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Literature Review: Mental Health Systems
Health care reform offers opportunities to improve the care of persons with serious
mental illness, but it also can lead to the disruption of innovative systems of care that have been
developed in recent years through Medicaid and other public programs. The care of mentally ill
persons must be organized to maximize possible trade-offs between inpatient and other
community services in a way that will promote function and satisfactory adjustment. An
indemnity approach emphasizes controls on demand; instead, better design of supply-side
approaches is required, using incentives to integrate services through case management and other
methods (Mechanic). Considerable capacity development is needed to integrate long-term care
appropriately into the mainstream, but serious barriers include control of risk selection and the
difficulties of fairly adjusting capitation rates for high-utilization patients (Andersen). Issues in
mental health care are paradigmatic of many other areas of medical care and reflect changing
family and community organizations and new challenges in care and rehabilitation.
The heterogeneity of mental health problems, the demographic shifts in populations at
risk, and the realities of designing and implementing effective programs, were often overlooked
(Mechanic). Components essential for maintenance of function and rehabilitation have yet to be
linked into a responsible alternative to long-term or episodic hospital care.
Mental health law traditionally focuses on preserving the civil and constitutional rights of
people labeled mentally ill. However, because of fundamental changes in the public mental
health system, most people labeled mentally ill no longer reside in state psychiatric hospitals. As
a result, the core policy issue in mental health today is assuring access to community based
services, supports, and housing which enable people to live successfully in the community
(Petrila). Because of this different environment, the definition and scope of mental health law
must be expanded dramatically if those interested in the subject are to continue to influence
mental health policy.
Trevino focuses on American Public Health Association's advocacy efforts focused on
two major issues: the adoption of a national health program that features universal coverage with
a comprehensive set of benefits for all our nation's residents, and the enhancement of the federal,
state, and local public health infrastructure (Trevino). Both medical care services and public
health programs must be expanded if we are to improve the nation's overall health status.
Mental health policy has evolved haphazardly, reflecting fragmentation of authority,
competing ideologies, limitations of current knowledge and technologies, and changes in
entitlements and insurance associated with health and welfare programs (Mechanic). The stigma
of mental illness affects both intergovernmental cooperation and public response. Health reform
provides an opportunity to address neglected areas and to build a closer connection with general
health services. New coalitions of advocates for the mentally ill, the elderly, and persons with
disabilities could construct a coherent long-term-treatment orientation that would benefit all.
The Institute of Medicine's The Future of Public Health calls for a strengthening of
linkages between public health and mental health, with a view to integrating the functions at the
service delivery level (Collier). In 1977, mental health and addiction services were merged into
the Department of Health. More recently, in 1988, adult mental health services were split off into
a quasi-public corporation. Children's mental health, however, was retained as a distinct service
within the Department of Health in order to enhance coordination with other health services for
children. Replication of such coordinated-care models is certainly feasible (Zimmerman).
Organizational change for local mental health systems has been advanced as an important
aspect of improving the performance of public mental health systems. Fiscal decentralization is a
central element of many proposals for organizational change. Data from the states of Ohio and
Texas were used in one study to examine some of the consequences of fiscal decentralization of
public mental health care (Frank). The data analysis shows that local mental health systems
respond to financial incentives, even when they are modest; that fiscal decentralization leads to
increased fiscal effort by localities; and that decentralization also results in greater inequality in
service between poorer and wealthier localities.
State agencies are charged with ensuring the productive use of resources in the
ambiguous and controversial mental health segment of the public health sector. Equity,
efficiency, and effectiveness are difficult for these agencies to measure because of undefined
system boundaries, decentralized control of resources, conflicting outcome expectations, and
uncertainty about the most appropriate technology (Arrington).
REFERENCES
Andersen, Ronald M. 1995. Revisiting the Behavioral Model and Access to Medical Care: Does
it Matter? Journal of Health and Social Behavior Vol. 36, No. 1. (Mar): 1-10.
Arrington, Susan and Donald S. Biskin. 1982. Assessing the Productivity of a State Mental
Health Service System. Public Productivity Review Vol. 6, No. 3. (Sept): 192-205.
Collier, Maxie T., A. Soula Lambropoulos, Gail Williams-Glasser, Stephen T. Baron and John
Birkmeyer. 1991. The Linkage of Baltimore’s Mental Health and Public Health Systems.
Journal of Public Health Policy Vol. 12, No. 1. (Spring): 50-60.
Frank, Richard G. and Martin Gaynor. 1994. Fiscal Decentralization of Public Mental Health
Care and the Robert Wood Johnson Foundation Program on Chronic Mental Illness. The
Milbank Quarterly Vol. 72, No. 1. (1994): 81-104.
Mechanic, David. 1987. Correcting Misconceptions in Mental Health Policy: Strategies for
Improved Care of the Seriously Mentally Ill. The Milbank Quarterly Vol. 65, No. 2. (1987):
203-230.
David Mechanic, David. 1994. Establishing Mental Health Priorities.
The Milbank Quarterly Vol. 72, No. 3. (1994): 501-514.
Mechanic, David. 1993. Mental Health Services in the Context of Health Insurance Reform.
The Milbank Quarterly Vol. 71, No. 3. (1993): 349-364.
Petrila, John. 1992. Redefining Mental Health Law: Thoughts on New Agenda.
Law and Human Behavior Vol. 16, No. 1. (Feb): 89-106.
Treviño, Fernando M. and Jeff P. Jacobs. 1994. Public Health and Health Care Reform: The
American Public Health Association's Perspective
Journal of Public Health Policy Vol. 15, No. 4. (Winter): 397-406.
Zimmerman, Marc A. and Louis A. Wienckowski. 1991. Revisiting Health and Mental Health
Linkages: A Policy Whose Time Has Come…Again.
Journal of Public Health Policy Vol. 12, No. 4. (Winter): 510-524.
Health Care in the United States
In an attempt to curb runaway health costs, the concept of managed care was introduced:
no longer would medical services be fee-for-service. Rather, the managed care entity would
authorize, and by extension, ration, medical services for its patients. The resulting networks
would become ubiquitous in the American health care systems, and seemingly overnight, the
system was reinvented. The question of course, was whether or not the care remained efficacious
– and the answer to the question would be less forthcoming for a mother with a sick child at
three in the morning than it would be for the director of any particular HMO. The following
articles examine the state of managed care in the United States, with particular attention paid to
areas of interest for policymakers.
Blendon (1998) considers the rise of managed care and the resulting backlash against the
widespread belief that consumers will lose control of their health care. The authors attempt to
determine whether this backlash is real (as opposed to being a product of the media) and if it is,
whether it is justified, and efficacious. They find that it is real, and that it is influenced by “a
significant proportion of Americans reporting problems with managed health care plans,” and
also that “the public perceives threatening and dramatic events in managed care that have been
experienced by just a few.” Moreover, fear of managed care efficacy in an unforeseen future
disability are widespread. Thus, while Americans are generally satisfied with their health
insurance plans (regardless of the type), they also want regulation of managed care plans, even if
it raises costs. Though poorly written, the reader can infer that the problem lay with the media
and over-anxious (read: litigious) Americans, and not with the health care industry.
In a well-written piece, Caronna (2004) uses an “institutional perspective to analyze the
history and current state of the American health care system in terms of the alignment of its
normative, cognitive, and regulatory elements.” By examining three different eras of healthcare
(professional dominance, federal government involvement, and managerial control and market
mechanisms), the author argues that consumer and provider dissatisfaction with managed care
has resulted in the emergence of a new era that “renews alignment between normative beliefs
and values, cognitive models, and regulation.”
Deal, et al (1998) focus on the rationing of medical care via managed health care and its
effect on children. They argue that a lack of choice hurts those who need it the most – the
seriously ill, and that the needs of children (a large percentage of enrollees) are being
overlooked. The authors offer several recommendations, such as ensuring that benefits meet
children’s changing needs, that they offer appropriate pediatric access, that care can be
coordinated with other child-serving organizations, encouraging active participation of the
parents, and using risk-adjusted capitation rates, or special reinsurance pools. Finally, the authors
argue that health care plans should be rewarded for improving the health of children.
Hellinger (1998) examines the relationship between managed care and quality, and finds
that managed care has not decreased quality, although this may not be the case with some
vulnerable subpopulations. Hellinger also confirms other studies that indicate consumer
satisfaction with managed care is on the decline, especially when trying to access specialized
care. Dissatisfaction is most common among older, poorer, and sicker persons than with their
younger, wealthier and healthier cohorts. Finally, the author argues that generalizability is a
problem, and new maintenance rules may have a large impact on the future of health care.
McGlynn, et al. (2003) offers a highly-cited piece that attempts to determine the quality
of health care in the United States via a random sample telephone survey and medical records
examinations that measured performance on 439 indicators of quality of care for 30 acute and
chronic conditions as well as preventative care, which were then constructed into aggregate
scores. They find that participants received only 54.9% of recommended processes in care, with
only slight differences between care provided for acute and chronic conditions. The variation
occurred according to the particular medical condition: 78% for senile cataracts; 10% for alcohol
dependence. The authors argue that while there is no simple solution, an overhaul of current
health information systems, and a national base line for performance are steps in the right
direction.
Mechanic (2001) argues that public focus is incorrectly focused on managed care issues,
which he argues are peripheral to the central question, and that the public should be focused on
overall health care reform, and ideally, universal health care. The problem, Mechanic argues, is
that there is a distorted understanding of the relation between financial constraints and the
provision of accessible and competent health care, and that public trust in the “system” has
decreased as a result. Public trust in managed care systems is also declining due the realization
that services that patients want or need may be denied. This trust is further compromised by
physician unhappiness with managed care organizations who may prohibit doctors from
discussing treatment with patients prior to obtaining an authorization for that treatment, although
this practice is rumored more than actually done. Thus, the author argues that future health care
reform should focus on building the public trust. The problems with healthcare reform, however
are numerous: policymakers have too many concerns to keep at bay, and to many people to make
happy. The only solution is to “muddle through” with a system that sets constraints on spending
but also has the flexibility to deal with complexity in people’s lives, and the government can best
contribute to this goal by establishing a “universal decent minimum standard for health care.”
Miller and Luft (1997) examine managed care and consider whether this leads to better or
worse care, and conclude that managed care does not automatically equate to worse care,
although Medicare HMO enrollees with chronic conditions showed worse quality of care.
Quadagno (2004) argues that while political theorists attribute the failure of the national health
insurance in the US to broader forces of American political development, the real obstacle is
actually “stakeholder mobilization,” with the stakeholder being, of course, organizations such as
the AMA, insurance companies, and employer groups who have been able to help defeat every
effort to enact national health insurance across an entire century. The author seeks out a
successful reform organization in search of a possible tactic, and argues that “prospects for
reform are enhanced when a coalition is organized in ways that closely mirror the representative
arrangements of the American state.” In other words, this means an organizational structure with
a federal framework, that used a top-down/bottom-up approach to health care reform.
The authors examine managed health care plans administered by Medicare in an effort to
determine the equivalency in care received by blacks and whites. Their unit of analysis is the
individual level observations (N = 1.8m), taken from 183 health plans over a six year period
from 1997-2003. For each measure, they assess the magnitude of the racial disparities that had
changed over time with the use of multivariate models that adjust for the age, sex, health plan,
Medicaid eligibility, and socioeconomic position of beneficiaries on the basis of their area of
residence. They find that not only did clinical performance improve for both race of enrollees,
the racial disparity decreased over time for seven of nine measures. The authors attribute the
decrease to increases in the consistency of delivery of care, although they authors wisely selfdeprecate their study by citing several weaknesses, such as a lack of examination into location of
care, the lack of other ethnic groups in the study, and most importantly, the authors did not seek
to isolate the causal mechanism at work.
Finally, Chassin, et al.,(1998) via an “Institute of Medicine National Roundtable on
Health Care Quality,” argue that the problem with American health care is not managed care, it
is the quality of the care itself. The authors discussed the problem with a wide variety of experts
and concluded that serious problems exist with the misuse, overuse, or the underuse of
recommended care practices, and also argue that the quality of health care can be precisely
defined and measured with a degree of scientific accuracy comparable with that of most
measures used in clinical medicine.
In conclusion, it seems pretty clear that the managed health care system works great,
except in the cases in which you need to use it. Policymakers are going to have a tough time
working out a solution that has the consensus and approval of all parties involved.
Works Cited
Blendon, Robert J., et al. 1998. “Understanding the Managed Care Backlash.” Health Affairs.
17(4): 80-95
Caronna, Carol A. 2004. "The Misalignment of Institutional "Pillars": Consequences for the U.S.
Health Care Field." Journal of Health and Social Behavior 45: 45-58
Chassin, Mark R., and Robert Galvin. 1998. “The Urgent Need to Improve Health Care Quality.”
The Journal of the American Medical Association. 280 (11): 1000-1007.
Deal, Lisa, Patricia Shiono, and Richard E. Berman. 1998. “Children and Managed Health Care:
Analysis and Recommendations.” The Future of Children. 8(2): 4-24.
Hellinger, F. J. 1998. "The Effect of Managed Care on Quality: A Review of Recent Evidence."
Archives of Internal Medicine 158 (8): 833-41.
McGlynn, Elizabeth, et al. 2003. “The Quality of Health Care Delivered to Adults in the United
States.” The New England Journal of Medicine. 348: 2635-45.
Mechanic, David. 2001. “The Managed Care Backlash: Perceptions and Rhetoric in Health Care
Policy and the Potential for Health Care Reform.” The Milbank Quarterly. 79(1): 35-55.
Miller, Robert H., and Harold S. Luft. 1997. “Does Managed Care Lead to Better or Worse
Quality of Care?” Health Affairs. 16(5): 7-25
Quadagno, Jill. 2004. "Why the United States has no National Health Insurance: Stakeholder
Mobilization Against the Welfare State, 1945-1996." Journal of Health and Social
Behavior. 45: 25-44
Trivedi, Amal N., Alan M. Zaslavsky, Eric C. Schneider, and John Ayanian. 2005. “Trends in
the Quality of Care and Racial Disparities in Medicare Managed Care.” New England
Journal of Medicine. 353(7): 692-700.
Health Care Reform: A Literature Review
Reformation of health care in the United States has been a topic of dissention among policy
makers and consumers for several decades. Secondary to the issue of health care is the need for
adequate behavioral health care funded by insurance and public assistance programs. The debate
surrounding the issue of how to deliver the services is prevalent in scholarly research. Mental
health care should be available to consumers in the same format as physical health care and
should be provided by the local entity most capable of managing the providers, funds, and
customers. The literature around this topic encompasses three common themes: ample time to
develop a transition from fee for service to managed health companies, carve-out versus carve-in
models for behavioral health care, and appropriate capitation or financing rates for the mental
health care provision. The evolution of Medicaid- federal funding to American states for
indigent health care, has forced states to depart from fee for service and move toward managed
care organizations. The fee for service model allowed providers to take advantage of the system
financially while delivering inadequate care to the indigent (Giles & Marafiote 1998). With cost
containment as the focus for state budgets, managed health is the only feasible solution. The
question as to who should manage the care, a public or private entity, and how the behavioral
health components should be provided has proponents on both sides of the issue.
One crucial warning came in from pro-private and pro-public management policy makers- avoid
a rapid roll out of the reformed plan. The state of Florida made dramatic changes in the state
health care plan and customers experienced major disruptions in care because of a failure to
ensure adequate contracts were executed in a timely manner (Ridgely, Giard, & Shern 1999).
Excellent service was received once an appropriate number of providers had entered the
contractual agreement. David Mechanic (1993) suggests that States take at least one decade to
build capacity of providers of mental health care in order to adequately address the supply side
approach. A Kansas study by Johnston and Romzek (1999) refer to a rapid move to managed
care as the Kettl model “to maximize certainty rather than competition”. The authors argue that
Kansas legislators verbalize the use of the market model where competition makes efficient
production but failed to realize the need to pay for staff as well as services (pgs 390-391).
Oregon’s health care reform raised national criticism but they painstakingly approached the
categorization and prioritization of care for the indigent over several years and then planned to
implement a two-year phase-in approach (Pollack, McFarland, Georg, & Angell 1994). The
need to balance the health care budget should not create a crisis for the medically fragile and
underserved by creating chaos with poor planning and rapid change.
Affordable health care for Americans has become an illusive dream over the past three decades
while adequate health care for the indigent and disabled seems implausible. Insurance
companies have migrated toward health maintenance organizations “HMO’s” and Preferred
Provider Options “PPO’s” in order to purchase blocks of health care from accredited
professionals for their customers. Many state Medicaid plans also moved into an HMO plan for
health care but the behavior health component has been excluded due to the cost (Callahan,
Shepard, Bieinecke, Larson & Cavanaugh 1995, Giles & Marafiote 1998), difficulty for
consumers to access due to restrictions (Pollack et al. 1994, Callahan et al. 1995), or caps of
service at unreasonable quantities (Ridgely et al. 1999, Ettner & Johnson 2003, Benko 2006).
The solution for the issue in Medicaid plans is to either provide the behavior health component
through the HMO or a “carve-in model”, or to contract outside the HMO professionals for care
as a “carve-out model”.
The argument against the carve-in model for mental health care is captured in the Oregon study
(Pollack et al. 1994) as the four “uns”, “undefinable, untreatable, unpredictable, and
unmanageable”. Since the HMO plan uses a forecast schedule and capitation rate to predict the
utilization of mental health services of customers, these factors lead to the exclusion of care
directly from providers. The services must be rendered by highly credentialed professionals that
are in short supply. Mental health care has largely been the responsibility of the state (Mechanic
1993, Callahan et al. 1995, Johnston et al. 1999, Ridgely et al. 1999) while health care, for the
body, has been the responsibility of the private sector. The fear of bankruptcy for HMO’s lead
many states to leave the mental health care of Medicaid recipients in a carve-out plan (Callahan
et. al. 1995, Johnston et al. 1999, Ridgely et al. 1999, Ettner et al. 2003) with a referral necessary
from the health provider to access a contracted mental health professional. Kansas’ reform plan
included contracting with a private non-profit to case-manage the mental health patients before
and during the provision of mental health care (Johnston & Romzek 1999). The states that chose
a carve-out revealed in the literature review are Florida (Ridgely et al. 1999), Maryland (Ettner
& Johnson 2003), Massachusetts (Callahan et al. 1995), Minnesota (Christianson, Lurie, Finch,
Moscovice, & Hartley 1992) and Kansas (Johnston & Romzek 1999).
States that chose a carve-in model were the foci of research about utilization rates. Research of
services in California (Beattie, McDaniel & Bond 2006) compared three counties’ substance
abuse and dual diagnosis mental health care visits to determine if forecasts were a plausible
measurement under an inclusive managed care plan. Oregon (Pollack et al. 1994) strategically
planned through a three tiered process for a carve-in plan that allowed universal access,
reasonable rates, and cost containment. Mechanic (1993) argues for carve-in as the only
equitable way to deliver mental health services and proposes managed care companies strike a
balance between acute care and restorative care typically needed for chronic mentally ill persons.
Giles and Marafiote (1998) raise the issue of ethical consideration for professionals and caution
against the HMO’s goal of reducing inpatient stays and capping utilization rates for mental
health care. With the evolution of managed mental health care companies, they urge (pg 48) the
inclusion of practitioners in the decision of forecasting treatment services for various diagnosis.
This method is precisely what Oregon did in the tiered approach of decision making for their
care plan (Pollack et al. 1994). Research revealed no statistical increase in use rates from a fee
for service model to the managed care model in six of seven factors measured (Beattie et al.
2006) and an eventual reduction in visits under managed health care (Christianson et al. 1992).
The ability to forecast use of services in order to properly budget for the care is the main impetus
for selection of a reform plan. The issue is appropriately summarized by Mechanic (1993) “The
Mental Health sector has been shaped substantially, albeit unintentionally, by general health and
welfare policies that were not designed to accommodate the mentally ill.” States want to ensure
the providers are willing to deliver the service for the rate allowed and to avoid a health crisis in
the state that would put the task back into the safety net of the state. Failure to appropriately
forecast use rates resulted in bankruptcy of an HMO in Florida (Ridgely et al. 1999) and the final
four HMO’s backing out of the state plan in Colorado (Benko 2006).
With proper forecasting of use rates, effective treatment was accomplished in Massachusetts
(Callahan et al. 2003) and Maryland (Ettner & Johnson 2003) by determining newly diagnosed
mentally ill required more services than those customers with an older or existing diagnosis.
Florida (Ridgely et al. 1999) and Maryland (Ettner et al. 2003) used an automatic enrollment
process to spread the cost of patient’s care out evenly to various providers. A categorical
analysis of costs of mental health services revealed substance abuse patients required more visits
than patients with other mental health diagnosis (Callahan et al. 1995, Ettner et al. 2003)
resulting in lower profits for the companies serving those clients (Ettner et al. 2003). Several
states realized a reduction from the forecasted use rates as compared to fee for service statistics
per capita enrolled (Christianson et al. 1992, Callahan et al. 1995).
These studies are irrespective of the managing entity being public or private for Medicaid. There
were successes and failures on public and private management of the funds as well as problems
with the carve-in and carve-out models for mental health services. The most critical failures of
the system seem to rest on the selection of a managed care organization that does not have
experience with Medicaid and mental health care (Christianson et al. 1992, Callahan et al. 1995,
Johnston & Romzek 1999, Ridgely et al. 1999, Beattie et al. 2006, Benko 2006). Mechanic
(1993) argues for a separate HMO for mental health care and to take one decade to develop this
new entity. Johnston et al. (1999) wants mental health care to remain under the state if
competition among providers isn’t possible and referred to the state transfer of care to a sole nonprofit as “a monopoly transfer to an interest group”. The selected non-profit lobbied for the
contract in the same way as the case study’s non-profit agency.
The subsets of carve-in or carve-out models seem to solve the transition phase dilemma but the
inclination to balance state budgets while providing critical mental health care to the indigent on
Medicaid seems to rest on inclusion in managed health rather than exclusion from the providers.
The call for ethical considerations by Giles et al. (1998) is a necessary policy change to address,
from a professional vantage point, the needs of the mentally ill and the mandate to care for the
patient throughout the course of a crisis. Non-profits can run human service provision more
efficiently than government (Christianson et al. 1992, Johnston et al. 1999, and Ridgely et al.
1999) but capitation rates for mental health services must be adjusted to prevent bankruptcy of
the agency (Christianson et al. 1992, Mechanic 1993, Pollack et al. 1994, Callahan et al. 1995,
Giles et al. 1998, Johnston et al. 1999, Ridgely et al. 1999). Government entities are forced to
focus on the bottom line of a financial statement or risk brisk scrutiny by constituents (Ridgely et
al. 1999) while non-profit organizations adeptly manage the care of the human being first while
maintaining openly public budgets connected to the care of the ill.
References
Beattie, Martha., McDaniel, Patricia., & Bond, Jason. 2006. “Public sector managed care: A
comparative evaluation of substance abuse treatment in three counties,” Addiction. 101
(6) 857 – 872.
Benko, Laura B. 2006. “Colorado losing last Medicaid HMO,” Modern Healthcare. 36 (32) 12 –
14.
Callahan, James J., Shepard, Donald S., Bieinecke, Richard H., Larson, Mary Jo., & Cavanaugh,
Doreen. 1995. “Mental Health/ Substance Abuse Treatment in Managed Care: The
Massachusetts Medicaid Experience,” Health Affairs Policy Journal of the Health
Sphere. 14 (3) 173 – 185.
Christianson, Jon B., Lurie, Nicole., Finch, Michael., Moscovice, Ira S., & Hartley, David. 1992.
“Use of Community-based Mental Health Programs by HMO’s: Evidence from a
Medicaid Demonstration,” American Journal of Public Health. 82 (6) 790 – 796.
Ettner, Susan L., & Johnson, Steven. 2003. “Do adjusted clinical groups eliminate incentives for
HMO’s to avoid substance abusers? Evidence from the Maryland Medicaid
HealthChoice Program,” The Journal of Behavioral Health Services and Research. 30 (1)
63-78.
Giles, Thomas R. & Marafiote, Richard A. 1998. “Managed Care and the Practitioner: A Call for
Unity,” Clinical Psychology Science and Practice. 5 (1) 41 – 50.
Johnston, Jocelyn M. & Romzek, Barbara S. 1999. “Contracting and Accountability in State
Medicaid Reform: Rhetoric, Theories, and Reality,” Public Administration Review. 59 (5)
383 – 399.
Mechanic, David. 1993. “Mental Health Services in the Context of Health Insurance Reform,”
The Milbank Quarterly. 71 (3) 349 – 364.
Pollack, David A., McFarland, Bentson H., Georg, Robert A., & Angell, Richard H. 1994.
“Prioritization of Mental Health Services in Oregon,” The Milbank Quarterly. 72 (3) 515
– 550.
Ridgely, M Susan., Giard, Julienne. & Shern, David. 1999. “Florida’s Medicaid Mental Health
Carve-Out; Lessons from the First Years of Implementation,” Journal of Behavioral
Health Services and Research. 26 (4) 400 – 416.
Will Mental Health Costs Drive Us All Crazy?
Mental health care and its subsequent costs are rarely, if ever, brought to the forefront in the
discussion of American health care. Insurance companies have lagged notoriously behind in
their benefit design provisions for mental healthcare when compared with other medical benefits
in private insurance. This lack of parity in essence discriminates against people with mental
illness and substantially increases their financial risk. (Barry, Frank and McGuire, 2006). Many
mental health advocates call for the expansion of such services on the basis that insuring or
providing them would actually reduce costs-or at least would allow them to pay for themselves
(Gabbard 1997). In addition, differences of opinion regarding the validity of the cost offset
model (treatment of mental health to reduce overall medical costs) continues to complicate this
debate.
Insurance companies have commonly discriminated against the treatment of mental illness.
Very few insurance policies have customarily reimbursed outpatient psychiatric services at the
same level that they reimburse outpatient nonpsychiatric medical treatment (Sharfstein, Stoline
and Goldman, 1993). Researchers note the contributing stigma attached to psychotherapy that
they believe may come from several myths: 1) psychotherapy is not a real treatment; 2)
psychotherapy is simply hand-holding that any nontrained professional could do; 3) there is no
evidence supporting the efficacy of psychotherapy; and 4) if psychotherapy is available to the
public as a component of a standard benefits package, “everyone” will use it and it will “break
the bank” (Mumford, et al., 1997).
Private health insurance is generally more restrictive in coverage of mental illness than in
coverage for somatic illness. Insurers fear that coverage of mental health services would result
in high costs associated with long-term and intensive psychotherapy and extended hospital
stays. They also were reluctant to pay for long-term, often custodial, hospital stays that were
guaranteed by the public mental health system, the provider of “catastrophic care.” These
factors encouraged private insurers to limit coverage for mental health services.
Many employers already believe the bank is near its breaking point. According to a recent
article in Health Affairs, employers have largely been ineffective and unenthusiastic managers
of the health benefits they sponsor. Health care, in general, is viewed as a distraction from their
core mission, yet they cannot manage costs effectively nor can they stop delivering such
benefits for obvious reasons (Galvin and Delbanco, 2006).
Mental health care makes them
want to lose their minds, figuratively speaking, of course.
Some private insurers refused to cover mental illness treatment; others simply limited
payment to acute care services. Those who did offer coverage chose to impose various
financial restrictions, such as separate and lower annual and lifetime limits on care (per person
and per episode of care), as well as separate (and higher) deductibles and co-payments. As a
result, individuals paid out-of-pocket for a higher proportion of mental health services than
general health services and faced catastrophic financial losses (and/or transfer to the public
sector) when the costs of their care exceeded the limits. (Report of the Surgeon General,
2007).
Federal public financing mechanisms, such as Medicare and Medicaid, also imposed
limitations on coverage, particularly for long-term care, of “nervous and mental disease” to avoid
a complete shift in financial responsibility from state and local governments to the Federal
government. Existence of the public sector as a guarantor of “catastrophic care” for the
uninsured and underinsured allowed the private sector to avoid financial risk and focus on acute
care of less impaired individuals, most of whom received health insurance benefits through their
employer (Goldman 1999).
There is a growing acceptance that good mental health can lead to good physical health.
Researchers are connecting the relationship in more significant ways. According to one study,
the widespread evidence of reduced rate of increase of medical expense following mental
health treatment argues for the “inseparability of mind and body in health care”, and it
strengthens the assertion that mental health treatment may improve patients’ ability to stay
healthy enough to avoid hospital admission for physical illness (Mumford, et al., 1997).
Interestingly enough, while the demand for psychiatric treatment has increased over the past
ten years, with the proportion of the population receiving treatment for depression alone more
that tripling (Olfson, Marcus and Druss, 2002), the number of psychiatrists in the United States
has plateaued and is expected to lag behind population growth (Cooper, 2002). The
implications of such a shortage of psychiatrists is further compounded by the reluctance of a
growing number of them to accept new patients whose coverage requires a great deal of
administrative activities, such as those covered by privately managed plans and Medicaid (Wilk,
et al, 2005).
Mental health care is obviously in a state of concern. Stigmatization of not only those seeking
assistance, resistance of employers and insurance companies to cover such assistance as well
as the disturbing current trends in the psychiatric workforce all must be aggressively addressed.
These conditions are reversible through education and effective public policy; the costs if we are
unsuccessful are simply too great to bear.
.
References
Mumford, E., Schlesinger, H. J., Glass, G. V., Cuerdon, T. (1998) A New Look at Evidence
About Reduced Cost of Medical Utilization Following Mental Health Treatment. Journal
of Psychotherapy Practice and Research, Volume 7, Number 1, Winter 1998. 67-85.
Wilk, J., West J. C., Narrow, W. E., Rae, D. S., Regier, D. (2005) Access to Psychiatrists in the
Public Sector and in Managed Health Plans. Psychiatric Services, April 2005, Volume
56, Number 4, 408-410.
Galvin, R., Delbanco, S. (2006) Between A Rock and A Hard Place: Understanding the
Employer Mind-Set. Health Affairs – Volume 25, Number 6, 1548-1555.
Goldman, H. H. (1999) Justifying Mental Health Care Costs. Health Affairs, Volume 18, Number
2, 94-95.
Mental Health: A Report of the Surgeon General. (2007)
http://www.surgeongeneral.gov/library/mentalhealth/.html
Olfson, M., Marcus, S. C., Druss, B. (2002) National Trends in the Outpatient treatment of
Depression. Journal of American Medical Association. Volume 287, 203-209.
Sharfstein, S.S., Stoline, A.M., Goldman, H.H. (1993) Psychiatric Care and Health Insurance
Reform. American Journal of Psychiatry, Volume 150, 7-18.
Barry, C. L., Frank, R. G., McGuire, T. G. (2006) The Costs of Mental Health Parity: Still an
Impediment? Health Affairs, Volume 25, Number 3, 623-634
Gabbard, G.O., Lazar, S.G., Hornberger, J. (1997) The Economic Impact of Psychotherapy: A
Review. American Journal of Psychiatry, Volume 154, 147-155.
Cooper, R. A. (2002) There’s A Shortage Of Specialists: Is Anyone Listening? Academic
Medicine, 2005, Volume 77, 761-766.
Managed Health Care and Children
Literature Review
Health care, with its associated high costs and less than universal access, often dominates
political debates in the United States. Children suffer from a lack of advocacy and therefore face
even greater challenges in utilizing this already complicated system. Although managed health
care possesses the potential for improved access, lower costs and coordinated care, it currently
fails to achieve these lofty expectations.
Before diving into the ups and downs of managed health care, one should explore its history.
This type of care goes back to the 1920’s and group payment plans such as Ross-Loos, Kaiser,
and Group Health. Even further back, in 1850’s California, immigrant settlers banded together
to arrange for health care provision. The issue pops up again in the 1970’s as the Nixon
administration pushed HMO’s as a way of cutting the costs of health care. In the 1980’s,
offshoots of these organizations were placed under the category of “managed care”. Hughes and
Luft, in their article entitled, Children and Managed Health Care, 1998, defined managed care
as:
…..a variety of financing and delivery arrangements. The single unifying characteristic of these various approaches
is that those enrolled in managed care plans are encouraged or required to obtain care through a network of
participating providers, who are selected by the managed care organization and who agree to abide by the rules of
that organization. This is in contrast to fee-for-service arrangements, in which patients typically may seek care from
any licensed health care professional or organization, and providers may perform services based on their individual
judgments about what is appropriate or needed.1
As we will see, there is little available data on children as consumers of managed care. Deal and
Shiono’s article, Medicaid Managed Care and Children: An Overview, 1998, focuses on one
area with existing data.
The use of managed care arrangements to deliver health services to Medicaid beneficiaries has increased in recent
years as states and the federal government have sought new ways to control escalating health care expenditures
associated with the Medicaid program. Low-income and children, who represent the great majority of Medicaid
beneficiaries but account for only a fraction of total program expenditures, have been the primary groups enrolled in
Medicaid managed care.2
Based on data from this group, many observers believe that some of the major challenges facing
managed care include complete care of children, coordination of care, and costs of care.
Jonathan Finkelstein argues, in Defining the Challenge and Opportunities for Children in
Managed Health Care: A Pediatrician’s Perspective, 1998,
The first attribute of care systems that promote child health is the assignment to a specific provider (or group) of the
responsibility to provide complete care for a population of children. This responsibility includes not just the
treatment of disease when a sick child is brought to the office, but monitoring outreach, and disease prevention
activities. I believe that managed care has made us confront the real challenges in operationalizing the concept of a
medical home. It is always much easier to treat the child in front of you than to develop effective out reach for those
families who do not seek care.3
In Defining the Challenge and Opportunities for Children in Managed Health Care: A Parent’s
Perspective, 1998, Carol Gleason adds,
Another opportunity for managed care is motivation and flexibility to create special ancillary or supportive services
for children with complex needs. …..Yet another opportunity for managed care lies making available a network of
providers that includes appropriate pediatric specialists, as well as mechanisms for out-of-plan referrals when
warranted.4
Managed care held the promise of increased access to these specialists by way of the primary
care provider. It has not fulfilled that promise. According to Freund and Lewitt, Managed Care
for Children and Pregnant Women: Promises and Pitfalls, 1993,
Findings from the few studies that attempted to measure separately the effect of managed care on use of specialists
and primary care physicians suggest that managed care is associated with a reduction in the use of specialists by
children without a commensurate increase in the use of primary care physicians. 5
These effects are magnified in special needs children. Stroul, Pires, Armstrong, and Meyers, in
The Impact of Managed Care on Mental Health Services for Children and Their Families, 1998,
projected that,
Rather than expanding the array of covered services, the advent of managed care could result in a regression to the
traditional insurance model of covering a limited number of services for a limited amount of time. 6
Overall, child health care is different from adult health care and needs recognition of that fact by
managed care providers. Szilagyi, in Two Commentaries: Managed Care for Children: Effect on
Access to Care and Utilization of Health Services, 1998, outlines these differences.
Most children are physically healthy. Their health care needs include preventive services; acute services for
frequent illness and injuries; management of developmental, school-related, psychosocial, and emotional problems;
and the occasional use of specialty, emergency, or inpatient care. Evaluation of access and utilization should focus
on these types of services.7
Tied into complete care is coordination of care, and this is addressed by Gleason.
Another major opportunity for managed care lies in the coordination role of the primary care provider, who
functions as a case manager to ensure that preventive interventions occur and that coordinated referrals for specialty
care are made.8
Stroul adds,
The loss of an interagency focus is another concern. Interagency planning at the system level and interagency
service planning for children are both integral aspects of systems of care. Both of these elements could be lost if
they are not directly incorporated into managed care plans, requests for proposals, and contract requirements for
MCOs.9
Cost-saving potential in managed care has not been borne out by experience. Freund and Lewitt
state that,
Not only does the available literature not show that managed care improves health status or the quality of medical
care, it is also not encouraging regarding the cost-saving potential of most forms of managed care. It also appears
that managed care has had very little, if any, effect on the rate of growth in health care costs. 10
Managed care influences costs in five basic areas, according to Bergman and Homer, Managed
Care and the Quality of Children’s Health Services, 1998.
1) Limiting inappropriate use of health care services 2) Controlling access to health care services 3) limiting care by
restricting benefit packages 4) limiting the provider network, and 5) manipulating clinicians’ financial incentives to
reduce utilization of expensive services.11
There are serious limitations to the data analyzed in these studies. Szilagyi enumerates these.
Experts have noted methodological difficulties in evaluation the effects of managed care plans. These constraints
are a major reason for the dearth of studies evaluating managed care effects, and perhaps for the inconsistent and
often contradictory findings. Managed care plans differ widely in their structure, financial arrangements, and
utilization management, and it is difficult to make generalizations about even theoretical effects on access or
utilization of care. The effect of managed care depends on the extent of financial incentives and disincentives
placed on the providers, and on the structural and financial arrangements of the comparison groups. Consequently,
it is possible to observe even greater variability among different types of managed care plans than between managed
care plans and fee-for-service arrangements…..Overall, studies have yielded mixed results, with no consistent
improvement in access to care resulting from Medicaid managed care.12
Deal, Shiono, and Behrman, in Children and Managed Health Care; Analysis and
Recommendations, 1998, offer the following recommendations for child care in a managed care
system. They approach the problem at four levels, individual, family, community, and provider
to create an integrated approach to the problem which addresses the problems of complete,
coordinated, and cost-effective coverage for children.
1) Hughes, Dana C.; Luft, Harold S., Managed Care and Children: An Overview, The Future of Children, Vol. 8,
No. 2, 1998, p. 28
2) Deal, Lisa W.; Shiono, Patricia H., Medicaid Managed Care and Children: An Overview, The Future of Children,
Vol. 8, No. 2, 1998, p. 93
3) Finkelstein, Jonathan A., Defining the Challenge and Opportunities for Children in Management Health Care: A
Pediatrician’s Perspective, The Future of Children, Vol. 8, No. 2, p. 139
4) Gleason, Carolyn S., Defining the Challenge and Opportunities for Children in Managed Health Care: A
Parent’s Perspective, The Future of Children, Vol. 8, No. 2, p. 136
5) Freund, Deborah A.; Lewitt, Eugene M., Managed Care for Children and Pregnant Women: Promises and
Pitfalls, The Future of Children, Vol. 3, No. 2, 1993, p. 104
6) Stroul, Beth A.; Sheila A. Pires; Mary I. Armstrong; Judith C. Meyers, The Impact of Managed Care on Mental
Health Services for Children and their families, The Future of Children, Vol. 8, No. 2, 1998, p. 122
7) Szilagyi, Peter G., Two Commentaries: Managed Care for Children: Effect on Access to Care and Utilization of
Health Services, The Future of Children, Vol. 8, No. 2, 1998, p. 40
8) Gleason, Carolyn S., Defining the Challenge and Opportunities for Children in Managed Health Care: A
Parent’s Perspective, The Future of Children, Vol. 8, No. 2, p. 135
9) Stroul, Beth A.; Sheila A. Pires; Mary I. Armstrong; Judith C. Meyers, The Impact of Managed Care on Mental
Health Services for Children and their families, The Future of Children, Vol. 8, No. 2, 1998, p. 122
10) Freund, Deborah A.; Lewitt, Eugene M., Managed Care for Children and Pregnant Women: Promises and
Pitfalls, The Future of Children, Vol. 3, No. 2, 1993, p. 107
11) Bergman, David A.; Charles J. Homer, Managed Care and the Quality of Children’s Health Services, The
Future of Children, Vol. 8, No. 2, p. 63
12) Szilagyi, Peter G., Two Commentaries: Managed Care for Children: Effect on Access to Care and Utilization of
Health Services, The Future of Children, Vol. 8, No. 2, 1998, p. 42
Bibliography
Anderson, Gerard F., State Regulation of Managed Care: The Impact on Children, The Future of
Children, Vol.8, No. 2, 1998, pp. 76-92
Bergman, David A.; Charles J. Homer, Managed Care and the Quality of Children’s Health
Services, The Future of Children, Vol. 8, No. 2, pp. 60-75
Deal, Lisa W.; Shiono, Patricia H., Medicaid Managed Care and Children: An Overview, The
Future of Children, Vol. 8, No. 2, 1998, pp. 93-104
Deal, Lisa W.; Shiono, Patricia H.; Richard E. Behrman, Children and Managed Health Care:
Analysis and Recommendations, The Future of Children, Vol. 8, No. 2, 1998, pp. 93-104
Finkelstein, Jonathan A., Defining the Challenge and Opportunities for Children in Management
Health Care: A Pediatrician’s Perspective, The Future of Children, Vol. 8, No. 2, pp. 138-140
Freund, Deborah A.; Lewitt, Eugene M., Managed Care for Children and Pregnant Women:
Promises and Pitfalls, The Future of Children, Vol. 3, No. 2, 1993, pp. 92-122
Gleason, Carolyn S., Defining the Challenge and Opportunities for Children in Managed Health
Care: A Parent’s Perspective, The Future of Children, Vol. 8, No. 2, pp. 134-138
Hughes, Dana C.; Luft, Harold S., Managed Care and Children: An Overview, The Future of
Children, Vol. 8, No. 2, 1998, pp. 25-38
Stroul, Beth A.; Sheila A. Pires; Mary I. Armstrong; Judith C. Meyers, The Impact of Managed
Care on Mental Health Services for Children and their families, The Future of Children, Vol. 8,
No. 2, 1998, pp. 119-133
Szilagyi, Peter G., Two Commentaries: Managed Care for Children: Effect on Access to Care
and Utilization of Health Services, The Future of Children, Vol. 8, No. 2, 1998, pp. 39-59
Managed Healthcare
Elected officials can hardly go a day without addressing issues related to managed
healthcare. The question is; what is the appropriate of role government in guaranteeing the
highest levels of standards in quality of care? Do we leave healthcare in the realms of the free
market or is government involvement a necessity? Changes in managed healthcare are
constantly being sought by consumers, physicians, politicians, healthcare workers, and the health
plans themselves. The end result for any major changes in managed healthcare always fall on
the consumer, this is not too often a positive result. Policymakers are forced to remember who
donated to their campaigns and most often are not qualified to make decisions regarding health
care and reform. The debate on healthcare reform has many sides and can be consumer focused,
managed plan focused, employer mandated, or deal with prescription drug issues. The
healthcare debate has recently focused on management problems, private vs. government (local,
state, or federal). The healthcare debate is so multifaceted that most elected officials give up
without ever passing any type of real reform. One area that is often forgotten in the health care
debate is mental health. Mental health policy, as it pertains to serious and chronic mental illness,
represents an arena so badly served by much of the social and preventive care ideology which is
still commonly espoused today (Mechanic. 1987). It is estimated that 15% of the population
suffers from some form of mental disorder and that we are facing a pandemic of mental
disorders, so we are compelled to do something about it (Wagenfeld. 1983). A national study of
adolescents and adults found that 48% of the respondents reported that they had experienced a
mental disorder in their life time (Takeuchi, Kim. 2000). When people seek health care
regarding mental health issues they are usually misdiagnosed and mistreated and some
treatments work on certain groups, but not others (Takeuchi, Kim. 2000). This leads to a move
to diversify treatments for diversified populations, this is when managed health care and local
clinics are best.
California created a task force to address the issues facing the State which found that any
long term solutions to the profound problems in the system would, “ require fundamental cultural
and systematic change” (Enthoven,Singer. 1998). The taskforce found a backlash amongst
consumers due to the fact they were forced from a fee-for-use type plan into a HMO plans which
utilized cost containment measures. In a study by Steve Findlay, he explains the trends in
managed behavioral healthcare. By focusing in California, Findlay estimates that 78% of
Americans in a private or public health plan are also enrolled in some type of managed
behavioral health plan. This is taxing the system and in 1996 forced 27 states to develop a
managed care plan for mental health patients in efforts to serve the Medicaid effectively
(Findlay. 1999). Medicaid works best when it is used in conjunction with community-based
systems of care, private sector for profit companies (Stroul, Pires, Armstrong, Meyers. 1998).
These community-based systems of care, which are financed largely by Medicaid, are most
effective at meeting the needs of juvenile patients and their families. The study finds that those
suffering from emotional and behavioral disorders are best served in a managed health care
system that utilizes approaches that control for service utilization and contain costs. These
community-based systems are just another step in the ever evolving process of mental health
care. During the 1850s States began to build asylums in an attempt to treat those with mental
disorders in a more humane way then the confines of the local jails at the time (McPheeters.
1977). According to McPheeters these hospitals led from treatment to custody and rarely made
any attempt to bring about healing. Mental health was not considered a federal government
concern until the passage of the Community Mental Health Centers Act of 1963 (McPheeters.
1977).
In a study headed by Dr. Dane Wingerson, M.D., he gives us a statistical model of the
numbers of patients visiting hospital triages (emergency rooms) instead of having consistent
mental health treatment. This places burdens on the medical community and their ability to treat
seriously injured. In his conclusion, Wingerson found that patients who were enrolled in a
mental health plan were consistently less likely to be homeless and abuse drugs
(Wingerson.2001).
Not all players in the mental health debate agree on the managed care solution.
Traditionally the state has been charged with the responsibility for policy formulation, resource
distribution, and monitoring functions (Arrington, Biskin. 1982). In an article by S. Arrington
and D. Biskin we are given the opportunity to see how private entities do not mix well with state
regulations. The authors of the article also cite the problems cause by conflicting expectations
from politicians, professionals, parents, the press, and the public at large. Another area of
concern in mental health issues is who is going to pay and what is considered a medical problem
and what is a mental health problem? Advocacy groups contend that research demonstrates
mental condition s like schizophrenia and bipolar disorders are diseases and are more properly
addressed in a health care system (Pollack1994). The insurance companies like to argue what
Pollack call the four “uns”: undefinable, untreatable, unpredictable, and unmanageable
(Pollack1994).
Bibliography
Arrington, S., and D. Biskin. Assessing the Productivity of a State Mental Health Service
System. Public Productivity Review, Vol. 6 (Sep. 1982): 192-205.
Enthoven, A., and S. Singer. The Managed Care Backlash and the Task Force in California.
Health Affairs. Vol.17, No. 4 (Jul./Aug. 1998).
Findlay, S. Managed Behavioral Health Care in 1999: An Industry at a Crossroads. Health
Affairs. Vol. 18, No. 5 (Sep./ Oct. 1999).
McPheeters, H. Mental Health Programs. Proceedings of the Academy of Political Science.
Vol.32, No.3
(1977): 159-169.
Mechanic, D. Correcting Misconceptions in Mental Health Policy: Strategies for Improved Care
of the Mentally Ill. The Milbank Quarterly. Vol. 65, No. 2 (1987): 203-230.
Pollack, D., and B. McFarland. Prioritization of Mental Health Services in Oregon. The Milbank
Quarterly. Vol. 72, No. 3 (1994): 515-550.
Stroul, B., and S. Pires. The Impact of Managed Care on Mental Health Services for Children
and their Families. The Future of Children. Vol. 8, No. 2 (1998): 119-133.
Takeuchi, D., and K. Kim. Enhancing Mental Health Services Delivery for Diverse Populations.
Contemporary Sociology. Vol. 29, No. 1 (Jan. 2000): 74-83.
Wagenfeld, M. Primary Prevention and Public Health Policy. Journal of Public Health Policy.
Vol. 4, No. 2 (Jun. 1983): 168-180
Wingerson, D., and J. Russo. Use of Psychiatric Emergency Services and Enrollment Status in a
Public Managed Mental Health Care Plan. Psychiatric Services. Vol. 52, No. 11 (Nov. 2001):
1494-1501
Beattie, M., Hu, T., Li, R., & Bond, J. (2005). Cost-effectiveness of public sector
substance abuse treatment: Comparison of a managed care approach to a
traditional public sector system. Journal of Behavioral Health Services &
Research, 32(4), 409-429.
A managed care and a traditional (non managed care) substance abuse treatment program were
compared to see if there were significant differences in access, costs, outcomes, and cost
effectiveness. Predisposing, enabling, and reinforcing variable mean scores were compared to
determine whether or not there were significant differences between the two samples. The
results of the study demonstrated that the managed care program was cheaper and more cost
effective, although utilization of programs was not as different as expected.
Cousineau, M., & Lozier, J. (1993). Assuring access to health care for people under
national health care. American Behavioral Scientist, 36(6), 857-870.
This article is about helping people who are homeless. The homeless population is increasing in
numbers with complex medical issues. Health care reform must include a mechanism to ensure
this population does not get left behind.
Essock, S., & Goldman, H. (1995). States embrace of managed mental health care.
Affairs, 14(3), 35-44.
Health
Mental health care is typically provided by state mental health agency (SMHA). Unlike other
health care services, the state is the primary provider of mental health care. Initially, the state
provided services internally. However, over time, the state system for managing mental health
care evolved to become more of a manager of a variety of services provided by multiple entities.
The purpose of this paper is to analyze the factors that define managed behavioral health systems
and to identify the typical game plan to manage care. The factors presented include contracting,
utilization, review, and monitoring of services. One of the primary goals of SMHA’s is to
provide the best services for the least amount of money. Many are forced to look to outside
entities to achieve this goal.
Fronstin, P., & Lee, J. (2005). A community expands access to health care: The case of
access health in Michigan. Health Affairs, 24(3), 858-863.
A significant number of the American population is uninsured. Access Health is a communitybased approach that intends to reduce the number of uninsured in Muskegon, Michigan. This
paper describes the program today along with key issues involved in the origination of the
program. The program was founded by the Kellogg Foundation. The program was created in
part with the help of local doctors and community funding was one of the most significant issues
discussed.
Gance-Cleveland, B., Costin, D., & Degenstein, J. (2003). School-based health
centers: Statewide quality improvement program. Journal of Nursing Care
Quality, 18(4), 288-294.
School-based health centers may be the best way to reach disadvantaged youth who would not
otherwise have access to care. Two primary issues for the sustainability of school-based health
centers are the generation of funding and quality of services provided. The Colorado
Association for School-Based Health Care (CASBHC) was founded in 1996. It quickly became
evident that quality of care would need to be documented in order to obtain reimbursement. A
statewide initiative was undertaken to strengthen and improve school-based health centers.
Certification standards and quality of care indicators were established. A survey was conducted
to determine patient satisfaction since this is a measure of the quality of service provided.
Access to care was the most important factor influencing the quality of care.
Lavis, J., Davies, H., Oxman, A., et. al. (2005). Towards systematic reviews that
inform
health care management and policy-making. Journal of Health
Services Research &
Policy, 10(Supp 1), 35-48.
This study sought to identify the factors that influence policy-makers to utilize specific research
to inform their decisions. The results highlighted that interaction between researchers and policy
makers and timing are two important factors that influence the use of information by policy
makers. It was noted that it is beneficial for policy makers to be informed of the critical issues
relative to specific policy so that they can make informed decisions. The analysis also
demonstrated that although recommendations are frequently provided, less information is
provided on contextual factors that could help inform decisions. It was recommended that
researchers could help policy makers by highlighting the contextual factors relevant to decisions.
Maarse, H. (2006). The privatization of health care in Europe: An eight country
analysis. Journal of Health Politics, Policy, and Law, 31(5), 981-1014.
The process of privatization of health care in eight countries was the focus of the paper.
Evidence that privatization of health care is increasing was presented. The factors that influence
the process of privatization or that serve as barriers preventing privatization were examined.
Lengthy discussions of the characteristics of public and private were undertaken. A pragmatic
approach was taken from four perspectives: health care financing, health care provision, health
care management and operations, and health care investment.
Neumann, P., & Sullivan, S. (2006). Economic evaluation in the US: What is the
missing link? Pharmacoeconomics, 24(11), 1163-1168.
The evaluation of the American healthcare system typically excluded cost analysis. Instead,
health care is typically evaluated based on clinical outcomes. In 2005 over half of medical
expenditures in the United States were funded by federal or state programs. This article cites the
reasons that cost effectiveness has not been popular as an analysis of health care in the United
States and predicts it will become more popular in the future.
Shi, L., Politzer, R., Regan, J., Lewis-Idema, D., Falik, M. (2000). The impact of
managed care on the mix of vulnerable populations served by community
centers. Journal of Ambulatory Care Management, 24(1), 51-66.
health
This study attempted to measure the impact of managed care on vulnerable populations served
by community health centers. Community centers utilizing a managed care model were
compared to those that did not. The results of the study demonstrated that managed care facilities
provided service to a smaller number of uninsured and a greater number of Medicaid patients
compared to their counterparts. It was concluded that managed care may present a barrier for the
indigent to receive services.
Zuvekas, A. (2005). Health centers and the healthcare system. Journal of
care management, 28(4), 331-339.
ambulatory
The relationship between health care centers and physicians, hospitals, teaching centers,
specialty physicians, networks, and other providers is examined. Health centers serve as
providers of primary and preventive care to their patients. Still, there are limitations to the
services a health center can provide. This is especially true when patients are uninsured. Since
health centers may not be able to provide services to everyone, their relationship to other service
providers is critical. Managed care programs may help ensure the survival of health centers by
collecting payment in advance or connecting patients to government funding programs such as
Medicaid and Medicare.
Public vs. Private
Regarding the case study of the “Philadelphia Behavioral Health System,” the city was
wedged in a difficult situation trying to figure out the most efficient and beneficial way to
improve and take care of its impoverished and mentally ill population. According to the case
study, “nearly 90 percent of the [city’s homeless population] were estimated to have problems
with mental illness and substance abuse.” (C16-02-1649, p. 1). The current public health system
in place was not efficient and cost worthy. With minimal funds and improper organization,
many residents were unable to get medical treatment for their various ailments or were
repeatedly diagnosed for the same illness resulting in a waste of money and time. Residents
complained of the “jumble of funders and treatment providers.” (C16-02-1649, p. 2).
Throughout tumultuous years of reorganizing and many patients suffering, the city
decided to convert its public behavioral health care for a private health maintenance organization
(HMO). They were seen as cost effective and much better at organizing appropriate care.
However, Philadelphia soon realized that this private entity was much more concerned with
profit maximizing rather than adequate and beneficial care. The federal government granted the
HMO a certain amount of dollars to spend per patient, which in turn, the HMO farmed out their
patients to other organizations. These organizations were termed “carve-out companies because
they handled behavioral health money that had been ‘carved out’ of the original contract.” (C1602-1649, p. 9). The HMO would allow these companies a small fraction of the money the
federal government lent and pocketed the rest for their shareholders. These types of contracts
were not uncommon in the “managed behavioral health care industry.” (Sturn, 1999, p. 360).
The residents were unhappy because the HMO were unwilling to treat numerous ailments
due to pricing and were only interested in their profits. The community rose up and terminated
the private system. Later, a new entity emerged that was community based and specialized only
in behavioral health care. They would handle the federal government money for that specific
group and would create a system that not only cared for the patient’s needs but also were also
efficient and organized in order to keep costs down.
In the literature, this problem was faced in many states as well as countries all over the
world. The central problem associated with the feud between public and private health care
systems is cost efficiencies. Other problems include “inadequate coverage, relatively high levels
of public dissatisfaction, and expensive, complex administrative requirements.” (McPhee, 1995,
p. 69). According to the literature, health care reform models can be categorized into three
groups: “private marketplace insurance, employer-based health insurance, and centralized or
single-payer health care models.” (McPhee, 1995, p. 69). Within these three groups, public
satisfaction is a primary component. However, the main focusing question for the reform is
whether the majority of the population most affected by the reform enjoys a high level of health.
In addition, American Medical Association sponsored surveys have “reported that both the
people, as well as physicians in the U.S., consider cost as the first concern facing the health care
system today.” (McPhee, 1995, p. 69). Following that question, the second largest concern for
health care reform is the accessibility for the patients.
There is also an argument against those two central concerns. In other literature, cost and
accessibility are vital to a health care system, but are not enough. Feingold suggests that other
concerns that have been the driving force behind reform are the “high and rapidly increasing
costs…and lack or inadequacy of private or public insurance coverage for a substantial part of
the population.” (Feingold, 1994, p. 727).
Another case study, similar to the Philadelphia study, was done in Fort Bragg. It
followed the “transition from a demonstration project for child mental health services to a
capitated managed behavioral health care contract with a for-profit managed care company.”
(Heflinger & Northrup, 2000, p. 390). The purpose of this study was to understand the impact
on the individuals and community with the implementation and start up of a capitated managed
behavioral health care program, similar to the Philadelphia system. The various problems the
system incurred ranged from “access to services decreased …difficult to treat children were
shifted to the public sector, [to] ratings of service system performance and coordination fell.”
(Heflinger & Northrup, 2000, p. 390).
Managed health care systems are frequently what cities and counties turned to try to
handle the rising Medicaid costs. Originally, managed care was used for healthy populations but
within the last decade or so, it has been moving into non-traditional markets. These include
managing health care for part of the population with disabilities. (Donegan Shoaf, 1999, 240).
Managed health care systems also focus on drug and alcohol abuse as well.
Throughout the literature, there are so many varying opinions concerning which sector
would be best handling a community’s need for a health care system. There are corporations
fighting to have the private sectors managing health care. A qualification they always employ
exemplifies their years of experience managing large populations. Contrarily, publicly managed
health care systems declare their attention to the patient’s needs and well-being. Private
corporations seem to do best in healthy populations whereas public health systems are necessary
in parts of the country where accessibility and costs are primary concerns. The debate is on
going and a consensus has yet been found.
References
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The Kennedy School of Government, Case Program.
Donegan Shoaf, L. (1999). Defining Managed Care and Its Application to Individuals
with Disabilities. Focus on Autism and Other Developmental Disabilities. 14(4), 240251.
Emanuel, E. (2002). Health Care Reform: Still Possible. The Hastings Center Report.
32(2), 32-34.
Essock, S., & Goldman, H. (1995). States’ embrace of managed health care. Health
Affairs. 14(3), 34-45.
Feingold, E. (1994). Health Care Reform-More than Cost Containment and Universal
Access. American Journal of Public Health. 84(5), 727-728.
Ginsburg, P., & Lesser, C. (1999). The View from Communities. Journal of Health
Politics, Policy & Law. 24(5), 1005-1014.
Halverson, P., Mays, G., Kaluzny, A., & Richards, T. (1997). Not-So Strange
Bedfellows: Models of Interaction between Managed Care Plans and Public
Health Agencies. The Milbank Quarterly. 75(1), 113-138.
Heflinger, C., & Northrup, D. (2000). What Happens When Capitated Behavioral Health
Come to Town? The Transition from the Fort Bragg Demonstration to a Capitated
Managed Behavioral Health Contract. Journal of Behavioral Health Services &
Research. 27(4),.390- 406.
McPhee, D. (1995). Health Care in the United States: The Battle of Reform. Journal of
Health and Social Policy. 7(1), 69-87.
Musser, J. (1996). Health Care Data: Government Intervention or Private Cooperation?
The Milbank Quarterly. 74(1), 37-41.
Rodgers, J., & Barnett, P. (2000). Two Separate Tracks? National Multivariate Analysis
of Differences Between public and private substance Abuse Programs. American
Journal of Drug & Alcohol Abuse. 26(3), 429-443.
Sparer, E. (1976). The Legal Right to Health Care: Public Policy and Equal Access. The
Hastings Center Report. 6(5), 39-47.
Steinbrook, R. (2006). Health Care Reform in Massachusetts- A Work in Progress. New
England Journal of Medicine. 354(20), 2095-2098.
Sturn, R. (1999). Tracking Changes in Behavioral health services: How have carve-outs
changed care? Journal of Behavioral Health Services and Research. 26(4), 360372.
Healthcare
Philadelphia, like many other cities in the United States, found itself struggling with their
healthcare systems. During the mid-1980s, health care costs had been rising at a rate of 13% per
year – double the rate of inflation – for the past decade (Wunsch 71). Many health care systems
appeared to be failing, and with a growing “anti-government” sentiment, cities, like Philadelphia,
began considering other alternatives. By 1996, the Philadelphia city council was tasked with how
to reorganize their behavioral health services. The council was considering two proposals: one
would allow private sector health maintenance companies to manage the system and the second
would allow the city to create its own managed care organization.
The issue of HMOs versus publicly managed healthcare is a heated debate, one
that we are still dealing with over a decade after the Philadelphia city council tackled the issue.
The literature on the matter, however, seems fragmented into pro and anti-HMO, with both sides,
at least, willing to acknowledge their own weaknesses. The policy analysis studying the market
approaches to health cost containment have “suffered from confusion over the differences among
fact, hypothesis, and evidence. This confusion has made the analysts’ assessments …even more
provisional and personal than they must unavoidably be (Brown 185). Much of the literature
focused on three areas: 1) the quality of care given by HMOs, 2) the actual savings HMOs can
offer, and 3) recommendations for policy makers.
Prepaid medical service plans in the United States have existed for over a century, but
came into prominence during the Great Depression. The current HMOs, however, “operate with
a markedly different set of incentives…” and are often exempted from the restrictions and
regulations placed upon public-sector care systems (Luft 531). This can create obvious
discrepancies in the types of care received in publicly versus privately owned healthcare
facilities. According to Lawrence Brown, “everyone knows what everyone knew before the
HMO strategy was launched: HMOs have impressively low rates of hospital use. But the extent
of savings…is disputed…and little is known about the quality of care…” (Brown 186).
The fact that HMOs are privately managed, and the private sector is typically primarily
concerned with profit has been an enormous criticism of HMOs. Veach and Collen cite a
situation in which a doctor and patient decided upon a treatment regimen, but once the doctor
consulted the HMOs financial ledger, he noticed by changing drugs, which might not have been
as effective and have caused unwanted side effects, the doctor could reduce the HMOs payment
from $430 to $30 (Veatch 13). Baker and Corts contend that there is some evidence that supports
the claim that HMOs cost less than traditional healthcare systems because they “use fewer
expensive tests and procedures…” (Baker 389). They go on to say, however, that “HMOs have
lower costs…simply because they enroll consumers who are healthier than average…” (Baker
389). James Ligon finds a similar conclusion: “mean outpatient expenditures under HMO and
FFA delivery systems do not differ…” (Ligon 105). Dana Golman, et al, puts it even more
bluntly saying that there are “little if any savings from the HMO.” (Goldman 61). While HMOs
are touted to be a more streamlined, cost effective method, this doesn’t appear to be the case.
Finally, several conclusions were offered for policy makers debating the use of HMOs.
Dana Goldman states that “policymakers who are considering managed care as a potential
vehicle for covering broad segments of the population should be careful about designing a
benefits package that induces large movements down a demand curve.” (Goldman 294.) Fredric
Wolinsky states that much of the data is contradictory in nature and that very little can be
concluded about the performance of HMOs. He does, however, make several statements, most
importantly “the major factor involved in reducing the costs of HMO care is the lower level of
hospitalization” but that “we do not know how or why” that is the case (Wolinksy 578).
With the preponderance of conflicting data, perhaps the guidance of Richard McNeil, Jr.
and Robert E. Schlenker is the most sound of all: “No single delivery mode can incorporate
incentives for achieving all the quality, cost, and distribution goals our society has set for health
care delivery in the United States…we feel the best approach is a system which uses different
delivery modes—based on different incentive structures—actively competing with one another”
(MnNeil, Jr. 220).
Bibliography
Baker, Lawrence C., and Kenneth S. Corts. “HMO Penetration and the Cost of Health Care:
Market Discipline or Market Segmentation?” 1996. The American Economic Review. Vol. 86,
No. 2, (May, 1996), pp. 389-394.
Brown, Lawrence D. “Competition and Health Cost Containment: Cautions and Conjectures.”
1981. The Milbank Memorial Fund Quarterly. Health and Society, Vol. 59, No. 2. (1981), pp.
145-189.
Goldman, Dana P. “Managed Care as a Public Cost-Containment Mechanism.” 1995. The RAND
Journal of Economics. Vol. 26, No. 6, (Summer 1995), pp. 277-295.
Goldman, Dana P., Arleen Liebowitz, and Joan L. Buchanan. “Cost-Containment and Adverse
Seleciton in Medicaid HMOs.” 1998. Journal of the American Statistical Association. Vol 93,
No. 441. (Mar., 1998), pp. 54-62.
Ligon, James A. “Fee-for-Service versus HMO Outpatient Expenditure Patterns.” 1994. The
Journal of Risk and Insurance. Vol. 61, No. 1, (Mar. 1994), pp. 96-106.
Luft, Harold. “Assessing the Evidence on HMO Performance.” 1980. The Milbank Memorial
Fund Quarterly. Heath and Society, Vol. 58, No. 4, Special Issue: HMO Promise and
Performance. (Autumn 1980), pp. 501-536.
McNeil Jr., Richard, and Robert E. Schlenker. “HMOs, Competition, and Government.” 1975.
The Milbank Memorial Fund Quarterly. Health and Society. Vol. 53, No. 2, (Spring 1975), pp.
195-224.
Veatch, Robert M., and Morris F. Collen. “Case Studies: The HMO Physician’s Duty to Cut
Cost.” 1985. The Hastings Center Report. Vol. 15, No. 4, (Aug., 1985), pp. 13-15.
Wolinsky, Fredric D. “The Performance of Health Maintenance Organizations: An Analytic
Review.” 1980. The Milbank Memorial Fund Quarterly. Health and Society. Vol. 58, No. 4,
Special Issue: HMO Promise and Performance. (Autumn 1980), pp. 537-587.
Wunsch, Bobbie, and Barbara Aved. “Trends in Health Care Financing: Opportunities for
Family Planning Agencies.” 1987. Family Planning Perspectives. Vol. 19, No. 2, (Mar. – Apr.,
1987), pp. 71-74.
Health Care Literature Review
The American health care system has many conflicts of interest, the most important is the
ability of health care providers to provide quality care while attempting to make a profit. They
might resort to hyping new and expensive drugs when other, cheaper drugs exist, due to their
relationship with pharmaceutical companies. They also might attempt to deny care to the sickest
people, because their care costs the most money. Managed care organizations attempt to make
these decisions.
Reshma Jagsi examines conflicts of interest due to the prevalence of direct to patient drug
advertising. The article begins with a listing of hypothetical conflicts of interest wherein a
patient specifically requests a drug he had seen advertised in some fashion. The researcher
suggests that there is a “glaring lack of guidelines” for direct to patient advertising, and the
ability of doctors to suggest the best treatment options when they have a financial conflict of
interest. The researcher suggests a ban on pharmaceutical gifts to doctors, stronger disclosure
rules, and more stringent regulation of advertising as possible solutions (Jagsi 2007).
A group of researchers also analyze the practice of managed care organizations to offer
certain incentives to doctors based on their actions. The most common incentives are to offer a
bonus based on a low number of referrals to specialists, and for seeing a high number of patients
each day. A survey of California doctors found that they felt that these incentives could
compromise quality of care, and that they had lower feelings of job satisfaction than those who
had incentives based on quality of care (Grumbach, Osmond, Vranizan, Jaffe, and Bindman
1998).
Another aspect of the American health care system is the use of primary care doctors who
serve as “gatekeepers” to specialists. Christopher Forrest compares the US and UK system of
referrals to specialists and finds that the British are more satisfied with the gatekeeper role that
their primary physicians take for two reasons: the British know that specialists are limited, while
Americans believe specialist care is essentially unlimited, and Americans perceive primary care
physicians to be potentially withholding referrals due to financial considerations. Americans are
referred to specialists at twice the rate as the British, and is one of the reasons for the higher cost
of American health care (Forrest 2003).
One extremely important question is if managed care provides quantitatively better or
worse care than non-HMO plans. Miller and Luft examine a group of studies examining the
effects of managed care plans and find that overall, no clear trends can be drawn. Some patients
vehemently disliked their managed care plan, while others felt that it provided good coverage.
The one area that the researchers found that patients involved in a Medicare HMO with chronic
health problems did consistently get worse care. However, they used data collected prior to
1992, so HMOs could overall be worse than non-HMO plans (Miller and Luft 1997).
One case study of a large company that “carved-out” their mental health care plan from
their standard coverage to a managed care system that actually showed high quality results with
significantly lower prices. Goldman, McCulloch and Sturm studied a large company over nine
years and found that by having a 24 hour hotline staffed by mental health professionals to serve
as the “gatekeeper” to further service, the company was able to keep costs down, and provide
good treatment options. This system reduced the number of inpatient stays at mental health
facilities, and shifted more patients to outpatient facilities for treatment, but there was no
significant quality of care decline (Goldman, McCulloch, and Sturm 1998).
Health care providers and practitioners must also have a high level of trust with their
patients to insure quality care. Thom, Kravitz, Bell, Krupat, and Azari surveyed patients
immediately after, and then two weeks after, a visit to the doctor. They found that high levels of
trust in a doctor did not equate to better quality of care, however low levels of trust were strongly
correlated with a perception of inadequate service, services being withheld from the patient, and
a refusal to follow doctors’ orders explicitly (Thom, Kravitz, Bell, Krupat, and Azari 2001).
Another article focusing on patient trust in physicians examined differences in racial
attitudes. The researchers found that Latinos and blacks had lower levels of trust in their
physicians than whites, and that they did not believe that there was enough interaction in their
visits. The researchers also found that black and Latino men were the least trusting. Those
enrolled in HMOs had some of the lowest levels of satisfaction and trust. They did not find a
reason for the outcome, and say that further study is needed (Doescher, Saver, Franks and
Fiscella 2000).
One group of researchers examined attitudes of the public on a physician deceiving a
managed care group in order to procure care for a patient that would not necessarily be covered.
Overwhelmingly, 70% of people think physicians should follow the proper channels and appeal
processes. However, those who have actually experienced a physician deceiving a managed care
group for their care supported this practice in much higher numbers than the rest of the survey
respondents (Alexander, Werner, Fagerlin, and Ubel 2003).
Attempting to balance quality health care, patient choice, and low prices might be an
impossible juggling act under the current US health care system. HMOs and managed care have
“revolutionized” the market, and a backlash is building. Another group of researchers have
examined this backlash, and have found that many states are passing laws protecting patient
choice and quality of care when dealing with managed care entities. The authors found that
people are clamoring for protections because they have heard anecdotal evidence of managed
care horror stories, where patients do not get the care they need due to bureaucratic
mismanagement and red tape. There is a strong backlash against managed care’s perceived poor
quality of service (Blendon, et al, 1998).
The future of managed care is uncertain. A group
of researchers examined current trends in managed care, and found that managed care groups
have changed tactics in the recent past. Previously, HMOs focused on either drastically
increasing market share by offering low prices, or by limiting doctor choice, referrals and other
care choices in order to keep low prices. They are now moving to more choice in physicians,
and increased care options, due to consumer demand, but the tradeoff is skyrocketing premiums
and other costs. By emphasizing higher quality healthcare, regardless of cost, HMOs lose some
of their reason for being: low prices (Draper, Hurley, Lesser, and Strunk 2002).
Works Cited
Alexander, Caleb G.; Werner, Rachel M.; Fagerlin, Angela; and Ubel, Peter A. 2003.
Support for Physician Deception of Insurance Companies Among a Sample of
Philadelphia Residents. Annals of Internal Medicine. 138: 472-475.
Blendon, Robert J.; Brodie, Mollyann; Benson, John; Altman, Drew E.; et al. 1998.
Understanding the Managed Care Backlash. Health Affairs. Vol. 17, No. 4.
Doescher, Mark P.; Saver, Barry G.; Franks, Peter; and Fiscella, Kevin. 2000 Racial and Ethnic
Disparities in Perceptions of Physician Style and Trust. Arch Fam Med. Vol.
9, Nov/Dec.
Draper, Debra A.; Hurley, Robert E.; Lesser, Cara S.; Strunk, Bradley C. 2002. The
Changing Face of Managed Care. Health Affairs. Vol. 21, No. 1. 11-24.
Forrest, Christopher B. 2003. Primary Care in the United States: Primary Care
and Referrals: Effective Filter or Failed Experiment? BMJ 326, 692-695
Gatekeeping
Grumbach, Kevin; Osmond, Dennis; Vranizan, Karen; Jaffe, Deborah; and Bindman,
Andrew. 1998. Primary Care Physicians’ Experience of Financial Incentives In
Managed Care Systems. The New England Journal of Medicine. Nov. 19.
Jagsi, Reshma. 2007. Conflicts of Interest and the Physician-Patient Relationship in the Era
of Direct-to-Patient Advertising. Journal of Clinical Oncology. Vol. 25, No. 7.
Goldman, William; McCulloch, Joyce; and Sturm, Roland. 1998 Costs and Use of Mental
Health Services Before and After Managed Care. Health Affairs. Vol. 17, No. 2,
40-53.
Miller, Robert H., and Luft, Harold S. 1997. Does Managed Care Lead to Better or Worse
Quality of Care? Health Affairs. Vol. 16, No. 5. 7-26.
Thom, David H.; Kravitz, Richard L.; Bell, Robert, A.; Krupat, Edward; and Azari, Rahman.
2002. Patient Trust in the Physician: Relationship to Patient Requests. Family
Practice. Vol. 19, No. 5.
Literature Review for “Public Takes on Private: The Philadelphia Behavioral Health System”
Navon, Marc, Deborah Nelson, Maria Pagano, and Michael Murphy. June 2001. “Use of the
Pediatric Symptom Checklist in Strategies to Improve Preventive Behavioral Health Care.”
Psychiatric Services. 52; 800-804.
The article discusses the findings of a test called the Pediatric Symptom Checklist or
PSC. Its purpose is to determine possible early warning signs of behavioral disorders for
children younger than 18 years old. The test was conducted in an urban neighborhood in
Massachusetts.
Several hundred children at 3 HMO facilities were surveyed through questionnaires
completed by their parents or guardians. Out of this, a further sample was randomly singled out
for a more detailed analysis. The results showed that the PSC was a useful guide for
pediatricians in their behavioral diagnoses, showing a strong reliability during a second round of
tests for the same children in follow-up visits. The in-depth sample analysis interviews further
revealed that some of the possible contributors to the behavioral diagnoses were the children’s
social and family setting.
The Pediatric Symptom Checklist discussed in the article could serve as a guide for
preventative care in the Philadelphia case study. If possible behavioral disorders cases can be
diagnosed and treated early, less money would be spent in the mental health system for what
could be future patients if early treatment is withheld.
Santiago, Jose M. December 1999. “Use of the Balanced Scorecard to Improve the Quality of
Behavioral Health Care.” Psychiatric Services. 50: 1571-1576.
In this article, the merits of using a Balanced Scorecard (BSC) in the mental health field
are discussed. While mainly used by businesses to determine their progress implementing
certain programs, the author suggests the use of BSC’s to asses the quality of care in the mental
health field.
He begins discussing various attempts to define quality and measure it. He believes that
such efforts are not focused enough to truly determine the effectiveness of treatment of the
mentally ill. The end result for the current tests designed to assess quality is the comparison of
patient outcomes to standards determined in advance by medical committees.
The author proposes using the Balanced Scorecard as an alternative to these tests
because of its cyclical nature. Four indictors, as well as a proposed fifth added by the author for
this analysis, are evaluated to determine the effectiveness of the treatment rendered. Cause and
effect relationships between the indicators can then be compared to guide future treatment.
The author concludes that, while such a test is a step-up from previous proposals, more
money is needed to conduct the evaluations and refine the techniques.
The HMOs in Philadelphia using capitation policies to generate profits would be best
suited for such an evaluation system. If profits are used in this way, the HMOs could attract
more people, including those who had been disillusioned with their care, by demonstrating to
them that a proactive response to their healthcare is being undertaken.
Mowbray, Carol T., Kyle L. Grazier, and Mark Holter. February 2002. “Managed Behavioral
Health Care in the Public Sector: Will It Become the Third Shame of the States?” Psychiatric
Services. 53: 157-170.
This article is a historical analysis of the benefits and negative effects of public-sector
mental health management. The final conclusions of the authors, after having gone through the
evolution of public mental health management in the United States, are the need for better
planning and implementation of treatment, better monitoring of treatment and the patients, and
better funding for services that treat those with serious mental health problems.
The article would best serve the Community Behavioral Health non-profit in
Philadelphia. It would help guide the non-profit in addressing some of the concerns being
brought up by the opposition HMOs concerning the service and efficiency problems
government-related health services are usually associated with.
Malat, Jennifer. December 2001. “Social Distance and Patients’ Rating of Healthcare Providers.”
Journal of Health and Social Behavior. Vol 42, No. 4; 360-372.
This paper does a statistical analysis associated with social distance and healthcare.
Some of the variables tested were race, education, and income.
The study finds a marked difference in the way healthcare and quality are believed to be
administered. Whites and those with a higher income reported a better quality of care in regards
to perceived respect and time spent in the evaluation of the patient’s condition.
This paper, while not specifically addressing the concerns of the mental health
community, is still relevant in that such issues as race and economic status can play a role in the
way healthcare can be administered. If diagnosis is not done properly due to prejudice, the
problems of the mentally ill may continue in the direction they were going at the beginning of
the article with a large number of them in the homeless population.
Gresenz, C R, S E Stockdale, and K B Wells. April 2000. “Community Effects on Access to
Behavioral Health Care.” Health Services Research. 35(1 Pt 2): 293-306.
This is a paper that explores the availability of mental health services, through HMOs,
based on location. It finds that access and care availability are stronger in higher income
communities than in lower income communities. This is due to the location of the HMOs and
community access to their providers for mental health services.
The policy implications for Philadelphia would influence the quality of care and reach to
those who are in need of the services of both CBH and HMOs in the area. Furthermore, it would
serve the state government and the regional commissions that disburse Medicaid in the state and
guide their decisions on where money should go to really make a difference in treatment for
individuals with mental illnesses.
Frank, R G, T G McGuire, and J P Newhouse. 1995. “Risk Contracts in Managed Mental Health
Care.” Health Affairs. Vol. 14, Issue 3: 50-64.
This article would better serve the HMOs in saving face while still allowing them to
make a profit. By using risk-sharing policies, HMOs would allow their carve-outs to focus less
on the total risk they would assume for patient care and let them focus more on better treatment
with shared risk from the HMO. In exchange for risk-sharing, the carve-outs receive payment
from the HMO according to costs on an established risk-premium level. This approach allows
patients the opportunity to receive better care and allow the HMO to save on costs with a flexible
payment system.
Kim, K. Kyu and Jeffrey E. Michelman. June 1990. “An Examination of Factors for the Strategic
Use of Information Systems in the Healthcare Industry.” MIS Quarterly. Vol. 14, No. 2; 201215.
The article addresses problems that developed in Philadelphia at the beginning of the
article, namely, the complex system of healthcare providers and the need for consolidation and
the transition to HMOs. The authors suggest the integration of better communications
technologies to assist in the treatment of patients through knowledge of patients being passed
between health providers.
In addition, the implementation of better lines of communication would allow for better
quality care by the HMOs. It would help in coordinating treatment and care among the large
numbers of providers within the HMO system. The possible savings from this integration would
also provide incentives for the use of future innovations to come and allow HMOs to provide
quality care and still work for the interests of their stockholders.
Globerman, Steven. Spring 1991. “A Policy Analysis of Hospital Waiting Lists.” Journal of
Policy Analysis and Management. Vol. 10, No. 2; 247-262.
This paper from Canada addresses the signs that waiting lines in hospitals may indicate.
It could help in guiding some kind of cooperation between HMOs and the government. As a
means of preserving efficiency, the CBH of Philadelphia could take over some of the mental
health services HMOs in the area may be over-burdened with. This would allow the HMOs to
cut costs and allow the CBH to work and gain information on its own practices, allowing them to
adapt and make a better case to the city of their ability to handle cases of the mentally ill.
McAlpine, D D and D Mechanic. April 2000. “Utilization of Specialty Mental Health Care
Among Persons with Severe Mental Illness: The Roles of Demographics, Need, Insurance, and
Risk.” Health Services Research. 35(1 Pt 2): 277-292.
This paper should serve as a guide to the CBH, HMOs, and the city concerning the
severely mentally ill. With the infighting between these organizations, they need to take into
account the plight of those who are in desperate need of their services. Some of the most
severely mentally ill are poor, likely to be African American, and are lacking in the education
needed to gain access to proper mental health care. These organizations could use these findings
to help identify those who are in most need and possibly coordinate their efforts to determine
who would be able to give the best care, under the individual circumstances, to the severely
mentally ill.
Druss, Benjamin G., Carolyn L. Miller, Robert A. Rosenheck, Sarah C. Shih, and James E. Bost.
May 2002. “Mental Health Care Quality Under Managed Care in the United States: A View
From the Health Employer Data and Information Set (HEDIS).” The American Journal of
Psychiatry. 159; 860-862.
This is a brief report on the status of mental health care by HMOs in 1999. The results
found a lack of high performance in the treatment of mental health based on the Health Employer
Data and Information Set, a “report card” on the performance of HMOs that provides
information on plan quality and a guide for employers in purchasing and rating health plans.
This could serve to benefit the CBH concerning the imperfections found in HMOs, giving
them some kind of chance at making the case of their ability to operate. It could also serve as an
incentive for HMOs in Philadelphia to improve their administration of healthcare and quality to
save face in the community and serve their stockholders.
Mental Health Care
HMO is a term often associated with the healthcare industry in the United States.
Specifically, HMO is an acronym for Health Management Organization, a term which was
introduced to the American market in the early 1970s. HMOs were a means by which to
restructure the current system in order to provide a cost-effective tool for the distribution of
healthcare services as opposed to the traditional fee-for-service methods that were in place.
Rather than pay each the physician for each visit or procedure, the HMO allowed the consumer
to pay a monthly fee to have access to a myriad of healthcare options.
According to Welch, HMOs may be typified in the four following categories: the staff
model, the group model, IPA, and the network model. The staff model type is one in which the
HMO hires the physician as well as pays them directly whereas the group model is one where
they are contracted with a single physician group practice. IPA is a business model in which the
HMO contracts directly with the individual physicians in private practices, and the network
model is one in which the health management organization contracts with two or more practices
(Welch 222).
At the end of 1969, 37 HMOs were in existence in the United States and by 1974, the
number had exploded to 183 (McNeil 195). Additionally, over 25 states had an HMO in place
by 1973 which further strengthened the notion that the HMO was a new method by which
consumers could get affordable healthcare (McNeil 198).
By 1978, the health plan market consisted of 4 types of the following: government
(Medicaid), commercial insurers, private health insurers (BlueCross), and alternative delivery
systems (HMOs). Demographically, the Western portion of the United States was more likely to
have HMOs, commercial insurers were popular in the Midwest and South, and those with
healthcare coverage such as BlueCross were primarily located in the Northeast (Hay 832).
States that had HMOs tended to share certain characteristics as opposed to those states
that did not. States with higher incomes, larger and urbanized populations, more physicians per
capita, and states with higher hospital costs more than often had health management
organizations in place. These characteristics would indicate that HMOs were more likely to
locate to areas in which competition with traditional forms of healthcare was more feasible
(McNeil 200). Moreover, HMO popularity was likely to be a result of federal policy in addition
to the favorable market conditions that were previously mentioned. These factors in tandem
allowed the HMO to gain prominence in the healthcare market.
In an increasingly complicated society, proponents of HMOs regard its utilization as a
means to lower the cost of the distribution of healthcare. Currently, affordable healthcare is a
difficult commodity for many Americans and policy makers have attempted to reform the
system. Many case studies have chronicled the efforts of lawmakers to induce change hoping
that reforms will lead to a better condition for all parties involved.
In a case study done by the Kennedy School of Government, Guckenberger analyzes how
behavioral health services are delivered to the public and the implications of how HMOs and
managed health care systems operate in an otherwise troubled system in Philadelphia. The state
believes that a major problem of state provided healthcare assistance is that it offers a broad
number of services at the expense of efficiency. The city views the main issue to be a lack of
coordination of all those involved in the system, one in which there is no central authority or
accountability. From the perspective of the consumer, the problem is viewed as the inability of
the city, state, Medicaid, and HMOs to have standardized requirements. Therefore, it becomes
difficult for a patient to go from one system to another without having to face a new set of rules
and regulations to abide by (Guckenberger 3, 4).
According to the study, 6.9% of mental health Medicaid users accounted for over 44.5%
of all Medicaid funded psychiatric care (Guckenberger 4). If structural problems and lack of
coordination continue to be endemic to the system, statistics such as these will continue to spiral
out of control. As a result, the study suggests that the consolidation of financial support in
addition to the cooperation of the city, state, and HMO level will lead to a condition in which
healthcare is distributed in a better manner.
Many healthcare reform proposals attempt to reduce the cost by utilizing HMOs. Costs
are kept to a minimum due to the HMOs oversight of a physician’s decisions, the use of a
capitated payment which takes into consideration the physician’s incentives as well as the health
care plan. Furthermore, HMOs tend to have lower hospitalization rates, stays, in addition to
having fewer tests and procedures done. It would seem that HMOs are the solution to the
growing problem of affordable health care, but there are those that do not wholly agree. Some
argue the success of HMOs are attributed to questionable practices and must be looked at more
thoroughly. For instance, opponents contend that HMOs enroll healthy consumers and very little
at-risk patients. Also, the lack of competition in a highly controlled HMO market would lead to
less consumer choice and high costs (Baker 390).
It is evident by the increasing cost of healthcare in the United States that efforts for
reform need to be taken more seriously. Whether one supports having universal healthcare
provided by the government, or more choice in coverage, reform in the current system is a
necessary precursor for Americans to have more affordable healthcare. HMOs may be a tool in
which to achieve change and should be looked upon as a viable option in any case of actual
reform.
Bibliography
Baker, Laurence C., and Kenneth S. Corts. "HMO Penetration and the Cost of Health
Care:
Market Discipline or Market Segmentation." The American Economic
Review Vol. 86, No.
2(1996): 389-394.
Benjamini, Yael, and Yoav Benjamini. "The Choice among Medical Insurance Plans."
American Economic Review Vol. 76, No. 1(1986): 221-227.
The
Colbert, Treacy. "Public Input into Health Care policy: Controversy and Contribution in
California." The Hastings Center Report Vol. 20, No. 5(1990): 21.
Gordon, Larry. "Public Health Is More Important than Health Care." Journal of Public
Policy Vol. 14, No. 3(1993): 261-264.
Health
Guckenberger, Katherine. "Public Take on Private: The Philadelpia Behavioral Health
System." The Kennedy School of Govervnment Case Program (2002): 20.
Halverson, Paul K., Glen P. Mays, Arnold D. Kaluzany, and Thomas B. Richards. "Not- soStrange Bedfellows: Models of Interaction between Managed Care Plans and
Public Health
Agencies." The Milbank Quarterly Vol. 75, No. 1(1997): 113-138.
Hay, Joel W., and Michael J. Leahy. "Competition among Health Plans: Come
Evidence." Southern Economic Journal Vol. 50, No. 3(1984): 831- 846.
Preliminary
McNeil, Jr. Richard, and Robert E. Schlenker. "HMOs Competition, and Government." The
Milbank Memorial Fund Quarterly. Health and Society Vol. 35, No. 2(1975):
195-224.
Musser, Josephine W. "Health Care Data: Government Intervention or Private
The Milbank Quarterly Vol. 74, No. 1(1996): 37-41.
Cooperation."
Welch, W. Pete, Alan L. Hillman, and Mark V. Pauly. "Toward New Typologies for
HMOs." The Milbank Quarterly Vol. 68, No. 2 (1990): 221-243.
Managed Health Care in the Public Sector
In the struggle to ensure adequate health care for as many people as possible state, local
and federal government agencies are increasingly looking for options to reorder the
administration of public health systems. The literature on these options is diverse and anything
but cohesive in its recommendations. Given the vast divergence in policy recommendations it is
interesting to note the striking consistency of the findings of these studies regarding the rationale
for implementing different policies, the expectations of those implementing new systems, and the
results of these changes.
There are many policy alternatives for politicians and bureaucrats to consider. The public
sector can simply turn over management to HMO or PPO providers, they can create their own
management organizations to administer funding, or they can use a mix of publicly administered
and privately managed care. The literature suggests that most states are tending to lean toward
private management of public health systems (Findlay 117). Given this trend it is most practical
to consider the effects of this type of policy alternative.
The literature suggests the benefits of managed care can be derived from three basic types
of interactions between public and private health care providers. First, there can be contractual
agreements between the private and public sector for the care of segments of the public health
population. In this case care is provided through private managed care and these companies are
paid from public funding by state and local governments. Second, there are situations in which
the private and public sector relationship is deeper than contractual obligations and a formal joint
venture exists. In this situation the public and private sector share both operating control and
responsibility for the health care system in place. The final model is a relationship in which
“managed care plan performs an activity that is central to the public health mission of the health
department” that is referred to as the stakeholder model or sole ownership model (Halverson
118, 128). This system provides the most systematic integration of public and private health care
management.
Public entities rationalize their decision to involve private managed care programs in the
administration of public health systems in a variety of ways. Some of the reasons given include,
collaborating and expanding outreach and education, improving case management, and
improving the efficiency of public health care (Halverson 122). The literature suggests that no
matter what model a particular city follows there are certain expectations that are central to the
decision to privatize or centralize the public health system. The bottom line for cities and states
across the United States seems to be cost. Every study cited in this review indicates that the
foremost expectation of government entities looking to integrate managed care companies on any
level in their public health systems is a reduction in operating costs. Nearly every other
expectation is related in some way to the overall cost of administering health care to the
uninsured. As Goldman explains, “Managed care attempts to control these costs through a
strategy that relies on coordination, rationing, and market power to limit expenditures (Goldman
279). Goldman sums up the expectations that most public systems have when they turn to
managed care. They expect that costs will be substantially decreased through a variety of
organizational and management differences.
John Iglehart, A.P. Schinnar, and Frank Richard both summarize the expectations that
come with the adoption of managed care that contribute to lower costs. Managed care is said to
give greater flexibility in service, reduce the reliance on inpatient care, reduce hospitalization
rates, and increase preventative care measures that may reduce hospital and doctor visits. In the
end all of these measures reduce costs to providers. Private entities have an incentive to reduce
cost because they need to make a profit in order to continue to exist in the private market
(Iglehart 131, Frank 106, Shinnar 258).
The concern that arises out of this emphasis on lowering costs is that the corporate
emphasis on profits will lead to a decline in the quality of care. In fact, studies find that there are
substantial decreases in costs in privatized systems. Frank reports that in Colorado,
Massachusetts, North Carolina, Tennessee, and Utah the inclusion of managed care has reduced
Medicaid costs by fifteen to forty percent. At the same time, however, care for the most needy
of the patients served by Medicaid was reduced by an average of thirty percent (106). This
reduction in costs is echoed in studies by Goldman and Shinnar. What is disputed is the effect of
these systems on the quality of care. Robert Miller argues in his study that “most quality of care
results were favorable to HMOs or showed similar quality of care” (14). Miller disputes claims
made by Frank and by Steven Findlay about the quality of care in managed care settings.
Findlay points out, “the industry was hired to lower those costs. It did. These declines are
largely attributable to…reducing outpatient care, cutting provider payments, a greater use of non-
physician providers…and the use of psychoactive drugs instead of psychotherapy” (120).
Findlay goes on to point out that while costs have been reduced it has not occurred without any
declines in quality of care.
Additionally, Miller points out that, despite lower costs, managed care has little
motivation to sustain high quality care, that there is little information available to consumers, and
that managed care is hindered by slow clinical changes. All of these are obstacles to effective
public health management. Furthermore, many in the field are concerned about continuity in
care. This concern takes two forms. First, as Jeffery Geller explains, under managed care
programs it increasingly unlikely that patients will be seen by the same doctor every time they
receive medical services. Managed care providers give restrictive lists of covered providers and
this list changes frequently. Also, Geller shows in his study that readmission to the same
hospital decreased with managed care while repeat users were increasingly, “admitted to new
facilities where patients were unknown” (5). The second type of discontinuity is related to
coverage in general. A 1998 study conducted by Olveen Carrasquillo found that nearly two out
of three Medicaid enrollees lost coverage within twelve months and that within this population
one out of three still had no coverage four months later (467). This study found that, “uninsured
patients rarely have access to managed care providers…moreover, the rapid turnover of
Medicaid enrollees hampers monitoring of quality care” (468).
A review of this literature suggests that it is entirely appropriate for public health systems
to utilize managed care companies to lower costs but they must be cognizant of the possibility
that the quality of care will decline and take steps to prevent this from happening. Furthermore,
it seems clear that it is necessary for the state or local government to work with managed care
companies to ensure that patients can be treated by the same doctor or at least the same facility
over the duration of their treatment even when leaving Medicaid programs and obtaining private
insurance on their own. The discontinuity in care is a serious threat to the patient and the
integrity of the health care system. There are issues that need to be mediated between the public
an private sector but these do not preclude the use of managed care as effective way of dealing
with the inefficiency that exists in many publicly managed health care systems.
Works Cited
Callahan, James J. et. al. “Mental health/substance abuse treatment in managed care: The
Massachusetts Medicaid experience.” Health Affairs. Chevy Chase: Vol.14, iss. 3; pg.
173. 1995.
Carrasquillo, Olveen. “Can Medicaid Managed Care Provide Continuity of Care to New
Medicaid Enrollees? An Analysis of Tenure on Medicaid.” American Journal of Public
Health, 1998-3, vol. 88, issue 3, p 464
Findlay, Steven. “Managed behavioral health care in 1999: An industry at a crossroads.” Health
Affairs. Chevy Chase: Vol.18, Iss. 5; pg. 116, 9 pgs. 1995.
Geller, J L. “The Effects of Public Managed Care on Patterns of Intensive Use of Inpatient
Psychiatric Services.” Psychiatric Services. vol. 49, issue 3, p 327, 1998.
Goldman, Dana P. “Managed Care as a Public Cost-Containment Mechanism.” Journal of
Economics, 1995, vol. 26, issue 2, p 277
Hadley, T. R. A. P. Schinnar and A. B. Rothbard. “Opportunities and risks in Philadelphia's
capitation financing of public psychiatric services.” Community Mental Health Journal.
Vol. 25, iss. 4. pg. 255. 1989.
Halverson, Paul K. and Glen P. Mays, Arnold D. Kaluzny, Thomas B. Richards. “Not-SoStrange Bedfellows: Models of Interaction between Managed Care Plans and Public
Health Agencies.” The Milbank Quarterly. Vol. 75, No. 1. pg. 113-138. 1997.
Iglehart, J K. “Managed Care and Mental Health.” New England Journal of Medicine, vol. 334,
issue 2, p 131, 1996.
Miller, Robert H. and Harold S. Luft. “Does Managed Care Lead to Better or Worse Quality of
Care?” Health Affairs. Sep/Oct 1997.Vol. 16, Iss. 5; pg. 7, 19 pgs
Richard, G Frank, Howard H Goldman, and Michael Hogan. “Medicaid and mental health: Be
careful what you ask for.” Health Affairs. Chevy Chase: Vol.22, iss.1; pg. 101. 2003.
Mental Health Care
Introduction
The way in which public and private mental health care is provided has undergone significant
change since the 1980’s. Thirty years ago, state sponsored institutions were the status quo.
However since then, behavioral care has evolved into a variety of highly complex systems. The
overarching evolutionary change has been one of transition from generic state care to specialized
private management1. In the earlier model, federal and state funding was channeled directly to
state hospitals, which in turn provided care directly to patients. In modern models, funding
streams are directed to secondary and tertiary private firms that manage the delivery of care for a
profit.
The primary concern continues to be the tension between care delivery costs and quality of care.
Experts, however, disagree over which methodologies are optimal. A wide variety of
organizational structures, finance methods, and care delivery modes can be found across the
country, each with supporters and detractors. No final conclusion has yet been drawn. Even now,
policy makers are questioning the effectiveness of approaches that were favored only a few years
ago. One finds an overwhelming number of articles on the subject, the vast majority of which
were written at least a decade ago and very few of which agree.
An Overview Before Tackling the Details
1
Commonly referred to as carve-outs
Before tackling the task of exploring behavioral health delivery methodologies, researchers will
find an excellent overview of the evolution of this over the past few decades in an article entitled,
The Evolution of Behavioral Primary Care (Gray, Brody, and Johnson, 2005). The authors have
provided an excellent overview of how and why changes have unfolded from the perspective of
physicians themselves. A valuable reference of commonly used terminology, organizational
structures, finance methods, and care delivery modes, as well as arguments for and against these
models is provided. In addition, the authors describe very recent trends from what is termed a
‘2carve-out’ to ‘carve-in’ services. A second article is also recommended as a primer to the topic;
Protecting the Public Interests: Issues in Contracting Managed Behavioral Health (Robinson and
Clay, 2003). Here, the authors explain the issues of transition to private administration from the
perspective of impacts to the public sector. It suggested that researchers then proceed by dividing
their studies into two categories; those of Cost and Risk and Quality of Care. Because they
remain the primary drivers of behavioral health care policy, most academic literature addresses
one of these two fundamental issues.
Beginning with the topic of Quality of Care, Mechanic (2003) found through use of multivariate
analysis that the process of transition from one administrative model to another may negatively
impact a patient’s adherence to medication regimes. This supports the author’s conclusion that it
is essential to ensure that the introduction of a new program does not disrupt continuity of care.
Using data from the Vermont Department of Corrections and Department of Developmental and
Mental Health Services, Pandini, Banks, and Schacht (1998) describe a research methodology
A “carve-out” in managed care terminology refers to any managed care approach in which a separate system of
care is contracted out either because of the need from distinct services or in order to serve a defined population.
(Robinson and Clay, 2005).
2
known as probabilistic population determination. This methodology provides a way to
statistically identify common data between data sets that do not possess common identifiers. The
authors employ this method to measure mental health program performance in the area of
program accessibility to people with a history of criminal justice involvement. Probabilistic
population determination has the added advantage of protecting client confidentiality and
personal privacy. Sabin and Daniels (1999) conclude that care quality depends a great deal on
the specific language employed in contract documents between government, care providers and
insurers. Precise wording in these contracts ultimately determines the expectations and values of
care programs.
Following with articles addressing Cost and Risk, Ridgely, Giard and Shern (1999) provide a
case study of a carve-out implementation to explore its impact on the local mental health sector.
Their study raises concern about system stability, patient access, efficiency, and the shifting of
risk and public responsibility to private health providers. Frank, McGuire, and Newhouse (1995)
address a similar topic in their economic and cost-effectiveness study of what is termed ‘risk
contracting’ in behavioral health care. The authors conclude that a strategy that optimizes
incentives and treatment is a fundamental component of an economically successful behavioral
health program. Rosenthal (1998) explores the economic impact of transitioning from a fee-forservice system to a case-rate (captitated) system. Rosenthal observed a 25 percent reduction in
patient visits per episode that varied with the dollar amount of the captitated rate.
In another case study, Burns, Teagle, Schwartz, Angold, and Holtzman (1999) evaluate a pilot
public sector managed Medicaid mental health carve-out for North Carolinian youth. Over a five
year period, significant shifts from costly inpatient care to less costly outpatient services were
observed. This was coupled with a decreased rate of growth in mental health costs. Sturm (1999)
finds a trend indicating that the “traditional dichotomy of public and private systems of care is
quickly disappearing” and that overlap between public and private providers is evident. He also
points out the importance of information systems.
References
Burns, Teagle, Schwartz, Angold, and Holtzman. Managed Behavioral Health Care: A Medicaid
Carve-Out for Youth. Health Affairs. Chevy Chase: Sep/Oct 1999.Vol.18, Issue. 5; Pg. 214.
Gray, Brody, and Johnson. The Evolution of Behavioral Primary Care. Professional Psychology:
Research and Practice, 2005, Vol. 36, No. 2.
McGuire, Newhouse, and Joseph P. Risk Contracts in Managed Mental Health Care. Health
Affairs. Fall 1995. Vol.14, Issue 3. Pg. 50.
Mechanic, D. Managing Behavioral Health in Medicaid. The New England Journal of Medicine.
Volume 348:1914-1916. May 8, 2003. Number 19.
Pandiani, John A, Banks, Steven M, Schacht, Lucille M. Using Incarceration Rates to Measure
Mental Health Program Performance.
The Journal of Behavioral Health Services & Research. Gaithersburg: Aug 1998.Vol.25, Issue 3;
pg. 300.
Ridgely, Giard, and Shern. Florida's Medicaid Mental Health Carve-Out: Lessons from the First
Years of Implementation. The Journal of Behavioral Health Services and Research. Volume 26,
Number 4, November, 1999.
Robinson, Julia E. and Clay, Thomas. Protecting the Public Interests: Issues in Contracting
Managed Behavioral Health. Journal of Health & Human Services Administration, Spring 2003,
Vol. 25, Issue 4, p428-446.
Rosenthal, M. Risk Sharing in Managed Behavioral Health Care. Health Affairs, 1998. Vol. 18,
Issue 5.
Sabin, James, and Daniels, Norman. Managed Care: Public-Sector Managed Behavioral Health
Care: II. Contracting for Medicaid Services-the Massachusetts Experience. Psychiatric Services
50:39-41, January 1999
Sturm, Roland. Tracking Changes in Behavioral Health Services: How Have Carve-Outs
Changed Care? The Journal of Behavioral Health Services & Research. Gaithersburg: Nov
1999.Vol.26, Issue. 4; Pg. 360.
Lit Review: Managed Health Care
Managed Health Care is a very controversial topic and a hot topic in today’s political
arena as well. There are champions on both sides of the argument who state reasons why it is
both good and bad and both sides have viable reasons and experiences to prove their case.
Before one can debate the topic, one must first understand Managed Health Care. One definition
states: “managed care is an organized effort by health insurance plans and providers to use
financial incentives and organizational arrangements to alter provider and patient behavior so
that health care services are delivered and utilized in a more efficient and lower-cost manner”
(Williams, 125). This definition included the core principles of managed care: “it is an organized
effort that involved both insurers and providers of health care; it uses financial incentives and
organizational structures in reaching its goal; and its purpose is to increase efficiency and reduce
health care costs” (Williams, 125). Again, there are champions on both sides of the argument,
but central to the debate is determining whether managed health care is more efficient and
effective than other forms of health care?
In order to help answer this question one can look at the specific case of Philadelphia and
its health care system throughout the latter part of the past century. Philadelphia attempted to
reorganize its system of care because it was seen as uncoordinated, inefficient and ineffective for
it’s users and too costly. The city debated long and hard to in an attempt to come up with the
best solution.
Those in favor of managed care had many valid concerns and points to argue their case.
They found that with the current system Philadelphia used, “the most ‘challenging’ patients—
those least equipped to navigate the system in the first place—were most likely to experience
ruptures in the continuity of their care” thus ultimately leading this patients to stop receiving the
care they desperately needed (Guckenberger, 4). They also pointed out that, “without access to
coordinated, long-term care, heavy users showed up in emergency rooms time and time again,
seeking help for recurring problems. Authorities and mental-health advocates concurred that the
repetitious use of emergency-room intervention did not qualify as adequate “treatment’ in
anybody’s book. Moreover, it was expensive” (Guckenberger, 4). According to the research
done by the officials in Philadelphia, “’pre-paid’ health maintenance organizations (HMO’s)
were cost efficient, promoted better monitoring of serves than their fee-for-service counterparts.
It seemed ‘managed care’ was better suited to providing more appropriate and less expensive
care” (Guckenberger, 5).
The other side of the argument, against managed care, has as valid of points as those in
favor of it. Access to care is a key point in a health care system, and “from an access end of
things, folks had a very difficult time getting authorized for services…and disenchanted patients
fell back into the public system or dropped out completely” (Guckenberger, 10). The core
techniques of managed care include “authorizing only approved providers under contract with
the managed-care company to treat enrolled clients, reviewing their decisions as they provide
services and monitoring high-cost cases closely” (Iglehart, 131). Also, “most managed-care
plans do not cover chronic mental illness in their standard benefit package” which is a huge
downfall to the idea of managed care because this is often the most serious type of service
needed by patients and they do not have easy access to it, making it likely that they do not
receive treatment. (Iglehart, 131). Another huge concern for those opposed to managed care is
that “private managed-care companies are in business to serve their shareholders. While the
provide good care to the majority of the people, they profit by controlling the delivery of
services. ‘The incentive for these companies is to deliver as little services to as few people as
possible’” (Guckenberger, 11).
One official in Philadelphia thought she had come up with the perfect solution to the
problem but in the end it was difficult for her to find people to back her plan. She developed
community health plan, a non-profit, where savings would be put back into the system rather
than given to the shareholders, which would help improve care and expand the services provided.
Many people did not believe this community system could work because “private sector
managed-care companies, for their part, were equipped to assume huge legal and financial riskincluding those connected with malpractice lawsuits” the city on the other hand could not afford
such problems if and when they occurred (Guckenberger, 17).
Both sides of the argument have compelling points which illustrates that some type of
reform needs to take place within the health care system. For better or worse, “the greatest
contributors to the development of managed mental health, a development they now bemoan,
have been the service providers themselves (fee for service), practitioners and facilities. By not
paying sufficient attention to or not caring about costs and length of treatment, they killed or at
least seriously wounded the goose that laid the golden egg” (Iglehart, 132). Serious problems
revolving around quality of care exist in the health care system today and “a large number of
Americans are harmed as a direct result. Quality of care is the problem, not managed care.
Current efforts to improve will not succeed unless we undertake a major, systematic change to
overhaul how we deliver health care services, educate and train clinicians and assess and
improve quality” (Chassin, 1000).
Works Cited
Chassin, Mark. The Urgent Need to Improve Health Care Quality. The Journal of the
American Medical Association. Vol. 280, No. 11. 16 September 1998.
Fiscella, Kevin. Inequality in Quality: Addressing Socioeconomic, Racial and Ethnic
Disparities in Health Care. Journal of American Medical Association. Vol. 283,
No. 19. 19 May 2000.
Guckenberger, Katherine. Public Takes on Private: The Philadelphia Behavioral Health
System. Kennedy School of Government, Case Program. 2002.
Iglehart, John K. Health Policy Report: Managed Care and Mental Health. Health
Policy Report. Vol. 334, No. 2. 11 January 1996
Strum, R. How Expensive is Unlimited Mental Health Care Coverage Under Managed
Care?. Journal of the American Medical Association. Vol. 278, No. 18. 12
November 1997.
Williams, Stephen and Torrens, Paul. Introduction to Health Services, 6th edition. Delmar
Thomas Learning, Albany, NY. 2002.
An issue in the managed health care literature which has lacked sufficient attention is that
which reflect the needs and special circumstances of people with disabilities. Some of the
existing literature is reviewed below. The article by Hill and Wolridge deals exclusively with
decision making by people with disabilities in managed care situations. (Hill & Wolridge 852)
Given the unique characteristics of people with disabilities greater attention must be given to
their needs. Even a “healthy” person will have limited information and must be guided by
someone more qualified to make informed decisions regarding one’s own health. (Hill &
Wolridge 855) This necessitates the dissemination of information but the special circumstance of
the disabled requires a more diverse approach.
The sources of information for people with disabilities is scarce and in many instances
people with disabilities are not trusting so they rely on family and friends who themselves insist
they need more information. (Petty 2002; Shofaer et al 2001) Friends and family are unable to
know the true costs of decisions so they themselves rely on expert opinion. A distinction must be
made between adults and children. Children with disabilities are typically better taken care
because their parents pay more attention to the issues and are therefore more informed. (Oliver
2004) Even when information is available, some people with mental illness may not seek and use
it. Many disabilities, or their medication, have symptoms which include fatigue, indecisiveness,
and diminished concentration; manic symptoms include greater distractibility; symptoms of
schizophrenia include disorganized speech and behavior, delusions, and extreme negativism.
(Hill et al 2002)
People with disabilities often have difficulty choosing the proper health plan not only
due to their own disabilities but also to the complexity of the issue. This is why multiple
methods of disseminating information must be utilized among which are: written materials,
audiotapes, videotapes, hot lines, outreach counselors, and small group settings. (Hill et al 2002)
The evidence shows that dissemination of information must be diverse an; excellent case in point
is the internet which is not used to any great extent by people with mental retardation which is
why other avenues to information must be readily available. (Kaye 2000)
Another problem with the dissemination of information is the inability of many
organizations to keep the current addresses of those they serve. This has prevented mailers from
being as effective as they could be. An academic problem is the possible biases, or over
sampling, in statistical studies as a result of unreliable contact information. (Bailey et al 1999) It
is recommended by Hill & Wooldridge that people with disabilities should provided contact
information for more than just emergencies others such as social workers, friends, neighbors (if
only on good terms), and anyone else who may have consistent contact with the patient should
be gathered. This will ensure the greatest possible contact with those in need and the
continuation of access to useful information so that the disabled can make the decisions that best
serves their needs. (Tanenbaum & Hurley 1995)
The literature shows that people with disability care just as much about their health as
those without disability, however, the disabled are at a constant disadvantage when it comes to
choosing a medicinal route. This is a result of lack of information, complex information, and
inconsistency of information. What is needed is an overarching organization that can provide
information tailored to the particular needs of the individuals they intend on serving. New
teaching methodologies must be introduced to better inform the disable, particularly those with
mental disabilities and live on their own.
Bailey, James, David Van Brunt, and David Mirvis. “Academic Managed Care
Organizations and Adverse Selection under Medicaid Managed Care in
Tennessee.” Journal of American Medical Association. (September 15 1999):
1067-1072.
Guadagnoli, Edward and Patricia Ward. “Patient Participation in Decision
Making,” Social Science and Medicine Vol 47 No 3 (1998): 329-339.
Hill SC, Thornton CV, Trenholm C. Risk selection among SSI enrollees in
TennCare. Inquiry. 2002 Summer;39(2): 152–67.
Hill Steven and Judith Wooldridge. “Informed Participation in Tenncare by
People with Disabilities,” Journal of Healthcare for the Poor and Underserved 17
(2006): 851-875
Kaye HS. Computer and internet use among people with disabilities. (Disability
Statistics Report 13.) Washington, DC: U.S. Department of Education, National
Institute of Disability and Rehabilitation Research, 2000 Mar.
Martins, M. TennCare enrollee database verification report: December 30, 2003.
Nashville, TN: Bureau of TennCare, 2003.
Oliver,
Thomas. “Policy Entrepreneurship in the Social Transformation of
American Medicine: The Rise of Managed Care and Managed Competition.”
Journal of Health Politics, Policy and Law Vol 29 Nos 4-5 (Aug-Oct 2004): 701733.
Petty D. Explaining Medicare
Education. 2002; 3(7):1–8.
to
caregivers.
Issue
Brief
Center
Medicare
Shofaer S, Kreling B, Kenney E, et al. Family members and friends who help
Beneficiaries make health decisions. Health Care Finance Revised. 2001 Fall;
23(1):105–21.
Tanenbaum, Sandra and Robert Hurley. “Disability and the Managed Care Frenzy”
Health Affairs 14 (4): 213-219.
Mental health is one of the most overlooked and difficult issues for policy makers
to adhere to regarding healthcare. The severity of mental illness and disorders have not
been adequately addressed, as mental health budgets in the world average around less
than 1% of the total healthcare expenditure of states (Zolnierek, 2008: 563). The
importance of mental healthcare is undeniable though, as mental illness is the fourth
leading cause of disability in the world and will become the second biggest cause to
disability within fifteen years (Zolnierek, 2008: 562). Many desires for policy on mental
healthcare focus around quality care that is available and affordable. The success of
many policy decisions in attempting to produce these desires is in question though.
Much literature has been published on the problems with mental health policy, such as
the negative effects of deinstitutionalization, the limits regarding the use of primary care
instead of specialist care, and the lack of access to mental healthcare in rural areas due to
the privatization of Medicaid usage. Looking at these different scholarly opinions, one
62
will gain a distinct image of the problems in which policy makers face in attempting to
improve mental healthcare.
In a move towards ending the use of institutional care for mental patients for a
community care based system, policy makers had abruptly changed the mental health
system. Based off of the dominate position of psychoanalysis, help given through the
community appeared to be a bigger benefit to patients than having them confined to
restricted and isolated mental hospitals (Novella, 2008: 303). The policy change has its
beginnings in the belief in ensuring the human rights of mental patients which had been
disregarded in the past (Zolnierek, 2008). The change towards a community based
system required the destigmatisation of mental disease so that mental health could be
considered ‘health.’ This allowed for community attitudes to change towards mental
health (Hickie, 2002: 377). Many problems have been observed with this change,
including lack of funding. Some critics of the policy point to the lack of understanding of
the dynamics of metal health, where a broader view towards mental health is required
(McCubbin, 1999: 57-60). Other problems, particularly among the most severe and
chronic patients, limited the effectiveness of care and placed many individuals back into
some form of an institution, including care-homes and prisons (Novella, 2008: 304;
Zolnierek, 2008: 564).
Other changes to metal healthcare have created similar problems towards patients,
as many health providers lack specialists in metal health and funding for proper
treatment. The push towards the use of primary care services has led many to believe
that the policy on metal health has limited the effectiveness of the system. This push
towards primary care, as with the push towards privatization, has increased the fear that
63
low costs means poor quality and little access; some of the problems which were desired
to be avoided (Hickie, 2002: 376). Primary care was considered to be the only system
that “has the potential to reach the broader population, provide access to the right mix of
affordable primary and secondary care services, and promote the integration and
continuity of medical and psychological care that persons with mental disorders require”
(Hickie, 2002: 376). Problems have arisen though, as “the primary care portal is not
effectively realized – disorders may not be recognized or, if recognized, may not be
appropriately diagnosed and treated” (Zolnierek, 2008: 564). While many place hope
with primary care based systems, more integration with mental health specialists and
training with professionals is required for the system to be efficient (Zolnierek, 2008:
566).
Just as the move towards primary care has its downsides, the privatization of
healthcare regarding to Medicaid usage has found similar problems with availability and
access. The problem of access is especially severe in rural areas, where specialists are
lacking and organizations that previously provided care have lost funding (Hickie, 2002:
377). According to one author, Medicaid managed care puts many barriers between
those who require service and healthcare providers. These barriers include: service
fragmentation, transportation, lack of cultural and linguistic competency, Medicaid
enrollment, stigma, and immigration status (Willging, 2008: 1231). The privatization of
Medicaid usage has taken public funding away from “safety net groups” (SNI), which
have historically taken care of poor and rural populations, requiring individuals to seek
care in far to reach areas (Willging, 2008: 1231).
64
Policy makers have a huge difficulty in developing proper healthcare access that
is affordable to all individuals as well as high in quality in the service that they provide.
Though the policies that have been mentioned above have produced negative
consequences for some individuals, many of these policies where developed with the
general population in mind. For example, the privatization of Medicaid usage was
developed “as a means for reducing service delivery costs and improving the quality of
healthcare for eligible populations” (Willging, 2008: 1232). Though some have benefited
from such actions, policy makers need to look at those who are left out of the system and
attempt to include their well being in their policy decision-making.
65
Works Cited
Hickie, Ian, and Grace Groom. 2002. “Primary care-led mental health service reform: an
outline of the Better Outcomes in Mental Healthcare initiative.” Australasian
Psychiatry 10(4): 376-382.
McCubbin, Michael, and David Cohen. 1999. “A Systemic and Value-Based Approach to
Strategic Reform of the Mental Health System.” Healthcare Analysis 7: 57–77.
Novella, Enric J. 2008. “Theoretical accounts on deinstitutionalization and the reform of
mental health services: a critical review.” Med Healthcare and Philos 11: 303–
314.
Willging, Cathleen E., Howard Waitzkin, and Ethel Nicdao. 2008. “Medicaid Managed
Care for Mental Health Services: The Survival of Safety Net Institutions in Rural
Settings.” Qualitative Health Research 18(9): 1231-1246.
Zolnierek, C. D. 2008. “Mental health policy and integrated care: global perspectives.”
Journal of Psychiatric and Mental Health Nursing 15: 562–568.
Regarding Philadelphia’s issue of efficiently managing its behavioral health care
system, two proposals were brought to the table. One would allow private sector health
maintenance companies, or HMOs, to manage the behavioral health care of Medicaid
recipients, and the other would allow the city to create its own managed care organization
so as to manage the behavioral health of Medicaid recipients itself. At the outset of the
process, the state’s single provider, the state psychiatric hospital, was shut down due to a
record of poor care and abuse. It was then believed that the private sector could do a
better job.
Privatization is often looked to when efficiency within a system is desired. A
major problem with privatizing health care, however, is the fact that “in containing costs,
the clinical aim [becomes] to limit treatment to whatever will return patients to a
reasonable level of functioning as soon as possible,” at which point prevention becomes
secondary (Shore & Beigel, 116, 1996). Essentially, without preventing a problem from
returning, a patient must often succumb to visiting o a medical facility multiple times,
66
which becomes quite costly for the patient. While in the past, the ability to offer care
without regard to cost was possible, “the philosophy of managed behavioral health care
includes an awareness of limited resources from the outset” (Shore & Beigel, 117, 1996).
This forces providers to think economically, rather than perhaps medically, forcing
patients to spend more money for less treatment, perhaps what makes HMOs more
financially efficient for providers overall.
In addition to this aspect of HMOs, is the fact that in order to be cost-effective,
there also arises “intensified competition among mental health professionals for patients
suitable for outpatient psychotherapy while patients who typically have more serious
disorders are relatively neglected” (Shore & Beigel, 118, 1996). Since using outpatient
services is often deemed as cheaper to providers because they consist of social workers
and psychologists who accept lower fees than psychiatrists, there are clear financial
benefits to its use. Positively, according to some researchers, “outpatient mental health
treatment can in fact lead to a reduction in unnecessary or excessive general medical care
expenditures,” meaning that patients resort to seeing cheaper clinicians for medicines that
they would normally obtain from more expensive general physicians (Olfson et al, 81,
1999). Costs are thus also reduced because poor mental health is often related to poor
physical health, and if a patient is forced to see an outpatient psychologist first, then
perhaps they will be able to avoid using primary or emergency care later.
So despite criticisms regarding the treatment of patients beneath HMO plans like
the one above, “managed care [simply attempts] to use dwindling health care resources
more responsibly, and cut down on the use of unneeded services” (Boyle & Callahan, 11,
1995). Practices of resorting to simplified and often less extensive outpatient treatments
67
for those suffering with mental illness, came about for a logical reason. Due to an
“unprecedented and often unwarranted expansion of mental health services in the 1980s,”
it is believed by some that most outpatient psychiatric services were a hobby for the selfindulgent and money-hungry therapists suffering from “the Woody Allen syndrome”
(Boyle & Callahan, 19,1995). In order to stem such misuse of the system, managed
mental health care offered more narrow definitions of what it meant to truly be mentally
ill, rather than allowing the latest fads to financially erode the system.
These narrow definitions are often addressed in carve-out programs. In
Huskamp’s 1998 article, he discusses how “spending for episodes of mental health and
substance abuse treatment of a managed behavioral health care carve-out program”
reveals methods of decreasing costs (1560). By focusing on the costs accrued by patients
through inpatient and outpatient facilities, Huskamp was able to conclude that the
adoption of a carve-out plan was associated with a substantial decrease in spending. For
this reason, many HMOs have resorted to carving out certain types of care and placing
“financial incentives on the managed behavioral health care vendor [that] can result in
dramatic changes in spending patterns for episodes of mental health and substance abuse
treatment” (Huskamp, 1562, 1998).
Overall, managed care has often been looked to as an answer for confused and
jumbled public systems with many treatment providers. While Philadelphia specifically
was forcing people suffering from multiple heath problems to shuttle from one location to
another, HMOs are often able to better monitor both funding and providers for many
patients. Financially, HMOs do what the state cannot, which is force providers to curtail
spending on costly hospital stays and unnecessary treatments. Despite the fact that this
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could be seen as managed care simply delivering as little service to people as possible,
managed care is in fact cost-efficient and uses much of its money to become technically
advanced for the future.
Regarding policies to improve the functioning of HMOs, it seems significant to
ensure that managed care addresses one certain challenge. That is to be resourceful with
monetary funding “without losing concern for the care of individual patients” (Shore &
Beigel, 119, 1996). One path to achieving this goal could stem from thwarting the
practice of “many HMOs contracting with external vendors for mental health care, rather
than maintaining an internal mental health department” of its own (Hodgkin et al, 375,
1997). Such an act would perhaps force HMOs to have more knowledge of their patients.
Works Cited
Boyle, Philip J. and Daniel Callahan. “Managed Care in Mental Health: The Ethical
Issues.”
Health Affairs. Vol. 14, Issue 3, pp.7-22. Fall 1995.
Hodgkin, D. et al. “Make or Buy: HMOs contracting arrangements for Mental Health
Care.”
Administration and Policy in Mental Health. Vol. 24, No. 4 pp. 359-376. March
1997.
Huskamp, Haiden A. “How a Managed Behavioral Health Care Carve-Out Plan Affected
Spending for Episodes of Treatment.” American Psychiatric Association:
Psychiatric
Services. Vol. 49, pp. 1559-1562. December 1998.
Olfson, Mark et al. “Menatal Health/Medical Care Cost Offsets: Opportunities for
Managed
Care.” Health Affairs. Vol. 18 Issue 2, pp. 79-91, Mar/Apr 1999.
Shore, Miles F. and Allan Beigel. “The Challenges Posed by Managed Behavioral Health
Care.” The New England Journal of Medicine. Vol. 334 No. 2, pp. 116-119. 11
January 1996.
It is well noted in much of the literature available that information about mental
health is generally not separated from physical health in terms of insurance. Empirical
69
evidence mostly couples the two making it hard to test for differences. The data used in
most of these studies come from the
RAND Corporation, particularly the “health insurance experiment” data set. The issue of
effectiveness of mental health care providers has become increasingly important in many
cities in recent years. Studies attempt to find policy that will help reduce cost and
provide better service that is more accessible.
Buchanan’s study uses the simulation model he developed to determine the
effects of different health care plans and how they compare between individual and
family. Using complicated mathematical formulas, this simulated study provides that
insurance is curbed even by the smallest deductions. “For mental health services, when
one family member enters treat- ment others frequently follow shortly” (24).
Marquis’s literature finds that people are more responsive to decreases in
premiums than they are to increases. Using the expected utility theory as compared to
alternative models, she finds that the alternative model is a better indicator of a person’s
assessment of risk taking. Once a person expects a certain amount of coverage, they tend
to value that level more highly than the previous level. “The alternative utility model
also sug- gests that a decrease in the price of insurance will increase the demand for
generous coverage by more than the demand for generous coverage will fall in response
to an increase in the price (7).”
Ozcan studies Virginia’s mental health organizations and the performance of
publically funded mental health care. Using regression analysis, they examined both
environmental and internal organizational variables. Education and minority status
provided both direct and indirect influence on the effectiveness variable. Those with
70
higher educations tended to use private health insurance more often than public outpatient
services. The study also suggests that mental illness is more pervasive in members of
lower socio-economic classes.
Rosenheck begins with the assumption that the performance of health care
systems is largely judged on access. The Department of Veterans Affairs (VA) is the
largest provider of mental health care in the US. As such, this study uses this specific
demographic to determine accessibility. Total funding and efficiency are both high
correlated with rate of service use. “Total funding, however, was more powerful than
efficiency as a predictor of rate of service use among low-income veterans (9).” This
study provides that there may be important differences across localities in accessibility of
services and as a result multiple measures of accessibility may be needed.
Wells’ study tries to determine whether levels of mental health status and prior
use of mental health services affects decisions to use PPO’s for employees enrolled in
fee-for-services plans. PPO’s are supposed to alter the behaviors of both patient and
provider (2). They only work, however, if a large cross-section of employees joins them,
particularly the sicker patients. The study found that only ½ of those studied participated
in PPO’s. The study also concludes that patients who had previously received care from
a PPO tend to stay with this provider while those with which used a non-PPO had no
greater propensity to use non-PPO providers than those with no earlier usage.
Joan L. Buchanan, Emmett B. Keeler, John E. Rolph, Martin R. Holmer. Simulating
Health Expenditures under Alternative Insurance Plans. INFORMS. Management
Science, Vol. 37, No. 9 (Sep., 1991), pp. 1067-1090
71
< http://www.jstor.org/stable/2632327>
M. Susan Marquis, Martin R. Holmer. Alternative Models of Choice Under Uncertainty
and Demand for Health Insurance. The MIT Press. The Review of Economics and
Statistics, Vol. 78, No. 3 (Aug., 1996), pp. 421-427
< http://www.jstor.org/stable/2109789>
Yasar A. Ozcan, Ramesh K. Shukla, Laura H. Tyler. Organizational Performance in the
Community Mental Health Care System: The Need Fulfillment Perspective. INFORMS.
Organization Science, Vol. 8, No. 2 (Mar. - Apr., 1997), pp. 176-191
<http://www.jstor.org/stable/2635309>
Robert Rosenheck, Marilyn Stolar . Access to Public Mental Health Services:
Determinants of Population Coverage. Lippincott Williams & Wilkins. Medical Care,
Vol. 36, No. 4 (Apr., 1998), pp. 503-512
<http://www.jstor.org/stable/3767136>
Kenneth B. Wells, M. Susan Marquis, Susan D. Hosek. Mental Health and Selection of
Preferred Providers: Experience in Three Employee Groups. Lippincott Williams &
Wilkins. Medical Care, Vol. 29, No. 9 (Sep., 1991), pp. 911-924
< http://www.jstor.org/stable/3765859>.
According to Katherine Guckenberger, in Public Takes on Private: The
Philadelphia Behavioral Health System, the city of Philadelphia faced a tough decision in
1996: should it continue to allow private health maintenance organizations (HMOs) to
manage the behavioral health care of Medicaid recipients or should it form its own
managed care organization (MCO) in order to perform this function itself? The central
question is whether either public or private MCOs are objectively better, and the answer
appears to be “no.” Both public and private MCOs have advantages and drawbacks, and
the best solution may be to implement an integrated system that can maximize the
advantages of both, while minimizing their drawbacks.
The most well-known advantage of private MCOs, and the primary reason
Philadelphia originally contracted them, is their cost effectiveness (Guckenberger, 2002).
Because they work for profit, HMOs are unlikely to provide unnecessary or ineffective
services. In theory, HMOs’ cost effectiveness goes hand in hand with high quality
treatment. They are likely, for example, to provide high continuity of care to seriously ill
patients in order to reduce their time in the system, and, therefore, there cost to it
(Guckenberger, 2002). According to Minkoff and Pollack (1997), private MCOs have
72
the capacity to provide managed care because they currently do so for 103 million people
(Minkoff & Pollack, 1997). Private, unlike public, MCOs have the management, data
processing, clinical infrastructure, and access to capital and retained earnings, necessary
to serve public enrollees. Furthermore, private MCOs are not constrained by the legal
and bureaucratic obstacles faced by their public counterparts when purchasing and hiring,
thus permitting greater flexibility and immediate action (Minkoff & Pollack, 1997).
Private MCOs’ most celebrated advantage is also the source of their most
apparent drawback: their search for cost reductions and profits is seen to sometimes
conflict with their duty to provide quality service. This was the case in their handling of
behavioral health care in Philadelphia, as they spent only a fraction of the capitated rate
they were given for behavioral care (Guckenberger, 2002). This cost reduction strategy
had a negative effect on the level of service behavioral care patients received. Horn et al.
(1996) provide a similar example, as they point out that a common cost reduction
technique, formulary limitations, causes greater inconvenience and longer periods of
sickness and discomfort for patients (Horn et al., 1996). Another drawback of private
MCOs is that, according to Merrick, Garnick, Horgan, and Hodgkin (2002), less than half
(48.9%) conduct behavioral health clinical outcome assessment, a fact which might have
implications quality of care (Merrick, Garnick, Horgan, & Hodgkin, 2002). Lastly,
private MCOs lack experience with, and sensitivity to, the needs of public sector clients,
consumers, and family advocacy groups. They are also frequently unaware of unique
local community needs (Minkoff & Pollack, 1997).
Private MCOs’ drawbacks are the public MCOs advantages. Whereas HMOs are
oftentimes unaware of community needs, non-profit government agencies are generally
familiar with the long-term needs of consumers and the community. Because they are
non-profit, furthermore, public MCOs are perceived as being committed to their
communities, not to distant stockholders (Minkoff & Pollack, 1997). It is primarily for
this reason that people may have greater trust, and be more willing to participate, in
public MCOs.
Non-profit public MCOs, however, are not as efficient as private MCOs. Ozcan,
Shukla, and Tyler (1997) call attention to the fact that the less that publicly funded
community organizations meet community needs, the more government funds they
73
receive, suggesting that the government’s resource allocation may reward inefficiency
(Ozcan, Shukla, & Tyler, 1997). Not surprisingly, financial performance is lower for city
or county-managed mental health centers than for other types. This may be due to large
and complex organizational structures and bureaucratic politics (Ozcan, Shukla, & Tyler,
1997). Bureaucratic politics also make it difficult to shift funds from one purpose to
another without obtaining approval after approval, and they can compromise the network
provider selection process, as providers with political connections might be selected over
better-qualified providers (Minkoff & Pollack, 1997). Even hiring qualified persons can
be challenging for public MCOs due to public personnel hiring requirements and lower
public salary levels (Minkoff & Pollack, 1997).
Both private and public MCOs have advantages and drawbacks. Implementing an
integrated system, however, might maximize their advantages while minimizing their
drawbacks in order to, as Welton, Kantner, and Moriber Katz (1997) suggest, achieve the
goals of medicine cost-effectively (Welton, Kantner & Moriber Katz 1997). A way to do
this would be to use private sector MCOs with a public agency providing oversight and
facilitating the consolidation of local, state, and federal funding for the MCOs. The
public agency could monitor for quality of, and access to, care to meet the unique needs
of the individual consumers and the community. Performance standards, to include
outcome assessments, and with accompanying financial rewards or penalties, could be
used to promote a healthy balance between cost reduction and quality of service (Minkoff
& Pollack, 1997). This would capture the benefits of private and public MCOs (cost
effectiveness and commitment to community, respectively), while minimizing their
drawbacks (profit seeking at the expense of service and inefficiency).
Works Cited
Horn, S. et al. (1996). Intended and unintended consequences of HMO cost-containment
strategies: results from the managed care outcomes project. The American
Journal of Managed Care, 2(3), 253-263.
Kennedy School of Government Case Program. (2002). Public takes on private: the
Philadelphia behavioral health system. Exton, PA: Guckenberger, K.
Levy Merrick, E., Garnick, D., Horgan, C. & Hodgkin, D. (2002). Quality measurement
and accountability for substance abuse and mental health services in managed
74
care organizations. Medical Care 40(12), 1238-1248.
Minkoff, K., Pollack, D. (Eds.). (1997). Managed mental health care in the public
sector: a survival manual. Amsterdam: Harwood Academic Publishers.
Ozcan, Y., Shukla, R. & Tyler, L. (1997). Organizational performance in the community
mental health care system: the need fulfillment perspective. Organization
Science, 8(2), 176-191.
Welton, W., Kantner, T. & Moriber Katz, S. (1997). Developing tomorrow’s integrated
community health systems: a leadership challenge for public health and primary
care. The Milbank Quarterly, 75(2), 261-288.
In the case study, Public Takes on Private: The Philadelphia Behavioral Health
System, the elected officials with the city of Philadelphia was faced with the challenge of
reorganizing its behavioral health system, “often characterized as fragmented, ineffective,
and confusing” (C16-02-1649.0, p. 1). The council had to decide whether to allow the
behavioral health care of Medicaid recipients to be managed by private sector health
maintenance companies, known as HMOs, or to allow the city’s newly-created nonprofit,
Community Behavioral Health (CBH), to manage recipients itself. In order to control the
continuity and quality of care, CBH proposed to take control of the three funding
streams: state funds for Philadelphia Hospital; city, state and federal funds for behavioral
health programs; and Medicaid. The intent was to eliminate the frustration patients were
experiencing from a three-tiered system – the carve out companies (Behavioral health
maintenance organizations) that were subcontracted by the HMO’s to handle the
behavioral health money that had been carved out of the original contracts.
While the shift to carve-out programs is an attempt to primarily contain costs, it is
imperative that this approach not adversely impact the quality of the mental health care
services. The authors of Effect of a Mental Health “Carve-Out” Program on the
Continuity of Antipsychotic Therapy “studied the effect of transitioning Tennessee’s state
75
operated Medicaid program, TennCare, to a fully capitated, specialty carve-out program,
TennCare Partners. The study looked at the continuity of antipsychotic therapy for
patients with severe mental illness through this transition, primarily the post-transition
group that might have been affected by the change and the pre-transition group that,
during a one-year follow-up period, was unaffected by the transition. The study revealed
that the shift from the state operated program to the carve-out program resulted in a
reduction in the continuity of antipsychotic therapy, affecting vulnerable patients with
severe mental illness. Therefore, the authors concluded that more emphasis should be
given to ensuring that carve-out programs do not unduly disrupt the continuity of care,
during both the transition periods and the “steady-state” operation.
In, From Silos to Bridges: Meeting the General Health Care Needs of Adults with
Severe Mental Illness, the authors discusses the obstacles to bridging the mental health
care sector and the general health care sector, noting that “the mental health specialty
sector is the health care home for adults with severe mental illnesses (Horvitz-Lennon,
Kilbourne & Pincus, 2006, p. 659). Similar to the case in Philadelphia, the authors note
that evidence supports the notion that individuals suffering from severe mental illness
have difficulties obtaining general health care and that its quality is inferior to those with
fewer impairments. The article is based on the concept of clinical integration, which is
defined as “the extent to which patient care services are coordinated across people,
functions, activities, and sites over time” (p. 661). Before clinical integration can
succeed, effective communication, collaboration, comprehensiveness and continuity of
care must exist.
76
While coordination is lower for carve-outs, the separation between mental health
care and general health care create additional problems, including lack of communication
and accountability. To limit the negative impact of the separation between health care
sectors, the authors noted that policies should be included in carve-out contracts. In
addition, as was the case in the proposal of CBH, capitation rates should be adjusted to
facilitate integrated health care.
Recognizing the need for addressing the mental health care dilemma at the
national level, in April of 2002, President George W. Bush established the New Freedom
Commission on Mental Health with the charge to “recommend improvements to enable
adults with serious mental illness and children with emotional disturbances to live, work,
learn, and participate in their communities” (p.507). In Mental Health Maze and the Call
for Transformation, President Bush identified three impediments to recipients receiving
first-rate mental heath care: 1) the stigma associated with mental illness; 2) undue
limitations of coverage due to subpar health insurance; and 3) fragmented services and
programs. The Committee recommended a change to the country’s approach to mental
health care where less than 40 percent of those with severe mental illness receive
consistent treatment.
Interestingly, providers from the general health care sector recognize deficiencies
in coverage, cost and quality describing the United States health care system as broken.
In the article, U.S. Healthcare: The Intertwined Caduceus of Physicians, Coverage,
Quality, and Cost, the American College of Cardiology Board of Trustees adopted
healthcare reform principles advocating improvements to coverage, quality, and cost by
the year 2010. More specifically, the principles look to 1) create economies of scale in
77
administrative costs by establishing large scale groups; 2) a benefit package outlining
evidence based minimum benefits; 3) encourage quality service that is affordable and
efficient to all Americans through incentives and competition; and 4) allow choices in
providers and the type of health plan.
The authors of, Will Parity in Coverage Result in Better Mental Health Care?,
note that mental health care services grew significantly from the 1960’s to the mid1990’s financed by various sources. By 1997, approximately three fifths of funding for
mental health care was made through both public and private health insurance programs.
However, the authors argue that managed care has changed the way mental health care
has been delivered and paid in the United States and questions whether parity between
mental health coverage and general health coverage will lead to equality in access to
mental health services. While managed mental health care, both programs that are
integrated with general health care and carve-outs programs, significantly reduces
spending, managed-care programs should “not exclude cost-effective treatments in an
effort to limit cost” (p. 1704).
Frank, Richard G., Goldman, Howard H., & McGuire, Thomas G. 2001. “Will Parity in
Coverage Result in Better Mental Health Care?,” The New England Journal of Medicine,
Vol. 345, No. 23 1701-1704.
Garson, Jr., Arthur. 2004. “U.S. Healthcare: The Intertwined Caduceus of Physicians,
Coverage, Quality, and Cost,” Journal of the American College of Cardiology, Vol. 43,
No. 1 1-5.
Iglehart, John K. 2004. “The Mental Health Maze and the Call for Transformation,” The
New England Journal of Medicine, Vol. 350, No. 5 507-514.
Ray, Wayne A., Daugherty, James R., & Meador, Keith G. 2003. “Effect of a Mental
Health ‘Carve-Out’ Program on the Continuity of Antipsychotic Therapy,” The New
England Journal of Medicine, Vol. 348, No.19 1885-1894.
78
Horvitz-Lennon, Marcela, Kilbourne, Amy M., & Pincus, Harold A. 2006. “From Silos to
Bridges: Meeting the General Health Care Needs of Adults with Severe Mental Illness,”
Health Affairs, Vol. 25, No. 3 659-669.
An aging population and advances in medical technology are making health
insurance increasingly expensive. This becomes the main issue in health care reform,
how do we keep costs down while maximizing the quality and efficiency of health care.
Questions such as these begin to look at competing ideas such as public versus private
based systems and fee-for-pay versus managed care delivery systems. Fee-for-service
plans are health insurance plans that allow the holder to make almost all health care
decisions independently because he pays for the service. The holder receives
reimbursement if the service is covered by the policy by submitting a claim to the
insurance company. These plans tend to have higher deductibles and co-pay. Managed
care systems on the other hand, are health care delivery systems aimed at increasing the
quality of care while eliminating the inefficiencies often through prepaid medical plans.
They aim to reduce the cost as well.
The question that Landon et al. (2004) try to answer is what differences
beneficiaries experience between the two delivery systems. In their research, Landon et
al. (2004) used survey data administered by the Centers for Medicare & Medicaid
Services (CMS) in 2000 and 2001. The survey was issued in a managed care version and
a FFS version to beneficiaries aged 65 years or older. The survey measured overall
ratings: of the plan, personal physician, care received overall, and care received from
specialists. The survey also measured summary of beneficiaries’ experiences with care.
They found that respondents in managed care and fee-for-pay plans were similar to each
other. Nationally they found fee-for-pay Medicare beneficiaries rated experiences with
care higher than did those with managed care. They also rated personal physicians higher
than managed care beneficiaries. Managed care beneficiaries reported significantly fewer
problems with paperwork, information, and customer service. They were also more likely
to report having received immunizations for influenza and pneumococcus. The data
presented in the study suggests that managed care was better at delivering preventive
services, whereas traditional Medicare was better in other aspects of care related to access
and beneficiary expenses (Landon et al, 2004). They also found that care experiences
between the two delivery systems vary across regions of the country, and states within
regions, suggesting that consumer experiences are affected by particular characteristics of
the organization and norms of care in different area (Landon et al, 2004). One limitation
the author acknowledged was the difference in response rates between the two
beneficiaries. The response rate for managed care was 82 percent opposed to 68 percent
for fee-for-pay care. Unmeasured confounders might have influenced our findings. These
results have significance importance especially in policy decisions that are made. These
tradeoffs between the strengths of the two delivery systems
In another study, Kirsner, Trapido, & Wilkinson (2005) examined possible
differences in the stage at diagnosis for breast and cervical cancer between the two
medical health care delivery systems. The important issue is whether, and how, the health
care delivery system in which patients participate may affect patient care. The researchers
used two national databases to get their data: the Medicare database from the Centers for
Medicare and Medicaid Services and the National Cancer Institute’s Surveillance,
79
Epidemiology, and End Results program. Logistic regression analysis was then used to
evaluate whether HMO status affected the stage at diagnosis. The researchers used both
univariate and multivariate approaches in logistic analysis. The main study finding was
that women enrolled in HMOs with breast cancer were 17 percent more likely and those
with cervical cancer 35 percent more likely to be diagnosed at an in situ stage (or stage 0)
of diagnosis than fee-for-service patients. These differences remained even after
controlling for potential confounders such as age, race, socioeconomic status, and marital
status. One reason why this may be the case is the HMO effect, which describes the
greater likelihood of HMO patients to use preventive services including disease
screening. This study builds upon Riley’s research (Kirsner, Trapido, & Wilkinson, 2005)
and is consistent with their findings that demonstrated the diagnosis of breast and cervical
cancer at an earlier stage in patients enrolled in HMOs. Kirsner, Trapido, & Wilkinson’s
(2005) hypothesis that patients enrolled in HMOs either have greater access to or use of
preventive services was supported by their study. Thus, one way to improve patient
outcomes is to improve access and vigilance for patients. Some limitations the authors
talked about were the generalizability of the study to younger patients, since the study
population was 65 years or older. Problems with the sample may arise due to the sample
not being representative of the nation. As the authors suggest, this study has importance
because early detection of treatable cancers is a fundamental component of cancer
prevention and control efforts aimed at decreasing cancer mortality.
The inconsistencies of health care may cause people to be less confident in their
delivery system. Fiscella, Franks, & Clancy (1998) try to examine patient behavior,
especially skepticism, and how it may influence insurance coverage, having a regular
source of care, and choice of physician. People that are skeptical of the value of health
care are more likely to forgo health care coverage by opting not to purchase coverage.
They are also more likely to be associated with not having a regular source of care.
Skepticism is also hypothesized to result in lower utilization as measured by physician
visits, emergency department visits, hospitalizations, total annual health care
expenditures, and preventive health care (Fiscella, Franks, & Clancy, 1998). Thus,
skepticism is seen as exerting effect s on health utilization and behavior as well as
indirect effects via access factors (Fiscella, Franks, & Clancy, 1998). The research data
was taken from the Household Survey component of the National Medical Expenditure
Survey (NMES), which was a cross-sectional survey of 35,000 individuals in 14,000
households. In multivariate analyses, skepticism was associated with younger age, white
race, lower income, less education, and higher health perceptions. After adjusting for
these variables, skepticism was associated with less healthy behavior, with not having
health insurance, not having one’s own physician, choice of physician, fewer physician
and emergency department visits, less frequent hospitalizations, lower annual health care
expenditures, and less prevention compliance. These findings suggest that the medically
skeptical may be at risk for health problems resulting from underutilization. The data also
suggests that a policy that increases employee-funded premiums or decreases employerbased tax deductions may result in large numbers of the medically skeptical forgoing
health insurance. The limitations the researchers acknowledges is the cross sectional
design and the measure of skepticism, which is used in this secondary data analysis was
limited by use of the preexisting questions that provided modest internal reliability.
80
Some experts have turned to other systems around the world for possible solutions
to health care reform. Toebes (2006) did a case study of the Netherlands to examine their
new health care system. The issue in the Netherlands is whether to further privatize
health care services. Many countries are currently privatizing health care which seems to
be the trend around the world. Public health systems are increasingly coming under
pressure due to the rising costs of health care. These cost increases are due to a variety of
factors, including improvements in medical techniques, the changing age profiles of
populations, and rising expectations about the quality of care (Toebes, 2006). The old
health care system in the Netherlands (National Health Services) was covered by 60
percent of the population and the remainder by private insurance. The Dutch government
gradually introduced competition between insurance companies by letting some of the
public entities become private. Under the new system, each person is supposed to receive
the same basic insurance coverage provided by the private insurance company of his or
her choice. The insurance companies will be allowed to compete against one another in
order to make a profit. Half of the basic health insurance will be financed by a fund
consisting of governmental and employment-based contributions. The other half will be
financed by the insurance contributions of all insured persons 18 years or older. The
government has imposed obligations on the insurance companies, including the
obligation to accept all applicants, and the prohibition against differentiating between
consumers on the basis of their health status, age, and other factors. Due to the larger role
of insurance companies, the new system might become more efficient in terms of cost.
There is also a risk that the new system will create more uninsured people. Toebes (2006)
also notes that the new system needs to be set up to ensure that government meets its
obligations to protect individuals. One way is to regulate and govern these new powerful
actors in the health sector. It is crucial to define state responsibilities and establish how
governments are to oversee the engagement of these actors in the health sector.
Other experts have said health care reform needs accountable care systems. These
experts acknowledge that most physicians still practice either by themselves or in small
groups. Small practices have less capacity to implement electronic medical record, less
frequently use teams to care for patients with chronic illness, and are less able to provide
reliable and valid data on quality and efficiency measures. Shortell and Casalino (2008)
propose the concept of accountable care systems (ACS). An ACS is an entity that can
implement organized processes for improving the quality and controlling the costs of care
and be held accountable for the results. Shortell and Casalino (2008) suggest 5 models:
Multispecialty group practice, Hospital medical staff organizations, Physician-hospital
organization, Interdependent practice organization, and Health plan-provider
organizations. At present there is little incentive for physicians to join or form
organizations that can produce better outcomes at the same or lower cost. They do not
have the capability to manage both quality and cost. The evolution of incentives and the
development of capabilities to respond to the incentives are needed.
Works Cited
Fiscella, K., Franks, P., & Clancy, C.M. (1998). Skepticism toward Medical Care and
Health Care Utilization. Medical Care, 36(4), 180-189.
81
Kirsner, R.S., Trapido, E., & Wilkinson, J.D. (2005) The Effect of Medicare Health Care
Systems on Women with Breast and Cervical Cancer. American College of
Obstetricians and Gynecologists, 105(6), 1381-1388.
Landon, B.E., Zaslavsky, A.M., Bernard, S.L., et al. (2004). Comparison of Performance
of Traditional Medicare vs. Medicare Manged Care. Journal of the American
Medical Association, 291(14), 1744-1752.
Shortell, S.M., Casalino, L.P. (2008). Health Care Reform Requires Accountable Care
Systems. Journal of the American Medical Association, 300(1), 95-97.
Toebes, B. (2006) The Right to Health and the Privatization of National Health Systems:
A Case Study of the Netherlands. Health and Human Rights, 9(1), 102-127.
Health care has recently become one of the most controversial issues in the
United States as many Americans are increasingly unable to afford the rising costs of
health insurance. One issue that has been particularly challenging to address is how to
effectively provide access to behavioral health services. This is displayed in the Kennedy
School of Government Case Program, “Public Takes on Private: The Philadelphia
Behavioral Health System.” In this case, forms of private and public coverage were
compared, specifically focusing on the pros and cons of a fee-for-service model and the
health maintenance organization (HMO) plan. Providing behavioral health services
continues to be a serious concern for a number of cities in the U.S., yet how to deliver
quality services in a cost-effective manner has yet to be determined.
In the article, “A Comparison of Effects of Sociodemographic Factors and Health
Status of Outpatient Mental Health Services in HMO and Fee-for-Service Plans”, the
authors found that age and education can be good indicators of usage of mental health
services. They also point out an unfortunate trend with regards to income: “enrollees in
the lowest income group have a significantly higher probability of having any outpatient
mental health visit and of visiting any mental health specialist and incur significantly
greater mental health expenses than do enrollees in the middle or high income groups”
(955).
82
Authors Jeffrey A. Buck and Beth Umland mention that employers tend to
support mental health and substance abuse services less than other medical services
covered by insurance plans. “Employers often restrict MH/SA benefits by placing more
limits on their use or imposing greater cost sharing than they do for other health care
services” (122). This situation reflects the general disparity between medical and
behavioral services and the related complications that arise within insurance coverage
plans.
In their article, “Does Managed Care Enable More Low Income Persons to
Identify a Usual Source of Care? Implications for Access to Care”, authors Peter J.
Cunningham and Sally Trude state that even though managed care and HMO plans can
improve access to care for lower income persons, there are unintended consequences that
negatively affect people that are also in need of health services. “It is possible that the
cost pressures from managed care limit the ability of health care providers to crosssubsidize care they provide to medically indigent persons by charging higher fees for
privately insured patients, thus limiting the amount of care they are willing or able to
provide to the uninsured” (723).
In the article, “The Economics of Behavioral Health Services in Medical Settings:
A Summary of Evidence”, the authors emphasize that an integrated care approach,
encompassing both medical and behavioral practices, is an ideal way to offer behavioral
health services. This approach is cost effective and it increases the communication
between private care practitioners and behavioral health practitioners. Additionally, the
idea of an integrated approach may also be better accepted by patients as they view it as
addressing medical issues. “This is necessary for the very high percentage of patients in
83
primary care who have severe behavioral health needs but would not accept care defined
as mental health or psychiatric care” (294).
Finally, one general question that is interesting to consider in this discussion is the
type of services that health care professionals would choose when given the choice of
medical care. In an article entitled, “Personal Choices of Health Plans by Managed Care
Experts”, the authors surveyed managed care experts and found that in a majority of
cases they chose not to enroll in HMO plans (half as likely as non-experts). “For
physician experts, one obvious explanation for the aversion to HMOs we observed is an
ingrained dislike of managed care arising from their clinical practice experience and other
professional influences” (382). Though the authors admit that there are several
explanations to the findings in their research, the preferences of managed care experts
should be noted when discussing which form of medical care is best suited for their
patients.
References
Blount, Alexander, Michael Schoenbaum, Roger Kathol, Bruce L. Rollman, Marshall
Thomas, William O'Donohue, C.J. Peek. “The Economics of Behavioral Health Services
in Medical Settings: A Summary of Evidence.” Professional Psychology: Research and
Practice, Vol 38, No. 3, (Jun 2007), pp. 290-297
Buck, Jeffrey A. and Beth Umland. “Covering Mental Health and Substance Abuse
Services.” Health Affairs, Vol. 16, No. 4 (1997), pp. 120-126
Cunningham, Peter J. and Sally Trude. “Does Managed Care Enable More Low Income
Persons to Identify a Usual Source of Care? Implications for Access to Care.” Medical
Care, Vol. 39, No. 7 (Jul. 2001), pp. 716-726
Studdert, David M., Jayanta Bhattacharya, Michael Schoenbaum, Brandee Warren and
Jose J. Escarce. “Personal Choices of Health Plans by Managed Care Experts.” Medical
Care, Vol. 40, No. 5 (May 2002), pp. 375-386
84
Wells, Kenneth B., Willard G. Manning, Jr. and Bernadette Benjamin “A Comparison of
Effects of Sociodemographic Factors and Health Status of Outpatient Mental Health
Services in HMO and Fee-for-Service Plans.” Medical Care, Vol. 24, No. 10 (Oct.
1986), pp. 949-960
As we learned from the case study regarding the Philadelphia Behavioral
Health System, people (regardless of specific health concern), need effective coordinated
care. A fragmented care system leads to duplication of service, out of control billing and
people (usually who most need the care) falling through the cracks and not receiving any
treatment at all.
When Hungary transitioned from its former socialist nation dependent on the
USSR, to an independent nation, the reform of healthcare became an important social and
political issue. The most important question they face is the allocation of financial
resources. This article looked at the funding options available in Hungary. General
practitioners, home care (nursing), out-patient care and acute chronic care of hospitals
were all put into a historic and present day context. The budget approach of the 1980’s
was replaced by performance-related financing methods including the ICPM
(International Classification of Procedures in Medicine) code system of the WHO in outpatient care and the introduction of the HBCS in in-patient care. (Boncz et al. 2004).
One of the most important changes in the Hungarian health care financing system
was the introduction of performance-related financing. The principle of “money follows
the patient” replaced the global budget approach. The new financing methods
contributed to the successful survival of Hungarian health care during the past 12 years.
There is still a call for the integration of financing and communication between different
types of care so as to make the institutions more cost-effective in their treatment for
patients. (Boncz et al. 2004).
85
Another issue raised by the Philadelphia experiment was the treatment of the
providers and the problems that arose from capitation, or even sub-capitation as was the
case for the behavioral health providers. Terrence Conway (et. al.) examined the
physician perceptions of managed care in an article they wrote in 1998. They concluded
that increasing quality and decreasing cost may be included in the same equation, if the
physician’s job satisfaction is included through organizational support and a user-friendly
work environment. (Conway et. al. 1998).
Conway (et. al.) interviewed one-hundred and sixty attending physicians of an
urban public hospital in a metropolitan area with low to moderate managed care
penetration. Confirmatory factory analysis and structural equation models were applied.
The study revealed that when physicians perceived that high job satisfaction would ensue
they also perceived that quality and access to care would improve under managed care.
Risk sharing, from the physician’s perspective did not translate to cost savings as
expected by manage care organizations, and only resulted in a fractional improvement on
a perception of quality and access of care. (Conway et. al. 1998).
Kathleen Green-Raleigh (et. al.) examined the behavior women of child-bearing
age and their relationship with manage care. The importance of this study and how it
relates to the Philadelphia experiment is how it important to disseminate information to
the public with regard to educating them on the resources available to them whether they
are immediate need of said services or not.
The study involved a telephone survey of non-pregnant women of childbearing
age who belonged to a Southern California managed care plan. Survey data was
analyzed in logistic regression models assessing differences in selected behaviors
86
between women planning pregnancy and others. The study concluded all women of
childbearing age need information about the importance of engaging in healthy
behaviors. Health care providers who have regular contact with such women should send
clear messages about the adverse effects of alcohol and smoking during pregnancy and
the importance of taking a multivitamin regularly, regardless of women’s pregnancy
plans, before they become pregnant. (Green-Raleigh, et. al.. 2005).
Another issue of the Philadelphia experiment is the duplication of costs and
uncontrolled billing through Medicaid. Managed care has responded to this problem with
utilization review. The aim of utilization management is to ensure that the treatment
provided to patients is clinically appropriate and medically necessary. More than 90% of
privately insured persons and a growing number of Medicaid patients are subject to
utilization review. This study examined the effects of utilization management review
activities on patterns of hospital care among a sample of adult patients insured through a
managed fee-for-service-plan. (Wickizer and Lessler, 1998).
The study was a retrospective analysis of insurance administrative data
representing a case series of patients for whom utilization management review was
performed. Two activities were analyzed: pre-admission review and concurrent
(continued stay) review. Review outcomes included inpatient or outpatient care denied,
site treatment shifted (from inpatient to outpatient), or reduction in requested hospital
days (total days requested-total days approved). The most common action taken was to
limit the length of stay by concurrent review, which accounted for 83% to total reduction
in inpatient care. They concluded that utilization management programs appear to limit
87
hospital care by managing length of stay once patients were admitted. (Wickizer and
Lessler, 1998).
The last article looks specifically on how Psychiatric cases are targeted by
managed-care systems. It would seem that this would have the most direct correlation
with the Philadelphia case-study. The authors noted that mental health services account
for approximately 8% of total health care expenditures, and of this, psychiatric inpatient
treatment for approximately 50%. Case management (a managed care approach),
attempts to identify, monitor, and manage high-cost cases early in the course of the
episode, before they incur catastrophic costs. (Goldstein, et. al, 1988).
Using claims data from a large nationwide insurer, the authors developing an
empirical approach to identifying potentially catastrophic cases. The findings suggest
that, in addition to diagnosis, other factors such as age and treatment setting contribute to
long stays and high costs and thus should be used to identify catastrophic cases for case
management interventions. The authors found that mental health managed-care programs
identify inappropriate, inefficient, or unnecessary care by evaluating, monitoring, and
sometimes managing reimbursement for psychiatric treatment. Catastrophic cases can be
identified through understanding the effects of patient and setting characteristics on costs
and quality of care. (Goldstein, et.al., 1988).
The issues raised by the Philadelphia case study seem to be making the argument
for the need for managed care. Despite it problems, it does provide effective coordinated
care. It provides more appropriate and less expensive care. The use of managed care
coupled with utilization review provides a high continuity of care that does work with
both medical as well as behavioral health needs.
88
Boncz, Imre, Julia Nagy, Andor Sebestyen, and Laszlo Korosi. (Sept. 2004). Financing
Health Care Services in Hungary. The European Journal of Health Economics. Vol: 5,
No: 3 pp. 252-258
Conway, Terrance, Tzyy-Chyn Hu, and Steven R. Daugherty. (Sept, 1998) Physicians’
Perceptions of Managed Care: A Structural Equation Model Assessment of Key
Dimensions. Medical Care. Vol: 36, No: 9 pp: 1430-1435.
Goldstein, Jill M., Ellen L. Bassuk, Stephen K. Holland, and Danya Zimmer. (Aug.
1988). Identifying Catastrophic Psychiatric Cases: Targeting Managed-Care Strategies.
Medical Care. Vol: 26, No: 8 pp: 790-799
Green-Raleigh, Kathleen, Jean M. Lawrence, Huichao Chen, Owen Devine, and Christine
Prue. (Dec. 2005). Pregnancy Planning Status and Health Behaviors among Nonpregnant
Women in California Managed Health Care Organization. Perspectives on Sexual
Reproductive Health. Vol: 37, No: 4. pp: 179-183.
Wickizer, Thomas M., and Daniel Lessler. (Nov. 1998). Effects of Utilization
Management on Patterns of Hospital Care Among Privately Insured Adult Patients.
Medical Care. Vol: 36 No: 11 pp: 1545-1554.
Delivery of health care in the United States has been rapidly changing in recent
years. Many people view these changes as an evolution of the health care system, while
others view the changes as devolution. There is still the ever-present question as to
whether private, public, or a hybrid version of them both is the most advantageous
direction for health care. Health care reform in general, always seems to be a hot topic,
but is a very broad subject. For the purpose of this review, the often overlooked vein of
health care, mental health care, will be the focus with an analysis of the pros and cons of
the current systems of delivery.
Comparing Private and Public Sector Mental Health Care
The two main factors considered in drawing comparisons between public and
private health care are cost and quality. Although mental health care in many cases is
funded separately from physical health care, these two factors are still the main concern
89
regarding the best way to handle it. When considering cost, one must ask whether that
cost is related to cost to the government or cost to the individual. Will the coverage be
provided from a government funded social program like Medicaid, or by private
insurance purchased by an individual at a lower cost associated with a tax benefit.
Analyses of data from the 2005 Medical Expenditure Panel Survey indicate that total
medical spending is much lower when coverage is provided by Medicaid than it is when
coverage is provided by private insurance. Public insurance is particularly advantageous
from the consumer’s perspective because associated out-of-pocket spending is far lower
(Ku). The problem is that many of the public programs such as Medicaid are not offered
to a great deal of the poor population that are uninsured and require mental health care.
In fact, it is estimated that approximately 60 percent of poor Americans are not covered
by Medicaid (Ramirez de Arellano). Policy makers must strive to make mental health
care affordable to all, while keeping the quality of those services as high as possible.
The quality of service to the individual using public health care tends to be much
lower than in privately funded care. For example, in a study of quality difference
between The Department of Veteran Affair’s mental health program and private mental
health care by Douglas L. Leslie, Ph.D. and Robert A. Rosenheck, M.D. (2000), the
private sector outperformed V.A. on most quality measures. The study looked at
Individuals receiving VA inpatient mental health care during the first six months of each
fiscal year from 1993 to 1997.The patients were identified from discharge abstracts. A
similar cohort of privately insured individuals was identified using MEDSTAT's
MarketScan database from 1993 to 1995. Individuals in both cohorts were tracked for six
months after discharge. Length of stay, readmission rates, and access to outpatient
90
services were calculated. Numerous other studies have shown the private sectors quality
of care to be much better than that of the public health system. Many believe that the
cause of lower quality care in public institutions, is the lack of competition these
institutes face to receive funding. If a public institution is guaranteed funding regardless
of performance, they have no incentive to give quality care. This same lack of
competition may cause public systems to be less efficiently run than a private institution
that must make money to survive, and please stock holders in the case of major
corporations.
These statistics and viewpoints have many implications as to how policy makers
structure how mental health care is delivered to the public. Although there is no one
correct approach, the greatest successes to date have come when policymakers start with
a vision of what goals they want the service system to achieve and then, engaging in
comprehensive planning with stakeholder groups, use managed care to reach those goals.
Managed care appears to be a useful and cutting-edge tool for achieving cost efficiency in
a dynamic system while offsetting risks and protecting consumers (Bazelon Center for
Mental Health Law). However, initial programs in managed care had physical and
mental health lumped together, with mental health institutions receiving no direct
funding. The physical health care took large commissions on referrals to the mental
health institutions, with a large loss of income for those institutions, as seen in the article
on Philadelphia’s behavioral health system. Later programs provided, for the private and
public sector, direct funding to mental health care institutions through carve-out
programs, which in theory would increase the quality of care to mental health patients
91
(Sturm 1999). As policy makers consider shifts to managed mental health care, they
must consider what agencies will be the most beneficial to give the contracts to.
Generally speaking, state officials, when considering how to contract out
management of their public mental health system, are in positions similar to those of
private corporations that seek good coverage for their employees. Despite some important
differences in populations served, both types of payers are concerned with accountability,
predictability of costs, and good consumer outcomes. Public systems can therefore learn
from the experiences of private purchasers (Bazelon Center for Mental Health Law).
However, government institutions have to consider if when assigning a contract to a
private agency, they are capable of dealing with severe cases of mental health.
Traditionally public institutions have dealt with these cases. The current options
presented to officials regarding using managed mental health care, are non-profit
agencies and private for profit agencies. Both have their pros and cons, and different
states choose to use different agencies. It may be best to keep these two types of agencies
competing in order to raise the quality of service and keep cost of service down.
Bazelon Center for Mental Health Law. (2000). Effective Public Management of Mental
Health Care: Views from States on Medicaid Reforms that Enhance Service Integration
and Accountability. Washington, D.C.
Ku, L. & Broaddus, M. (2008). Public and Private Health Insurance: Stacking Up The
Costs. Health Affairs, 27(4), 318-327
Leslie, D. L. & Rosenheck, R. A. (May 2000). Comparing Quality of Mental
Health Care for Public-Sector and Privately Insured Populations. PSYCHIATRIC
SERVICES. 51(5), 650-655
92
Ramirez de Arellano, A. B. & Wolfe, S. M. (2007). Unsettling Scores: A Ranking of
State Medicaid Programs.
http://www2.citizen.org/hrg/medicaid/assets/reports/2007UnsettlingScores.pdf
Sturm, R. (November 1999). Tracking Changes in Behavioral Health Services: How
Have Carve-Outs Changed Care? 26(4)
The Philadelphia health care crisis is not a problem that is unique in America. The
debate over public versus private health care, funding, organization and the difficulties of
a large and complex industry with fragmented oversight is one that is addressed by
several scholars and has been for several years. The particular problems of Philadelphia –
misdirected incentives stemming from Medicaid’s fee-for-service operation, overall lack
of coordination, and structural difficulties leading to patient confusion, all can be seen in
many other cities and nations as part of the struggle to find affordable, effective health
care for citizens. In particular, the mental health system is one saddled with additional
difficulties because these citizens often need ongoing care to prevent them from “slipping
through the cracks.”
Part of the debate surrounding the particulars of the Philadelphia case includes
carve out companies, which, according to Busch et. all, “separates the financial risk for
insuring a population.” In Philadelphia, Medicaid constituted a large, unregulated aspect
of the mental health services distribution and the trend is reflected nationally. In the
1990s, public dollar funding by Medicaid rose from 33% to 44% (Busch, Frank, Lehman,
& Greenfield, 2006). Because of the fee-for-service organization, Medicaid spending
showed little signs of slowing and carve out companies were contracted to help keep
costs low. However, as displayed in Philadelphia, a potential outcome of incorporating
carve outs into the health care system is a decrease in quality of care. Busch et. all
examine particularly the impact of carve outs on behavioral health issues that are cooccurring, in this study schizophrenics who also suffer from alcoholism or drug abuse.
The result is that, because of the cost-cutting nature of the carve outs, behavioral health
services such as family therapy, group therapy and individual therapy decrease and
overall quality of care to those individuals who arguably need the services most declines.
This underscores a main point when looking at private vs. public health care – in
reducing the costs of health care (when compared to the limitless spending induced by
Medicaid programs), carve out companies necessarily reduce quality of care.
Another problem addressed in the Philadelphia behavioral health services debate
was that of a lack of coordination. City activists found that the three streams of funding
operated more or less independently of one another. Thus, patients , who often utilized all
three streams, found themselves being circulated in an inefficient manner between the
branches of funding. This lack of coordination drove up costs and reduced effectiveness
93
of services. Part of the solution debate regarding this coordination problem revolves
around creating community-based health care programs and services to take the strain off
of main hubs, such as hospitals. The creation of community programs would force reform
and reorganization and help to eliminate overlap in the health care system. Coye, using an
example from Veteran’s Affairs, argues that creating community programs would ease
the burden of financing by reducing high hospital stays and costs by diverting individuals
into outpatient, community services that would be significantly cheaper and more
effective (Coye, 2008). A problem that Coye does not address, however, is the necessity
still to gain control over the sources of funding (in Philadelphia’s case, Medicaid, grants,
city, etc.) in order to make the organizational reforms and community-based programs
efficient.
Much literature on Medicaid describes the problems and soaring costs associated
with the implementation of the program. However, particularly in dealing with the case in
Philadelphia, the benefits and necessity of Medicaid must also be considered. In a study
which examined the use of Medicaid in special education in Philadelphia, Mandell found
that cuts in Medicaid (which serves 1 in 4 children in the US) would be detrimental to
many special education children who rely on the program for much of their behavioral
services (Mandell, 2008). The Deficit Reduction Act, which limited much of the freedom
of the Medicaid program, was passed in Philadelphia without any information regarding
the fiscal relationship between Medicaid and other programs. As a result, disruptances in
quality of care for children who rely on behavioral health services increased. This article
highlights the importance of enacting reforms that find ways to maintain costeffectiveness of Medicaid without eliminating many of the benefits that patients derive
from it – a problem described in the case of Philadelphia.
Much can be learned about health care systems and alternative ways of providing
health services by examining the systems enacted in other nations. For example, social
health insurance is a type of program enacted in many Latin American countries that
requires individuals subscribing to the insurance to make compulsory contributions to a
fund. The idea is to create a health care system that covers a large population to help
insure as many individuals as possible. However, as it was described by Lloyd-Sherlock
in the case of both Argentina and Mexico, social health insurance suffers from many of
the same problems as the managed care system in America (Lloyd-Sherlock, 2006). In
Argentina, SHI was fragmented and separate funds led to inefficiency. There was poor
regulation and attempts at reform simply furthered fragmentation. Additionally, it failed
in its goal of enrolling lower socioeconomic individuals into the program (LloydSherlock, 2006). In essence, the social health insurance fared poorly due to lack of
organization and fragmentation, similar to the problems of Philadelphia. Ultimately,
according to Meadows et. all, the problem of health care systems comes to resource
distribution decisions. Poor management of money leads to inefficiency, lack of care, and
general failure to attain basic health care goals. Meadows et. all examine the reforms of
Australia’s health care system, and see that the redistribution of funds from the
institutional level to the community level can be more effective in distributing services to
patients (Meadows, Burgess, & Bobevski, 2002). Additionally, Meadows et. all
emphasizes the necessity of considering socioeconomic characteristics of an area when
creating community programs (Meadows, Burgess, & Bobevski, 2002). For example,
high density , low income metropolitan areas have a higher incidence of mental health
94
needs than less populated, more suburban areas. Thus, policy makers need to focus on
proper distribution of health services when creating community-based models.
Health care is a growing problem across the nation. With policy makers and
government officials turning to privatized health care models, the system becomes geared
more towards profitability. In Robbins’ article, the discussion of private equity firms and
the ability for venture-capitalists to make substantial profit off of health care services
such as behavioral health takes priority over any discussion on the need to get health care
to the citizens who need it (Robbins, Rudsenske, & Vaughn, 2008). Although arguments
have been made regarding the relative success of private programs over Medicaid in
being cost effective and more fluid, the difficulty of reducing services to individuals who
are in dire need rises. In sum, the complexities of the health care system create obstacles
to the ultimate goal – keeping citizens healthy and protected. Philadelphia is simply one
example of many occurring across the nation and internationally regarding the health care
crisis.
Bibliography
Busch, A. B., Frank, R., Lehman, A., & Greenfield, S. (2006). Schitzophrenia, CoOccuring Substance Abuse Disorders and Quality of Care: The Differential Affect of a
Managed Behavioral Health Care Carve Out. Adm Policy Ment Health & Ment Health
Serv Res , 338-397.
Coye, M. (2008). Health Care Financing: Outside of the Box. Hospitals and Health
Networks .
Lloyd-Sherlock, P. (2006). When Social Health Insurance Goes Wrong: Lessons from
Argentina and Mexico. Social Policy and Administration , 353-368.
Mandell, D. (2008). Medicaid's Role in Financing Healthcare for Children with
Behavioral Health Care Needs in Special Education: Implications of the Deficit
Reduction Act. Journal of School Health , 533-538.
Meadows, G., Burgess, P., & Bobevski, I. (2002). Distributing Mental Care Resources:
Strategic Implications From the National Survey of Health and Well Being. Australian
and New Zealand Journal of Psychiatry , 217-223.
Robbins, C., Rudsenske, T., & Vaughn, J. (2008). Private Equity Investment in Health
Care. Market Watch , 1389-1398.
Mental health care affects a large number of individuals in our society.
According to the National Institute of Mental Health, “1 in 4 adults - suffer from a
diagnosable mental disorder in any given year.”3 More effective mental health policies
must be implemented to help these individuals achieve the best life possible under their
3
Braithwaite, p. 1724.
95
conditions. The mental health system in the United States is in dire straits. New
approaches must be utilized to improve the system. “…our mental health systems are
plagued with barriers to equal access and treatment for persons with mental illness.”4
These barriers to equal access include, but are not limited to, race, patient’s inability to
speak English, and low-income.
Different ways to improve the mental health system involve many actors. They
include state mental health agencies, city and county officials, and patients.
Mental Health System
One approach to improve the mental health system is evidence-based practices
(EBP). These involve “clinical practices in mental that had substantial empirical
evidence of their effectiveness and were targeted at adults with serious mental illness.”5
This article went on to state that it is necessary for the state mental health authority
(SMHA) to get involved in implementing this system. Without their involvement these
EBPs are not effective in offering proper care and treatment to their patients. SMHAs
must use their position to change the system.
Patient Empowerment/Patient Enabling
Another approach to improving the mental health system is patient empowerment.
The patient/survivor movement (which is the name given to patients advocates in the
mental health field).6 These individuals try to influence policy-making in the mental
health field. These organizations have helped to make this field more patient-oriented.
Another patient involvement approach is called patient enabling. It allows the
patient the chance to live their life outside of a hospital environment. The patient is given
4
Ibid. p. 1724.
Isett, p. 196.
6
Tomes. p. 721.
5
96
the opportunity to live in the community. They live with the symptoms and try to
integrate into society. However, this approach does have its downsides. “…2
drawbacks to community living that participants describes: loneliness and a lack of
access to medical care.”7
These two approaches give the patients a chance to be more involved in their
mental illness. They may not have perfect results, but improvement can be made so that
the patients voices are heard.
One Barrier to Mental Health Care
Latinos use of mental health care varies; it can depend on whether they are
English-speaking or Spanish-speaking. A study done revealed that, “Spanish- and
English-speaking Latinos have different patterns of mental health use. Rather than
finding underuse of all mental health services by Spanish-speaking Latinos, as
hypothesized, the results were mixed.”8 The authors suggested further studies are needed
to understand the link between language and the use of mental health services.
Conclusion
There are many improvements necessary before the mental health system is
beneficial to all members of society experiencing mental illness. The national, state
mental health systems, county and city officials must take a proactive approach in making
changes. The patient empowerment groups ought to continue to strive for patient rights.
Society as a whole can only benefit when its ill members are given the care, respect and
understanding due to them.
Bibliography
Braithwaite, Kisha. (2008). Mending our Broken Mental Health Systems. American
Journal of
7
8
Davidson. P. 139.
Folsom. p. 1179.
97
Public Health, 96 (10), 1724.
Davidson, L., Ridgeway, P., Kidd, S., Topor, A., & Borg, M. (2008). Using Qualitative
Research to Inform Mental Health Policy. The Canadian journal of Psychiatry,
53 (3),
137-144.
Folsom, David P., et al. (2007). A Longitudinal Study of the Use of Mental Health
Service by
Persons with Serious Mental Illness: Do Spanish-Speaking Latinos Differ from
EnglishSpeaking Latinos and Caucasians. Am J Psychiatry, 164 (8), 1173-1180.
Isett, K., Burnam, A., Beattie, B., Hyde, P., Morrissey, J., Magnabosco, J., et al. (2008).
The
Role of State Mental Health Authorities in Managing Change for the
Implementation of
Evidence-Based Practices, 44, 195-211.
Tomes, Nancy. (2006). The Patient as a Policy Factor: A Historical Case Study of the
Consumer/Survivor Movement in Mental Health. Health Affairs, 25 (3), 720-729.
Since the 1950’s mental health has slowly moved form the exceptional to
mainstream. What was once regarded as outside the normal bounds of health care in
general has no stepped into the light and is being addressed more seriously. This move,
however, is the beginning of many more problems. Receiving mental health care in the
United States is disparate, with minorities and low-income persons receiving poor care;
accessing mental health care can be convoluted, either by not knowing where to start or
how to navigate the system; funding of mental health care is complicated and often
inefficient. Overall, administration of mental health becomes lost in a maze of deciding
who provides what and how it will be paid for.
Within the past couple of decades mental health care has moved from a
segregated, specialty service to a more recognized, mainstream setting. Frank and Glied
point to an increase in spending on mental health care exceeded $85 billion at the turn of
98
the century, which was a continuation of steady increase since the 1970s, as one factor
prompting the move from exceptionalism to mainstream (2006). Increased attention by
private insurers and federal legislation to promote parity between mental and traditional
medical health costs are other furthering factors.
Minorities consistently receive lower levels of treatment. Lower income and
lower education are correlated with receiving inadequate treatment or no treatment at all,
which are typically more widespread among minorities (Wang et al 363). Some
responses to why minorities receive lesser care is thought to derive from the fact the
minorities tend to have better mental health which creates bias toward diagnosing the
problem as physical (Miranda 1106).
Overwhelmingly though, lack of access is the main culprit for such disparities.
Lack of insurance is the most prevalent explanation. Complicated systems and lack of
ethnic representation also contribute toward low levels of use among minorities (Miranda
1104). Rural areas also suffer from low usage levels of mental health institutions.
Quality of care is often tied to the structure and financial aspects of the provider.
A trend in medical coverage emerged as the health maintenance organization (HMO).
Arguably proficient at medical care, HMOs lack expertise in mental health care and thus
often sub-contracted to third parties known as carve-outs. Carve-outs can be under both
for-profit and non-profit structures. An interesting study by Hodgkin et al show that
publicly owned/ for-profit carve-outs show an increase in numbers served, while private
non-profits relate to an increase in quality care (2004). Neither is sufficient by itself
which might suggest that a stronger partnership between private and public is what is
needed to improve mental health all around.
99
Other possibilities for future improvements in mental health care are outlined by
Clarke et al. They recognize three trends already in use that will increase access and
improve care, including more reliance on self-help methods, relocation of low-intensity
care to new settings such as primary care facilities and non-traditional places, and
implementing a pay-for-performance system which provides incentives for facilities to
improve their scorecard of patient care results (Clarke et al 2006).
Bibliography
Clarke, Greg, Frances Lynch, Mark Spofford, and Lynn Debar. 2006. Trends Influencing
Future
Delivery of Mental Health Services in Large Healthcare Systems. Clinical
Psychology: Science and Practice 13 (3) 287-292.
Frank, Richard and Sherry Glied. 2006. Changes in Mental Health Financing Since 1971:
Implications for Policy Makers and Patients. Health Affairs 25 (3) 601-613.
Hodgkin, Dominic, Donald S. Shepard, Yvonne E. Anthony, and Gail K. Strickler. 2004.
A
Publicly Managed Medicaid Substance Abuse Carve-Out: Effects on Spending
and
Utilization. Administration and Policy in Mental Health 31 (3) 197-217.
Miranda, Jeanine, Thomas G. McGuire, David R. Williams, and Philip Wang. 2008.
Mental
Health in the Context of Health Disparities. American Journal of
Psychiatry 165 (9)
1102-1108.
Wang, Philip S., Michael Lane, Mark Olfson, Harold Pincus, Kenneth Wells, and Ronald
Kessler. 2005. Twelve-Month Use of Mental Health Services in the United States.
Archives of General Psychiatry 62 (6) 629-640.
The Philadelphia mental health system was in need of a major overhaul. When a
city is faced with this situation there are a few areas they must first consider. Many have
100
to do with the demographics of the concerned area. There are many studies that focus on
how the areas demographics affect the mental health system. Four of which are
highlighted below.
The authors of “How do patients expect the mental health service system to act?”
create a study explaining the lack of adults seeking mental health care due to their preconceived notions. This study looks at gender and race-ethnicity as the main factors of
how a sector of society views the mental health care system. Depending on which race or
gender the individual belongs might lead to their willingness to seek mental health care.
The findings in this study could be used by cities when trying to develop a mental health
care program. The study finds that non-Latino males show a large distrust of the mental
healthcare system (Bramesfeld, 2007). A city with a large non-male Latino population
may want to think about creating a P.R. campaign directed at this population to help them
better understand the system. The only aspect this study lacks would be looking into what
it is in particular about the selected demographics that causes the distrust or lack of use.
This could help the city target the specific areas where attention needs to be most
focused.
“Human Rights and Access to Psychiatric Care for Adult Asylum Seekers” is a
study of the Swedish health care system. In particular, Ginsburg and Bäärnhielm studied
the Swedish rules and regulations pertaining to adults seeking psychiatric care in asylum.
The issue appears to be in how the patients are treated and regulations are present to
ensure fair treatment. The Swedish system appears to be very haphazard where many
people end up in the emergency room instead of with a specialist. They uncovered
patients not being treated equally or with the dignity a health care professional should
101
give to all patients (Ginsburg, 2008). The study is an eye opener for health care
professionals. Mental health patients want to be treated with equal respect and regulations
should be in place to ensure this occurs. Asylum seekers are requesting the same respect
as any other patient and this study proved that was not occurring in Sweden. This study
can be viewed as a warning for a city looking to update their health care system.
“Why Lower Income Mothers Do Not Engage…” looks at how low-income
mothers do not always receive mental health care for their own needs. They will take
their children to receive mental health services even though they are also in need of care.
The mother’s usually suffer their own anxiety caused by their child’s disorder. The study
looks at how the mother and the child’s health are connected. Each one feeds off the
others happiness or anxiety. The mothers in the study explained a few different reasons
why they would not seek help. Many felt that their reasons for feeling distressed were not
conducive to finding help in the mental health care system. The women felt that the
external forces that were stressing them out would not fit within the realm of the mental
health care system. The women in the study also felt that going to a mental health facility
would cause them to be labeled as unfit mothers (Anderson, 2006). This study can be
very helpful for a town with high population of low-income mothers. Including programs
to assist with the stresses of everyday life would help these mothers with their anxiety
and maybe keep them out of the system all together.
“Gender, Race-Ethnicity, and Psychosocial Barriers to Mental Health Care”, was
based on a study conducted by the World Health Organization (WHO). They looked at
the WHO’s definition of responsiveness of the health care system. The authors of this
study went to Hannover, Germany to speak with mental health patients to gauge where
102
they believed the priorities needed to be. Most important of those in the study choose
attention, dignity, and autonomy as the most important aspects to be incorporated into the
mental health care system (Ojeda, 2008). They also found there was a need for more
quality long-term facilities. The findings of this study can be used for any emerging
health care system. This is a vulnerable population that wants nothing more than to be
treated equally and with respect. They want the same privilege extended to them as any
patient which includes privacy.
Sources:
Bramesfeld, Anke; Klippel, Ulrike; Seidel, Gabriele; Schwartz, Friedrich W.; Dierks,
Marie-Luise. “How do patients expect the mental health service system to act? Testing
the WHO responsiveness concept for its appropriateness in mental health care.” Social
Science & Medicine, Sep2007, Vol. 65 Issue 5, p880-889, 10p.
Anderson, Carol M.; Robins, Cynthia S.; Greeno, Catherine G.; Cahalane, Helen;
Copeland, Valire Carr; Andrews, R. Marc. “Why Lower Income Mothers Do Not Engage
With the Formal Mental Health Care System: Perceived Barriers to Care” Qualitative
Health Research, Sep2006, Vol. 16 Issue 7, p926-943, 18p.
Ginsburg, Bengt Erik; Bäärnhielm, Sofie. “Human Rights and Access to Psychiatric Care
for Adult Asylum Seekers: Guidelines to Improve Care.” International Journal of
Migration, Health & Social Care, Jul2008, Vol. 4 Issue 1, p3-11, 9p.
Ojeda, Victoria D.; Bergstresser, Sara M. “Gender, Race-Ethnicity, and Psychosocial
Barriers to Mental Health Care: An Examination of Perceptions and Attitudes among
Adults Reporting Unmet Need.Preview.” Journal of Health & Social Behavior,
Sep2008, Vol. 49 Issue 3, p317-334, 18p.