Idaho mental health clinics sue state over Medicaid contractor’s cuts

IDAHO FALLS (Idaho Capital Sun) — Four Idaho mental health clinics are suing the state over a contractor’s plans to cut critical Idaho Medicaid services for people with severe mental illness. 

The lawsuit, filed last week in state court, asks a judge to pause Magellan of Idaho’s plans to cut specialized mobile teams that treat patients with severe mental illness who have struggled in routine settings. The cuts, providers argue, would effectively end the program, risking worsening mental health conditions and violent episodes in communities. 

“This is critical care — without their medication, these patients pose a serious threat of harm to themselves or others,” attorneys for the clinics wrote in support of their motion for a stay on the planned cut.

Magellan’s cuts, announced late last month, stem from the state’s attempts to avoid a projected budget shortfall, the Idaho Capital Sun reported. The private company, which runs Idaho Medicaid mental health benefits, plans to cut peer support services and the mobile treatment program, called Assertive Community Treatment, on Dec. 1.

Spokespeople for the Idaho Department of Health and Welfare and Magellan Health declined to comment on the lawsuit, saying they don’t comment on pending litigation. 

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Lawsuit follows outcry over the cuts

Four mental health clinics — Access Behavioral Health Services, Tueller Counseling Service, Riverside Recovery and Mental Health Specialists — filed the lawsuit against the Idaho Department of Health and Welfare. 

The providers argue that the state can’t change payment methods for the Assertive Community Treatment program “without following the required procedures; without publishing its decision and the reason for it; and without otherwise complying with applicable law.”

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Days before the lawsuit was filed, several leaders of the mental health clinics that sued the state told the Idaho Capital Sun they feared these cuts could risk violent episodes in communities. 

Many of the roughly 400 to 500 people on the program will end up homeless if the program ends, Tueller Counseling Service Clinical Director Tom Tueller previously told the Sun.

In a news release Saturday, the Idaho Association of Community Providers said the program ending would shift costs to police, jails, local governments, hospitals and emergency medical services. The group’s analysis said the program costs the state $7 million each year.

“Idaho is eliminating every evidence-based program for its highest-acuity psychiatric populations,” the analysis found. “These cuts will not save money — they will destabilize six distinct populations and shift $150-180 (million) in new costs to Idaho’s hospitals, counties, EMS systems, and child-welfare programs.”

A Change.org petition opposing Magellan’s cuts has over 7,500 signatures.

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