Mental Health Care Crisis

Issue

Minnesota’s mental health care system is struggling to meet growing demand. More than 800,000 adults in the state have a mental illness, yet nearly one in four of those individuals do not receive the care they need. Despite landmark legislation in 2021, significant gaps persist. 
 
A core challenge is that hospitals have become the default mental health crisis providers. Because hospital emergency departments operate 24/7, and community-based mental health resources are limited, patients in crisis often have no other optioneven when a hospital setting isn’t the most appropriate level of care. This places strain on emergency departments while leaving patients without access to specialized services better suited to their needs. 
 
Compounding this issue is chronic underpayment for mental health services. A 2024 Minnesota Department of Human Services rate study confirmed that reimbursement rates from public programs fall short of actual costs, making it difficult to recruit and retain mental health professionals and expand services to meet demand.

Impact

  • Of the 800,000 adults in Minnesota who have a mental illness, 200,000 did not receive mental health care.
  • A 2024 Minnesota Department of Human Services rate study confirmed underpayment of mental health services as a barrier to meeting patient demand and sustaining the workforce. 
  • Adolescent mental health services requiring residential treatment represent an area of critical need.

Policy Solutions

  1. Improving payment rates: State and federal programs, including Medicare, Medicaid, and MinnesotaCare, as well as commercial insurers, must increase reimbursement for mental and behavioral health services. 
  2. Expanding Psychiatric Residential Treatment Facilities (PRTFs): Increase availability and staffing for adolescents who need a high level of care but not inpatient services. 
  3. Funding EmPATH units: Emergency Psychiatric Assessment, Treatment, and Healing units offer alternatives to emergency rooms for mental health crises and reduce hospital admissions, but currently lack Medicaid funding eligibility.
Photo of the Minnesota State Capitol

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