Hochul announces details of $1 billion plan to 'overhaul' New York's continuum of mental health care

Plan to increase inpatient psychiatric treatment capacity, boost insurance coverage and dramatically expand outpatient services

√ Investments said to create transitional & supportive housing to serve New Yorkers with mental illness; create systemic accountability for hospital admissions and discharges

Gov. Kathy Hochul has announced details of her comprehensive, $1 billion multiyear plan to “overhaul the continuum of mental health care and drastically reduce the number of individuals with unmet mental health needs throughout the state.”

Her team said, “First outlined during the 2023 State of the State last month, the plan aims to dramatically expand access to mental health care, reduce wait times, and ensure appropriate levels of care to correct a mental health care system that has suffered from chronic underinvestment.”

Hochul said, "New York state's mental health care system was strained and suffering from years of underinvestment even before the global pandemic exacerbated the problem and made things worse. New Yorkers who struggle with mental illness deserve a system that is suited for and responsive to their needs. From creating transitional and supportive housing to expanding our comprehensive network of outpatient services, this bold plan is aimed at providing the funding and resources needed to ensure everyone in our state can access high-quality mental health care."

The plan includes $890 million in capital and $120 million in operating funding to establish and operate 3,500 new residential units for New Yorkers with mental illness. These units include 500 community residence-single room occupancy units, which provide housing and intensive services to individuals with serious mental illness who are at the highest risk of homelessness; 900 transitional step-down units; 600 licensed apartment units serving individuals who require an intermediate level of services.

Also funded through this allocation are 1,500 supportive housing units, which serve individuals with a serious mental illness who have less acute needs but still require support to live in the community. In addition, the plan includes $25 million in capital and $7.3 million in operating costs for 60 community step-down housing units in New York City to serve formerly unhoused individuals who are transitioning from inpatient care.

Hochul is proposing to invest $60 million in capital and $121.6 million operating funding to “dramatically expand” outpatient services. This includes establishing 12 new comprehensive psychiatric emergency programs providing hospital-level crisis care; tripling the number of certified community behavioral health clinics in New York, from 13 to 39, that offer walk-in, immediate integrated mental health and substance use disorder services for New Yorkers of all ages and insurance status; creating 42 additional assertive community treatment teams to provide mobile, high intensity services to the most at-risk New Yorkers, plus eight additional safe options support teams – five in New York City and three in the rest of state – to provide outreach and connection to services for homeless populations with mental illness and substance use disorders; and expanding capacity at 20 Article 31 clinics that provide core mental health services serving the most vulnerable New Yorkers.

The plan also includes requirements that hospitals responsibly admit and discharge patients, with new, comprehensive standards for evaluation and increased state-level oversight to ensure that new protocols are being used effectively. To ensure the success of these new requirements for discharge planning, a $28 million investment will create 50 new critical time intervention care coordination teams to help provide wrap-around services for discharged patients – from housing to job supports.

Additionally, an investment of $2.8 million will expand the intensive and sustained engagement treatment program to offer peer-based outreach and engagement for adults with serious mental illness. The plan invests $3.3 million in the individual placement and supports program will ensure that the Office of Mental Health expands the use of this evidence-based model of supported employment for adults with mental illness.

A press release stated, “Hochul will advance legislation to close gaps in insurance coverage for behavioral health services and prohibit carriers from denying access to medically necessary, high-need, acute and crisis mental health services for both adults and children, including medications for substance use disorder. In addition, Gov. Hochul will introduce legislation requiring commercial insurance providers to pay for school-based services at a level equal to the higher paying Medicaid rate, to ensure timely access for all children.”

Additionally, Hochul is proposing to adopt appointment availability and geographic accessibility standards for behavioral health services. This will require payment parity for behavioral health telehealth services, and mandate the use of OMH-designated medical necessity criteria and tools and authorize lawsuits by insureds for state law parity violations.

Hochul is also proposing a $20 million expansion of mental health services in schools by increasing Medicaid payment rates for school-based satellite clinics, and a $10 million investment to expand school-based wraparound services – including an annual investment to provide the start-up funding necessary to get new and expanded school services in operation quickly. The plan also includes an additional $12 million to expand the HealthySteps program and home-based crisis intervention teams, and $10 million in grants to suicide prevention programs targeting high-risk youth.

New York State Office of Mental Health Commissioner Dr. Ann Sullivan said, "Gov. Hochul's executive budget includes proposals and resources that will expand, strengthen and revitalize the state's behavioral health care system in ways that were not possible in previous years. It provides us with new policies and programs that will increase access to housing and to outpatient and inpatient services, and gives us the tools we need to expand school-based mental health clinics, reduce racial inequities in health care and close gaps in insurance coverage for mental health services. I applaud Gov. Hochul for her historic commitment to strengthening the continuum of mental health care for all New Yorkers."

Hochul discussed her plan during a visit to Montefiore Medical Center's Albert Einstein College of Medicine. The Montefiore Health System is one of only a few hospital systems throughout the state that kept operating all of its psychiatric beds during the COVID-19 public health emergency.

The press release stated, “New York state allowed these hospitals to make operational decisions during the public health emergency that resulted in many of them taking inpatient psychiatric beds offline in order to manage the demand for medical/surgical beds. Roughly 850 of these beds, including 450 in New York City, remain offline today, despite the expiration of the state's public health emergency in 2021, and the growing demand for inpatient psychiatric services.”

New legislation will allow the state Office of Mental Health to fine Article 28 community hospitals up to $2,000 per violation per day for failing to comply with the number of psychiatric beds outlined in their operating certificate. Hochul's plan also provides $18 million capital and $30 million operating funding to expand inpatient psychiatric beds, including opening 150 new adult beds in state-operated psychiatric hospitals, “representing the largest expansion at these facilities in decades.”

Hochul's plan provides an additional $60 million to support the 988 Suicide and Crisis Lifeline – an increase of $25 million from the prior budget. To support the workforce, the plan provides $5 million for the Office of Mental Health's Community Mental Health Loan Repayment Program, expanding the eligibility for the program to include licensed mental health professionals and building on the $9 million included for psychiatrists and psychiatric nurse practitioners when the program was launched in 2023.

The governor will introduce legislation to create a qualified mental health associate credential, which will provide a career ladder and additional training for mental health paraprofessionals, allowing them to work more independently and improve quality and access to care in OMH funded and licensed settings. In addition, Hochul has proposed 2.5% cost of living adjustment, marking the second year she has included a COLA in her budget – “demonstrating her commitment to increase support for these critical programs and workers.”

State Sen. Nathalia Fernandez said, "The Governor's budget proposals for mental health reflect a long-overdue seriousness that is on par with the issue itself. The sizable increase in spending from 2023 should net a wave of positive results for the inseparable issues of mental hygiene and substance abuse. I am encouraged to see Gov. Hochul take this step. To continue to make a difference in the future, we need intergovernmental coordination between city, state and federal officials, as well as increased funding through multiple agencies where mental health and substance abuse coincide."

Unique People Services Executive Director Yvette Brissett-André said, "Governor Hochul has provided a real plan for the future that supports the life-saving work performed by organizations serving the needs of vulnerable New Yorkers. Her investments in community-based services and supportive housing will help many children, adults and families realize their full potential and thrive in the communities they call home."

Montifiore Medical Center President Dr. Philip Ozuah said, "In her first address as governor, Kathy Hochul pledged to be a champion and an advocate for all New Yorkers. Her budget proposal, and her commitment of $1 billion to address mental health challenges, delivers on that promise. I'm grateful that she chose to unveil her plans here at Montefiore/Einstein and for the gratitude she showed to our community."

Mental Health Association of New York State CEO Glenn Liebman said, "Gov. Hochul and Commissioner Sullivan have created a bold mental health vision for the future that includes housing, youth mental health and insurance parity. We are very supportive of this commitment to strengthen and transform the mental health care system, and will continue to work with the governor and Legislature on our priorities as the budget process continues."

NAMI-NYS Interim Executive Director Sharon Horton said, "NAMI-NYS applauds Gov. Hochul for both making mental health a true priority in her budget proposal and for discussing how mental health issues have negatively impacted her family in her budget address. NAMI-NYS thanks the governor for advancing measures that align with our leading advocacy priority; the need to expand access to mental health supports and services; and adopting recommendations that NAMI-NYS has been making for more than a decade. The governor's plan boldly aims to increase access for all of those across the broad spectrum of psychiatric disorders by funding both in-patient and community-based services. We are also encouraged to see the governor aim to improve hospital admission and discharge practices – which NAMI-NYS have long been critical of – as well as addressing the lack of insurance parity, which keeps people from accessing services and expanding mental health services for New York's Children."

Institute for Community Living President and CEO Jody Rudin said, "Gov. Hochul's plan invests in the right places, along the continuum of evidence-based programs, from prevention to permanency. It smartly increases funding for youth mental health services, programs like ACT, SOS and CTI that support the hardest to treat, and for more housing with wraparound services, which is the best prescription a doctor can write. It is a transformational plan that has the power to move us from a fragmented system to a comprehensive one by building on community-based, trauma-informed programs that help people get better."