Executive Committee - Special Meeting — Agenda Packet

1 EXECUTIVE COMMITTEE SPECIAL MEETING Wednesday, March 4, 2026, 8:30 AM ADMINISTRATION BUILDING - ROOM A-200 121 W. MAIN STREET, PORT WASHINGTON, WI AGENDA A. CALL TO ORDER B. PROPER NOTICE C. PUBLIC COMMENTS, CORRESPONDENCE, COMMUNICATIONS D. ACTION ITEMS 1. Resolution: Creation of an Ozaukee County Department of Human Services Dual Diagnosis Day Treatment Center Using Ozaukee County Opioid Settlement Funds 2. Budget Amendment 2026 – Transfer of $600,000 of Opiate Settlement Funds to Day Treatment Center E. NEXT MEETING DATE March 30, 2026 F. ADJOURNMENT Page 1 of 13 Item: D.1. Agenda Item Information Sheet To: EXECUTIVE COMMITTEE From: Jason Dzwinel, County Administrator, Kellie Kretlow, County Clerk Meeting Date: March 4, 2026 Department/Office: Dept of Administration Item Name: Resolution: Creation of an Ozaukee County Department of Human Services Dual Diagnosis Day Treatment Center Using Ozaukee County Opioid Settlement Funds Summary: Resolution was proposed and reviewed by the Health and Human Services Committee on March 3, 2026 meeting for Executive Commitee and County Board final approval. Proposed One-Time Use of Opioid Settlement Funds - Integrated Behavioral Health Day Treatment (Dual Diagnosis) Program –Ozaukee County Recommended Action: Approve Attachments: 1. Day Treatment Center Resolution 2. Dual Diagnosis Support Document (2) Page 2 of 13 RESOLUTION NO. 25- CREATION OF AN OZAUKEE COUNTY DEPARTMENT OF HUMAN SERVICES DUAL DIAGNOSIS DAY TREATMENT CENTER USING OZAUKEE COUNTY OPIOID SETTLEMENT FUNDS WHEREAS, in 2021, a nationwide settlement agreement was reached by and between several pharmaceutical companies and a class containing most states, counties, and several cities and municipalities; and WHEREAS, in 2021, the Governor signed 2021 Wisconsin Act 57 which outlines the distribution and use of Wisconsin’s share of settlement funds of over $780 million through 2038, with 70% of the proceeds being allocated to 87 local governments that participated in the litigation; and WHEREAS, the Ozaukee County Board of Supervisors have adopted various resolutions authorizing settlement agreements with pharmacy retailers, manufacturers and distributers of opioids; and WHEREAS, the balance of the Ozaukee County Opioid Settlement Special Revenue Fund, is $1,489,000 as of December 31, 2024; and WHEREAS, the Ozaukee County Opiate Settlement proceeds will total $3,800,000 through December 31, 2038: and WHEREAS, 2021 Wisconsin Act 57, the relevant settlement agreements and the State of Wisconsin Joint Committee on Finance approved permitted uses of settlement funds for opioid abatement activities, including treatment, prevention, recovery support, harm reduction, and related system improvements, consistent with the national settlement agreement; and WHEREAS, Ozaukee County continues to experience the impacts of opioid use and polysubstance use disorders, often in combination with serious mental illness, resulting in increased emergency detentions, psychiatric hospitalizations, and involvement with law enforcement and the criminal justice system; and WHEREAS, Ozaukee County currently lacks a local day treatment or partial hospitalization program for adults with co-occurring mental health and opioid and other substance use disorders, creating a significant service gap and reliance on costly inpatient or out- of-county treatment options; and WHEREAS, the proposed Dual Diagnosis Day Treatment Program within the Ozaukee County Human Services Department would provide evidence-based, integrated behavioral health treatment, serving as both a step-down from inpatient hospitalization and a step-up from traditional outpatient care; and Page 3 of 13 WHEREAS, the program is designed to improve care coordination across Human Services, the courts, law enforcement, and crisis response systems, thereby reducing repeat emergency detentions, jail utilization, and avoidable hospital admissions; and WHEREAS, opioid settlement funds are intended to support one-time, capacity-building investments that expand access to substance use disorder treatment and reduce the long-term impacts of the opioid epidemic, including emergency response and public safety costs; and NOW, THEREFORE, BE IT RESOLVED, by the Ozaukee County Board of Supervisors that $600,000 of the Ozaukee County Opioid Settlement Special Revenue Fund be allocated as a one-time investment to support planning, initial staffing, licensing, and program launch for the Ozaukee County Department of Human Services Dual Diagnosis Day Treatment Center; and FURTHER RESOLVED, that the Health and Human Services Committee shall receive quarterly reports beginning in June 2026 on the use of the $600,000 of the Ozaukee County Opioid Settlement Special Revenue Fund, the ongoing licensure of the Ozaukee County Department of Human Services as a DHS 75 certified clinical facility, the recruitment of a Board Certified Psychiatrist to oversee the Dual Diagnosis Day Treatment Center and the audit of ongoing operations anticipated to be substantially supported through Medicaid and other third- party reimbursement. Dated at Port Washington, Wisconsin, this 4th day of March, 2026 SUMMARY: Approving $600,000 of Ozaukee County opiate settlement funds to support the development of a Dual Diagnosis Day Treatment Center. VOTE REQUIRED: Majority HEALTH AND HUMAN SERVICES COMMITTEE Page 4 of 13 Executive Summary Proposed One-Time Use of Opioid Settlement Funds Integrated Behavioral Health Day Treatment (Dual Diagnosis) Program – Ozaukee County Funding Context Ozaukee County currently has $1.7 million in opioid settlement funds available, with a total allocation of $3.7 million through 2038. These funds are presently supporting the co- responder team and must be used for opioid harm reduction and treatment expansion. The anticipated annual expenditure of approximately $225,000 in 2026 for the co-repsonder team. In an effort to put these funds to their best use, the County Administrator, Human Services Director, Public Health Officer, Sheriff, and District Attorney met as ad hoc group to review potential uses of the funds to assist with opiate harm abatement per the requirements of the settlement. All parties agreed that the establishment of an Integrated Behavioral Health Day Treatment (Dual Diagnosis) Program emerged as the most strategic and system-impactful use of these funds. Program Need There is currently no comparable day treatment service in Ozaukee County. The lack of this service serves as a barrier to county citizens seeking this treatment. It is not offered by all of the health systems within Ozaukee County and no not-for-profit organization currently operating in the county holds the appropriate licensure. In the absence of this level of care, individuals with co-occurring mental health and substance use disorders often cycle through: • Emergency departments • Crisis detention • Jail and court involvement • Inpatient psychiatric hospitalization These systems are designed for short-term stabilization, not sustained recovery and are costly for the county. Moreover, the county is currently using contracted Psychiatric services to maintain our DHS 75 licensure that currently supports the ongoing treatment services in the Human Services Department. While this approach satisfies the state licensing requirements it is not optimal, expensive and can be a hinderance in mental health court hearings. The use of contractor examiners places the county in a position that is incongruent with the intended statutes and opens the door to liability, legal battles, and additional costs. Using one-time opiate settlement funds to establish a Dual Diagnosis Day Treatment Program fills these services gaps by providing structured, intensive outpatient treatment Page 5 of 13 while individuals remain in the community. Additionally, the funds that the treatment billing will generate will allow the county to hire a Medical Director replacing the contracted Psychiatric services to not only serve the program, but also other treatment programs in Human Services as well as satisfy the requirements of the Ozaukee County Courts. Program Overview The proposed program would: • Operate five days per week • Serve up to 16 clients per day at full implementation • Provide integrated treatment for serious mental illness and opioid/polysubstance use • Support administration of Chapters 51 and 55, including court hearings, re- commitments, and guardianship cases • Coordinate closely with the behavioral health team including crisis, the co- responder unit, courts, law enforcement, and jail services • Provide a ready treatment solution for individuals in crisis reducing the need to voluntary and involuntary commitments This creates a defined treatment destination beyond hospital emergency detention or incarceration. System Impact This program strengthens and complements the co-responder model by: • Providing an alternative to emergency detention • Reducing jail admissions related to behavioral health crisis • Reducing the number of individuals waiting in jail for higher level step down level treatment • Lowering emergency department utilization • Offering a more humane and clinically appropriate stabilization pathway Instead of cycling individuals through hospital and jail systems, the County would have a structured, recovery-focused option Pro Forma Summary (Based.on.Behavioral.Health.Cost.Model) 1. Annual Operating Cost (Staffing-Based) • Total Annual Cost: $661,168 (Represents.direct.staffing.cost·.does.not.include.supplies.or.equipment¡) Page 6 of 13 Staffing Plan NEW HIRE STAFF CURRENT STAFF 1. Psychiatrist (0.75 FTE): ~$306K • Needed for State license compliance • 0.25 FTE to support Behavioral Health Services 2. Case Manager (1.0 FTE): ~$105K 3. Occupational Therapist (0.50 FTE): ~$59K • Needed for client services and licensure from State • 0.50 FTE to support Behavioral Health CCS Program – full cost recovery 1. Behavioral Health Manager (0.35 FTE): ~$56K 2. Clinical Lead (0.75 FTE): ~$93K 3. QA (0.25 FTE): ~$26K 4. Support (0.25 FTE): ~$16K • Reallocation of responsibilities to clinic operations • Capacity created with enrollment of current clients in clinic CLINIC PRO FORMA ASSUMPTIONS Estimated Hourly Clinic Billing Rates Medicare Rate: $41.00 Medicaid Rate: $21.00 Insured Rate: $58.00 Self Pay: $16.00 Estimated Per Diem Rates Medicare Rate: $250-$350 Medicaid Rate: $170 Insured Rate: $350-$600 Self Pay: $128 Current Outpatient Payor Mix Ozaukee Medicare Rate: 37% Medicaid Rate: 45% Insured Rate: 12% Self Pay: 5% Page 7 of 13 PAYOR MIX BILLING ASSUMPTIONS - CURRENT PAYOR MIX Eight Clients Annual Biling Hours: 12,240 240 Weekly Hours 51 Weeks (Omitting Christmas) Hours Billed Revenues Medicare Payor: 4559 $186,935 Medicaid Payor: 5539 $116,311 Insured Payor: 1499 $86,965 Self Payor: 643 $10,282 TOTAL $400,493 Sixteen Clients Annual Biling Hours: 24,480 480 Weekly Hours 51 Weeks (Omitting Christmas) Hours Billed Revenues Medicare Payor: 9119 $373,871 Medicaid Payor: 11077 $232,621 Insured Payor: 2999 $173,930 Self Payor: 1285 $20,563 TOTAL $800,986 Clinic Operating Cost: $661,168 Reduced Outpatient Payor Mix Medicare Rate: 27% Medicaid Rate: 55% Insured Rate: 5% Self Pay: 12% Page 8 of 13 PAYOR MIX BILLING ASSUMPTIONS - REDUCED PAYOR MIX Eight Clients Annual Biling Hours: 12,240 240 Weekly Hours 51 Weeks (Omitting Christmas) Hours Billed Revenues Medicare Payor: 3335 $136,751 Medicaid Payor: 6763 $142,015 Insured Payor: 643 $37,271 Self Payor: 1499 $23,990 TOTAL $340,027 Sixteen Clients Annual Biling Hours: 24,480 480 Weekly Hours 51 Weeks (Omitting Christmas) Hours Billed Revenues Medicare Payor: 6671 $273,503 Medicaid Payor: 13525 $284,029 Insured Payor: 1285 $74,542 Self Payor: 2999 $47,981 TOTAL $680,054 Clinic Operating Cost: $661,168 At full census, the program covers operational costs of staff, as it does, at a conservative payor mix of reducing Medicare and Commercial Insurance. Because day treatment is cost-reporting eligible, the small remaining gap may be further reduced depending on cost settlement outcomes through Medicare during the ramp up period. Financial Strategy Opioid settlement funds would be used as a one-time startup investment to: • Cover ramp-up operating gap • Support initial staffing and recruitment • Fund program development and implementation Once enrollment reaches 14–16 clients per day, reimbursement offsets nearly all ongoing staffing costs. This approach: • Uses settlement funds for infrastructure development Page 9 of 13 • Avoids long-term structural dependency • Builds a sustainable treatment model Conclusion With $1.7 million currently available and $3.7 million allocated through 2038, Ozaukee County has a rare opportunity to convert restricted opioid settlement funds into lasting treatment infrastructure. At full enrollment, the program approaches financial sustainability while: • Expanding opioid and dual-diagnosis treatment capacity • Reducing pressure on law enforcement and courts • Improving recovery outcomes • Filling a critical regional service gap This is a strategic, time-limited investment with long-term public safety and public health returns. Page 10 of 13 Item: D.2. Agenda Item Information Sheet To: EXECUTIVE COMMITTEE From: Jason Dzwinel, County Administrator Meeting Date: March 4, 2026 Department/Office: Dept of Administration Item Name: Budget Amendment 2026 – Transfer of $600,000 of Opiate Settlement Funds to Day Treatment Center Summary: Resolution authorizing the transfer of $600,000 from the Opiate Settlement Fund to Human Services for the development of a Day Treatment Center. Recommended Action: Staff respectfully requests that the committee approve the resolution authorizing the transfer of $600,000 from the Opiate Settlement Fund to Human Services for the development of a Day Treatment Center. Attachments: 1. Resolution Budget Amendment - Day Treatment Center 2. Budget Amendment Form - HS Treatment Center Seed Funding Page 11 of 13 RESOLUTION NO. 25- BUDGET AMENDMENT 2026 – TRANSFER OF $600,000 OF OPIATE SETTLEMENT FUNDS TO DAY TREATMENT CENTER RESOLVED, by the Ozaukee County Board of Supervisors, that budgets be increased in the accounts as follows: Department/Program Account Number Account Name Amount Amount Human Services - Day Treatment Center Expense 202-5-11-51101-000 Day Treatment Center Salaries and Benefits $ 600,000.00 Opiate Settlement Fund Expense 225-0-00-81100-202 Transfer from Opiate Fund to Human Services $ 600,000.00 Human Services Revenue 202-0-00-71100-225 Operating Transfer from General Fund $ 600,000.00 Dated at Port Washington, Wisconsin, this 4th day of March 2026. SUMMARY: Resolution authorizing the transfer of $600,000 from the Opiate Settlement Fund to Human Services for the development of a Day Treatment Center VOTE REQUIRED: Two-Thirds of Members Elect EXECUTIVE COMMITTEE Page 12 of 13 Resolution No: Period Transfer Recorded: TO: Finance Committee FROM: Increase of Revenue: Fund Transfer: Date of Request: 2/25/2026 Supplemental Appropriations: Acct # 202-5-11-51101-000 $ 600,000 A/C # 202-0-00-71100-225 $ 600,000 / - - / - Pre-request Account's Budget / Changed To Pre-request Account's Budget / Changed To Cost Ctr & A/C Desc Cost Ctr & A/C Desc Acct # 225-0-00-81100-202 $ 600,000 A/C # $ - - / - - / - Pre-request Account's Budget / Changed To Pre-request Account's Budget / Changed To Cost Ctr & A/C Desc Cost Ctr & A/C Desc Acct # $ - A/C # $ - - / - - / - Pre-request Account's Budget / Changed To Pre-request Account's Budget / Changed To Cost Ctr & A/C Desc Cost Ctr & A/C Desc Acct # $ - A/C # $ - - / - - / - Pre-request Account's Budget / Changed To Pre-request Account's Budget / Changed To Cost Ctr & A/C Desc Cost Ctr & A/C Desc Acct # $ - A/C # $ - - / - - / - Pre-request Account's Budget / Changed To Pre-request Account's Budget / Changed To Cost Ctr & A/C Desc Cost Ctr & A/C Desc Acct # $ - A/C # $ - - / - - / - Pre-request Account's Budget / Changed To Pre-request Account's Budget / Changed To Cost Ctr & A/C Desc Cost Ctr & A/C Desc Total Debits: 1,200,000 Total Credits: 600,000 Date of Meeting Date of Meeting Budget Amended By: TYPE IN Oversight Committee Chairperson's Name Reason for Request (Be Specific). Also fill out Support Document for County Board. Date Amended: Oversight Committee Members Finance Committee Members Department Head Signature Transfer to Human Services Debit / Expense New cost center for Treatment Center Transfer from Opioid Fund Credit / Revenue Administration Department Name Type of Budget Amendment (check one) X Budget Amendment Request Committee Approval Form X Page 13 of 13