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‘Our staff are like, “Screw this”’: How Minnesota’s mental health sector is trying to avert a burgeoning employment crisis

A Q&A with Julie Bluhm, CEO of Guild Services, a St. Paul-based nonprofit devoted to helping people with mental illness and long-term homelessness.   

Guild’s Crisis and Residential Treatment Staff celebrating Mental Health Awareness Month.
Guild’s Crisis and Residential Treatment staff celebrating Mental Health Awareness Month.
Courtesy of Guild Services

The struggle to hire and retain employees to support people with developmental disabilities has been highlighted in the news lately. But there is another hiring crunch that hasn’t received the same amount of attention; that of nonprofits providing mental health, housing and employment services for individuals experiencing mental illness and chronic homelessness.

The reasons for this struggle are many, and solutions are difficult to come by. Julie Bluhm, CEO of Guild Services — a St. Paul-based nonprofit devoted to helping people with mental illness and long-term homelessness find the tools they need to lead stable, fulfilling lives — shares her perspective on the burgeoning employment crisis in her sector.  

This employment issue is driven by the field’s demanding educational requirements and stagnant wages, Bluhm explained. And if something doesn’t happen soon, she said, organizations like Guild will be in full-blown crisis. 

“In the mental health community, we really want to impress upon the public that this truly is the perfect storm,” she said. 

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In this Q&A, Bluhm talks more about that storm, and what she and her peers have been trying to do to address the cirsis. The interview has been edited for length and clarity. 

MinnPost: Earlier this month, I wrote a story about how Minnesota nonprofits that serve people with developmental disabilities are struggling with a severe worker shortage. Is your organization facing similar workforce issues? 

Julie Bluhm: I think that people in the developmental disabilities world are struggling to hire and retain workers because they are limited to paying the federal minimum wage, or maybe just above that.  In the mental health community, we are able pay our people closer to a living wage, like $45,000 a year. Still, in today’s job market, that pay rate isn’t very competitive. We’re now starting to face a challenge finding and keeping good employees. We’ve been anticipating a crisis like this for years, but not much has happened to prevent it. At the legislative level, they’ve been pushing us off … But I think we’re really bumping up against a crisis now.  

MinnPost: Where does funding for your staff salaries usually come from? 

JB: The community-based mental health system that Guild is part of is a safety-net system built for people on Medicaid. We’re taking care of people who in the past would have likely been institutionalized. We offer hands-on, in-the-community services. Our funding stream is billed for reimbursement from state and federal sources. It’s not based on grants. It’s based on submitting an invoice for services to DHS. Our entire funding structure, our ability to do all we have to do as an employer, is based on us getting reimbursed for that work. 

MinnPost: One of the reasons that pay rates for your employees have been better than those for workers in the developmental disabilities sector is because your jobs require people to have a higher level of education. Why aren’t your salaries keeping up with the economy? 

Julie Bluhm
Julie Bluhm
JB: Our rates have been stagnant for years. In 2005, getting paid $40,000 a year when you first got out of college would’ve been great. Now, 17 years later, we’re still starting people at $40,000, maybe $45,000, depending on the role. The cost of college is a real burden to the people who work here. I’ve had people who’ve worked for me who have $90,000 in college debt and they’re making $40,000 a year, maybe topping out at $65,000 a year after years of work. That pay rate is based on a number that DHS and the state legislature set for our reimbursement, and there hasn’t really been any real move lately to increase those rates.

MinnPost: Have you developed any workarounds to help increase pay for your employees or relieve some of their college debt? 

JB: The legislature and DHS define all of the services that we provide. And it’s a really narrow scope for these services. We don’t have the flexibility to get creative with billing. In order for us to hire people to do these services and retain our license, our staff has to have very specific education and experience. We have this really old-school training expectation of, “bachelors degree, masters degree, unpaid  internship,” to be qualified for one of our jobs. We know that these requirements create huge barriers for many of our staff who are BIPOC or come from nontraditional backgrounds. 

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MinnPost: All that education topped with an unpaid internship could get expensive. 

JB: If someone wanted to come into this field and they were a single parent, for instance, they are signing up for a lifetime of debt. 

MinnPost: It seems like employers in your sector are sitting on a bubble. You’re offering jobs where employees can do good work and earn a modest paycheck. Increasingly, for all but those with a supportive partner or family, the numbers just aren’t adding up. 

JB: At the legislature and DHS, they’re continually increasing the requirements. They’re not investing in us having good, qualified staff, but they’re also not saying, like they do in the developmental disability world, “This is just a minimum-wage job.” They’ve clearly said, “This a professional service,” but the wages we are able to provide them aren’t a professional wage anymore. Increasingly, our staff (is) like, “Screw this. I’m going to do telehealth.” 

MinnPost: You have staff members leaving and taking jobs with virtual therapy companies?

JB:  Yes. We’re seeing this switch increasing in mental health systems across the board. Our staff (has) limitations in the amount of money they are able to make in our jobs. But they have masters degrees in social work, marriage and family therapy or psychology. They have real-world experience. Now there are for-profit companies that are saying, “You can work from home and see patients virtually that have depression or anxiety.” Of course they’re choosing that over what we can offer them. They get paid the same and they can work from home. 

MinnPost: Have you developed new strategies for retaining employees? 

JB: Right now we are looking for immediate relief. For instance, DHS is looking at ARPA (American Rescue Plan Act) funds. These are federal funds that are available to states and counties after we were hit by the pandemic. DHS staff (is) looking at how to get those funds directed to programs like ours and Mt. Olivet Rolling Acres, to put some resources toward retaining the staff that we have, knowing we’re in this crisis period. 

Hiring bonuses are something that a lot of our peers are offering. It is almost comical. If you go to the Minnesota Council of Nonprofits job board and look at case manager jobs, you’ll see things like “$2,000 bonus,” or “$5,000 bonus.” That’s just not sustainable. We’re giving money to people who are new instead of the people who have stayed been with us for 10 years and make $50,0000. Now we have one or two applicants for our jobs and they are asking for $55,000 immediately. I think crisis funds would help us now, but in the long run we are really looking for rate increases. I look at a one-time influx of funds and as much as that makes me excited for this year’s budget, I know we’ll still be right back here in a year.

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MinnPost: Have there been any moves at the legislature to change the pay structure for people working in your sector or help defray the cost of college? 

JB: I was looking through our legislative ask this cycle. One ask is for the legislature to create a method of rate increases, and to really look at the field as a whole and what it is going to take to recruit and retain this workforce. Right now, the way our internship system works, for instance, you basically have to work a job for free before you qualify for a job where you will be paid.

MinnPost: Does this requirement discourage potential job applicants? 

JB:  We want to increase diversity in our workforce, but we have this structure that throws up a lot of roadblocks. If you are not someone who has parents or a partner who can help support you through college and graduate school it is a difficult proposition to convince them to enter this sector. How can I say, “Become a social worker,” when you could major in business and make so much more money? 

MinnPost: Let’s go back to your legislative asks. What are people in your sector hoping will happen at the State Capitol this year?

JB: NAMI is pushing some very specific legislative requests this year. What we’re really looking at is the unpaid internship requirement, and the need to pay your internship supervisor. We are asking the legislature for free access to supervision. We’re looking at different ways to achieve this. Maybe a supervisor could bill DHS for supervision hours, rather than have it paid out-of-pocket by the student. We’re also talking about increasing funding for loan forgiveness. These kinds of programs already exist in Greater Minnesota, but we’re hoping to expand them more broadly to the Twin Cities. 

We’re talking about funding cultural healers. We have a very rich culture of healing in different communities in this state. The only kind of services that are paid for are the Western, medicalized method of delivering mental health services. There has been this movement to say, “If the Hmong community has a cultural healer that community members would rather see to solve their problems, they should be paid for that, too.”

MinnPost: It sounds interesting, but how would you do that? 

JB: This would mean creating alternative pathways to licensure for people from diverse backgrounds. It would require acknowledging that we know we have a workforce that is predominantly white and we want to think of creative ways to change that. We are working with NAMI in thinking about how we could develop alternative pathways to get people into our agencies.  

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MinnPost: I’ve heard that you are developing partnerships with other entities.

JB: My strategy for the last few years has been to start looking at how to develop mutually beneficial partnerships with other payers, including counties. We recently had a partnership with Scott County. We do their intensive residential treatment and crisis services where people live for 10-90 days. The usual rate to provide these services doesn’t pay for any capital costs. It has been a huge barrier to getting people reimbursed for billed services. So we worked with Scott County to get funds allocated for providing these services.

Because the larger community is more concerned these days about mental health and housing, there have been more opportunities where we have been approached by communities and given one-time support to provide these services.

MinnPost: Do you think it’s important to build these outside relationships? Is it distracting from your most important partners?

JB: As an agency, we’re investing in fundraising. We’ve restructured our executive team. We’ve added a chief advancement officer, with the understanding that the needs in our communities are higher than ever. There is a lot of interest coming from corporations in supporting their staff and making an impact in the larger community. As I’ve thought about our revenue options, I’ve decided that investing in fundraising is a good strategy for us.

In a nutshell, we’ve lost confidence in government and gone private. That sounds bad, but we can’t pay our staff the amount we want to pay them with government support alone. We’re looking to private foundations to help us do some of that.