GREENSBORO – From Schizophrenia and depression to bipolar disorder, thousands of people with mental illness call North Carolina home. Now the federal government is threatening to withhold millions of dollars in Medicaid money from a state mental health program.

Both the teenager that walked into a crowded mall and shot five people and the Virginia Tech gunman who killed 32 fellow students had a history of mental illness. It’s a disease that affects an estimated 60 million Americans.

"In our county it's going up,” explained Robert Middleton, director of mental health in Rockingham County.

Rockingham County spends more than $4 million a year to treat the mentally ill. Middleton said it has become increasingly more difficult since the state adopted the community support program in 2007.

"We have individuals, citizens and clients, who not only see a physician, a psychiatrist and a therapist, but also have someone who comes out and checks on them in the community,” Middleton said.

But that program could be in trouble. Because of inconsistencies in service by some providers, the federal government is threatening to withhold $138 million if North Carolina doesn't clean up its act.

“It's going to put at risk those services we do in the community and put those people, those clients at more risk of having some type of breakdown,” Middleton said.

It’s the type of breakdown that could land them in jail or worse. At any given time, the Rockingham County Jail houses 160 inmates. More than 50 percent of those are being treated for some sort of mental illness.

"It is a big draw on our budget in the jail,” noted Rockingham County Sheriff Sam Page. He said his deputies are on the front lines of this war against mental illness.

"One week a month ago, we had seven attempt suicides in a week, four of them involving firearms, [and] one of them was successful,” Page said.

He added that it not only puts officers at risk, but it is tying up limited resources.

"A lot of times we have officers, sometimes one and two officers, maybe three officers tied up at hospitals sitting with mental patients waiting for their first evaluation," Page said. "That process could take on the short end four hours, on the average and on the long end over 12 hours."

Page said that is precious time off the streets that they have to spend policing the jail.

“If they hold those monies and that trickles down and the LMEs don't have the money to operate with where they need then I think that we're going to need to expand that facility,” Page said.

A representative from North Carolina Health and Human Services said they are in the process of correcting the problem, including sanctioning offending providers. Meanwhile, there's enough money in the community support budget to keep the program running for some time.

The state is working with the federal government to resolve the issue before the next scheduled payment.