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    Document Summary
    - Report Published -

    House Document No. 85

    Document Title
    The Feasibility of Public-Private Educational Facilities and Infrastructure Act of 2002 (PPEA) Proposals for the Operation and Maintenance of Mental Health Facilities

    Department of Mental Health, Mental Retardation and Substance Abuse Services; Secretary of Health and Human Resources

    Enabling Authority
    Appropriation Act - Item 298 C. (Regular Session, 2005)

    Executive Summary
    Item 298 C of the 2005 Appropriation Act directs the Secretary of Health and Human Resources, in coordination with the Commissioner of Mental Health, Mental Retardation and Substance Abuse Services, to examine the feasibility of Public-Private Education Facilities and Infrastructure Act of 2002 (PPEA) proposals for the operation and maintenance of mental health facilities. The Secretary is directed to report on the feasibility of the use of PPEA proposals to the Governor and General Assembly by November 1, 2005.

    The study was conducted with the assistance of a staff workgroup from the Department of Mental Health, Mental Retardation and Substance Abuse Services (DMHMRSAS) and state facilities that developed initially policy issues and questions, and evaluation criteria required to evaluate such a PPEA proposal. An exposure draft of the report, including the policy issues and questions and the evaluative criteria, was shared with a Stakeholders Group. The exposure draft was distributed and posted on the website of DMHMRSAS. Comments from the Stakeholders Group meeting and from public comment were incorporated in the final report. Letters and e-mail responses from private providers, local governments, community services boards (CSBs), and advocacy organizations are included in Appendix B of this report.

    Many of the issues and questions raised in this study require discussion by both the Executive and Legislative branches of state government. These critical decisions involve the willingness of the public, and by extension its elected representatives, to entrust a traditional function of state government to the private sector. In addition, access to services for consumers, the quality of services, and the transition of state employees to the private sector are major components of the decision-making process for determining whether to contract state hospital operations. Before embarking on the use of PPEA for the maintenance and operation of a critically important health care and public safety function, the following public policy questions need discussion, debate and decision:

    A. The provision of inpatient mental health services for consumers who are indigent or who have very difficult or complex conditions is a fundamental and traditional function of state government. These services are critical to maintaining the public safety net and to providing access to quality services. How will privatizing the management of a state mental health facility help or hinder the Commonwealth’s responsibility for assuring these services? Given the complexity of the services system, how will privatization affect the facility’s relationships with other state facilities, community services boards, and private providers, including providers of acute care?

    B. Will privatization affect the ability of private acute care hospitals to transfer patients to state mental health facilities when such a transfer is the appropriate placement for the patient? Will privatization lead to a further reduction in the number of beds in state facilities? Will it affect the public service delivery system, including private providers, CSBs, law enforcement, local government, etc., if some state facilities are operated under contract by a private provider while others continue to be operated by DMHMRSAS?

    C. As the services system is transformed to a consumer-driven system of services and supports how will the views of consumers and their families be solicited in the decision-making process regarding the potential privatization of state mental health facilities? How open will the decision-making process be?

    D. What relationship will the private provider have with the State Mental Health, Mental Retardation and Substance Abuse Services Board, or with the State Human Rights Committee in terms of compliance with policy and regulations? How will the statutory oversight responsibilities of the Inspector General for Mental Health, Mental Retardation and Substance Abuse Services, and the Virginia Office for Protection and Advocacy be carried out?

    E. What will privatizing the management and operation of a state mental health facility mean to the local economy, local governments, and local health care systems? To what extent will efficiencies gained by privatizing the management of a state facility be sustained over time? What will happen to access and quality of care if these efficiencies are not sustained?

    F. Will a private corporation be willing and capable of responding to external forces and changing demands in order to function as part of a public mental health services system?

    G. Can a contract be written that reflects the flexible and cooperative nature of the responsibilities shared among the DMHMRSAS, state facility and CSB partners in the current public mental health service system?

    H. Is the Commonwealth prepared to transition state employees who work for state mental health facilities to private service?

    I. How will privatizing the management and operation of a state mental health facility help or hinder the facility’s provision of a Constitutionally acceptable level of care to consumers?

    J. How will privatizing the management and operation of a state mental health facility help or hinder the services system’s implementation of the Vision of a consumer-driven system of community-based services? Will privatization add a level of complexity to an already complex system or will it be largely transparent to consumers and family members?

    K. Will the Commonwealth be able to act effectively and quickly if the privatized service needs to be brought back under state management to maintain the continuity and quality of services for consumers and their families?

    L. How will a private corporation comply with the intent of 37.2-316-37.2-319 of the Code of Virginia relating to the restructuring of the services system

    Decisions about privatizing services currently operated exclusively by state government require public debate by policy-makers and the citizens. This report outlines the major policy issues and questions that must be addressed in the public forum. Appendix A of the report provides a guideline for the private sector to develop public-private partnership proposals and for DMHMRSAS to conduct a thorough review and evaluation of such proposals if policy makers decide that privatization should be pursued. Appendix B includes responses to the report.