Feds to N.C.: Clean Up Mental Health System

The federal government has held back at least 138 million dollars in payments to North Carolina's mental health treatment system until it's persuaded the state has fixed problems.

The state Department of Health and Human Services says federal regulators notified the agency of its decision to defer a quarterly payment for community support services.

Federal officials say the amount is 175 million dollars, while state officials say the amount is likely to be reduced to 138 million dollars.

State officials have acknowledged that private providers of the new program overcharged the state or provided poor care, leading to millions in wasted taxpayer dollars.

Federal officials want to see a corrective plan before it releases the funds.


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