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Unity Center Asks State For Higher Rates, Citing Financial Woes

January 7, 2020

About two years ago, Oregon’s only emergency psychiatric hospital faced a closure threat over the abuse, neglect and even death of patients. Now Unity Center Behavioral Health is in deep financial trouble.

The Northeast Portland mental health hospital racked up $35.3 million in losses through fiscal year 2019, according to a financial statement it made to the Oregon Health Authority in December. It expects to lose another $21.4 million in this fiscal year, the document says. 

The statement says that when Kaiser Permanente, Legacy Health, Oregon Health & Science University and Adventist Health opened Unity Center in 2017, they expected losses -- but not to such an extent. 

“The projected loss was $6 million annually but due to several contributing factors the losses each year have been much greater,” the document says. “This is not financially sustainable.”

Unity Center filed the document, which was first reported on by the Portland Business Journal, with the state amid discussions over its finances, said Robb Cowie, the lead spokesman for the Oregon Health Authority.

In response, the authority has convened a group that includes Unity’s founders and Multnomah County that will try to find a solution, Cowie said.

“Unity is a key part of the state and local behavioral health system,” Cowie said in a statement. “We count on Unity to provide a safe, supportive environment to stabilize people who are experiencing a mental health crisis.” 

The document blames Unity’s losses on several factors, including stepped-up federal and state regulations. But it essentially points the finger at the state. It says Unity has been strapped with an overflow of patients who should instead be treated at the Oregon State Hospital in Salem.

“Due to lack of capacity at OSH, Unity Center has become the Portland extension of the Oregon State Hospital,” the document says. “We did not envision providing this level of care for this volume of patients.”

The document is the latest twist in the continuing saga of Oregon’s mental health crisis. The state hospital lacks beds, mental health patients have languished in jails and people in crisis have ended up being “boarded” in hospital emergency rooms.

In December, the state hospital stopped accepting mental health patients who posed a threat to themselves or others for nearly two weeks to comply with a judge’s order to admit people housed in jails, so-called aid-and-assist patients who are accused of a crime but too mentally unstable to help with their own defense.

“Unity Center is providing the same level of care as OSH to a population of patients for which the state is responsible,” the document says. “Due to the high level of care Unity Center provides to patients waiting for an OSH bed, many are never actually admitted to OSH. Instead, they are discharged back into the community because of the excellent care they receive at Unity Center.”

And yet, the state pays Unity far less than it pays the state hospital for Medicaid patients, the document says. The state reimburses Unity $834 a day for committed patients awaiting a bed at the Oregon State Hospital. That compares with $1,500 those patients cost Unity and $1,450 the Oregon Health Authority pays to the state hospital, the document says.

The document requests that the state increase its daily rate for committed Medicaid patients to $1,450.

“Unity Center is a critical component to providing better care and better access to behavioral health services for all Oregonians, but it is not the complete answer to a mental health crisis that is years in the making for the state of Oregon,” Brian Terrett, communications director for Legacy Health, which runs Unity, said in a statement. “Other state systems of behavioral health care are modeled on intertwined funding of state, local, and county resources, whereas in the state of Oregon, that is not the case. We tried to create a model that was similar to the funding models we’ve seen in other states, but to date, those efforts have been unsuccessful.”

Cowie said the state plans to review Unity’s rates but noted that Unity and the state hospital provide different levels of care. 

“Unity is intended to provide stabilization for people in crisis, while the hospital provides treatment for people with severe mental illness who need inpatient care so they can recover and return to the community,” Cowie said. 

Despite its financial woes, Unity’s founders have no intention of closing the facility.

It cost $47.9 million to build and launch. When it opened in January 2017, it was hailed as an answer to the Portland area’s mental health crisis. But the facility was plagued with problems almost from the start, with reports of abuse, neglect and two deaths. The federal government threatened to stop Medicaid reimbursements -- which would have meant Unity’s financial death -- and the state investigated. A year and a half ago, federal officials backed off as the state gave the facility a thumbs up with a corrective plan that involved hiring more staff.

Unity hired more nurses. The old director, Chris Farentino, left and last September, Legacy hired Melissa Eckstein to take her place.

In its December statement, Unity says it’s succeeded in its mission -- in part. The hospital has 107 inpatient beds -- 85 for adults and 22 for adolescents ages nine through 17 -- and another area where patients are treated and released within a day. The PES, or Psychiatric Emergency Service, is an open room with armchairs where patients are quickly seen by a provider, stabilized and then discharged with access to community resources. The idea is to save on expensive inpatient care.

In its statement, Unity says the PES has been “a great success.” Between 70 and 75 percent of patients have been seen by a physician or psychiatric nurse practitioner, given a treatment plan and discharged within 18 hours. But it says the remaining patients who need hospitalized care have stayed longer than the five to 10 days the founders originally expected.

“Unfortunately, we have yet to achieve the level of progress needed on inpatient length of stay,” the statement says. “The high percentage of patients waiting for a bed in the Oregon State Hospital and the lack of available resources in the community for patients needing longer-term care both contribute to a longer length of stay at Unity Center.”

Terrett said in his statement that Unity has discharged 5,000 people since it opened and managed more than 10,800 visits last year to the PES.

“We remain committed to the mission of delivering immediate psychiatric care and a path to recovery for people experiencing a mental health crisis,” Terrett said.

 In the coming weeks, the state plans to bring more senior executives into the workgroup to address Unity’s problems, Cowie said.

“We know it will take time to resolve these questions,” Cowie said. 

You can reach Lynne Terry at [email protected]; she's on Twitter @LynnePDX.