What Are the Risks?

The Burns et al. 2025 study and Arizona’s program-reported data document real outcomes. So do the closure records from Arkansas, Montana, Sonoma County, and Nevada. This card documents both the positive and negative.

Documented Failures and Near-Collapses

Northwest Arkansas Crisis Stabilization Unit (2024)

A documented collapse in Arkansas: a state-funded crisis stabilization unit in Washington County closed abruptly in April 2024 after the University of Arkansas for Medical Sciences (UAMS) took over operations in 2023 and then could not sustain them.

The sequence: The state had been systematically reducing monthly operating funds: from $133,000 per month to $90,000 to $60,000, a 55% cumulative reduction. The unit was the state’s lowest-utilization facility, seeing approximately 14 patients per month at a cost of $7,860 per patient, compared to 67 patients per month at $1,761 per patient at Pulaski County. When the state cut funding again, UAMS could not make operations viable. Multiple staff members resigned before the announced June closure date. With only four employees remaining, the facility announced immediate closure on April 11, 2024, because it “wasn’t able to safely operate.”

Axios NW Arkansas documented the sequence: the prior operator had closed the facility in 2022 when it could no longer afford operations; UAMS took over as a rescue; the UAMS operation then replicated the same outcome.

Sonoma County Crisis Stabilization Unit (August 2024)

Sonoma County, California’s only dedicated psychiatric emergency facility was shut down in early August 2024 after a severe mold infestation made the building unsafe to operate. The facility was offline for nearly two months, leaving Sonoma County without any dedicated psychiatric emergency alternative to the general emergency room.

The cause was facility maintenance failure rather than funding collapse, but KSRO documented the consequence: emergency departments absorbed the volume.

Montana’s Crisis Stabilization Collapse (2020–2023)

Montana lost five crisis stabilization facilities across six years as a direct consequence of one budget decision: the 2017 special legislative session cut Montana’s Department of Public Health and Human Services budget by roughly $200 million. Western Montana Mental Health Center (WMMHC) had funded $27 million of its $40 million annual budget through Medicaid. When Medicaid reimbursement for case management was slashed, the organization began spending $3.4 million more annually than it earned. A subsequent state-commissioned study confirmed that crisis stabilization was reimbursed at $363 per day against a benchmark cost of $400 per day — a 9% structural deficit built into every patient-day.

The cascade:

Journey Home — Helena (Lewis & Clark County): Closed January 10, 2020. Lewis & Clark County declined to renew its contract with WMMHC. The sole company that bid to replace WMMHC determined that Medicaid reimbursement would cover only half the operating costs. WMMHC CEO Levi Anderson stated: “The current state is a result of the state not funding good care.”

Hope House — Bozeman (Gallatin County): County contract terminated February 2022; WMMHC ceased all Bozeman operations April 2023. Gallatin County’s own government FAQ states explicitly: “In 2017, the Montana Department of Public Health and Human Services experienced a $200 million reduction in behavioral health funding. These cuts eliminated case management services and reduced financial sustainability for crisis stabilization providers across the state.” No community-based crisis stabilization facility has replaced it.

In February 2023, WMMHC suspended crisis beds at three additional locations simultaneously — Kalispell, Polson, and Butte — eliminating 31 crisis beds in a single announcement and leaving a 147,000-square-mile state with 16 crisis stabilization beds in two cities 47 miles apart. The Montana legislature responded in May 2023 with $300 million for behavioral health — but as of early 2025, only approximately $7.4 million had been spent, mostly on planning.

The root cause in Montana is the same structural problem that closed the Arkansas unit: states set reimbursement rates below operating costs, and the gap between what Medicaid pays and what 24/7 crisis care actually costs grows until the program collapses. The Montana collapse is documented across Helena Independent Record, Gallatin County government records, Montana Public Radio, and KFF Health News.

Angela Kimball of Inseparable has described the structural dynamic the Arkansas collapse illustrates: police and fire departments are funded for capacity — they are paid to be available whether or not they respond to a call in a given hour. Crisis programs are funded primarily for encounters completed. The gap between capacity cost and encounter revenue leaves the infrastructure that makes encounters possible — training, supervision, administrative staff, facility maintenance, staff on shift between patients — without a reliable funding source.

Staffing Constraints

The Washington State HCA 2024 report identifies workforce shortage as a primary operational constraint for crisis stabilization centers.

Salt Lake City’s Huntsman facility requires 200 mental health professionals to operate at full capacity. Memphis’s 55,000-square-foot center needs 120 psychiatrists, nurses, counselors, peer support specialists, and case managers. These are not aspirational staffing levels; they are the minimum workforce required to operate the facilities that opened.

The United States has a documented shortage of mental health professionals. HRSA data identifies more than half of U.S. counties as behavioral health workforce shortage areas.

When centers cannot fill positions, they face three choices documented in the Washington State HCA report: reduce operating hours, reduce clinical capacity, or accept lower-qualified staff.

Geographic Coverage Gaps

Even in states with significant investment, crisis stabilization centers are unevenly distributed.

West Texas Mental Health Center’s facility in San Angelo serves seven counties from a single location. SAMHSA’s 2025 National Guidelines identify transportation distance as a documented rural access barrier.

Quality Variation

Not all crisis stabilization centers provide the same quality of care, and the operational floor for what constitutes a “crisis stabilization center” is not uniformly defined.

The PBS NewsHour 2024 story about Calvin Carbello, a 17-year-old Phoenix resident, documented a stabilization stay at an urgent psychiatric care clinic in Phoenix where he spent the night in chairs alongside other youth with no meaningful therapeutic intervention. His mother Kelly described it as a holding space more than a treatment facility. SAMHSA’s 2025 National Guidelines cite Arizona’s system as the national reference model; PBS NewsHour documented the Carbello account to illustrate that facility-level quality is not guaranteed by system-level investment.

Dr. Balfour’s research notes that centers which turn patients away break the trust of law enforcement referrers who need a reliable destination.

Funding Fragility

The American Rescue Plan Act (ARPA) construction funding window that drove much of the 2022-2025 center-building surge has closed. Centers that were built with ARPA funds are now operational and running on their ongoing operating budgets. The Washington State HCA 2024 report identified that the operational cost structure of facility-based stabilization centers does not align with available reimbursement mechanisms: Medicaid reimburses billable clinical encounters but not training, supervision, administrative functions, or staff on shift between patients. Arizona’s system, which has operated for over 30 years, uses a fully Medicaid-financed model documented by AHCCCS as its operational foundation.

Limited Long-Term Outcome Evidence

The revolving-door reduction that makes crisis stabilization centers’ central case has not been demonstrated in independent multi-year research. The 30-day non-reutilization figure from Arizona (63.3% of Tucson Crisis Response Center patients did not reutilize crisis or ED services within 30 days) is the best available measure and covers a single operator in a mature system. Whether crisis centers reduce the long-term pattern of repeated emergency contacts over 6 months, 12 months, or 5 years remains an open empirical question.

The Burns et al. 2025 study documents ED diversion; it does not document long-term revolving-door reduction.

The Co-Occurring Complexity Problem

Dr. Balfour’s research identifies co-occurring complexity — serious mental illness with active substance use — as a population that exceeds what voluntary living-room models can safely manage. Albuquerque’s three-zone center, which includes separate zones for different acuity levels, represents one documented design response.

The Federal Funding Cliff

The structural risks described above have been compounded by a recent shift in federal funding that any decision-maker evaluating a crisis center in 2025 or 2026 must factor in.

The American Rescue Plan Act construction window that funded many centers between 2022 and 2025 has closed. The ARPA dollars were one-time: they could fund construction and early operations, but they were not designed to sustain programs. Centers built with ARPA funds are now dependent on their ongoing operating revenue streams — Medicaid reimbursement, state appropriations, and local general funds.

The situation has worsened on the federal side. In March 2025, the federal Department of Health and Human Services terminated $1.74 billion in Substance Abuse and Mental Health Services Administration (SAMHSA) pandemic-era grants, with $542 million left unspent at cancellation. In January 2026, SAMHSA terminated approximately 2,800 additional grants, affecting an estimated $2 billion in behavioral health funding, before partially restoring some grants after significant advocacy backlash.

One concrete example of the direct impact: Renown Crisis Care Center in Sparks, Nevada, a 23-hour behavioral health crisis center, suspended services on April 10, 2025, when HHS terminated its ARPA grant. The center had no alternative revenue stream and went dark immediately. It later reopened using state 988 Suicide and Crisis Lifeline fee funds — but only because Nevada was one of the 12 states that had enacted a dedicated 988 funding mechanism. States without a 988 fee or equivalent dedicated revenue had no comparable fallback.

SAMHSA and the National Alliance on Mental Illness document that, as of 2025, only 12 states have enacted a 988 telecommunications fee generating ongoing funding for crisis services, and only five states have established recurring state appropriations for 988-linked crisis infrastructure. The Renown Nevada closure and reopening illustrates what this means in practice: programs without a non-federal revenue backstop go dark when federal grants are terminated.

The Washington State HCA 2024 report identifies diversified revenue — Medicaid for billable encounters, state appropriations for capacity costs, and local contributions for infrastructure — as the funding model associated with program sustainability.

The Pulaski County Second Arkansas Failure

While the Northwest Arkansas closure is the first documented Arkansas program collapse, a second closure in 2025 extends the failure record and illustrates that the structural problem has not been solved.

The Pulaski County Regional Crisis Stabilization Unit in Little Rock, operated by UAMS, closed July 3, 2025. UAMS declined to renew its operating contract after seven years, citing no increase in state contract funding despite rising costs for salaries, medications, and supplies, and a nursing shortage that periodically forced the organization to close psychiatric beds at its main hospital to staff the crisis unit. As of September 2025, an Arkansas request for proposals drew interest from two companies, but neither submitted complete proposals. Arkansas, which had authorized four crisis stabilization units under a 2017 law, now operates two.

The Arkansas record — two of four authorized units closed in 2024 and 2025 — is documented across Becker’s Behavioral Health, the Arkansas Democrat-Gazette, and UAMS statements. The Gallatin County government FAQ and Montana Public Radio document the same pattern in Montana.

Bottom Line

The documented failure modes are: funding collapse through encounter-based reimbursement below operating cost (Arkansas, Montana); physical infrastructure failure (Sonoma County); federal grant termination (Renown Nevada); and workforce attrition triggered by any of the above. The Washington State HCA 2024 report identifies the reimbursement-to-cost misalignment as a systemic structural issue, not isolated program failures.