from the Oregonian, June 10, 2008

Multnomah County plans to dramatically reduce the scale and sweep of the state’s largest provider of mental health services, but county officials say clients will continue to get the help they need.

The future of Cascadia Behavioral Healthcare, which was propped up by an emergency government loan after it nearly collapsed in May, will have a significant effect on the rest of the safety net for people suffering from depression to drug addiction to schizophrenia.

County Chairman Ted Wheeler said the plan — likely to be unveiled this week — will transfer some of Cascadia’s clinics, employees and clients to other nonprofit providers. No services will be discontinued, but the changes will leave Cascadia providing less than 40 percent of the county’s mental health services down from about 80 percent, an aide added.

The specifics of the plan are a mystery, because it has been developed by county leaders largely behind closed doors, sparking complaints. Advocates for the mentally ill say they have been left out of the planning, and Cascadia executives say they no longer control the fate of their own company.

In May, Cascadia’s bank seized all of its cash to pay off a defaulted loan, forcing company executives to seek a last-minute $2.5 million bailout from the county and state to keep clinics open and employees paid. The company insists that it is now operating safely in the black. Cascadia replaced all of its top executives and trimmed about 450 employees — a third of its work force — through layoffs, program reductions and resignations.

Multnomah County, which was instrumental in the creation and growth of Cascadia, is pushing for even more changes. The company agreed to transfer entire programs to other providers, such as Bridgeview Community, a Portland transitional housing program that helps the seriously mentally ill prepare for independent living. Cascadia is also required to provide daily financial updates and clear every check of more than $50 with county officials.

“The county really is in the driver’s seat,” said Wayne Miya, chairman of Cascadia’s board.

Derald Walker, Cascadia’s CEO, sent his entire staff an e-mail last week lamenting that county officials were preparing to dismantle Cascadia without telling them when, how or why.

“A short while ago Multnomah County told me, and I shared with you, that ‘by the end of May, there will be some clear decision’ about restructuring Cascadia. That time came and went, with no decision,” he wrote in the June 4 e-mail. “Yesterday state and county officials told me that we can expect to hear a decision within a week. I believe that respect demands that you should first learn about such a decision from me, but I am not in control of this.”

That contrasts sharply with public pronouncements by county officials. Joanne Fuller, the county’s top human services official, told a recent meeting of mental health workers, activists and clients that Cascadia “as an organization that runs itself” will make decisions about its future. Those comments have been echoed by Wheeler’s staff.

Walker said he could not comment on the county’s actions for fear it would jeopardize Cascadia. His top priority is supporting the partnership with the county, he said. “There may be elements of the change I take issue with but the overall effort to restructure the community mental health system is more important,” he said.

But even Walker acknowledged he didn’t know when to expect a plan or what it would look like. The vacuum of public information has created widespread anxiety and fueled the rumor mill.

The county has refused to release the findings of forensic auditors hired to analyze Cascadia’s financial situation.

As the crisis was unfolding, Wheeler and his staff said the work of those special auditors would be essential to understanding the scope of the problem and would serve as a blueprint for future decisions about the company.

When Jason Renaud, a volunteer at the Mental Health Association of Portland, asked for a copy of the draft, County Auditor LaVonne Griffin-Valade replied in an e-mail that the auditors had simply provided some basic financial spreadsheets, not a formal audit.

In fact, Griffin-Valade had canceled the auditors’ inquiry into Cascadia’s finances after they provided a draft report of their findings. Griffin-Valade said that because the auditors did not complete their report — at her request — she won’t release it because it could contain errors. She said the county already has the financial information it needs.

Even Wheeler and his staff have not seen the draft report, she said.

“I still want to know what happened,” said Beckie Child, president of the Mental Health Association of Oregon. “Someone wrote a report of some sort. Why can’t that be released?”

The Oregonian has also been denied a copy of the auditors’ findings and has appealed to the Multnomah County district attorney.