Cascadia’s rise and fall

Oregonian – July 10, 2008 – not online
By A G Sulzberger

Cascadia’s rise and fall

1984: Multnomah County stops providing mental health services itself and begins contracting out work to four small providers.

1990: Leslie Ford becomes CEO of one of the providers, Southeast Mental Health Network, later known as Network Behavioral HealthCare. Over the next decade, it grows from an approximately $4 million business to a $17 million operation.

2002: Peter Davidson is named county mental health director and charged with reforming the mental health system.

2001-02: Ford and Davidson partner to merge the county’s three largest mental health providers –Network, Mt. Hood Community Mental Health Center and Unity Inc. –under the banner of Cascadia.

2002-03: The rocky merger and cuts to the Oregon Health Plan lead Cascadia to lay off 300 employees.

2005: Cascadia in debt. A county review of contracts gives Cascadia a failing grade, which is later changed under pressure from county supervisors.

2006: County switches its payment model for mental health services. Cascadia struggles with new model.

September 2007: Patrick Payton, a Multnomah County employee, warns his bosses about Cascadia’s condition in increasingly dire e-mails, predicting that the nonprofit will probably need a government bailout.

October 2007: Cascadia’s new chief financial officer, Scott Dickison, quits after less than a week.

January 2008: Cascadia asks for another $500,000 advance from the county and state. Ford assures government leaders that the company is on the right track.

February: Cascadia hires Chip Burczak as chief financial officer. He raises the alarm about the depth of Cascadia’s financial problems.

April: Cascadia warns the state and county that it needs $4 million to keep operating. Both refuse to lend money. Ford resigns as part of an overhaul of the company’s executive team. The company reduces top managers by about half and company staff by about a quarter.

May: The county and state lend $2.5 million to Cascadia to keep the mental health system running after the company’s bank sweeps its cash accounts to collect debt.

June: Multnomah County releases a plan to scale back Cascadia by about a third and says more cuts will follow.

June: Cascadia Board Chairman Wayne Miya resigns.

July: Burczak resigns, saying Cascadia isn’t taking actions needed to save the company.

Cascadia changes

Cascadia provides housing, treatment and crisis services to thousands of Multnomah County residents with mental illness and addictions at any given time, about 2,500 in June alone. Since its troubles:

Personnel: Cascadia has lost more than a quarter of its work force and about half of senior managers through layoffs and resignations. The top five executives and the chairman of the board all are gone. The company now has about 1,000 employees.

Services: A plan unveiled in June calls for Cascadia to transfer nearly a third of its services and clients in Multnomah County to other providers. Washington County, its second-largest contractor, has ended all contracts with Cascadia. Marion County also is considering scaling back.

Finances: Cascadia’s budget is expected to drop from about $58 million a year to about $36 million. The company has improved accounting and billing practices. Multnomah County and Oregon Department of Human Services officials are reviewing the company’s finances.