A major client of Jackson County Mental Health is pulling its patients — putting a halt to the county's ambitious plans for expansion and new hires.

Whether layoffs will result because of the reduction in Oregon Health Plan patients served by the county is yet to be determined, mental health officials said.

Beginning in January, Jackson Care Connect, a coordinated care organization, will begin shifting its OHP clients who get mental health treatment from Jackson County Health & Human Services to other providers. 

It will begin referring adults to ColumbiaCare for outpatient mental health treatment. ColumbiaCare provides a variety of mental health services in the Rogue Valley, including residential treatment and supportive housing.

Youths will be referred to Kairos, a Grants Pass-based provider of residential and community-based mental health care.

The transition from using mental health workers employed by the Jackson County government to using ColumbiaCare and Kairos will happen over an 18-month period, said Jackson Care Connect CEO Jennifer Lind.

"We've worked really hard to minimize disruption in the community and to our patients," she said.

Meanwhile, AllCare, a coordinated care organization also serving OHP patients, will keep using Jackson County mental health workers to directly serve patients, but will shift administrative duties such as claims processing to Grants Pass-based Options for Southern Oregon.

"Our hope is there will be little change and low or no impact. We want to make sure members' needs are being seen to and we don't destabilize any systems," said AllCare Behavioral Health Director Athena Goldberg.

AllCare and Jackson Care Connect have been paying Jackson County to provide mental health services to OHP patients. The number of county residents on OHP skyrocketed from 30,000 four years ago to about 65,000 after Congress expanded coverage through the Affordable Care Act.

Jackson County received about $15 million annually from Jackson Care Connect to provide mental health care, and another $13 million from AllCare, said Health & Human Services Director Mark Orndoff.

To meet the demand for mental health services, the county has been recruiting workers from around the country and currently has the equivalent of 240 full-time mental health employees, Orndoff said.

Jackson County had been trying to fill 60 vacancies, but will now put those hiring plans on hold because of the changes with the coordinated care organizations, he said.

Orndoff and County Administrator Danny Jordan said they aren't certain yet whether the changes will lead to any layoffs of existing staff.

The county had hoped to lease a building in Ashland to provide more mental health services on the south end of the Rogue Valley, but will also postpone that expansion, Orndoff said.

Jackson County has a mental health worker embedded with the Ashland, Talent and Phoenix police departments, and another worker stationed at Southern Oregon University, he said.

The county had hoped to expand drug and alcohol treatment services and begin accepting patients with private insurance, but those plans are being reassessed as well, Orndoff said.

Lind said Jackson Care Connect and Jackson County were not able to come to an agreement during negotiations. Cost was one of the issues.

Lind said the Oregon Health Authority is requiring coordinated care organizations to do a better job of integrating physical and mental health care. Jackson Care Connect needs to stay within its budget.

She said organizations are entering an era of increasing scrutiny over the use of resources. Jackson Care Connect's goal is to increase services at a sustainable rate.

Dr. Mark Bradshaw, chief medical officer with AllCare, said Oregon has made an agreement with the federal Department of Justice to improve care for people with severe, ongoing mental health issues.

For decades, Oregon has moved to deinstitutionalize people, with the goal to shift them into community care settings. But too many people fell through the cracks, with chronically mentally ill people sometimes ending up homeless and without treatment.

Coordinated care organizations are facing deadlines to get people coming out of the state psychiatric hospital into community housing, Bradshaw said.

"We're under scrutiny to meet the expectations," he said. "We'll be under the watchful eye of the Oregon Health Authority."

Bradshaw said Options has more experience with supportive housing, but AllCare wants to keep Jackson County as the main provider of mental health services for patients.

Orndoff said Jackson County will continue to provide a range of mental health services to local residents, including Assertive Community Treatment for high-risk patients who would otherwise bounce around hospitals, the criminal justice system and sobering facilities.

The county's Early Assessment program will keep helping youths with emerging mental illness so they stay connected to work, family members and the community.

Other ongoing Jackson County mental health services include crisis services and a wrap-around program for children and their families with complex needs.

Orndoff said Jackson County and the coordinated care organizations are trying to minimize disruptions, but he remains concerned.

"We're very concerned about our most vulnerable clients and the impact of this transition," he said. "We're also concerned about impacts to our staff."

Reach staff reporter Vickie Aldous at 541-776-4486 or valdous@mailtribune.com. Follow her at www.twitter.com/VickieAldous.