IMAGINE SAM CHEEK'S incredulity at receiving this one-paragraph letter from the Baltimore-area hospital caring for his son, who had tried to cut his throat a month earlier: "We plan to discharge your son Andrew on February 25, 2002. If you do not come to take Andrew home on that date, we will notify Department of Social Services, Child Protective Services, that he is an abandoned child in need of placement."

An abandoned child? Just weeks before, the doctors had told Mr. Cheek that his 13-year-old son needed to be placed in a therapeutic group home after his hospital stay. But one home refused to take Andrew because of his aggressive behavior - he suffers from bipolar disorder and previously assaulted a staff member - and no other placement could be found for him.

What was the boy's father to do?

This frustrated father, a disabled veteran from Laurel, told the hospital: Go ahead, call social services, and if you don't I will.

Andrew's monthlong stay at the hospital illustrates how doctors' findings and rulings by insurance companies can conflict with the needs of a seriously mentally ill child. It shows how a lack of community-based facilities can result in extra costs for a hospital, hurried discharges to control costs, fruitless appeals to insurers, and most troubling, a wrenching decision by a parent to give up custody in order to get a child help.

And Mr. Cheek's experience is not unusual. A yearlong, state-funded study released recently by a Baltimore advocacy group found that about 200 families a year relinquish custody of their children because an underfunded, overwhelmed system can't adequately address the mental health needs of critically ill kids. Families with some form of private insurance are more likely to face this issue than those on medical assistance, according to the Maryland Coalition of Families for Children's Mental Health. That's because private health plans usually cover fewer services than the publicly funded insurance programs available to a child in state custody.

Other major factors leading to relinquishment of custody are the frequency of hospitalizations in a year, a family's belief that a child isn't ready to come home and the fact that a child is adopted. Andrew, for example, has been in and out of institutions since he was 8 years old.

Although insurers serving Marylanders are required to offer the same degree of care for mental disabilities as physical illnesses, experience shows otherwise. Self-insured employers are exempt under federal law from that mandate. A child with a severe mental illness also can easily exhaust a family's private insurance coverage. Ask Sam Cheek. He is on his third carrier and filed for bankruptcy in 1997 because he says he couldn't keep up with the out-of-pocket expenses for his son's care.

In the past five years, mental health services for children have increased in Maryland due to the state's participation in a special federal program for uninsured kids whose parents can earn up to $54,000 a year for a family of four. But parents with private insurance often end up making desperate choices to ensure that their severely mentally ill child receives the breadth of care needed.

By the time Mr. Cheek received the letter on abandoning his son, the teen-ager's hospital stay had exceeded his 30-day inpatient benefit. Mr. Cheek's insurer refused to pay for a longer stay, citing the doctor's opinion that the "maximum therapeutic benefit" for Andrew had been achieved.

Insurers often disagree with health car providers on the type of service and length of care for a mentally ill child, deciding that one or the other is "not medically necessary." While some parents appeal those decisions to the state insurance commissioner, many do not. But they should - a report last spring by the insurance administration found that independent review boards commissioned by the state to hear appeals reversed carriers' decisions twice as often as they upheld them.

The best hope for parents like Sam Cheek may be Robert L. Ehrlich Jr. The governor-elect has expressed shock at the custody dilemma and promised action.

A strong executive - and one with friends in Washington - could help bring about legislative and policy changes to improve the plight of these families.

Here are a few ideas: Maryland should follow the example of 10 other states and explore its options under the federal Tax Equity and Financial Responsibility Act of 1982. Known as TEFRA, it allows states to enroll children with mental or emotional problems - regardless of family income - in Medicaid-funded, community-based programs, provided the child remains at home.

That help would ease the burden on families who care for children at home and, perhaps, decrease residential and hospital stays.

Maryland also should encourage big employers to share more of this burden. Lastly, Mr. Ehrlich could use his influence in Congress to pass a federal law that would require self-insured employers to comply with state mandates on mental health parity. Another federal law, if passed, would allow states to use Medicaid funds to pay for community programs for certain children now treated in expensive residential centers.

Of course, Maryland would need to assess the financial impact of such proposals, an unenviable task given the state's ballooning deficit. But a review now by Mr. Ehrlich would give him a head start on the issue before his January inauguration. Then he can decide if he can truly sign an executive order on his first day in office - a campaign pledge - that would spare parents the anguish of relinquishing custody of their children and provide the services they need.

And what of Mr. Cheek's son Andrew? He remains in state custody and a patient in a residential treatment center operated by the same hospital that sent his father that threatening letter.

If Governor Ehrlich decides to sign that executive order, Sam Cheek would be among the parents applauding.