Accelerate the Use of Alternative Treatment Approaches for Schizophrenics in State Mental Hospitals

The state should accelerate the use of new treatment alternatives for schizophrenics in state mental hospitals and return those who are successfully treated to the community with necessary support.

The Texas Department of Mental Health and Mental Retardation (TxMHMR) has the opportunity to empty a sizeable portion of state hospital beds due to a new drug that makes it possible for some patients to live and work in the community.

Clozaril is a new antipsychotic medication capable of radically transforming the world o f the severely mentally ill. It alleviates the symptoms of schizophrenia so effectively that many patients who formerly required institutional care can begin to live a normal life in the community. With appropriate assistance in housing and rehabilitation, many former state hospital patients can progress to full independent living and employment.

According to one clinical study, 30 percent of patients improve significantly after six weeks of therapy. The percentage increased to more than 60 percent after s ix months of treatment. Follow-up studies showed that 55 percent of the patients were able to work or go to school. 1~ The Hospital and Community Psychiatry report on the cost-effectiveness of Clozaril stated that 72 percent of the Clozaril patients discharged after their initial hospitalization were not readmitted during a two-year follow up period. The report also found that 82 percent of the patients w ho responded to treatment with Clozaril were able to function adequately at home or in community group homes and supervised living arrangements. 2~

Although the drug is comparatively expensive, maintaining patients on the drug in the community is far less expensive than maintaining them in a mental institution, and it is far more humane. Clozaril costs $478 per month. It does not cure schizophrenia, b ut only treats the symptoms of delusional thinking and hallucinations, so patients must remain on the medication.

Clozaril can also cause a potentially fatal reduction in white blood cells in 1 to 2 percent of patients, so weekly blood tests are required at a cost of $281 per month, for a total outpatient cost of $759 per month or $9,108 per year. If a patient receives Medicaid through Social Security Income (SSI) or some other form of eligibility, the state s part of this cost declines to $3,299 due to federal matching funds.

As of December 1, 1992, there were 1,493 patients in Texas state hospitals diagnosed as schizophrenics. 3~ Their average stay in the state hospital is over two years, at an average cost of about $80,000 per year. If patients successfully treated with Clozaril were returned to the community and their beds closed, the state would reduce its costs by a net of $14.7 million in fiscal 1994. More importantly, the patients could lead much more normal lives.

The New England Journal of Medicine states that Clozaril can be used safely if patients are closely monitored for side effects with tests, which include regular white-cell counts. 4~ Minnesota has provided Clozaril to 1,000 of its 4,300 eligi ble patients, and California has treated 1,300 patients with Clozaril. 5~

TxMHMR has begun limited use of Clozaril. At present, the agency has 400 inpatients and 400 outpatients on Clozaril, with plans to add an additional 264 inpatients and 528 outpatients by fiscal 1994, and 102 inpatient and 204 outpatients by fiscal 1995. Th e agency does not plan to close any of these state hospital beds due to the backlog of patients seeking admission to state hospitals. Some of these patients could be successfully treated with Clozaril as outpatients.

Adding more patients to this treatment schedule would only marginally increase any liability that the state may incur from the use of this medication and would decrease the potential liability that would occur from further delaying available treatment for these patients.

To accelerate the use of Clozaril to move patients out of state hospitals and to close their beds, community mental health resources would need to be available. For those released, TxMHMR would need to ensure adequate housing, rehabilitation and case management.

All eligible patients should receive SSI and Medicaid. SSI payments would help pay for supported housing, and Medicaid would pay for about 64 percent of the costs of case management, rehabilitation and Clozaril treatments. The state s 36 percent match for these expenses could come from the savings in removing the patients from state hospitals and closing the beds.

A. The Legislature should instruct the Texas Department of Menta l Health and Mental Retardation (TxMHMR) to accelerate the Clozaril inpatient treatment plan to give all appropriate state hospital patients a Clozaril trial by the beginning of fiscal 1994.

TxMHMR should develop a plan to begin treatments as soon as possible.

B. The Legislature should instruct TxMHMR to place patients who respond appropriately to the treatment alternative in community settings with supportive housing, rehabilitation services, case management, job placement services and drug monitoring through Community Mental Health Mental Retardation Centers, outpatient services at state hospitals or other community facilities. Care should be exercised to ensure the patients are appropriately cared for.

C. The Legislature should instruct TxMHMR to close any state hospital bed vacated by a Clozaril patient and reduce the appropriation for TxMHMR accordingly in order to recognize any savings.

The Legislature could reopen beds at their discretion to receive patients who may be on waiting lists or could use the beds for prisoners needing alcohol and drug abuse treatment in lieu of building new facilities for that purpose. This recommendation is explored in another section of this report.

D. The Legislature should increase state funding of In-Home and Family Support Services to assist Clozaril patients in the transition into the community and independent living.

Dollars identified in this recommendation should follow the patients treated with Clozaril.

If state hospital patients could mo ve into the community and their beds were closed, the state would realize substantial savings, in addition to the contributions that many of these former patients would make as employed members of local communities.

The former patients would be afforded a normal life free of the devastating effects of schizophrenia.

Some mental health-related jobs would be lost due to the closing of state hospital beds; however, other jobs would be gained in the community providing supportive services. Some jobs would a lso be gained in the community due to some patients being sent to nursing homes. If the closed beds are filled with prisoners needing alcohol and drug abuse treatment, some of the same types of jobs currently held by state hospital staff could be retained, such as directors, counselors, clinical supervisors, nurses, clerical staff and various support personnel. Beds could also be filled to meet other mental-health related needs.

Fiscal Impact
If all eligible patients in the state hospitals were given Cloz aril trials, a minimum of 35 percent could be successfully moved into the community, based on conservative statistics derived from current research. Some statistics support a higher percentage of success. At present, the state spends an average of $79,935 of general revenue funds per year for each state hospital patient.

With community psychiatric care for those eligible, Medicaid would cover 64 percent of the costs of case management, rehabilitation services and Clozaril treatments for eligible patients. The state would use general revenue for only 36 percent of these costs.

Based on these statistics, net savings to general revenue of about $30 million per year should be feasible once the program is fully operational. The program could also free-up 500 state hospital beds to alternative uses. Because of uncertainty about the t iming of implementation of the program and the positive response rate among patients, the actual fiscal impact of this program cannot be estimated.

1 Herbert Y. Meltzer, M.D., Effect of Six Months of Clozapine Treatment on the Quality of Life of Chronic Schizophrenic Patients, Clozapine: A Compendium of Selected Readings (Stanford, California, 1992), pp. 51-59.
2 Dennis A. Revicki, Ph.D., Cost-Effectiveness of Clozapine for Treatment-Resistant Schizophrenic Patients, Hospital and Community Psychiatry Vol. 41, No. 8 (August 1990), p. 853.
3 Figures provided by the Texas Department of Mental Health and Mental Retardation, Austin, Texas.
4 Ross J. Baldessarini, M.D., Clozapine A Novel Antipsychotic Agent, The New England Journal of Medicine, vol. 324, No 11 (March 14, 1991), p. 750.
5 Claudia Wallis and James Willwerth, Awakenings: Schizophrenia, A New Drug Brings Patients Back to Life, Time, July 6, 1992, p. 57.