By Jim Schutze
By Rachel Watts
By Lauren Drewes Daniels
By Anna Merlan
By Lee Escobedo
And the task won't be easy.
Although Northstar has yet to finish enrolling patients, Magellan and Value Options are already seeing their medication costs spiral out of control.
While Medicaid paid for only three prescriptions per patient per month, Northstar requires the companies to pay for unlimited medications, including the exorbitantly priced "new generation" medications used to treat patients who are severely mentally ill. Waters says the policy has already sent his pharmacy costs soaring some 200 percent over his budget.
"The requirement is to spend more money on medications, but that's not reflected in our overall revenues," Waters says. "The price of the drugs has gone up, and the number of people needing it has gone up. That means we have to cut back on something."
Waters hopes to curtail costs by entering into a contract with drug manufacturers, who would be guaranteed the Northstar account in exchange for lowering their prices. Even if the plan works, Waters says, some patients will not automatically get the best available drugs, particularly "new generation" medications, even though they vastly improve patients' ability to stay healthy and represent the best chance the companies have to reduce the long-term costs of treating those patients.
"That is counterintuitive to everything we want to do with Northstar," says Waters. "It's getting to be an ethical question."
The medication dilemma reflects a broader problem the companies will face in solving future disputes with doctors over what type of care is necessary for patients. So far, there have been few complaints from the county's mental-health providers, whose Medicaid patients are only now enrolling in the program. But the county's chemical-dependency counselors, who haven't traditionally relied on Medicaid dollars, are beginning to cry bloody murder.
In the close-knit community of chemical-dependency providers, New Place has always been a place of distinction. A sign posted above the agency's front door captures its philanthropic mind-set: "Thru this door pass the most beautiful people in the world."
Founded in 1983, New Place is the first outpatient drug treatment center of its kind in Dallas and, until this month, it was the largest, serving some 160 indigent clients at its offices in East Dallas, Plano, and McKinney. On September 27, New Place earned a final distinction by becoming Northstar's first fatality.
On that Monday afternoon, the center's staff of 18 counselors solemnly gathered inside a group therapy room while Carolyn Tartaro, the center's executive director, took her position behind a lectern. Although Tartaro came equipped with a prepared announcement, her tears told the staff everything they needed to know.
"I've worked every possible scenario to try to make it work. I've worked all the numbers, and I just can't make it work," Tartaro told her staff. "They won. I cry uncle."
Since a basic goal of Northstar is to limit costly medical emergencies, such as drug overdoses and botched suicides, New Place should be booming with business because its sole purpose is to prevent such incidents by teaching addicts how to kick their habits. Instead, Northstar has had the opposite effect: The number of its clients dwindled and, because the money follows the patient in this new system, so did its revenues.
Since July, Tartaro tried to offset the impact of Northstar by laying off administrative staff, beginning with her accountant. Then Tartaro started losing counselors, including the Hispanic woman who ran the center's only Spanish-speaking treatment program. By September, it became clear that those cuts still weren't going to generate enough money to cover its $1.2 million budget.
Although New Place was the first center to cave under Northstar, it isn't the only agency getting squeezed. New treatment guidelines, in which Magellan and Value Options are systematically reducing and denying services, are testing the financial limits and the quality of care provided at all the nearly two dozen drug treatment centers in the Northstar region.
"Paranoid" may be the best word to describe the current mood among the centers' directors, who believe Magellan and Value Options are slowly eliminating their programs because they are too expensive.
"We all get the feeling in the nonprofit world that they want us gone," says Ed Cinisomo, the executive director of Daytop Village. "The illusion was that we kept patients too long and wasted money. That's a sham. We know how to keep things together with duct tape and chewing gum. If my programs in Texas close, that's terrible."
Daytop is a New York-based nonprofit that operates residential drug treatment programs in Dallas and Palestine. Together, the two centers treat more addicted teenagers than any other adolescent program in the state. Like Tartaro, Cinisomo is now seeing his patients and his revenues disappear. "Last year at this time, I had 95 kids in my program. Today I have 55," he says. "Where are the kids? They're not showing up."
Several factors -- some intended, others not -- are conspiring to reduce care.
For years, the Greater Dallas Council on Alcohol and Drug Abuse served as the county's central intake unit for indigent adults who suffered from addiction. When those adults showed up at the council, its staff would conduct an initial chemical-dependency assessment and then would refer them to treatment, either residential or outpatient, depending on what level of care they needed and which centers had space available. For teenagers, a nonprofit organization called Dallas Challenge was an important referral agency.