Mental Health Services for Medicaid Beneficiaries: Getting Appropriate Care in Medicaid or SCHIP Managed Care Plans

May 27, 2004

The Health Care Reform Tracking Project has been tracking publicly financed managed care initiatives and their impact on children and adolescents with behavioral health problems and their families. Summaries of its findings are on http://rtckids.fmhi.usf.edu/rtcpubs/hctrking/pubs/2003_statesurvey/index.htm. On a Health Assistance Partnership conference call, speakers from the Health Care Reform Tracking Project, the National Mental Health Association, and a variety of mental health consumer assistance programs discussed their experience with various forms of managed mental health care.

“Carve out” managed care systems are arrangements under which behavioral health services are financed and administered separately from physical health services. They contrast with “carve in” or “integrated” managed care systems, in which physical and behavioral health care are in one managed care system (even if the behavioral health services are sub-contracted.)
Both the Health Care Reform Tracking Project and the National Mental Health Association have found that carve out systems serve families better than integrated systems in some respects:

It is easier to get flexible, individualized systems of care
Families seem to be more involved in treatment plans
Interagency treatment plans are more likely
Carve outs are more likely to provide education and training regarding special populations.
Further, in integrated systems, it is very hard to collect data on how mental health dollars are used and if managed care organizations subcontract behavioral health services, they often consider any data about the services or payment for those services as proprietary and confidential.

Carve-outs can be perceived as well intended, but they also have a disadvantage: physical and mental health systems do not easily communicate to provide comprehensive health care for the mentally ill. On the other hand, this lack of communication between physical health and mental health systems predated managed care.
How to promote communication between physical and mental health providers? To overcome potential problems in prescribing drugs, one state has ensured that the same pharmacies are part of both the physical managed care plans’ and the behavioral managed care plans’ provider networks. Maryland generates lists daily of providers from whom each beneficiary is receiving services and makes sure the providers are aware of one another.
Use of pharmaceuticals. The use of formularies, prior authorization procedures, and increased co-payments all have adversely affected consumers’ ability to get needed psychiatric drugs. Consumer assistance programs can help document harm done and make policy makers aware of problems. Some states have exempted mental health drugs from prior authorization. Florida and Missouri are starting systems in which a third party reviewer outside of the managed care plan decides whether to approve use of a drug. Minnesota allows consumers to get a prescription filled once that requires prior authorization, and gives them notice that they must go through authorization procedures next time. However, consumers still have not understood the system and have trouble when drugs need to be refilled. Consumer assistance programs may want to work with affiliates of the National Mental Health Association on such policy issues. For the National Mental Health Association’s issue briefs on access to medications, a directory of affiliates is on http://www.nmha.org.

The information for this fact sheet came from the May 27, 2004 Health Assistance Partnership (HAP) conference call. The speakers included David Verseput from the Michigan Department of Community Health, Oscar Morgan and Erica deFur Malik from the National Mental Health Association, and Mary Armstrong, from the Health Care Reform Tracking Project at the University of South Florida