Governor Hochul Announces Passage of $1 Billion Plan to Overhaul NY’s Continuum of MH Care

May 3, 2023

For Immediate Release: 5/3/2023 GOVERNOR KATHY HOCHUL


FY 2024 Budget to Increase Inpatient Psychiatric Treatment Capacity, Dramatically Expand Outpatient Services and Boost Insurance Coverage    

Transformative Plan Represents Largest State Investment in Comprehensive Mental Health Care Since the Deinstitutionalization Era of the 1970s    

Governor Kathy Hochul today announced a $1 billion transformative, multi-year investment to overhaul the State’s continuum of mental health care and drastically reduce the number of New Yorkers with unmet mental health needs. As part of the FY 2024 Budget, the plan will correct a system that has suffered from decades of chronic underinvestment by dramatically expanding access, reducing wait times, and ensuring appropriate levels of care are provided to those who struggle with mental health issues. The Budget will provide funding for new residential units, increase inpatient capacity, and dramatically expand outpatient services. In addition, there will be investments in peer-based outreach, an expansion of school-based mental health services, and the closing of gaps in insurance coverage for behavioral health services.

“Decades of chronic underinvestment has allowed far too many New Yorkers to fall through the cracks in our State’s mental health care system,” Governor Hochul said. “The plan to fix our State’s continuum of mental health care marks a monumental shift in our approach, reversing years of neglect to our system and bringing bold investments to ensure that everyone in our state has access to the high-quality care they deserve. Today, we mark a new era in our state, making the mental health needs of all New Yorkers a top priority.”   

The Budget provides $890 million in capital and $120 million in operating funding to establish and operate 3,500 new residential units. The additional 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 and 600 licensed apartment units serving individuals who require an intermediate level of services; 1,500 supportive housing units serving individuals with a serious mental illness who have less acute needs but still require support to live in the community. Also included is $25 million in capital and $7.3 million in operating costs for 60 community step-down housing units in New York City, which will serve formerly unhoused individuals transitioning from inpatient care.  

The Budget will provide $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. In addition, the Budget provides the State Office of Mental Health with increased authority to sanction Article 28 community hospitals for failing to comply with the number of psychiatric beds outlined in their operating certificate, which demonstrates the Governor’s commitment to ensuring that beds taken offline during the COVID-19 pandemic are restored to operation immediately.

To expand outpatient services, the Budget invests $60 million in capital and $121.6 million operating funding, which will establish 12 new comprehensive psychiatric emergency programs providing hospital-level crisis care and triple the number of State-funded Certified Community Behavioral Health Clinics statewide -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.  

This funding will also create 42 additional Assertive Community Treatment teams for children and adults to provide mobile, high intensity services to the most at-risk New Yorkers and 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. The capacity at 20 Article 31 clinics will be expanded, providing core mental health services for the most vulnerable New Yorkers.   

An investment of $28 million will help create 50 new Critical Time Intervention care coordination teams to provide wrap-around services, from housing to job supports, for individuals needing transition assistance, including children and adults discharged from hospitals and emergency rooms. This investment will ensure the success of new requirements for hospitals to responsibly admit and discharge patients, including comprehensive standards for evaluation and increased state-level oversight to ensure these protocols are being used effectively.

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. An additional $3.3 million will be invested in the Individual Placement and Supports program, ensuring the expanded use of this evidence-based model of supported employment for adults with mental illness.   

The Budget provides $30 million to expand mental health services for school-aged children throughout the state, including $20 million for school-based mental health services and $10 million to implement wraparound services training. Additionally, the Budget includes $10 million to strengthen suicide prevention programs for high-risk youth.  

In addition, the Budget allocates $18 million over two years to reimburse providers for family preventive mental health services for parents and their children; and $24 million over two years to reimburse providers for adverse childhood experience screenings.  The FY 2024 Budget also builds on investments made in the FY 2023 Budget, including $12 million for HealthySteps and home-based crisis intervention programs to promote early childhood development and treatment for children and teens; and $3.1 million to bolster treatment for individuals with eating disorders.

The Budget also 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 Budget includes a 4 percent cost of living adjustment and an additional $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.

In addition to providing critical funding, the Budget also closes gaps in insurance coverage that have posed a barrier to New Yorkers needing mental health care and substance use disorder services. Under the changes outlined in the Budget, commercial insurance plans must adopt network adequacy standards for behavioral health services; cover life-saving mobile crisis, crisis intervention, and post-discharge services, those provided in school-based mental health clinics, and life-saving addiction medication treatments and overdose reversal medications that are available over the counter; and follow utilization review standards that prohibit preauthorization or concurrent reviews for the first 30 days of mental health treatment for adults in an in-network inpatient hospital or crisis residence.