monitoring to ensure fidelity to best practice standards.

• NAMI North Carolina advocates that the rules to implement the seclusion and restraint legislation be implemented on schedule and we will monitor the implementation process. We urge that the Department fully support implementation through training activities and other communication with providers impacted by the rules. NAMI North Carolina will monitor the activities of the General Assembly to ensure support of the rules and legislation.
  
• NAMI North Carolina urges that the Division accept and implement the committee recommendations for a uniform appeals process. NAMI North Carolina will continue to advocate for the establishment of a strong and comprehensive client rights system as an integral part of reform efforts.

• NAMI North Carolina will support parity legislation if it is introduced into the North Carolina General Assembly. We also will work to support federal legislation to require insurance parity for mental health benefits.

• While the state’s current budget situation makes it unlikely that any new programs will be established, a review should be done to determine how to use current resources and federal grant funds to provide training to police and court personnel and to support the expansion of jail diversion and mental health court programs.

NAMI North Carolina will monitor the implementation of Ticket to Work to ensure that consumers are offered an informed choice of service providers and that quality of services and employment outcomes improve. While the state’s current budget situation makes it unlikely that legislators will support the expansion of benefits and programs, NAMI North Carolina will continue to advocate that the state take advantage of the Medicaid options offered through the Ticket to Work and Work Incentives Improvement Act to allow individuals to work without losing Medicaid benefits. Taking advantage of these options supports recovery and, in the long run, will likely save the state money as individuals are able to return to productive work.

Failure to secure safe, affordable housing supported by appropriate community services is the greatest barrier to recovery from serious mental illness. Dismantling this barrier will require multiple approaches to increase support of and access to a variety of housing options and provide funding for best practice community services, including appropriate support for implementing the US Supreme Court Olmstead decision.

Severe mental illness places an individual at high risk for homelessness. Approximately one-third of the nation’s homeless persons have a severe mental illness. It is estimated that over 11,000 individuals with mental illness in North Carolina are in need of housing. The primary reason for the lack of housing for people with mental illness is financial status. Many people disabled by mental illness receive Supplemental Security Income (SSI) as their income source. In 2002, an individual living on SSI income in North Carolina received $545 a month, placing them at a statewide average of 18.3% of median income. This places them in the category of "extremely low income" as defined by the federal government, those making less than 30% median income. Not a single housing market area in the United States exists where a person with mental illness receiving Supplemental Security Income (SSI) can afford to rent a modest efficiency apartment. The low-income status also makes it extremely difficult for developers to create housing opportunities for these individuals, even when they take advantage of various state and federal programs.

Changes need to occur at the federal level to expand housing opportunities, but there also are things that North Carolina can do:

The federal government allows states, within specified regulations, to offer state supplemental payment programs for aged, blind and disabled adults. In North Carolina, Special Assistance is funded through state and county dollars. Under federal guidelines, payments could be made to eligible individuals in a variety of living arrangements. In 1974, North Carolina elected to make Special Assistance payments only for care in licensed facilities such as group homes and adult care homes. In 1997, 44 states were providing supplemental payments to aged, blind, or disabled adults. Only six states limit payments to licensed facilities, North Carolina being one of these. As a result, 9,000 individuals with mental illness or developmental disabilities reside in adult care homes in North Carolina, a setting inappropriate for the needs of most.

North Carolina could allow individuals to use Special Assistance funds outside of group homes and adult care homes. The federal government allows special assistance to be used to cover such items as food, shelter, clothing, and utilities and other necessities when SSI benefits are insufficient to cover basic needs. "Uncoupling" Special Assistance payments from licensed facilities could provide individuals nearly $400 a month. When combined with the average SSI benefit of $545, many individuals could afford an apartment and take advantage of supported services provided through the mental health authorities.

There has been strong support in the General Assembly to uncouple Special Assistance payments. Due primarily to opposition from the adult care home industry, legislation to support this has not yet passed. But a pilot study was commissioned by the General Assembly to help determine the costs and outcome of such legislation. The recently completed report to the General Assembly on the pilot suggests this type of assistance can have a profound impact in supporting people to live in their own home.

NAMI North Carolina will work with allied organizations to develop legislation to allow individuals who qualify for Special Assistance to use these funds to maintain an independent residence.

In 2001 the General Assembly established the MH/DD/SA Trust fund with $50 million to provide "bridge" or start up funds for community services. A major portion of the funds were targeted toward the development of housing. Unfortunately, due to unprecedented deficits in the state budget, the Governor took all but about $10 million from the Trust Fund to help balance the state budget. Of the remaining amount, $3.5 million was designated to develop housing for individuals in the MH/DD/SA system by providing revolving loans and/or grants to housing developers to leverage other housing funds such as the NC Housing Trust Fund or Federal housing funding. Using these funds will help support the development of additional housing units, but as one time funding it will not support the sustained expansion of housing opportunities that will be needed to address this problem. Additional funds will be needed.

NAMI North Carolina will support the Coalition 2001 budget request to increase funding to the MH/DD/SA Trust Fund to support the development of housing options, provide bridge funding for start up costs for new community support services, and provide ongoing funding to expand community services.

The ability to maintain a residence is often dependent on the availability of appropriate support services in the community. This includes a broad continuum of services such as crisis response, Assertive Community Treatment Teams (ACTT), case management, medication management, supported employment, peer support, in-home services, etc. North Carolina has not provided adequate funding for the development of these services in our communities. In 2001, the estimated cost of unmet needs with MH/DD/SA services programs exceeded $736 million. Efforts to reform the MH/DD/SA system require the development of a comprehensive continuum of community-based services. To be successful, funding must be available to support the expansion of community services.

NAMI North Carolina will support the Coalition 2001 budget request to increase funding to the MH/DD/SA Trust Fund to support the development of housing options, and provide bridge funding for start up costs for new community support services. But there also is a need to provide ongoing state support for community based services. Current levels of state funding cannot be reduced any further and, in fact, support needs to grow substantially if services are to be offered to those who are waiting for help. NAMI North Carolina supports the Coalition 2001 request to increase state funds for community services.

The Olmstead case was filed on behalf of two women, L.C. and E.W. who were dually diagnosed with mental illness and mental retardation and institutionalized in a Georgia State Psychiatric Hospital. These individuals wanted to live in the community and the professionals providing their treatment had determined that their needs could be met in the community. The state of Georgia, however, did not have any suitable community placement so both women remained hospitalized.

In 1999 the Supreme Court found that unjustified isolation in an institution is discrimination based on disability and a violation of the Americans with Disabilities Act (ADA). States were urged to develop a comprehensive plan for placing qualified people in less restrictive settings and establishing a waiting list that moves at a reasonable pace to place people in appropriate community settings. States also were directed to identify individuals at-risk for being placed into an institution and develop community services to prevent hospitalization.

North Carolina responded positively to the ruling, developing a statewide plan for Olmstead implementation that included considerable input from families and consumers. North Carolina’s plan called for assessing all individuals residing in institutions and developing an individual service plan for each individual detailing the services and supports needed for the individual to live successfully in the community. These plans have been completed and nearly 600 individuals living in the state psychiatric institutions have indicated they desire to live in the community and their treating professionals have agreed they are capable of doing so with support services. Limited funding has been available through the MH/DD/SA Trust fund to develop some services in the community for these individuals. However, the current state budget crisis has reduced the availability of these funds. The concern is that with state budget pressures, individuals will be released from our state facilities without the necessary services identified in their service plan available to them. Further, some have raised concerns that individuals being discharged from the state facilities under Olmstead service plans may be given priority for scarce community services, making it more difficult for those who currently reside in the community to access services.

NAMI North Carolina supports the action taken by the state of North Carolina to assess individuals living in state facilities and developing service plans for these individuals. But we will monitor implementation of these plans to ensure that individuals are not discharged from institutions without services being available in the community at the time of discharge and that individuals currently in the community are not displaced from or lose access to services in order to accommodate the needs of individuals with Olmstead service plans. Services must be expanded to meet the needs of all.

Nearly all health plans, both public and private, are struggling to manage pharmacy benefits, the costs of which have exploded over the past decade. North Carolina’s Medicaid program is no different. From 1998-2000 Medicaid prescription drug costs grew from $455 million to $754 million, an average annual increase of 29% per year. Last year the General Assembly looked at this issue and passed a measure requiring that generic medications be dispensed unless the physician explicitly orders a name brand prescription. The Department of Health and Human Services is also looking at ways to slow the growth of the Medicaid budget. While these efforts are focused on the broad issue of pharmacy, and not specific to medications for mental illness, their implementation could impact access to medications.

At the present time the state of North Carolina has taken a very measured approach to managing the Medicaid pharmacy budget. Efforts are focused exclusively on physician education about medication effectiveness and prescribing guidelines. Physician discretion in prescribing is maintained. Unlike many states, North Carolina has not implemented comprehensive prior approval or preferred drug lists. There is concern, however, that as North Carolina’s budget crisis persists there will be growing pressure to take more drastic measures in an effort to exact immediate cost savings for the state. Such action would be extremely short sighted as individuals unable to access effective medications would evidence lower compliance and require more costly hospital treatment.

We believe that individuals with mental illness must have access to treatments that have been recognized as effective by the FDA and/or NIMH and opposes measures that limit the availability of "new generation" medications. Professional judgment and informed consumer choice should determine the choice of medications based on knowledge of the effectiveness and side effects of the medication and consistent with treatment guidelines. We support the state’s efforts to manage the Medicaid pharmacy budget through physician education on medication effectiveness and prescribing guidelines. We oppose any efforts to impose a restricted formulary or a "fail-first" policy that requires trials of older, less expensive medications before prescribing newer medications.

In October 2001 the North Carolina General Assembly passed comprehensive legislation to reform the public MH/DD/SA system. A centerpiece of this legislation was to improve the accountability of the system by enhancing the involvement of families and consumers. A State Plan was written to implement this legislation. The State Plan required the establishment of a Consumer and Family Advisor Committee (CFAC) and the development of a Local Business Plan (LBP). The intent of the legislation and the State Plan was for the CFAC to play an integral role in developing the LBP and in monitoring its implementation.

As with any reform effort, how this has actually played out has varied across the state. Little information was provided to families, consumers, and local communities on how CFAC’s should operate, what role they should play, and how they should play that role. NAMI North Carolina took a leadership role in providing information and training to families and consumers in local communities to assist them to have meaningful participation in the process. But additional work needs to be done.

NAMI North Carolina will work with the Division of MH/DD/SA to make changes in the State Plan to clarify and support the role of families and consumers in local service planning and monitoring. The State must identify criteria for local programs in the operating and support of these committees and develop procedures to monitor compliance.

Over the past ten years a tremendous amount of research has been done to identify treatment and support services that have demonstrated effectiveness in promoting recovery from severe and persistent mental illness. There is now consensus around a core of services that can be considered evidenced based best practice. The state plan refers to such services and requires the development their development in our communities. One of these services is Assertive Community Treatment Teams.

NAMI North Carolina has been a leader in calling on the state to identify the best practice services it will require all communities to offer. We also have called on the state to require that these services reflect the essential elements that research has shown makes these services "best practice." For ACT Teams, for example, this means requiring that services provided by a team that is responsible for all client needs, high case manager to client ratio (roughly 10 clients per team member is recommended), services provided in clients’ natural setting, 24-hour coverage, shared caseloads among clinicians, flexible direct services, broad team skills and training (team has a psychiatrist, vocational specialist, nurse, substance abuse specialist, etc.), and a client advisory mechanisms that provides oversight of the service While ACT Teams are an essential best practice, a continuum of best practice services is needed in our communities to support recovery.

NAMI North Carolina will continue its leadership role in advocating for the adoption of best practice services in North Carolina. This includes not only defining these services, but providing training, adequate funding, and monitoring to ensure fidelity to best practice standards.

The North Carolina General Assembly passed progressive legislation in 1999 to regulate the use of seclusion and restraint interventions. Rules to implement the law were developed through a two- year review process. These rules are scheduled to go into effect in April 2003.

NAMI North Carolina advocates that the rules to implement the seclusion and restraint legislation be implemented on schedule and we will monitor the implementation process. We urge that the Department fully support implementation through training activities and other communication with providers impacted by the rules. NAMI North Carolina will monitor the activities of the General Assembly to ensure support of the rules and legislation.

A fundamental right should be the right to appeal any decision to deny, reduce, or terminate services through an administrative process and/or the court system (not just to the agency making the decision). The process for appeal should be the same, regardless of how services are being paid for. Currently, individuals who receive services paid by private insurance or by Medicaid have a right to appeal a denial, reduction, or termination in services not only to the area program but, if necessary, to the state and the office of administrative hearings (OAH). However, individuals who do not have a public or private health benefits program do not have such a right. These individuals can only appeal to the area program that made the decision.

As part of the mental health reform process a committee, including consumers and families, developed recommendations to establish a uniform system of appeal for all service recipients, including the right to appeal to the state OAH. There has been no response to this report. This is a central component of a strong clients rights system that must be established to protect individuals.

NAMI North Carolina urges that the Division accept and implement the committee recommendations for a uniform appeals process. NAMI North Carolina will continue to advocate for the establishment of a strong and comprehensive client rights system as an integral part of reform efforts.

Most private and public health insurance policies and programs discriminate against persons with mental illnesses by providing more restrictive coverage for their treatments than the coverage provided for treatments of other medical conditions. Insurance parity legislation requires health insurance plans to provide treatment for mental illnesses equal and commensurate with that provided for other major physical illnesses. The North Carolina State Employees Health Plan has required a mental health parity benefit since 1991. Substance abuse parity was added in 1997. The plan experienced cost decreases subsequent to implementation of parity.

Legislation to require mental health parity for group policies in North Carolina was first introduced in 1993 and every subsequent session of the General Assembly. The NC Senate approved a Mental Health Parity bill in 1997. The NC House has never allowed a committee vote on a parity bill. The powerful business and insurance lobbies have been successful in blocking the legislation. Their arguments against the legislation have changed over the years. Opponents have raised concerns about the reliability of diagnosis, the effectiveness of treatment, and cost of parity coverage. In each instance, research and actual experience in both North Carolina and other states have disputed these claims. Opponents now cite opposition to any type of mandate for coverage, stating that the cumulative effect will be to drive insurance costs up. Supporters of parity counter that without a mandate, only those needing coverage will buy it, creating a situation called adverse selection, which drives costs prohibitively high. Mandated coverage allows the cost of insurance to be spread out and remain affordable.

The federal government also is considering legislation to require mental health insurance parity. Passage of such legislation would rejuvenate efforts at the state level to pass similar legislation.

NAMI North Carolina will support parity legislation if it is introduced into the North Carolina General Assembly. We also will work to support federal legislation to require insurance parity for mental health benefits.

A report issued by the US Department of Justice in 1999 revealed that 16% of all inmates in state and federal jails and prisons have a severe mental illness. This means that on any given day there are roughly 283,000 persons with severe mental illnesses incarcerated in federal and state jails and prisons. In contrast, there are only 70,000 persons with severe mental illnesses in public psychiatric hospitals and 30% of them are forensic patients. In North Carolina, 23,000 adults with mental illness are under Department of Corrections supervision. About 5,000 are incarcerated in state prisons costing an estimated $117 million, with an additional 18,000 on probation or parole. A Duke University study of persons in North Carolina with severe mental illness found that 20% were arrested within one year following hospital discharge, largely for drug-related crimes or minor offenses such as trespassing, disturbing public order, and public intoxication. Police are becoming front line respondents to people experiencing psychiatric crises in our communities. Prisons and jails are not conducive to effectively treating people with mental illnesses. This trend has occurred because of the inadequacy of community mental health systems and support services. The state could take some immediate actions to reduce the criminalization of people with mental illness. Judges should be given the authority to divert non-violent offenders with mental illnesses away from incarceration and into appropriate treatment. Specialty "mental health courts", now present in several North Carolina communities, should be expanded. The state also should support training for police officers and probate, civil, and criminal court judges and personnel about mental illnesses and legal issues affecting people with these illnesses.

While the state’s current budget situation makes it unlikely that any new programs will be established, a review should be done to determine how to use current resources and federal grant funds to provide training to police and court personnel and to support the expansion of jail diversion and mental health court programs for adults and youth.

The Ticket to Work and Work Incentives Improvement Act of 1999 is a federal law intended to reduce work disincentives, and increase health insurance coverage and benefits eligibility for people who have a disability and are able to work. It does this by expanding Medicare and Medicaid coverage and expanding vocational rehabilitation service options. North Carolina has not taken advantage of the new Medicaid Options provided by the legislation. But in June of 2003 North Carolina will implement the Ticket to Work portion of the legislation that gives consumers greater choice in choosing their provider of VR services. Individuals who qualify for SSI or SSDI will no longer be referred automatically to the state Division of Vocational Rehabilitation for services but will be given a "ticket" to choose from a network of providers.

But what remains the greatest barrier to employment is the loss of benefits when an individual begins to work. The federal legislation adds two new optional eligibility categories for states: 1) states are able to offer Medicaid coverage to SSI beneficiaries who go to work and earn up to 250% of the poverty level, and 2) states can allow a Medicaid buy-in for people with disabilities who earn more than 250% of the poverty level up to 450% if the state charges a sliding-scale premium. If the state takes advantage of these options it will allow people with a disability due to mental illness to earn more money without jeopardizing their health benefits through Medicaid. This has been a major disincentive to return to work as many part-time and re-entry work positions do not provide health coverage.

NAMI North Carolina will monitor the implementation of Ticket to Work to ensure that consumers are offered an informed choice of service providers and that quality of services and employment outcomes improve. While the state’s current budget situation makes it unlikely that legislators will support the expansion of benefits and programs, NAMI North Carolina will continue to advocate that the state take advantage of the Medicaid options offered through the Ticket to Work and Work Incentives Improvement Act to allow individuals to work without losing Medicaid benefits. Taking advantage of these options supports recovery and, in the long run, will likely save the state money as individuals are able to return to productive work.

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