A class-action lawsuit by Disability Law Colorado and three Colorado families has resulted in a settlement agreement that requires the state to set up a large-scale system guaranteeing Medicaid-insured youth up to age 21 will receive needed intensive behavioral health services.
The action is considerable, said Heidi Baskfield, an original organizer of the lawsuit and president and CEO of Speak Our Minds, a national advocacy nonprofit focused on youth mental health.
While federal law allows for medically necessary intensive home- and community-based services, up to this point Colorado has not had a cohesive, organized system for programs or funding for youth mental health care, she said.
“This lawsuit is groundbreaking in that it will ensure a more systematic approach in planning, delivery and investment, in hundreds of millions of dollars annually versus little bits of investment here and there,” Baskfield said.
Money required to support the conditions of the settlement will come from a combination of new state general fund dollars flowing through Medicaid and federal matching dollars, Baskfield said.
After “complex and collaborative negotiations … all parties agreed that their time and efforts are better spent working to improve intensive behavioral health services in Colorado, rather than litigating the case in court,” said a statement from the state’s Department of Health Care Policy & Financing. The agency administers Colorado's Medicaid programs.
Under terms of the agreement, the agency will develop “a robust implementation plan” over the next 12 months to improve delivery of such services to children enrolled in Medicaid.
The plan will be enacted over the next five years, which Baskfield said is in line with how other states have handled outcomes of similar lawsuits. Massachusetts and Illinois have been national leaders in such litigation.
“So many things need to be built,” she said. “This isn’t a quick fix; this isn’t going to take a short time.”
The goal, according to the Department of Health Care Policy & Financing, is “to create a delivery model for culturally relevant, family centered, child-driven intensive behavioral health services and supports in the most integrated, least restrictive setting.”
Those will include intensive care coordination, intensive in-home and community services, and mobile crisis intervention and stabilization services.
“The outcome of our agreement will improve upon Medicaid’s already robust services for our children with intensive behavioral health services’ needs,” Dr. Robert Werthwein, the Department of Health Care Policy & Financing’s senior adviser for behavioral health and access, said last week in announcing the settlement agreement.
Statistics show that 26,707 children under age 21 in Colorado were identified as having a severe emotional disturbance in fiscal year 2020.
However, only 223 children who had been diagnosed with a mental health disorder and found to be at risk of out-of-home placement received intensive home- and community-based services.
In some cases, intensive services in Colorado have been limited to children who have intellectual or developmental disabilities.
“We are committed to identifying stronger solutions and opportunities to meet the behavioral health needs of children and families,” Werthwein said in his statement. “This agreement demonstrates our commitment to developing that path forward.”
After implementing a new plan, fewer children with mental illness will be forced to receive care out of state or stay for extended periods in hospital emergency centers, Baskfield said.
A wide scope will be cast in creating a comprehensive system of care, from prevention of mental health problems to crisis situations and everything in between, she said.
Half a million children in Colorado are Medicaid-eligible and many stand to benefit from the outcome of the lawsuit, which Baskfield calls “significant.”
Baskfield, a former Children’s Hospital Colorado vice president, staff attorney for the state education department and founder of the Advocacy Collective at the Farley Health Policy Center at the University of Colorado Anschutz Medical Center, signed on three families as plaintiffs in summer 2021.
Children in the families had cycled in and out of hospitals, emergency rooms and psychiatric institutions due to not receiving the home- and community-based services they needed, according to the lawsuit.
Each child had a mental illness or condition and had experienced harm from not receiving service, the lawsuit states. One of the children died during the legal proceedings.
Another plaintiff, a 13-year-old boy, had been hospitalized for months with multiple psychiatric conditions, including depressive traits, mood changes, attention deficits, anxiety, attachment issues, obsessive-compulsive behavior and symptoms of autism.
Early childhood trauma and possible prenatal drug exposure also contributed to the teen’s aggression and assaultive behavior with his family and staff and peers at school, the complaint states.
The boy had many incidents of “extreme and disruptive and dangerous behavior, property destruction, self-injurious behavior including headbanging, slapping, and repeated and specific threats to harm and kill others.”
Intensive assessment and treatment services were attempted with limited or temporary success, the lawsuit says.
The teen needed intensive home- and community-based services in a residential treatment setting or facility to correct or ameliorate his mental and behavioral conditions, plaintiffs assert.
“The state of Colorado has refused and failed to arrange for or provide Intensive Home and Community-Based Residential Services, so he remains unnecessarily institutionalized,” the lawsuit said.
The third plaintiff, a 13-year-old girl, had been psychiatrically hospitalized three times since 2021 and received five in-patient placements but needed intensive home- and community-based services to address her behavioral disorders, which include major depression, anxiety disorder, insomnia, bipolar disorder and trauma.
“While the lawsuit itself only named three specific families, the state understood there were many more kids just like them, and it was better to come together to begin to fix things versus wade through a prolonged expensive litigation process,” Baskfield said.
An expert in the field will be included in developing an implementation plan and ensuring it advances, she added.
The public will be asked for input on existing gaps in the process and what should be included for youth to obtain essential treatment, Baskfield said.
So that if in the middle of the night a child has a mental breakdown, “there will be a functioning system to help meet that need, and there won’t be massive gaps,” Baskfield said. “If you end up in the ER, once the child’s condition is stabilized there will be appropriate handoffs to support the child.”
The state will be tasked with recruiting more Medicaid providers to deliver the expanded and improved services, which will “require better provider payment rates and ease of use, for the state to come in compliance,” Baskfield said. Better provider payment rates, presumably, will draw more clinicians into the field.
She expects a natural tension to emerge between the state, the system administrator and end users.
“There’s going to have to be a coming together of both sides for this to work,” Baskfield said. “The state will have to be willing and able to do what was not thought possible before, and users will have to understand the practical limitations of a state-administered system of care.”
But it’s been proven that such a system can and does work, she noted, since physical health care for Medicaid patients falls under a state-administered process.
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