Feds may cite new mental facility

A surprise visit this week could lead to loss of funding for Central Regional and Dix

RALEIGH -- Federal regulators appear poised to cite Central Regional Hospital in Butner with at least one violation, further endangering a state plan to close Dorothea Dix Hospital in Raleigh and transfer patients to the new psychiatric facility.

According to an internal memorandum written Thursday by Dr. Michael Lancaster, head of the state mental health division, inspectors who showed up unannounced at the hospital this week indicated that both Central Regional and Dix are in danger of losing federal funding.

In an apparent violation of the state's contract with the federal Centers for Medicare & Medicaid Services, the new hospital, which is not yet accredited, has been billing for federal insurance reimbursements using Dix's provider number.

Tom Lawrence, spokesman for the state Department of Health and Human Services, confirmed that the inspectors, who are state employees working on behalf of Medicare and Medicaid, are sending a report on Central Regional to the federal agency's regional headquarters in Atlanta.

It is standard for inspectors to hold an exit interview with hospital administrators, where the reviewers disclose what they found wrong. Lawrence said he would not comment on what, if any, violations the inspectors told Central Regional officials they had found.

Lancaster has not responded to messages seeking comment.

It has been a difficult year for the state's mental hospitals. Earlier this month, federal officials cut funding to Cherry Hospital in Goldsboro after the death of one patient and the beating of another. Broughton Hospital in Morganton lost federal funding for nearly a year before regaining its certification in July.

The new $138 million hospital in Butner has been plagued by technical glitches and other problems since it partially opened in July.

The inspectors were dispatched to Central Regional following complaints about a security system that frequently sends out false alarms, emergency pagers that don't work, a roof that leaks in several places and malfunctioning air conditioning that keeps the temperature in the low 60s.

In court papers this week, an elderly patient was reported to have suffered from hypothermia this month after his condition went unnoticed too long by those who were supposed to be caring for him.

Merger in jeopardy

If federal regulators in Atlanta uphold the recommendation of the inspectors in the field, as is common, it will further imperil the plan of DHHS administrators to merge the two hospitals.

A state judge issued a temporary restaining order Thursday that bars the state from moving the bulk of Dix's patients to Central Regional, a process that had been scheduled to begin Oct. 1.

Superior Court Judge Allen Baddour acted in response to a class-action lawsuit filed Tuesday on behalf of Dix patients by Disability Rights North Carolina. The advocacy group's suit detailed 15 safety concerns at the new hospital.

A hearing in the case is set for Oct. 6.

It will likely be 60 days before another federal inspection of the hospital would be done, potentially quashing any move to merge the hospitals until December.

A state law that went into effect in July mandates that Dix's patients can't be transferred until Health and Human Services Secretary Dempsey Benton can certify that Central Regional meets Medicare and Medicaid standards. DHHS officials said this week that it will cost an additional $350,000 a month to keep Dix open.

Letter's consequences

Last week, more than 30 doctors and psychologists from Dix sent a letter to Lancaster protesting the pending move as premature and risky.

In his memo Thursday, Lancaster said he would try to address the concerns of the inspectors by dissolving the management structure at Dix and folding the hospital's operations under the administration at Central Regional, a group dominated by managers from the recently closed John Umstead Hospital.

The move effectively strips authority from Dix's clinical staff, whose protest letter last week embarrassed DHHS administration and was used in court Thursday to bolster the arguments of lawyers for Disability Rights.