The 2021-22 Budget: School Mental Health

analysis full gutter The 2021-22 Budget: School Mental Health FEBRUARY 2021 Background generates roughly $2 billion annually for mental health services—mainly those administered by Schools Are Required to Provide Special counties—via a 1 percent tax on incomes over Education Mental Health Services. Students $1 million. Counties must use their MHSA funding can receive mental health services from a to offer certain programs serving all age groups. variety of sources, including schools, county These programs provide a broad range of mental mental health departments, and health plans. health services, including prevention and early Beginning in 2011-12, schools assumed intervention services, as well as full-range mental responsibility for providing mental health services health services for students with serious emotional to students receiving special education, including disturbances not covered by health plans. Counties students identified with emotional disturbance. are required to submit to the state three-year plans (Responsibility for these services was previously that report their MHSA programs and expenditures. with counties.) These services are funded through Student Mental Health Has Become an the state’s special education mental health services Increasing Concern. In recent years, numerous program, which provided schools $381 million reports indicate that an increasing number of in 2020-21. Schools can also provide other students are experiencing mental health issues. mental health services or implement school-wide In a statewide survey conducted in 2014, more interventions to provide mental health supports than three-quarters of principals cited students’ to all students. To provide mental health services, social, emotional, and mental health as a moderate schools hire their own professionals, contract or severe problem in their schools. In California’s with county mental health departments or outside biennial survey on school climate and student contractors, establish on-site school-based health well-being, students indicated higher levels of centers, or use a combination of approaches. mental health risks than in past years. For example, When schools provide services directly, they may in the most recent survey (conducted between seek reimbursement for certain mental health 2017 and 2019), the share of 7th graders who had services from Medi-Cal, the state’s health care experienced cyberbullying increased to 27 percent program for low-income residents. Beginning in from 19 percent in the prior survey. The Centers 2020-21, schools also can use funding from the for Disease Control and Prevention recently special education mental health services program reported that California had a 38 percent increase for any mental health expense. in suicide deaths in individuals between the ages Counties Also Offer Children’s Mental Health of 10 and 24 in the past decade—consistent with Services. County mental health departments are national trends. Although data are not yet available, responsible for providing or arranging for many anecdotal evidence suggests that student Medi-Cal mental health services and—relative to mental health issues have recently grown due to schools—receive reimbursements from Medi-Cal pandemic-related school closures. for a wider range of children’s mental health 2019-20 Budget Provided $50 Million to services. County mental health departments Establish a County-School Partnership Grant also receive funding from the Mental Health Program. Although both provide children’s mental Services Act (MHSA). Approved by California health services, counties and schools do not voters as Proposition 63 in 2004, the MHSA typically partner to provide school-based services. 2021-22 LAO Budget Series 1 analysis full gutter In response to the lack of coordination between partnership grant program. According to the counties and schools, the 2019-20 budget OAC, the additional funding would be provided to provided $40 million one time and $10 million the unfunded partnership applications from the ongoing MHSA funding to establish a competitive initial round of funding. The Governor’s budget grant program to encourage county-school also includes $400 million one time ($200 million partnerships and increase student access to General Fund and $200 million federal funds) mental health services. Grant funding was required for the Department of Health Care Services to to fund, at a minimum, school-based mental health encourage Medi-Cal managed care health plans services, suicide prevention services, dropout to develop partnerships with schools. (We analyze prevention services, support for students needing this proposal in our post, The 2021-22 Budget: ongoing services, and outreach to vulnerable Behavioral Health: Medi-Cal Student Services youth. The Mental Health Services Oversight Funding Proposal.) and Accountability Commission (OAC)—a state Assessment agency created by Proposition 63—administers the grants, which are awarded on four-year cycles. By State Lacks Coordinated Strategy for August 2020, OAC awarded grants to ten existing Children’s Mental Health. Given growing partnerships and eight new partnerships, while concerns over student mental health, providing 20 applications totaling $80 million in requested additional state funding to increase school-based funds were left unfunded. mental health services appears warranted. The state’s system for children’s mental health, Governor’s Proposals however, is fragmented and includes various Provides $25 Million Ongoing in entities with overlapping responsibilities. A Proposition 98 Matching Funds for County child with mental health needs could receive Children’s Mental Health Projects. The education-related mental health services from their Governor’s budget provides $25 million ongoing school and also receive services through their for schools to match dollar for dollar county MHSA health plan or county mental health department for funds spent on a children’s mental health services medical reasons. These services are often provided project. The proposal is intended to encourage with no coordination between entities. Despite their counties to dedicate additional MHSA funding to shared interests in serving children, partnerships children’s mental health services. To be eligible for between schools, counties, and health plans are a match, projects must be included in a county’s not widespread throughout the state. Furthermore, three-year plan or annual plan update and focus on the state has limited information on how counties student mental health needs. Projects can provide are currently involved in school mental health and professional development on early identification how much MHSA funding is dedicated to children’s of mental health issues, establish or expand mental health services. This fragmentation and school-based mental health services, develop lack of coordination makes it difficult for the state peer support networks and partnerships with to identify the most cost-effective ways to increase community organizations, or develop resources and improve mental health services for children. A to support family engagement and students with statewide strategy could help clarify how schools, mental health needs. The California Department counties, and health plans should coordinate of Education (CDE) and the executive director of to provide a continuum of school-based mental the State Board of Education would develop the health services and ensure that children with application process and administer the three-year mental health needs are identified and connected grants, which could be renewed. to appropriate services. Moreover, it would help Provides $25 Million One Time to Expand guide the Legislature in determining the level of County-School Partnership Grant Program. state funding to provide for children’s mental health The Governor proposes $25 million one-time services and what is the most effective way to MHSA funding for the mental health county-school allocate and target such funding. 2021-22 LAO Budget Series 2 analysis full gutter Governor’s Proposals Lack Coordination, • Unlikely to Result in Immediate Increase Duplicate Efforts. The matching funds proposal in Services. With the urgency related to shares many similarities with the existing pandemic response, the Legislature might want county-school partnership grant program— to focus on taking actions that would increase both are competitive grant programs targeted children’s mental health services in the budget to county-school partnerships to increase year. Because the new matching funds school-based mental health services. The most program is structured as a competitive grant, notable difference is that the matching funds it will take some time before additional mental are administered by CDE to schools, rather than health services are provided. For instance, through OAC to counties. It is unclear how these CDE and the executive director of the State two proposals would complement one another. Board of Education would need to develop the If the state’s efforts are not coordinated, the application criteria and process, solicit and proposals could allow a district to receive both review applications, and award the grants. a partnership grant from OAC and matching School districts would need to coordinate with funds from CDE—thus limiting other districts from the counties to include eligible projects in their accessing funds from either program. It is also three-year plan or annual update, which would unclear how the Governor’s school mental health require additional time to complete the local proposals are intended to interact with some of review and approval process. the Governor’s proposals in K-12 education that • Existing Partnerships Likely Have an could also expand access to mental health support Advantage Applying for Funds. Since they in schools. This includes the Governor’s proposal already have experience collaborating and to provide $4.6 billion for expanded learning and coordinating programs together, existing academic support and $250 million for an educator county-school partnerships may more professional development block grant. quickly and easily develop projects eligible for Lack of Detail in Matching Funds Proposal matching funds, relative to other counties and Raises Several Concerns. The Governor’s districts. From our discussions with existing matching funds proposal leaves most county-school partnerships, relationships programmatic details to CDE, with approval between county mental health departments from the executive director of the State Board of and school districts take time to build. It is Education. Given this lack of detail, it is difficult for unlikely that counties and districts could build the Legislature to determine whether the proposal new partnerships quickly enough to meet the would result in increased or improved mental application deadlines. As a result, existing health services for students. Specific concerns we partnerships are better positioned to apply for identified with the Governor’s proposals include: the matching funds. • Number of Projects Likely to Receive • Unclear Whether Counties Would Increase Matching Funds Is Uncertain. Because Spending on Children’s Mental Health the proposal requires CDE to match eligible Services. The matching funds proposal is projects dollar for dollar, a handful of large intended to encourage counties to spend counties with high-cost projects could receive additional MHSA funding on children’s mental the matching grants and entirely exhaust all health services. As previously mentioned, available funding. Consequently, it is unclear however, the state does not collect robust data how many projects would be funded under this on county-level spending on children’s mental proposal and which type of partnerships would health services. Without knowing the current be likely to receive funding. levels of spending on children’s services, it • Expanded Services May Not Be Sustainable is unclear whether the proposed $25 million Without Matching Funds, Potential to Limit Proposition 98 would match new MHSA Access to Future Funds. The matching spending or existing funding already dedicated funds proposal includes no expectations to children’s services. 2021-22 LAO Budget Series 3 analysis full gutter that expanded services would continue the one-time augmentation to the county-school after the district’s three-year grant ends. partnership grant program and require grants be Because only a subset of eligible activities awarded to unfunded partnership applications. would qualify for Medi-Cal reimbursement This would result in a more immediate increase (primarily those providing school-based mental in school-based mental health services and health services), other projects focused on facilitate greater coordination between school professional development, peer networks, and districts and county mental health departments, resource supports would be reliant on ongoing particularly while our recommended work group— matching funds. CDE could continue to renew which we discuss in detail below—completes its the matching funds grants to allow expanded work. In awarding grants, we also recommend services to continue long term. Under such requiring OAC to prioritize applications from new an approach, however, grantees from the county-school partnerships. first funding round would receive funding in Consider School Mental Health Work perpetuity and prevent new districts from Group to Coordinate Future Efforts. Given accessing matching funds. the fragmentation and lack of coordination in the current state system for children’s mental health, County-School Partnership Grants Can we recommend the Legislature establish and fund Be Expanded More Quickly. In contrast to the a work group to develop a statewide strategy for matching funds proposal, augmenting the existing coordinating services. The work group should county-school partnership grants would result in a be tasked with identifying gaps in mental health more expedited increase in school-based mental services for children, barriers to coordinating health services. With the additional funding, OAC services, best practices for interagency can award grants to the unfunded partnership collaboration (including the use of interagency applications received from the first funding round, agreements, memorandums of understanding, and without needing any additional time for another joint local task forces), sustainable revenue sources application round. This is allowed under language (including whether ongoing Proposition 98 funds included in the initial request for applications. are needed), and recommendations for a more Of the unfunded applications, ten applications coordinated statewide approach to increasing requesting a combined $35 million were from access to mental health services in school new or emerging county-school partnerships. settings. Supporting these partnerships would promote Reject Matching Funds Proposal. The more coordination of services between counties matching funds proposal largely duplicates efforts and schools, as well as allow counties to provide of other proposed programs, would require some mental health services in schools where they time to result in increased school-based services, previously had not. and could have limited impact over time and across Recommendations the state. For these reasons, we recommend the Legislature reject the Governor’s matching Approve One-Time Augmentation to funds proposal and revisit ongoing Proposition 98 County-School Partnership Grant Program. In funding for school-based mental health at a response to more immediate student mental health later time after our recommended work group needs, we recommend the Legislature approve completes its work. LAO Publications This report was prepared by Amy Li, and reviewed by Edgar Cabral and Anthony Simbol. The Legislative Analyst’s Office (LAO) is a nonpartisan office that provides fiscal and policy information and advice to the Legislature. 2021-22 LAO Budget Series 4