Use of Outpatient Mental Health Care

Trial of a Prepaid Group Practice Versus Fee-for-Service

by Willard G. Manning, Kenneth B. Wells, Bernadette Benjamin


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The aim of this study was to determine whether a prepaid group practice delivers less outpatient mental health care than fee-for-service when both serve comparable populations. To do this, it used data from the RAND Health Insurance Study, a randomized controlled trial that assigned families to a prepaid group practice — Group Health Cooperative of Puget Sound (GHC) — or to fee-for-service insurance plans. The study also contained data on existing GHC enrollees, who served as controls. The study found that when GHC and fee-for-service plans treat comparable groups of patients who face no cost sharing, GHC delivers a much less intensive style of mental health care but treats a comparable fraction of the population. Adding cost sharing to fee-for-service plans reduces mental health expenses, but it also lowers the probability of use even though it does not lower the intensity of care.

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