Critical Elements of Public-Sector Managed Behavioral Health Programs for Severe Mental Illness in Five States

BACKGROUND: The evaluation of public-sector managed care plans has been hampered by lack of a systematic vocabulary as well as instruments to translate that vocabulary into a set of measurement procedures. A recently developed instrument has been used to evaluate public-sector behavioral health managed care arrangements for the Managed Behavioral Health Care in the Public Sector Study, conducted by the Substance Abuse and Mental Health Services Administration (SAMHSA). This article presents preliminary descriptive data for five sites at which the impact of managed care on adults with severe mental illness was studied. METHODS: Based on a review of the literature, the researchers developed a set of critical domains intended to represent the aspects of managed care most likely to affect consumer outcomes. Survey items were designed to elicit information on 6 domains accepted by an expert panel. The instrument was used to gather information from key informants at SAMHSA sites in five states. RESULTS: At several sites, the mental health premium was integrated with that for health benefits; however, at most sites, including some of the sites with integrated plans, mental health benefits were carved out and contracted to behavioral health organizations. Two states linked mental health and substance abuse benefits. Integration of mental health and pharmacy benefits was more common, but in two of the states, the pharmacy benefit was administered through the health plan. Risk for pharmacy benefits is likely to influence prescription of atypical antipsychotic medications. Differences between for-profit and not-for-profit organizations were not always clear. Also examined were assignment of risk and risk adjustment procedures. CONCLUSIONS: Per capita spending on public mental health varies widely by state and could result in substantial differences in system performance; thus it is critical to understand the context in which the systems operate. A public policy concern is that states are transferring most of the risk of Medicaid-funded behavioral health costs to private organizations, which often shift the risk to small nonprofit providers or other poorly capitalized organizations. Understanding the structures that have been put in place to handle mental health needs is critical to drawing conclusions from their experiences.