Embattled Cardinal Innovations announces merger with Vaya Health

MECKLENBURG COUNTY, N.C. — Cardinal Innovations announced on Tuesday that a merger with Vaya Health is in the works.

Vaya Health, which manages services for patients in 22 counties across North Carolina, will assume responsibility for coordinating services and supports for Cardinal Innovations members if approved by the NC Department of Health and Human Services and county representatives, according to the release.

The announcement comes as Mecklenburg County attempts to join the ranks of several local counties that have severed ties with Cardinal over claims of mistrust and lack of care.

Channel 9 has reported on issues with Cardinal Innovations for months. County leaders say the group is failing with some children waiting in emergency departments for more than 200 days for a spot at a residential treatment facility. Other people are struggling to get substance abuse treatment. The county wants to switch to Alliance Health, but it needs state approval first.

The county cites numerous reasons for wanting to disengage. Here are a few:

  • A fragmented discharge planning system for people experiencing behavioral health issues
  • Lack of appropriate placements for youth and adult wards
  • Delayed treatment authorizations

In September, Stanly County was approved to cut ties with Cardinal after the county manager said he pushed for more services --especially for children in foster care -- for years with no progress.

Union and Cabarrus counties have also voted to stop doing business with Cardinal over similar concerns.

Mecklenburg County voted Tuesday evening to separate from Cardinal, but it will not go into effect immediately.

“I think they have reached a level of frustration that says, ‘What do we have to lose,’” said Mark Boats, associate professor at UNC School of Government.

Bolt specializes in mental health law.

“I think some of the problems are systemic, the way the system is designed,” Bolt said.

The state will still have to sign off on the vote and county leaders will take public comment for 60 days. The vote was 9-0 in favor of disengaging from Cardinal Innovations. One commissioner withdrew themselves from the vote.

“I think it has gone on long enough,” commissioner Pat Cotham said. “Sometimes you have to fish or catch bait.”

State officials believe Cardinal’s decision to merge with Vaya was because big counties like Mecklenburg and Forsyth want to split with the company.

If that happens, Botts said, “The other option is for Cardinal to disappear completely and all the Cardinal counties join other public mental health agencies. And then you don’t have to worry that Cardinal has only a few counties left and not a sufficient population base

Cardinal Innovations is an LME, or governmental entity, which coordinates patient care with providers for everything from substance abuse to other mental health needs.

“Ironically, the other LME that there have been the most problems with, besides Cardinal, is the very LME that Cardinal plans to merge with,” said attorney Doug Sea.

Sea has sued Cardinal to try and get care for families who have been denied.

Sea said he thinks the commissioners made the right move and even though management at Cardinal has changed, it’s too late.

“The prior leadership, which was infamous and still under legal investigation and lawsuits, drove away so many good providers and created such a bad culture, the new leadership had a hard time trying to adjust to all of that,” Sea said.

The company said in a news release that the merger is in preparation for North Carolina’s transformation to Medicaid managed care in July. Both managed care organizations said they have been preparing to evolve their operations to offer fully integrated care for people with a serious mental illness, a serious emotional disturbance, a severe substance use disorder, an intellectual/developmental disability, or a traumatic brain injury.

“We believe that when we work together to meet the needs of our communities, we all benefit,” said Brian Ingraham, Vaya Health President & CEO. “Our number one priority throughout this transition will be to support members, providers and counties and avoid any disruption in care. We remain committed to offering a successful public service option as a Tailored Plan. It is a privilege to have the opportunity to strengthen the public model, support our county partners and serve even more North Carolinians on their journey toward health and wellness.”

The merger is expected to be completed by June 30, 2022. This would be Vaya’s fourth merger.

Cardinal Innovations sent the following statement to Channel 9:

“Our greatest hope is that through the process, Mecklenburg County truly listens to our shared consumers in Mecklenburg County – those that will be the most impacted by change – and that any actions they take reflect the will of their constituents. We believe that Vaya can be a strong partner to the county, and their focus on local relationships and local presence would be welcome in Mecklenburg.”

NCDHHS sent the following statement to Channel 9 following the merger announcement:

“DHHS has been actively engaged to ensure the thousands of consumers currently served by Cardinal Innovations continue to receive needed supports and services. The decision of Mecklenburg County to vote to request disengagement from Cardinal Innovations and the recent vote by Forsyth county to disengage from Cardinal introduced uncertainty and instability for the Cardinal organization and those they serve. We appreciate the boards of Vaya and Cardinal working rapidly to reach an agreement to consolidate to provide stability for beneficiaries and families. We will work closely with the boards and staff of each organization to better understand and work through the details of this transition.

There is still much work to be done. DHHS will continue to work with the counties who have requested disengagement and work with the NCACC to determine if additional counties are considering disengagement and the best process for moving forward. Throughout the process we will actively engage consumers, families, and providers for input.”

(WATCH: Mecklenburg County seeks to part ways with Cardinal Innovations)