Cost Trade-Offs Between Accessing and Retaining Uniformed Mental Health Providers

The Military Health System (MHS) does not have enough mental health providers to meet the needs of service members. The U.S. Department of Defense (DoD) has been using a variety of levers, such as recruitment and retention bonuses, to attract and keep providers in active service to address the shortage, but challenges remain. In December 2023, the Deputy Secretary of Defense issued a memorandum calling on the MHS to expand its behavioral health capacity and stabilize its care delivery system. To heed this call, the MHS needs to not only backfill positions and slow attrition, but it also needs to attract mental health providers from an increasingly limited pool of potential candidates.

To determine the most cost-effective approach to address the shortage of military mental health providers, the Office of the Assistant Secretary of Defense for Health Affairs asked RAND to identify cost-effective mechanisms to access and retain uniformed mental health providers. This article describes the key findings and recommendations of this study.

Issue

The military mental health workforce is understaffed relative to demand for care at military treatment facilities, leading to increased referrals of service members with behavioral health needs to private-sector providers. Because of the burgeoning need for behavioral health care in the wake of the coronavirus disease 2019 (COVID-19) pandemic, additional sources of care from private-sector providers are difficult to secure in a timely manner. Private-sector providers often have long waitlists or are not accepting new patients because they already have full caseloads, and many do not accept military health insurance. Therefore, service members who are referred to the private sector for care may face wait times that exceed Defense Health Agency guidelines.

In comparison to civilian populations, service members tend to have higher prevalence rates of behavioral health conditions, such as posttraumatic stress disorder, major depressive disorder, and substance use disorders. When combined with the stressful circumstances of their military duties, unmet behavioral health needs may lead their mental health to deteriorate further. In turn, this can lead to occupational impairment, personnel turnover, higher personnel costs, and separation from service. Ultimately, force readiness suffers when service members cannot access the care they need.

To address its mental health staffing challenges, DoD needed to understand its options for effectively accessing, recruiting, and retaining licensed mental health providers within its budgetary constraints. The Office of the Assistant Secretary of Defense for Health Affairs turned to RAND for help in answering the following key questions:

• How has military pay for mental health providers changed over time, and how does military compensation for mental health providers compare with civilian compensation?
• How large are active-duty mental health providers' retention responses to bonuses and other special and incentive (S&I) pays?
• When it comes to enlarging the military mental health provider force, is it more cost-effective to widen accession pathways or increase retention bonuses (RBs)?

Approach

We addressed the needs of DoD by first collecting and analyzing data on military and civilian mental health provider education and compensation. We then used those data in RAND's Dynamic Retention Model (DRM) to examine how well different approaches to accessing and retaining providers would help boost the uniformed mental health workforce and to evaluate the cost-effectiveness of the various approaches.

We compiled data on civilian and military pay and on military careers from the American Community Survey, the Occupational Employment and Wage Statistics survey, and the Defense Manpower Data Center (DMDC) and examined programs that have been implemented to promote the accession and retention of providers, including accession bonuses and S&I pays. We focused on five types of mental health providers that compose the majority of the uniformed mental health workforce who are licensed independent providers: psychiatrists, psychologists trained at both the doctoral and master's degree levels, social workers, and mental health nurse practitioners.

We used the DRM to systematically explore how increasing accessions, increasing retention via RBs, or a combination of both could be used to fill open positions in the most-efficient manner. The DRM models service members' choices to stay in the active component or participate in the reserve component conditional on military and civilian pay, as well as their taste for active and reserve service. We estimated models for psychiatrists (from two different sources of commission, Uniformed Services University [USU] and the Health Professions Scholarship Program [HPSP]), doctoral-level and master's-level psychologists, social workers, and mental health nurse practitioners. The DRM estimates were used to simulate military mental health providers' choices of whether to stay in the military at each year of service (YOS) under various values of RBs. This modeling allowed us to estimate percentage changes in the workforce that would result from an increase or decrease in RBs, as well as the per capita personnel cost associated with each change in RB for a variety of values of accession and training cost. DoD decisionmakers can use these results to weigh the costs and benefits that correspond to specific strategies that are meant to boost workforce development and inform their choices regarding which strategies to pursue.

Key Findings

The DRM simulations provide an evidence base that DoD may use to pair certain findings with targeted incentive policies for specific provider types. Four key findings emerged from our analyses.

• Expected annual real compensation for fully trained uniformed psychiatrists decreased during fiscal years (FYs) 2014–2022. The decrease for fully trained board-certified psychiatrists was approximately 10 percent, assuming that fully trained board-certified psychiatrists earned all special pays that were available (including Board Certification Pay, for which some may not have been eligible). Total nominal compensation increased for all provider types, and total real compensation increased for provider types other than psychiatrists. A potential decrease in the reporting of monthly and annual special pays for psychiatrists in the DMDC's pay files complicated our calculation of changes in total compensation for psychiatrists. However, total real compensation other than S&I pay (including bonuses, such as multiyear special pay [MSP] and RB) decreased by 12 percent over the sample period.
• With the exception of psychiatrists, military mental health providers earn more than civilians. Psychologists (both doctoral- and master's-level) and social workers tend to earn more in the military than they would in the civilian workforce. Mental health nurse practitioners earn about the same as their civilian counterparts, at least in the early part of their career. Fully trained military psychiatrists earn substantially less than they would in the civilian workforce; however, military pay for psychiatrists with under five YOS—some of whom may still be completing residencies—is higher than average pay for civilian residencies.
• Active-duty mental health providers vary in how responsive they are to relative changes in retention bonuses. For example, among psychiatrists who joined the military via HPSP, simulations showed that a 20 percent increase in the retention bonus would increase the force size by 4 percent, whereas, among those who joined via USU, the same size bonus only increased the force by 1.5 percent. In contrast, master's-level psychologists responded to the same bonus increase with a force size increase of 6.3 percent, which may reflect their shorter training requirements and a smaller estimated average “taste” for military service. It should be noted that changes in retention in the DRM reflect changes in total compensation, so the same percentage increase in bonus for providers who receive larger bonuses (e.g., psychiatrists) would be expected to affect retention differently than the same percentage increase in bonus pay for providers who receive smaller bonuses (e.g., social workers).
• It is more economical in the long run to expand the accession pipeline. The DRM simulations helped us determine the break-even accession and training cost—that is, the point at which per capita accession costs become less expensive than increases in retention bonuses for raising force size—for each provider type in the study. All the break-even points were relatively high, ranging from a high of $11.8 million for psychiatrists accessed via USU to a low of $400,000 for social workers. In other words, most reasonable means of accession and training will be less costly for increasing the military mental health provider workforce than increases in retention bonuses over the long term.

Recommendations

Given the four key findings, we developed three recommendations for DoD to consider in its efforts to increase the military mental health provider workforce.

Recommendation 1. The U.S. Department of Defense Should Widen Mental Health Provider Accession Pipelines

Because expanding accession will be more economical over the long term than increasing retention bonuses, DoD should widen accession pipelines for mental health providers into the military. There are many potential approaches to widening accession pipelines. One approach could be the expansion of training programs and financial aid availability to increase participation in military graduate medical education and training programs for psychologists and social workers. Another approach could address the attractiveness of working in the MHS, through tuition reimbursement programs or paid internships that allow junior-level providers to complete their training and licensure requirements in exchange for a service commitment. Fully leveraging authority to spend on hiring would also help accelerate the recruitment of qualified civilian providers. All these approaches are likely to expand the accession of active-duty mental health providers, although it is unclear which approaches will be most effective and cost-efficient.

Recommendation 2. The U.S. Department of Defense Should Increase Retention Bonuses for Uniformed Mental Health Providers

It will take time to sufficiently widen the mental health provider pipelines described in Recommendation 1 and for those efforts to have a meaningful effect on the force size. In the meantime, shorter-term strategies will also be needed to augment provider retention. One strategy DoD should pursue is increases in S&I pays—specifically increases in retention bonuses—to help retain mid- and late-career providers. The flexibility of these bonuses makes them particularly useful: they can be raised or lowered, or turned on or off, at will by DoD or service branches. These retention bonuses can help not only with the size of the uniformed mental health workforce, but also its composition. As more junior providers come into service through expanded pipelines, more senior personnel will be critically important to provide mentorship and to share expertise.

Recommendation 3. The U.S. Department of Defense Should Review Special and Incentive Pays for Mental Health Providers on a Regular Basis to Ensure That They Support Retention Goals

Annual real compensation decreased for military psychiatrists between FY 2014 and FY 2022. Furthermore, the real value of available special pays for psychiatrists decreased from FY 2018 to FY 2022, likely because of inflation. Total real compensation for other provider types increased over this period. Decreases in compensation for psychiatrists can lead to decreases in their retention, which is counterproductive when DoD needs to increase their force size. Additionally, it is possible that the increases in real compensation for other provider types have not increased retention sufficiently to meet DoD's goals for those provider types. Therefore, we recommend that DoD evaluate the type and value of S&I pays for military mental health providers on a frequent basis to ensure that compensation is set at a level that ensures the desired level of retention.