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Economist: Mental Health Center would save EBR millions

If residents with mental illness and substance abuse problems were treated instead of jailed, East Baton Rouge government would directly save millions of tax dollars and accumulate secondary benefits, an economic analysis commissioned by the Baton Rouge Area Foundation concludes.

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Basing his research on an effective model in San Antonio, economist M. Ray Perryman calculates that an EBR jail diversion program would save $3 million in taxes in year one and $54.9 million over 10 years.

Perryman was hired by the Baton Rouge Area Foundation, which is collaborating on a project with local law enforcement officials and behavioral health experts to decriminalize mental illness.

This initiative is addressing a problem: the shuttering of Earl K. Long Medical Center in 2013 and trimming of other mental health services has left people in crisis nowhere to go. Too often, when they break minor laws, police have no choice but to jail them.

Researching options, the Foundation came upon diversion programs that were lowering government payments in other cities; it’s less expensive to treat people who are mentally ill or abuse drugs than to incarcerate them.

The Foundation asked Perryman to establish whether East Baton Rouge would benefit as well.

Treatment instead of imprisonment, he concludes, would offer fiscal and economic benefits from two sources: 1) Direct savings of $3 million in the first year, $8.1 million per year at maturity, $26.4 million total over five years and $54.9 million over 10 years. 2) Higher productivity and smaller secondary costs to the community of $15.9 million in the first year, $42.4 million per year at maturity and $288.7 million over 10 years.

People who are treated can be employed and productive. That also reduces secondary costs associated with homelessness, poor health and shorter lifespans.

Perryman says Bexar County, where San Antonio is located, has among the most efficient diversion programs. A top reason is security officers there are trained to recognize mental illness and drug abuse problems. With that knowledge, they can drop off minor offenders to the county’s treatment center, bypassing jails altogether.

Earlier in May, a Foundation committee proposed a continuum of services and a treatment center for EBR that uses Bexar County’s model as its reference. The EBR proposal recommends a Recovery and Empowerment Center with triage and assessment services, a sobering unit, a detox center, peer-run respite center for residents who are near a crisis, case managers, and a medical stabilization unit.

About Dr. Perryman: Dr. Perryman is founder and president of The Perryman Group, an economic and financial analysis firm headquartered in Waco, Texas. His economic modeling systems form a basis for corporate and governmental planning around the globe. He has also authored several books, including Survive & Conquer, an account of the Texas economy during the turbulent 1980s, and The Measurement of Monetary Policy, a treatise on Federal Reserve activity. He is a Fellow of the International Institute for Advanced Studies and has received the Institute’s prestigious Lifetime Achievement Award