From crisis to crisis: Report details ‘fractured’ system for patients discharged from Warm Springs

State disputes the report, advocates say state hospital policies are making homelessness worse

By: - March 12, 2023 9:57 am

Montana State Hospital at Warm Springs (Photo via Wikimedia Commons | CC-BY-SA 3.0).

Two years ago, a van carrying a woman from the state hospital in Warm Springs was heading to drop the patient off at St. Vincent de Paul in Billings, a center that helps homeless residents. The woman had been a victim of human trafficking and forced prostitution. The center is in downtown Billings.

She never made it through the front doors of the building. Police found her little yellow bag of hospital records – given to all patients upon discharge – abandoned in a gutter nearby.

Another man was dropped off in Helena – with both a van ride and yellow bag with documents from the hospital. He was traveling along with two other men scheduled for discharge from the state’s hospital. Officials in Warm Springs weren’t sure where the trio would live, so they provided sleeping bags for living on the streets.

And on Oct. 13, 2022, state hospital staff dropped Earl Sholey-Larson at the Butte Rescue Mission. It was three hours before they opened, and like normal, staff there had no idea Sholey-Larson was coming. The mission knew Sholey-Larson, but was ill prepared. They started making calls to find short-term housing and psychiatric care. Paperwork created by the hospital listed the Butte Rescue Mission as his residence, but no one there knew anything about that.

By the next morning, Sholey-Larson had vanished.

“Nineteen days after his discharge into homelessness from Montana State Hospital, Earl jumped to his death from a building in Portland, Oregon. He was 28 years old,” a report from Disability Rights Montana said.

Those are just three of the stories chronicled in a report released right before the start of the 2023 Montana Legislature. “The Yellow Bags: Discharges into Homelessness from Montana State Hospital” was a report by Disability Rights Montana that studied how the state’s mental hospital was failing to provide care for residents they were discharging, and it is based on dozens of interviews with shelters, agencies and former patients who tell a similar story: The hospital’s discharge policies can move patients into homelessness and distress.

The Montana Department of Public Health and Human Services, the state’s largest agency and one responsible for the oversight and operation of Warm Springs, denies most of the report, calling it “largely unsubstantiated from the department’s perspective.”

It also said the department reviewed the medical records of the identifiable patients in the report and said they had “the required information to provide a safe discharge and placement for these patients. This information is contrary to the accusations made in the report.”

Disability Rights Montana is the federally-designed watchdog organization charged with tracking the state’s response and care of people with disabilities, and is charged with independent protection and advocacy.

Furthermore, because of the state’s strict privacy laws, especially as they pertain to medical care, the press and public have limited access to any information about the specific individuals in the report.

The “Yellow Bags” report is an overview of a system that often leaves patients who have been discharged from the state hospital directly into homelessness, often without any communication to staff in communities throughout the state, creating crisis and potentially danger. The report lists several dozen organizations and individuals contacted, including many former state hospital patients who shared their stories, and the possessions and information they had when they left the Warm Springs facility.

The report, written by Disability Rights Montana, has two components, first to report the state of discharging from the hospital, which has drawn much attention during the past two years for its poor conditions and being cut off from federal funding. However, Disability Rights Montana Executive Director Bernadette Franks-Ongoy said, “It is our responsibility to monitor state facilities that provide care and treatment to people with disabilities. We monitor to ensure residents in facilities are not abused or neglected and receive appropriate care and treatment.”

Little yellow bags

A picture of a yellow bag that is given to patients when they leave the Montana State Hospital (Photo provided by Disability Rights Montana).

The little yellow bags that are given to patients when they leave the state hospital at Warm Springs look similar to a logo from the Golden State Warriors. Bright yellow with a blue design, they say, “hope, courage, perseverance.”

The report details that Warm Springs patients are given these familiar drawstring backpacks, often with medications, some paperwork and sometimes mental health orders. Patients then are taken by van and often dropped off near a shelter, which oftentimes doesn’t know they’re coming. In some cases, the organizations aren’t even set up to take clients overnight.

“According to providers and former patients in every major city of Montana, the state hospital at Warm Springs regularly discharges patients to homelessness, dropping them at or near facilities that cannot provide adequate care, medication management, mental health services, or sometimes, even a bed for the night,” the report said. “A similar story plays out across the state: A discharged patient with a yellow bag arrives, almost always without warning, and with little or no ‘wrap-around’ supports in place by the state hospital.”


Although the state hospital, by regulation and policy, should have a discharge plan for every patient, those plans are rarely followed, the report said. Mental health advocates note that federal oversight used to help provide more transparency about whether the Warm Springs facility was providing those things, but since the federal government stopped reimbursing Montana for Medicaid because of excessive violations and its inability to remedy the numerous problems there, advocates warn that understanding about what is going on at the state’s hospital has gotten worse, not better.

“Providers report that the discharged patients they see are almost always ‘cold dropped’ by Montana State Hospital, a phrase used to describe the practice of driving persons to sidewalks, street corners, or parking lots near shelters or crisis centers leaving them with their yellow bags and other belongings… alone and far from anyone or anything they knew,” the report said.

Often those bags contain a limited supply of medications, which had previously been administered by hospital staff. Some of the patients reported not knowing what medications they’re on. Others are given powerful, psychotropic drugs, which can be misused or sold on the street. Sometimes, they have prescriptions for medication, but don’t have money or resources to fill them, often having a printed list of providers or pharmacies in city they’re dropped, but no appointments and no means to get to those places.

DPHHS largely denies the report’s specifics and released this statement to the Daily Montanan, which is printed in full:

“To bring context to this issue, it is important to emphasize the process a Montana State Hospital patient goes through prior to discharge. Each patient is assessed by a medical professional to ensure they can be safely discharged from MSH. And, when a patient no longer meets the legal and medical criteria required to remain hospitalized at the facility, the Department cannot keep them in its custody. DPHHS works diligently to ensure patients are discharged to an appropriate level of care or their residence, and continues to work on the well-known and complicated issues associated with providing appropriate care for individuals suffering from mental illness. We welcome the opportunity to be part of the conversation in finding solutions and will continue our diligent work to address the severe challenges facing MSH created after years of neglect.”


Making homelessness worse

Patients told researcher Casey Pallister, the author of the Disability Rights report, that when they’re being discharged from the hospital, staff there tell them where they’re going, leaving the impression that arrangements have been made on their behalf. But almost always, the residents are cold-dropped at those places and staff are left completely flat-footed.

For example, God’s Love in Helena is a “working shelter” where residents are expected to work, seek employment or be on disability. The Butte Rescue Mission has an application and vetting process. Meanwhile, the Poverello Center in Missoula has a daily lottery for the beds in the morning.

“People are often dropped by MSH in the late afternoon or evening. On top of that, local pharmacies are closed then. So right away, they have no housing and no way to fill prescriptions,” said Jill Bonny of the Poverello in the report.

Providers also told Disability Rights that other patients suffered from developmental or physical disabilities that left them even more vulnerable. For example, the report chronicles individuals who were partially blind, others who had wounds requiring medical care, and even others who were in flip-flops and a T-shirt in the middle of winter.

Staff members from shelters and organizations working with homelessness and mental illness say they’re already inundated with demands from the local community. They expressed frustration with the Montana State Hospital, which continues to drop off residents without the proper “warm” hand-off, without the support, and they’re unable to stop it.

Disability Rights Montana chronicles discharge policies dating back to 1978. It has been updated at least seven times since 2000, but few of these policies seem to be followed. Jeanine Holt-Seavy, the executive director of St. Vincent de Paul in Billings, said she was so “floored” when she learned of the practices, she filed formal complaints with the Centers for Medicaid and Medicare Services, which administers federal reimbursements. The process looked to be moving forward until the state decided it would fund the hospital without help – or oversight – from the federal government, which stopped the investigations as soon as Montana backed out of Medicaid at the state hospital.

Holt-Seavy said her organization is not an overnight shelter, so they have to scramble to find housing.

“I think we should hold the state to higher standards,” Holt-Seavy said in an interview. “They don’t care because the problem went away.”

DPHHS Spokesman Jon Ebelt admitted that the transition from the Warm Springs hospital to temporary housing is “certainly not an ideal situation.”

“However, should a former patient be discharged to a shelter or mental health crisis center within the state, in lieu of other options, those shelters or mental health centers are tasked with providing a safe and appropriate environment for those former patients.”

But advocates and organizations across the state say that those shelters or centers, and the capacity to take patients, simply doesn’t exist.

In Billings, the homeless population can rise to more than 600 – far outstripping the supply of beds on any given night. Some of those beds are utilized by programs that cannot house people outside of a program. Others aren’t “low barrier,” which means that they require sobriety or other requirements.

“The root problem here is that 95% (of the homeless population) has mental health and addiction challenges,” Holt-Seavy said. “That’s the real issue.”

St. Vincent de Paul helps to get them literally off the street, and can provide a warm place and shelter from the cold. Beyond that, staff have to scramble to find them a solution that doesn’t include camping out in downtown Billings.

“These people could be anyone,” Holt-Seavy said. “Everyone – every family – has been touched by mental health issues. And there’s a growing unmet need.”

According to state hospital policies, every patient should have a “community reentry plan” and an “aftercare plan.” Those should include community contacts with a social worker following up with the community contacts to check on “aftercare services.”

“No staff at any facility said they were involved in a discharge planning process for a patient from the state hospital,” the report said. “Likewise, no staff at any facility said they were called by the state hospital to ensure a patient dropped by MSH had even arrived. Some had no idea MSH had discharge process.”

Franks-Ongoy said the answer isn’t just throwing money at the institution, although the state hospital may need more funding. However, she said that more services in local communities are needed to support residents who suffer from mental illness, homelessness or disabilities.

“We’ve got to develop community services. We can’t just put more money into institutions,” Franks-Ongoy said. “It’s irresponsible for the state government to expect nonprofit and private organizations to swoop in where the government fails. Sure, you get a tax-exempt status for them, but the bottom line is that the government is failing to provide these services.”

She said that some of the state surplus or money should be used to support housing in various communities that would help ease the burden on people and the communities.

“The counties are trying to do right by this, but think of the money that could be used to support housing,” Franks-Ongoy said. “We aren’t using this opportunity to use these funds to make investments.”

Ebelt said the patients often land in homeless shelters “having nowhere else to go – a fractured community-based continuum that DPHHS is working aggressively to fix.”

Franks-Ongoy said that some of the problem is a mindset of lawmakers and state leaders who love to tout the idea of Montanans as rugged and self-sufficient.

“They want to make it appear that all these folks need to do is pull themselves up by the bootstraps,” Franks-Ongoy said. “But not everyone can do that. People need a lift up, and the state is in the position to provide that lift up.”

Federal concerns

Although the state’s approach to patients at the state hospital seems to have been consistent, the record presented by Disability Rights Montana shows an increasingly concerned federal response. In 2013, CMS investigators found that records kept on discharging patients were incomplete on about one-third of the patients.

In 2016, CMS cited the hospital for treatment planning that was “non measurable” and also “failed to develop and document individualized treatment interventions with specific focus.” That was true for 100% of the cases federal investigators examined, and they issued a corrective action plan that included training by mental health professionals on discharge and treatment plan development.

The next year, CMS again found that the state had not made progress on developing discharge plans, including discharging a male patient who had sexual misbehavior and an inability to care for basic needs to a “wet house,” which is a residence where chronic alcoholics can drink.

In 2022, investigators found that discharge notes that were deemed unacceptable and inadequate in prior reviews dating back to 2016 were still being copied and pasted into current discharge plans.

Misty Johnson, the operations manager at the Butte Rescue Mission, said she wants the residents to understand one thing about the report: “My hope is that this ends – that the hospital is made to fix this. A homeless shelter is the solution. I just wish they understood. I want them to know that these are people. And they are dying.”

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Darrell Ehrlick
Darrell Ehrlick

Darrell Ehrlick is the editor-in-chief of the Daily Montanan, after leading his native state’s largest paper, The Billings Gazette. He is an award-winning journalist, author, historian and teacher, whose career has taken him to North Dakota, Minnesota, Wisconsin, Utah, and Wyoming.