Medicaid,health care financing trends,and the future of state-based public mental health services

Medicaid now funds more than half of public mental health services administered by states and could account for two-thirds of such spending by 2017. This trend and others represent a major shift in the predominant model by which public mental health services are funded, organized, and delivered. One model is associated with programs administered by state mental health authorities and is characterized by direct funding of designated community providers. This model is being displaced by one associated with state Medicaid programs, which are based on organization and financing methods characteristic of health insurance plans. This shift in models encompasses issues such as administrative authority, funding source, data collection, population served, services provided, and attitudes toward providers and consumers. Failure to understand these changes and their implications will probably have negative consequences.     

Factors that influence state funding for mental health research

A 50-state survey was conducted to identify the extent of and the factors associated with states' funding of mental health research. Of the 49 states responding, 28 funded mental health research. Funds for research represented about .3 percent of total state expenditures for mental health. More populous states were more likely to fund mental health research. A moderately high correlation was found between state funding for research and federal research funding, and a modest but statistically significant correlation was found between state funding for research and total state expenditures for mental health. No correlation was found between state mental health research funding and state per capita mental health expenditures. Political environments supportive of mental health research were characterized by budget stability, articulate and committed leaders, and active citizen advocacy.     

The Ventura Planning Model: a proposal for mental health reform

The Ventura Planning Model is a proposal for public mental health reform. It addresses the decline in mental health funding. It offers a rationale for increased support--and funding--for public mental health services. The Planning Model grew out of the experience of implementing and operating the Ventura Children's Demonstration Project. The model has five characteristics, or planning steps: 1) multi-problem target population; 2) systems goals; 3) interagency coalitions; 4) services and standards; and 5) systems monitoring and evaluation. The Ventura Children's Demonstration Project implemented these planning steps, with an infusion of $1.54 million in funds from the state legislature. The project offset at least 66 percent of its cost by reducing other public agency costs and improved a variety of client-oriented outcomes. The success of the project in offsetting its costs has led the legislature to provide additional funds for three more California counties to implement the model for children and youth, and $4 million a year for four years for Ventura County to test the model for adults and seniors. Emphasizing cost offsets in addition to client-oriented outcomes provides a practical rationale for proposing increases in public mental health funds. This rationale also implies substantial changes in the operations of many public mental health agencies.     

Economic Crises and Public Spending on Mental Health Care

The current economic crisis poses severe challenges for the provision of mental health services around the world. At the very time when a severe recession increases many people's need for mental health services, public programs face declining revenues to fund those services. We review evidence of how past recessions affected public funding for mental health treatment as well as the preliminary evidence regarding the current recession's impact. Interestingly, although many countries are cutting spending as anticipated, a few of the wealthier countries are actually allocating funding to deal with the anticipated increase in mental health problems. More systematic tracking of mental health spending worldwide will be important in the future to identify problem areas and good ideas for responding to recessions.     

Opportunities and risks in Philadelphia's capitation financing of public psychiatric services

The city of Philadelphia was one of nine sites selected by the Robert Wood Johnson (RWJ) Foundation and the U.S. Department of Housing and Urban Development (HUD) to receive five-year funding to improve the delivery, quality and cost efficiency of public mental health services to its chronically mentally ill population. As part of the RWJ project, the city plans to restructure its delivery and reimbursement system, creating a not-for-profit central authority which will function as a health insurance organization (HIO) responsible for coordinating and managing psychiatric care to Medicaid clients. Operating under a model of capitation, the central authority will employ diverse funding mechanisms to finance and manage service delivery. This paper examines the benefits and risks inherent in the reorganization of Philadelphia's mental health service system under a capitation financing model. Issues considered include cost and utilization patterns, treatment outcomes, providers and their staffing patterns, service mix and the overall impact of capitation on clients.     

Realigning local-state relations: Grassroots mental health restructuring in the Pacific northwest

This article provides a historical account of how one county's mental health system transformed itself from an administrative pass through mechanism for state mental health funding to a five-county mental health authority. Also documented are the efforts to respond to legislative and consumer demands to develop client services in the community rather than at the state hospital. The authors describe the groundwork being laid for establishing a prepaid health plan necessary to manage the mental health Medicaid funds in a managed care environment.The authors wish to acknowledge the assistance of Ross Kane, member of the Snohomish County Council and Chair of the North Sound Regional Support Network.     

Systems issues in serving the mentally ill substance abuser: Virginia's experience

State service delivery systems have had limited success in meeting the needs of persons with major mental illness and substance abuse problems. Systems issues that create barriers to effective services include rigid program boundaries, inadequate assessment and diagnosis, lack of trained staff, the limited array of special services, and inflexible funding patterns. The state of Virginia, which administers mental health and substance abuse services through a single agency, has addressed these issues by clearly communicating that services for mentally ill substance abusers should be given high priority, by instituting a collaborative working relationship between mental health and substance abuse services, and by providing funding incentives. Additional efforts to develop advocacy organizations for mentally ill substance abusers, to train mental health professionals to serve this population, and to improve program evaluation and assessment are needed.     

Initiatives for improving mental health services to ethnic minorities in Australia.

Several major policy initiatives have been undertaken in Victoria, Australia's second-largest state, to address difficulties in providing accessible and culturally sensitive mental health services to ethnic minorities. These initiatives include the development and publication of a policy statement, alteration of funding formulas to take into account populations of persons with non-English-speaking backgrounds, incentive funding mechanisms, new funding specifically devoted to ethnic mental health, the establishment of service development positions in the major public hospital networks, and the establishment of a pilot project to employ bilingual staff as psychiatric case managers.     

India mental health country profile

India, the second most populated country of the world with a population of 1.027 billion, is a country of contrasts. It is characterized as one of the world's largest industrial nations, yet most of the negative characteristics of poor and developing countries define India too. The population is predominantly rural, and 36% of people still live below poverty line. There is a continuous migration of rural people into urban slums creating major health and economic problems. India is one of the pioneer countries in health services planning with a focus on primary health care. Improvement in the health status of the population has been one of the major thrust areas for social development programmes in the country. However, only a small percentage of the total annual budget is spent on health. Mental health is part of the general health services, and carries no separate budget. The National Mental Health Programme serves practically as the mental health policy. Recently, there was an eight-fold increase in budget allocation for the National Mental Health Programme for the Tenth Five-Year Plan (2002-2007). India is a multicultural traditional society where people visit religious and traditional healers for general and mental health related problems. However, wherever modern health services are available, people do come forward. India has a number of public policy and judicial enactments, which may impact on mental health. These have tried to address the issues of stigma attached to the mental illnesses and the rights of mentally ill people in society. A large number of epidemiological surveys done in India on mental disorders have demonstrated the prevalence of mental morbidity in rural and urban areas of the country; these rates are comparable to global rates. Although India is well placed as far as trained manpower in general health services is concerned, the mental health trained personnel are quite limited, and these are mostly based in urban areas. Considering this, development of mental health services has been linked with general health services and primary health care. Training opportunities for various kinds of mental health personnel are gradually increasing in various academic institutions in the country and recently, there has been a major initiative in the growth of private psychiatric services to fill a vacuum that the public mental health services have been slow to address. A number of non-governmental organizations have also initiated activities related to rehabilitation programmes, human rights of mentally ill people, and school mental health programmes. Despite all these efforts and progress, a lot has still to be done towards all aspects of mental health care in India in respect of training, research, and provision of clinical services to promote mental health in all sections of society.     

The Australian experience of deinstitutionalization: interaction of Australian culture with the development and reform of its mental health services

OBJECTIVE: To describe the Australian experience of deinstitutionalization of the Australian National Mental Health Strategy in the context of the history of mental health services in Australia, and of Australian culture. METHOD: The development of Australian Mental Health Services is described with reference to developments in both psychiatric intervention research and Australian culture. The effects and achievements of national mental health reforms are described and critically examined. RESULTS: The relationship in Australia between the development of mental health services and the development of Australian society includes the stories of colonization, gold rush, suppression of indigenous peoples' rights, incarceration of mentally ill people, and incompatible state service systems. Mental health services required reform to provide consistent services and support for full citizenship and rights for such individuals who are still on the margins of society. Recent national developments in service models and service system research have been driven by the Australian National Mental Health Strategy. The translation of national policy into state/territory mental health service systems has led to a 'natural' experiment between states. Differing funding and implementation strategies between states have developed services with particular strengths and limitations. CONCLUSION: The effects of competition for limited resources between core mental health service delivery and the shift to a population-based public health approach (to prevention of mental illness and promotion of mental health), leaves our services vulnerable to doing neither particularly well. The recent loss of momentum of these reforms, due to failure of governments to continue to drive and fund them adequately, is causing the erosion of their considerable achievements.     

India mental health country profile

India, the second most populated country of the world with a population of 1.027 billion, is a country of contrasts. It is characterized as one of the world's largest industrial nations, yet most of the negative characteristics of poor and developing countries define India too. The population is predominantly rural, and 36% of people still live below poverty line. There is a continuous migration of rural people into urban slums creating major health and economic problems. India is one of the pioneer countries in health services planning with a focus on primary health care. Improvement in the health status of the population has been one of the major thrust areas for social development programmes in the country. However, only a small percentage of the total annual budget is spent on health. Mental health is part of the general health services, and carries no separate budget. The National Mental Health Programme serves practically as the mental health policy. Recently, there was an eight-fold increase in budget allocation for the National Mental Health Programme for the Tenth Five-Year Plan (2002–2007). India is a multicultural traditional society where people visit religious and traditional healers for general and mental health related problems. However, wherever modern health services are available, people do come forward. India has a number of public policy and judicial enactments, which may impact on mental health. These have tried to address the issues of stigma attached to the mental illnesses and the rights of mentally ill people in society. A large number of epidemiological surveys done in India on mental disorders have demonstrated the prevalence of mental morbidity in rural and urban areas of the country; these rates are comparable to global rates. Although India is well placed as far as trained manpower in general health services is concerned, the mental health trained personnel are quite limited, and these are mostly based in urban areas. Considering this, development of mental health services has been linked with general health services and primary health care. Training opportunities for various kinds of mental health personnel are gradually increasing in various academic institutions in the country and recently, there has been a major initiative in the growth of private psychiatric services to fill a vacuum that the public mental health services have been slow to address. A number of non-governmental organizations have also initiated activities related to rehabilitation programmes, human rights of mentally ill people, and school mental health programmes. Despite all these efforts and progress, a lot has still to be done towards all aspects of mental health care in India in respect of training, research, and provision of clinical services to promote mental health in all sections of society.     

Public provision of mental hospital services: Some economic issues

Over the last three decades, the state mental hospital system has undergone major transformations as a result of changes in responsibility, funding, and programming for inpatient services. This article examines the budgetary process and decision making for state expenditures on mental health. Implications of recent and proposed policy changes at the federal level are examined in the context of current state mental health expenditures.     

Medicaid behavioral health carve-outs: a new generation of privatization decisions

This article addresses issues related to the privatization of various functions within the mental health system. It acknowledges the contributions of Robert Dorwart, who explored trends with regard to the privatization of inpatient psychiatric services. The authors then highlight changes in the division of labor between the public and private sectors regarding the financing and delivery of mental health services and the management of the system. Responsibility for funding the mental health system has remained largely a public responsibility while responsibility for production or delivery of services in the mental health system is typically held by private, for-profit, and not-for-profit organizations. The roles of managing the mental health system and setting policy are now shared between the private and public sectors in a number of states that have implemented Medicaid behavioral health carve-out programs. This article explores the impact of such privatization on cost, access, and quality of services by examining the experiences of three states with carve-outs. The authors suggest that while organizational form is an important issue, concerns about privatization should be tempered by attention to the contracting decisions made by purchasers, the level of resources devoted to services, and the adequacy of administration of the system.     

Economic barriers to widespread implementation of model programs for the seriously mentally ill

Although deinstitutionalization has been linked with an increase in the number of mentally ill people who are homeless or in jails, several demonstration programs started during the past 30 years have shown that community-based services for the seriously mentally ill can be both humane and cost-effective. Four such programs, none of which has been widely implemented or has significantly influenced service delivery systems, are described. The author contends that the chaotic and illogical funding system for mental health services is primarily responsible for failure of the widespread implementation of demonstrably effective programs. The economic disincentives of the present system include lack of coordination of services at the state and local level and federal policies that favor hospitalization, restrict payment for outpatient and rehabilitation services, and discourage mentally ill persons from working. The author suggests that public services for the mentally ill are unlikely to improve significantly until such disincentives are addressed.     

Performance standards and allocation of funds in community mental health programs

Performance measurement of mental health services has become a trend in managing public mental health services. This paper describes a process that measures the varying performance of county mental health systems in achieving goals. Performance and relative need are then used to make differential allocation of state funds for services.     

Corporatization and community health services

Reductions in federal and state funding are being accompanied by a greater emphasis on private health insurance. This has increased the trend in mental health toward the for profit corporation. Larger numbers of chronic patients are being shifted to the public sector with fewer resources to provide quality care. The for profit corporate ethos is on the ascendance in mental health; humanitarianism and the community have become secondary.     

Supporting Mental Health and Wellness among Private School Students: A Survey of Catholic Elementary and Secondary Schools

Little systematic inquiry has focused on school-based mental health services in the Catholic education sector, which educates more than two million children annually in the United States. More than 400 Catholic elementary and secondary schools were surveyed to inform a baseline environmental scan measuring how Catholic schools nationally are serving children's mental health needs. The article sheds light on patterns of mental health staffing and resource provision, student psychosocial and mental health issues, mental health service provision, and barriers to and challenges of mental health service provision. The findings are contextualized by comparison with estimates of public school mental health service provision, consideration of funding issues pertinent to the private school sector, and the continuing need for strategic assessment and action planning to support student mental health.     

Community mental health services and the elderly: Retrenchment or expansion?

Data gathered from a recent survey, of CMHC's suggest that the elderly are increasing their utilization of CMHC services. As more responsibility for mental health services is shifted to the states, a commitment to mental health services for the elderly increasingly becomes an issue of state discretion, and of state finances. This makes it probable that accessibility to mental health services for the elderly will become more variable and problematic on a national basis. This is especially important in light of data that indicates an increasing awareness by CMHC's of the mental health needs of the elerly.Research supported by the Pew Memorial Trust through a grant to the Palo Alto Medical Foundation. The interpretations and conclusions are those of the authors and should not be attributed to the funding source. The author gratefully acksowledge the assistance of Drs. Juanita B. Wood of the New School for Social Research, and Philip R. Lee (UCSF) and Brent Roehr of the Pew Memorial Trust.     

Mental health service delivery to older people in New South Wales: perceptions of aged care, adult mental health and mental health services for older people

OBJECTIVE: To compare the perceptions of aged care services, adult mental health services and mental health services for older people regarding aspects of mental health service delivery for older people in New South Wales, Australia. METHOD: The NSW Branch of the Faculty of Psychiatry of Old Age in association with the NSW Centre for Mental Health, sent a postal survey to all aged care services, adult mental health services and mental health services for older people in NSW. The survey canvassed issues ranging across service profiles, regional variations, availability of resources, processes of care, views on working relationships between services, difficulties and gaps experienced, and ways to improve co-ordination and service delivery. Clinical issues such as the management and practice of psychiatric disorders of old age, educational/training requirements and skill and experience in working with older people were explored. RESULTS: An overall response rate of 86% was achieved, including 95% from aged care services (n = 58), 74% from adult mental health services (n = 62) and 90% from mental health services for older people (n = 20). Only 59% of aged care services and adult mental health services considered that their local mental health services for older people provided an adequate service; resource and budget limitations were portrayed as the main constraint. Mental health services for older people varied widely in structure, settings and activities undertaken. Access to mental health beds for older people was also variable, and alongside staffing levels was considered problematic. Lack of staff training and/or inexperience in psychogeriatrics posed a challenge for aged care services and adult mental health services. CONCLUSION: Relationships between aged care services, adult mental health services and mental health services for older people are affected by lack of access to psychogeriatric staff, resource limitations of mental health services for older people, and inadequate liaison and support between the service types. Joint case conferences, education, increased funding of mental health services for older people, and cross referrals were considered ways to address these issues.     

The political development of "Program Realignment": California's 1991 mental health care reform

This article reviews the legislative process that resulted in the most significant reform of California's public mental health system in nearly 25 years. The reform, termed "Program Realignment," decentralized administrative and fiscal control of the mental health system from the state to the county level. The system prior to Program Realignment is discussed here to reveal an already diverse and decentralized county mental health system, fiscal distress, and general dissatisfaction with the system. From these conditions, the objectives of the relevant political actors arose. By tracing the policy development process of Program Realignment, several independent variables are revealed that help explain how and why this legislation came into being and allow generalization of this case to other states' experiences. These independent variables are an urgent need for action within a limited timeframe, a preexisting knowledge base and well-developed policy networks, a spirit of bipartisan cooperation, and the presence of strong leadership. Preliminary evidence suggests that consolidation of fiscal and programmatic authority at the local level has reduced fragmentation of services and increased fiscal flexibility. However, there is concern that the quality of care offered by the state's 59 local mental health programs will become increasingly disparate and that increased financial flexibility may not be used to improve services for clients but to save money for local governments. Lessons from California's experience can alert other states to the pros and cons of this policy approach to providing mental health services and inform policymakers in other states of the steps involved in bringing about such a policy change.