The state mental hospital in Morganton has taken a first step in getting its federal payments restored after having lost more than $1 million a month because of poor care of patients.

Investigators working for the federal government inspected Broughton Hospital this week. They told the state Thursday that the problems that led the federal government to stop paying for Medicaid and Medicare patients had been resolved, said Art Robarge, Broughton's interim director.

The federal government stopped paying Broughton, about 170 miles west of the Triangle, in August. One patient died while being restrained by staff members, and another patient who was supposed to be closely supervised was badly hurt in a fall.

The hospital has been working since then to correct problems so it could reapply for federal money. The head of the state Department of Health and Human Services appointed a team to supervise improvements, and the former hospital director was demoted.

Inspectors found new issues this week. For one, they recommended better oversight of specialists under contract who treat hospital patients.

Robarge said the hospital would start today on a plan for systematic oversight of specialists' reports.

Investigators must return for more inspections before the hospital has a chance to regain its federal funding. Robarge said he did not know how long it would take.

"We're going to accelerate our part of it," he said. "You can well believe it."