The Legislative Analyst’s Office has just issued the following report:
The 2015-16 Budget: Improved Budgeting for the Department of State Hospitals
This report examines the budget of the Department of State Hospitals (DSH), which provides inpatient mental health services to patients in DSH’s eight facilities. It provides an overview of the various components of the department’s budget, and details how the department develops its annual budget requests. We find several shortcomings with the current budgeting process. Specifically, we find that (1) the department has a large amount of funded beds that are not used; (2) the level of staff needed to operate DSH facilities is unclear; and (3) the budgeting methodology used by the department creates poor incentives for it to operate efficiently; and (4) other state departments have more transparent, updated, and efficient budgeting processes than DSH.
Based on these findings, we make several recommendations for the Legislature’s consideration. First, we recommend the Legislature require the department to establish or update several key components used to develop its budget to ensure that they are accurate and adequate. Second, we recommend that the Legislature direct DSH to use the updated information to develop its budget and staffing requests based on expected changes in the number and acuity (or level of care) of its patient population, as well as make adjustments to its budget if the actual population differs from its projections. Given the resources and time necessary to implement these recommendations, we also recommend that the Legislature require DSH to provide additional justification for its budget requests during the development and implementation of the new budgeting process.
The report is available using the following link:
