Nebraska providers say federal and state shifts threaten community mental health model

A hospital without walls is how Jessie Stallings describes Heartland Family Services.

She’s the organization’s clinical director of certified community behavioral health clinics. HFS offers services for individuals dealing with mental health or substance abuse challenges. Those range from peer support to crisis services and assertive community treatment.

“We have a psychiatric nurse practitioner, a therapist, a substance use specialist, peer support, all sorts of services under that umbrella, and they literally will go meet people by the river to make sure that they get their injection of their psychiatric medication or to check in and see how they're doing,” Stallings said.

That’s all through the certified community behavioral health clinic model, which focuses on integrated behavioral health care. HFS is one of seven CCBHCs in the state.

“We are able to really literally meet people where they are,” Stallings said.

The CCBHC model was officially established in 2014, when federal lawmakers passed the Protecting Access to Medicare Act, creating the CCBHC Medicaid demonstration and the CCBHC certification criteria.

Nebraska adopted legislation to implement the CCBHC model in 2023

But that model is now under threat – both from a federal memo and changes on the state level.

The federal memorandum from the Department of Justice – quietly released June 18 – suggests a changing opinion on access to care for Americans with disabilities and mental illness.

It all comes down to the 1999 Olmstead v. L.C. decision, which said individuals with mental and developmental disabilities have a right to integrated community care.

And on July 20, the DOJ took it a step further, publishing a notice that Olmstead guidance isn’t enforceable. It said it’ll revisit guidance under “a narrower reading of federal law.”

While the federal memo doesn’t change federal or state law, it suggests a shifting in a longstanding opinion on protections for people with mental health conditions, those who work in the industry say.

“They are moving towards mandated treatment, which can only be read as ‘or else,’ right, and that ‘or else’ is said to be incarceration and or institutionalization,” said Ryan Carruthers, executive vice president and chief clinical officer of CenterPointe, another Nebraska-based CCHBC.

Aileen Brady, the chief executive officer for CCHBC provider Community Alliance, said there’s concern regarding the federal memo.

“It signals that there may not be the continued effort to give people the right support in the community, and that's of concern,” Brady said.

She’s seen how Olmstead made services available for people in their communities.

“We do not want to move people into higher levels of care when they don't need that,” Brady said. “We want people to be able to live in the community near their families, near where home is for them.”

In 2024, Nebraska was found in violation of Olmstead by the DOJ’s Civil Rights Division after a three-year investigation. It found the state “over-relies on segregated service settings to serve people with (serious mental illness).”

Carruthers said there was a plan put together to move people out of institutionalization faster following the investigation.

“That plan was abandoned shortly after the new (Trump) administration came in, which made us wonder if there weren't some back conversations about, ‘oh no, we're not going to enforce Olmstead anymore,’” Carruthers said.

Nebraska had seemed to have embraced the CCBHC model.

At a Legislative Health and Human Services Committee hearing in February 2023, Gov. Jim Pillen crossed the political aisle, testifying in front of the committee in support of the bill.

“This bill is really important for us to step up and help and we need more mental health

specialists. The good news would be several years ago, the federal government created the program that especially designated outpatient centers called the certified community behavioral health clinics,” Pillen said at the time.

“So I'm here in total support of LB276 because of creating the certified community-based health clinics under the federally funded model,” Pillen said.

After testifying support, Pillen would later sign the bill into law.

He said the legislation would “help transform mental health and substance abuse services in Nebraska,” calling it a “no-brainer.”

At a 2025 press conference, Pillen called CCBHCs, “the next innovative step in providing all Nebraskans with high-quality and integrated behavioral healthcare appropriate to their needs.”

But now, as DOJ action looms, proposed state-level changes have providers thinking support for the model might be waning.

Proposed definitions of care

Nebraska DHHS is working on revising the proposed definitions of care under CCBHCs along with the pay model. The reason for new definitions is to create a standardized set of service definitions for payers, Medicaid and the Division of Behavioral Health.

They were set to go into effect July 1, but after concerns from Nebraska CCBHC providers, they’ve been delayed. DHHS officials told Nebraska Public Media News they will release service definitions in the “coming months after completing a thorough review.”

Brady from Community Alliance said when those proposed definitions came out in January, her and other providers were surprised due to significant changes and raised staffing requirements.

“It would have reduced, or in some cases, some agencies talked about eliminating programs, and we didn't believe that it was in the best interest of the people that we were serving,” Brady said.

Other CCBHCs expressed similar sentiments.

CenterPointe’s Carruthers said it hasn’t been a transparent process as the definitions are changing.

“CCBHCs have been kind of left feeling like there's a little bit of a bait and switch by the state of Nebraska,” Carruthers said.

He said the concern level among the behavioral health system in Nebraska has been a “10 out of 10” regarding those definition changes.

And to Brady, the future of behavioral health is the CCBHC model.

Brady said the beauty of the CCBHC is the framework gives a structure around holistic care, but it gives flexibility to implement care around the community’s needs.

“I personally hope that we don't return to that higher institutional level of care. You know, I've seen it in Nebraska when we brought people who had been hospitalized at our state hospitals for many many years. I saw when they were able to come to the community and get the right supports at the right time, how they did very very well,” Brady said.

At HFS, Stallings said regardless of what the federal government says, her organization knows clinically that the best place for people to receive treatment is in their community.

“We're still going to work to help people stay in their community, to not get hospitalized, to not get institutionalized, because it's important to us to be able to help them stay with the people and places they're comfortable with,” Stallings said. “We know that's most successful, and we also believe that choice and autonomy are important in treatment.”