HHS Inspector General Medicaid Managed Mental
Health Recommendations Consistent With NAMI Public Policy
Objectives
 | For
Immediate Release, 14 Mar 00 Contact: Chris
Marshall 703-524-7600
The U.S. Department of Health and Human Services (HHS) Office of
the Inspector General (OIG) has issued three reports on Medicaid
managed mental health programs. The recommendations made by the OIG
are similar to those NAMI has been making.
The OIG made three core recommendations for state Medicaid
programs and the Health Care Financing Administration (HCFA).
Interestingly, HCFA disagrees with the recommendations. The core
recommendations are:
- HCFA should work with SAMHSA to develop outcome measurement
systems
- HCFA should encourage States to develop independent, third
party mental health systems for conducting beneficiary
satisfaction teams
- States should obtain a 1115 waiver from HCFA to expand
services to non-Medicaid populations
OIG Recommendations for starting managed care programs
are:
- Separate mental health services from other health services
- Phase in conversion
- Exclude Drug Formulary from managed care
- Use existing public mental health system
- Keep contract language specific
OIG recommendations for transitioning from fee-for-service to
managed care are:
- Provide community education early and often
- Involve beneficiaries in conversion process
- Involve beneficiaries and families in treatment planning
- Ensure timely payment of providers
OIG recommendations for providing access to care are:
- Eliminate co-payments
- Assign health care coordinators
- Allow any accredited provider to participate
- Encourage liberal prior authorization policies
- Initiate outreach programs
- Develop rural services
- Initially share financial risk to encourage development of
services
OIG recommendations for children's mental health are:
- Specify services for children's mental health care in managed
care contracts
- Develop interagency agreements to promote coordination
As of July 1998, 36 states had implemented mandatory Medicaid
mental health managed care programs. The OIG examined seven state
programs - Arizona, Colorado, Iowa, Massachusetts, North Carolina,
Utah and Washington. All seven states used mental health carve-outs.
Four of the seven states phased in the program in geographic
regions.
OIG FINDINGS INCLUDE:
Cost Savings
OIG documented that four of the seven Medicaid managed mental
health programs saved from $4 million to $12 million the first year,
compared with the previous year's fee-for-service expenditures. The
other three states limited expenditures to the previous year's
expenditures. Four of these states returned "off the top" savings to
the state's general fund. The other states used the savings to
expand Medicaid to non-Medicaid eligible persons or to pay for
managed care administration.
Reduced Hospitalization, Some Increased Outpatient
Services
OIG reported that the seven state Medicaid managed health
programs had "dramatic declines" in impatient costs. One state
reduced inpatient costs from 51% of mental health costs to 17% in
one year. In two states there was a reduction of 40% to 50% in
available psychiatric hospital beds. In one state, average length of
stay dropped from 12 to 6 days while another dropped 30 to 20 days.
Four of these seven states documented increased utilization of
services from 1% - 2% after conversion to a managed care system. The
seven states developed new services which previously did not exist -
residential services, vocational services, respite care services,
in-home programs, clubhouses, day services, and personal services.
In six states, psychiatric hospital readmission rates were higher
under managed care, ranging from 4%-9% increases. Only one state did
not see any "noticeable increase." The OIG concluded that "lower
average length of stays and increased readmission rates may indicate
that persons with serious mental illnesses are being released from
inpatient care too quickly."
In a separate report, the HHS OIG concluded that "reductions of
inpatient care for children were greater than that for adults." One
state reported that children utilizing inpatient care was down 40%,
compared to a decrease of 2% by adults for the same period. Another
state reported a 30% decrease in psychiatric hospital admissions for
children, as compared to a decrease of about 6% by adults during the
same period.
While outpatient programs expanded in all seven states, "the
number of children that access services are still generally below
the level of access for adults." In one state, the rate of adults
accessing outpatient mental health services was 123.7 per 1,000
while the child rate was 54.8 per 1,000. In another state, while 6%
of adults accessed outpatient services, only 3% of children accessed
such services.
Pharmacy Remains Outside Behavioral Health Capitation
The OIG reported that none of the seven states managed mental
health programs included pharmacy benefits, "primarily because
states were unsure of how to accurately determine the cost for this
benefit.States believed that if they did not set the capitation rate
for prescription drugs at a correct level, managed care
organizations would have an incentive to restrict access." This led
the OIG to recommend that drug formularies be excluded from managed
care.
Care Fragmented Between Systems
The OIG observed in the seven state programs that "responsibility
for care is fragmented with possible cost shifting," and the OIG
recommended the development of interagency agreements to promote
coordination.
No Performance Data
No state had working outcomes measures in place.
The OIG concluded that "the overall effect on the health of
persons with severe mental illnesses" in seven Medicaid managed
mental health programs "was not quantified." Further, "none of the
states included in our study had working outcomes measures in place
before or after they converted to managed care. Even basic
utilization data, such as length of hospital stays and number of
visits, was inconsistently reported by states." The OIG recommended
that HCFA and the Substance Abuse and mental Health Services
Administration (SAMHSA) collaborate to develop outcome measurement
systems.
Needed: Independent Consumer Satisfaction Teams
The OIG has recommended that Medicaid managed mental health
programs "establish independent, third party mental health systems
for conducting beneficiary satisfaction surveys."
Needed: Consumer and Family Involvement
The OIG has recommended that Medicaid managed mental health
programs involve beneficiaries and families in both the conversion
process from fee-to-service and in treatment planning.
The three reports are available online from the Office of
Inspector General, Office of Evaluation and Inspections (OEI) What's
New page at http://www.dhhs.gov/progorg/oei/whatsnew.html
or can be accessed individually via the web addresses below.
Mandatory Managed Care: Changes in Medicaid Mental Health
Services (OEI-04-97-00340; 1/00) http://www.hhs.gov/progorg/oei/reports/a340.pdf
Mandatory Managed Care: Early Lessons Learned by Medicaid Mental
Health Services (OEI-04- 97-00343; 1/00) http://www.hhs.gov/progorg/oei/reports/a343.pdf
Mandatory Managed Care: Children's Access to Medicaid Mental
Health Services (OEI-04-97- 00344; 1/00) http://www.hhs.gov/progorg/oei/reports/a344.pdf
Attached below is NAMI's Where We Stand paper on managed
care.
MANAGED CARE: A NATIONAL OVERVIEW
NAMI's Position (summarized from the NAMI Policy Platform)
NAMI supports health care for all persons with brain disorders
that is affordable, nondiscriminatory, and includes coverage for
effective and appropriate treatment. NAMI supports federally
mandated minimum standards for health insurance coverage. NAMI
supports efforts of states to gain waivers of ERISA (Employee
Retirement Income Security Act) so self-insured employer health
plans would comply with state-mandated minimum benefit laws. Managed
care organizations must be held accountable for delivering a
comprehensive array of community support services, and appeal and
grievance procedures must be in place that are user-friendly and
time-sensitive.
The Need to Stand and Deliver
A crisis of confidence in health plans exists throughout the
nation. National mandated legislative solutions are required to
restore consumer confidence in health plans.
In September 1997 NAMI published Stand and Deliver: Action Call
to A Failing Industry. The report observed that managed care plans
failed to deliver on the following expectations: publicly available
and current practice guidelines, easy hospital admission and
flexible hospital length-of-stay, PACT programs, immediate access to
all effective medications, suicide attempt viewed as a medical
emergency, consumer and family participation in their treatment
planning and care, measurement of clinical outcomes, access to
psychiatric rehabilitation, and access to secure and supportive
housing.
In an October 1998 NAMI survey of consumer and family experiences
with managed care, 25 percent of respondents had positive
experiences with managed care in four areas: improved access to
treatment, emphasis on preventing crisis, focus on consumer
satisfaction, and decreased unnecessary hospitalization.
The five areas of most negative experience with managed care
were: don't know how to file an appeal (55 percent); seeing the
patient's doctor (41 percent); problems getting medications (34
percent); problems getting crisis services (33 percent); and
problems getting admitted to a hospital (28 percent). Twenty-five
percent of respondents had filed an appeal with their health plan;
families were successful 54 percent of the time and consumers were
successful 42 percent of the time.
Managed Care: A National Overview
According to a July 1998 SAMHSA-Lewin study, 46 states are
implementing 88 different managed behavioral healthcare programs.
Only Maine, Mississippi, Nevada, and Wyoming have no public-sector
managed behavioral healthcare programs. Of these 88 programs, 83
have mental health and 66 have substance abuse. Sixty-one (69
percent) include both mental health and substance abuse. However, 41
of these programs had been in operation less than one year. There is
a roughly 50/50 split between at-risk programs and administrative
services organization (ASO) arrangements. Fifty-five percent of the
programs use behavioral healthcare carve-outs, but only 17 percent
use non-Medicaid funds.
Colorado, Iowa, and the city and county of Philadelphia are
generally viewed as the most positive of these initiatives but even
there access problems exist.
Iowa and Massachusetts seem to be more advanced in terms of the
development and use of performance-based measurements. Philadelphia
leads the nation in the use of consumer satisfaction teams, teams
staffed by consumers and family members to ascertain enrollee
dissatisfaction.
Montana and Tennessee have reputations as having the most
problematic public-sector managed behavioral health care in the
nation. After 23 months of operation, the Montana Legislature
terminated the program. These states share common mistakes. There
was no previous managed care experience in the states, yet they
quickly implemented a managed care program statewide. Historic
patterns of service utilization by the Medicaid population were
unknown, yet the states added non-Medicaid-eligible, uninsured
populations to the managed care program and even included a pharmacy
benefit, even though historic patterns of utilization were not
known. Both states reduced spending, anticipating budget savings
from the program's financing before any actual implementation
experience occurred.
NAMI's Advocacy Strategies and Goals
NAMI's Stand and Deliver report identified nine measures of
success. These measures have been updated into 10 suggested action
steps:
1. Authentic, early, and continuing consumer and family
involvement in all stages of programming. Authentic means that the
involvement was not token, but actually had an impact.
2. Standardized benefit packages based on parity for mental
illness so that consumers can compare health plans based on
performance.
3. Public release of comparative performance by health plans and
treating providers. Performance data should be explicit,
benchmarked, standardized, publicly available, and independently
validated.
4. Public release of consumer satisfaction data, complied by
consumer satisfaction teams, staffed by consumers and families,
external to the health plan, but with the health plan's commitment
to immediately respond to complaints, grievances, and
dissatisfactions.
5. Consumer and family surveys, such as NAMI's Stand and Deliver.
6. Publicly available practice guidelines, which are adhered to
by a health plan's treating providers.
7. Immediate access to needed care.
8. Effective and timely grievances, appeals, and decisions using
third-party, independent, binding clinical review. The use of
independent, third party consumer and family facility and program
monitoring teams and the use of independent ombudsmen programs are
helpful.
9. Suicide attempts viewed as a medical emergency.
10. Standardized premium-rate structures so that consumers can
compare health plans based on performance and risk-adjustment cost
reimbursement so no plan is penalized because it enrolls and serves
a population with more severe illness.
Other lessons learned can be action steps in advocating
accountable and responsible managed care programs. These include:
11. Precisely define in the public domain, preferably in
authorizing legislation, key terminology such as the actual
benefits, how benefits are actually accessed, and medical necessity.
12. Consider using the Massachusetts practice where 100% of the
capitation is devoted to clinical care; where pharmacy is not
included in the behavioral health benefit capitation; where a
separately funded, adequately funded, and separately negotiated
administrative budget (currently 9% of the total expenditures)
operates; and where profit is entirely tied to the achievement of
performance goals. Massachusetts also uses risk corridors where
potential profits and losses are capped.
13. Use other successful state capitation rates when examining
the adequacy of your state or local capitation rate.
14. Implement detailed seamless systems of care between the
Medicaid and public mental health systems. Even in states with more
positive managed care experiences, such as Colorado and
Massachusetts, the responsibility line between Medicaid and the
public mental health system is not clear and people are denied or
delayed access to care.
For more information about NAMI's activities on this issue,
please call Clarke Ross at 703/312-7894. All media representatives,
please call NAMI's communications staff at 703/516-7963.
For information on serious
mental illnesses and brain disorders, or for a referral to
your State
and local affiliates, please contact the NAMI HelpLine:
1-800-950-NAMI (6264) / TDD 703-516-7227 Visit the HelpLine
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