NASHVILLE – On the first day of November 2021, Commissioner Marie Williams from the Tennessee Department of Mental Health and Substance Abuse Services (TDMHSAS) and Director Stephen Smith from the Bureau of TennCare presented budget proposals for Fiscal Year 2022-2023 to Governor Bill Lee and team at the State Capitol. Across both budget proposals (scroll down for the links), the clear winner was the mental health and well-being of Tennesseans with more than $110 million in new funding proposed related to behavioral health needs.


With a backdrop of skyrocketing overdose deaths (45% increase in TN from 2019-2020) and a three to four-fold increase in clinical levels of anxiety and/or depression amidst COVID-19 pandemic, Commissioner Williams, Deputy Commissioner Matt Yancey, and other departmental leaders announced a historic budget proposal that includes $106,729,900 in cost increases for behavioral health care and prevention in Tennessee, with the majority of this funding recurring. Of note, 100% of the proposed increases are to be funded by State dollars.

With nearly $107 million in cost increases, including $65 million in recurring funds, Commissioner Williams proposed budget for FY2022-23 includes $100 million more dollars compared to what was proposed last year. This is a very positive and significant investment proposed for behavioral health services. While not yet approved, TDMHSAS’ blueprint for the coming year is starting to emerge.

Take a look at the proposed TDMHSAS cost increases for FY2022-23 (funds are recurring unless noted otherwise):

  • Cost of Living Adjustment (COLA): $ 35,989,300
  • Substance Abuse Clinical Treatment: $6,000,000
  • Addiction Recovery Program (ARP): $1,000,000
  • Crisis Continuum Expansion: $25,799,900 ($10,299,900 recurring + $15,500,000 non-recurring)
  • Substance Use Residential Treatment Infrastructure Expansion: $26,520,000 (non-recurring)
  • TN Behavioral Health Workforce: $10,000,000
  • Creating Jobs Initiative: $900,000
  • IT Support Services: $520,700

In total, TDMHAS has proposed $64,709,900 in new recurring costs and another $42,020,000 in non-recurring costs.

Workforce Development

Much of this investment relates to behavioral health workforce development, a huge need that has been trumpeted by providers and advocates across the state for many years and is a priority for the Behavioral Health Foundation. In 2019 the Tennessee Association of Mental Health Organizations (TAMHO) published and distributed a call for an urgent investment of State funding to alleviate workforce shortages, a document which was authored by Elliot Pinsly, now the CEO of the Behavioral Health Foundation. In spring 2021, workforce development was noted as a key need across most of the seven planning regions for TDMHSAS across the state, and related legislative proposals were submitted by planning council Regions II and IV in May 2021. Meanwhile, Commissioner Williams announced around that same time that TDMHAS and TennCare were launching a new collaborative workgroup to examine behavioral health workforce issues in the state with the goal of identifying solutions for consideration in the FY2022-23 budgeting process. While the final report from that workgroup remains pending, we now know a lot more about the State’s path forward.

To support Tennessee’s public behavioral health workforce, Commissioner Williams has proposed $36 million for a 20% provider rate increase, based on a 2% increase over each of the previous 10 years. Another $10 million has been proposed for clinician sign-on bonuses ($4 million), a scholarship program ($5 million), and a new internship portal ($1 million). These programs for mental health care professionals, which are similar to existing incentives in place that apply to physical health care, are needed more than ever as demand for behavioral health care has spiked amidst ongoing workforce shortages.

Addiction & Overdose

In response to demand for addiction treatment and record overdose deaths in Tennessee, Commissioner Williams has proposed $33.5 million for various substance use related programming. This includes $6 million for clinical treatment to serve an estimated 2,460 Tennesseans, $1 million for expanded wraparound services to serve an estimate 1,798 Tennesseans, and $26.5 million in non-recurring funding for four residential addiction treatment facilities (adding 200-300 residential beds).

Creating Jobs Initiative

We are also excited to see the inclusion of $900,000 for the Creating Jobs Initiative, which will help expand much-needed supported employment services to Tennesseans with mental health needs. Maintaining a job is a highly influential factor in recovery, and TDMHSAS and partners have done a tremendous job over the past several years in delivering an expanding Individual Placement and Support (IPS) services.

Crisis and Decriminalization

And we are not done yet, with another hugely needed cost increase proposed aimed at the decriminalization of mental health and access to care: $26 million has been proposed to boost the state’s Crisis Continuum. This funding will support, “3 New Crisis Walk-In Centers/Crisis Stabilization Units, operational funding, and emergency department-based mental health professionals to meet mental health crisis needs and reduce burden on hospitals and law enforcement.” Missing is $15 million in one-time funding requested by the Tennessee Diversion Coalition for statewide co-response, community responder, and substance use deflection grants, though other funding opportunities may be available to support the launch and expansion of these law enforcement deflection services. Making sure the “deflect to what” is taken care of is critically important, and TDMHSAS is doing that by investing in the Crisis Continuum.

Peer Support Again Facing Reductions

Again on the chopping block are Peer Support Centers, which primarily serve vulnerable Tennesseans with serious mental health issues. Commissioner Williams has proposed $946,900 in reductions from these centers in FY2022-23, after proposing more than $1.5 million in reductions to those same centers the previous year (no reductions ultimately were made). Research continues to show the value of peer support in the continuum of services offered to individuals with mental health issues, and any reductions to peer support funding in Tennessee would be a step in the wrong direction. This was the only item suggested for a reduction in the coming year.


Following the TDMHSAS budget hearing was TennCare’s turn, and the good news for mental health in Tennessee continued. Among the proposed TennCare cost increases proposed, Director Stephen Smith included $11 million ($7 million recurring) for the “Mental Health Delivery System.” While details right now are slim, Director Smith and team indicated that the $11 million is aimed at boosting community mental health centers with a focus on treatment services. At the same time, $5 million in cost reductions have been proposed for clinical mental health treatment related to TN Health Link care coordination and one other program that was not specified. So this $11 million cost increase line item is ultimately a $6 million net increase and would be a win for Tennessee.

TennCare Director Smith
TennCare Director Stephen Smith


While there is work left to do to ensure these funds are approved in the FY2022-23 budget, both TDMHSAS and TennCare have signaled clearly that investing State funds into the behavioral health system is a top priority. Especially in regard to the workforce development proposal from TDMHSAS, it’s worth celebrating that such serious investments have been proposed to help make sure Tennesseans can access care when and where they need it. The continued advocacy work among many of our partners is starting to pay off, and we appreciate the efforts of TDMHAS, TennCare, and members of the behavioral health workforce workgroup that met over the summer to develop a plan to right the workforce ship. Today is a good day for mental health in Tennessee.

Governor Lee
Governor Bill Lee

Missed the budget hearings? Recordings are available here:

To view TDMHSAS’ budget proposal slides:

To view TennCare’s budget proposal slides:

UPDATE 11/2/21: A previous version of this story noted the total proposed cost increases as $163 million across TennCare and TDMHSAS, but we have since been informed that TennCare’s $50 million investment in workforce development is NOT intended for the mental health workforce as seemed to originally be implied during the budget hearing. Details from TennCare remain scarce.