Costs higher with managed care.

Although managed care can reduce the state's cost of caring for individuals with severe mental illness who are receiving Medicaid, it may actually increase the burden for the patients, according to a new study that was led by researchers at the Louis de la Parte Florida Mental Health Institute at the University of South Florida. The study compared costs in two Medicaid managed care plans with a standard fee-for-service Medicaid plan. Medicaid saved money with the managed care plans, but the patients in the fee-for-service plan had "significantly lower costs" than those who were in managed care. Managed care costs were higher because patients relied more on family caregiving, according to the authors. "For adults with severe mental illness, it appears that efforts to contain Medicaid mental health costs may result in deflecting costs back to these vulnerable persons and onto their families and friends," the authors concluded. The study was published on-line in the American Journal of Psychiatry on Jan. 15.