North Carolina’s Medicaid agency has suspended Medicaid payments to Boone-based New River Behavior HealthCare, one of the largest providers of mental-health services in Western North Carolina, leaving the public agency to possibly suspend operations, Carolina Public Press learned Friday.

‘We believe in recovery! The philosophy of recovery is central to our services,’ says the service brochure from New River Behavioral HealthCare. The mental-health services provider is under investigation, calling into question whether it will continue to operate. Click to view full-size image. The entire brochure is available within the post.

“We cannot divulge very much at all about this other than an allegation has been made, and the N.C. Division of Medical Assistance is investigating,” N.C. Department of Health and Human Services’ spokesman Brad Deen said. “By federal law, we are required to suspend Medicaid payments to this provider. By law, I cannot divulge the nature of the allegation.”

Deen would not say whether the service provider is or will be closed. He did say that the N.C. Department of Health and Human Services notified New River Behavioral HealthCare of the investigation by letter on Sept. 22. He also said he could not comment on how long the investigation will continue.

The news of the investigation comes just weeks after New River Behavioral suspended service to McDowell, Alexander and Caldwell counties. “This change is necessary for us to continue to operate in today’s climate of budget cuts and transformation in healthcare delivery,” it stated in a news release posted to its website. Service ended to those counties on Sept. 9.

In a story published Friday on, New River’s spokesperson said the agency was restructuring and had reduced its workforce by 24 people in the last week. The agency employs 300 people and serves about 13,000 people, the newspaper reported.

Messages left by Carolina Public Press for New River Behavioral HealthCare’s spokesperson were not returned Friday.

Smoky Mountain Center, the Sylva-based agency that oversees and coordinates mental-health services for Western North Carolina and makes referrals for care to organizations such as New River Behavioral HealthCare, will take over transitioning patients to other service providers, according to a Sept. 29 e-mail from CEO Brian Ingraham provided to Carolina Public Press. In the e-mail, Ingraham writes that New River Behavioral “has decided to cease operations.” [See the entirety of the e-mail, posted below.]

Ingraham did not return messages from Carolina Public Press on Friday.

New River Behavioral has provided mental health, developmental disabilities and substance abuse services for more than 45 years, according to information on its website. It accepts private insurance, Medicaid and Medicare payments. Currently, it provides services to 11 Western North Carolina counties and has outpatient units in Allegany, Ashe, Avery, Iredell, Surry, Watauga, Wilkes, Yadkin and Iredell counties, its online information says.

“We are a public entity, and serve the community as a major comprehensive provider of direct services in our community, endorsed by the State of North Carolina as a (Critical Access Behavior Health Agency),” it states in its brochure. [PDF] View its handbook here. [PDF]

Between July 1, 2010 to July 30, 2011, New River Behavioral conducted 910 interviews with “adult mental health consumers” who are new to services, and only for the more intensive services involving community outreach, a report from the Smoky Mountain Center to the N.C. Department of Health and Human Services states. This number does not include people receiving out-patient care. New River also provides services in schools and works with the court and school systems.

On Dec. 27, 2008, the Winston-Salem Journal reported that “state officials hoped that New River’s operation in the mountain counties would provide a model for services across the state,” following reforms to the state’s mental health system. But, the story continued, the agency, then one of two public mental-health care providers in the state, was then showing a $1.5 million operating loss.

To:                  SMC Providers

From:             Brian Ingraham, CEO of Smoky Mountain Center LME

Subject:        Announcement of Closing of New River Behavioral HealthCare

Date:              September 29, 2011

Smoky Mountain Center learned today that New River Behavioral Healthcare, a major service provider in Alleghany, Ashe, Avery, Watauga and Wilkes Counties, has decided to cease operations.  New River Behavioral Healthcare has a long history of providing services to individuals with mental health, substance abuse, and intellectual and developmental disability needs.

Smoky Mountain Center is committed to an orderly transition of services from New River to other providers.  The LME will actively manage the transition of consumers and their services to other service provider organizations, and begin working closely with New River Behavioral HealthCare, county government, and communities to promote close communication around the transition of care for these vital behavioral health services.  We are committed to an orderly transition that meets consumers’ needs.

SMC is gathering information and actively developing plans to provide continuity of care to consumers and to facilitate employment opportunities for New River staff with other provider organizations.  We will keep you informed as plans for the transition are developed.  Thank you for keeping consumers’ needs as our highest priority.

Please contact the Smoky Mountain Center Access Center at 1-800-849-6127, if you are experiencing consumer care issues.  Please contact your SMC contract manager (828-586-5501 or if you have provider specific questions.

Correction: An earlier version of this story stated that New River had 910 patients at its facilities. This statistic actually tracks initial interviews across this period, namely those who are new to services, and only for the more intensive services involving community outreach. This number does not include people receiving out-patient care.

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Angie Newsome is the executive director and editor of Carolina Public Press. Contact her at (828) 774-5290 or e-mail her at

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  1. One more thing…as you can imagine after that experience I can’t go to any place to get help. Because now I know that they don’t need a good reason to have you shipped off, they can make one up.

  2. I can see that happening. Went there for some time and they wouldn’t even prescribe me medicine that i had been taking for almost 8 years. They even told me that abilify wouldn’t cause tardive disconesia which even the drugs website says it can. My mom got it from the drug. Then they sent me to a psych hospital because I didn’t want to freakin talk to them. They treat patience as if they don’t have the ability to make their own decisions.