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Moving toward recovery and accountability: factors stakeholders need to keep in mind as Medicaid faces increasing scrutiny.

Medicaid plays a significant role in our country's healthcare delivery system. Today 53 million individuals have health insurance because of this vital federal/state program. For recipients with significant behavioral health issues, Medicaid coverage often has been the determining factor in their ability to access services essential to support their recovery.


Although often characterized as costly, Medicaid is an important part of the solution for increasing access to healthcare services. As state leaders wrestle with how to increase access to health insurance, they also must ensure that the best possible Medicaid program is in place. After all, just having insurance is insufficient to fully address healthcare needs. A truly effective delivery system allows individuals to participate in a continuum of well-organized, evidence-based supports and services. This consideration is crucially important when addressing the needs of those with mental illness and/or addiction.

As one of the largest (if not the largest) nonprofit behavioral health managed care companies in the country, Community Care Behavioral Health in Pittsburgh addresses Medicaid issues daily. Based on our experience, I recommend policymakers, providers, and stakeholders consider the following issues as they discuss moving Medicaid's behavioral health components toward greater accountability for access, quality of care, and financial performance.

The New Freedom Initiative and Recovery

Today's political and economic environments demand a renewed emphasis on stakeholder collaboration as the dominant feature in a system seeking balance between the demand for and availability of healthcare resources. The President's New Freedom Commission on Mental Health called for such collaboration and emphasized the power of recovery, setting the stage for states to begin thinking differently about how they support individuals with mental illness.

Community Care has demonstrated that using a recovery framework to manage behavioral health services not only respects an individual's unique needs, but also encourages using less costly peer-supported community-based services and improves quality of life. By effectively managing expensive services such as hospitalization, Community Care can pay for programs that members (i.e., consumers) want and that support recovery, such as peer-support services to assist those dealing with drug and alcohol addictions.

Community Care also has provided training programs to support the transformation of the delivery system to one that provides culturally competent, recovery-oriented services and supports. A series of annual conferences, called the Recovery Institute, creates the opportunity for providers, members, and other stakeholders to discuss the challenges and opportunities related to bringing recovery to the forefront of service planning and delivery.

Care Management

In its 2006 Profiles of Medicaid's High Cost Populations, the Kaiser Commission on Medicaid and the Uninsured identified individuals with mental illness as one of six high-cost populations requiring more effective support. The report reinforced the importance of ensuring that this population has access to an effectively managed service continuum to create a structured therapeutic environment that minimizes expensive inpatient admissions.

Community Care developed a clinical model for member care management that encourages oversight of decisions related to expensive services and helps providers and members identify appropriate community-based, recovery-oriented services and supports. Care management also establishes essential ongoing relationships with members with serious mental illness so that their immediate needs can be addressed quickly during a crisis.

The focus of our care management function ultimately is to ensure that members receive the appropriate level of care in the correct amount, frequency, and duration. Our successful use of care management can be attributed partly to our sophisticated information system. Using algorithms that consider prior authorization, utilization information, and other data elements, each member is rated on a severity scale. This allows care management resources to focus on members with the greatest needs.

Care Integration

We continue to learn more about the relationship between mental and physical health. Therefore, behavioral health and physical health professionals must work hard to create well-structured and respectful channels of communication. Relationships with corrections, social services, and vocational rehabilitation services also are essential.

Community Care has established and successfully sustained integrated relationships with physical health plans to exchange data and improve members' care. In addition to managing joint behavioral health and physical health pharmacy committees, Community Care also has collaborated with physical health plans to develop an integrated care management model allowing behavioral health and physical health managers to work side-by-side.

Evidence-Based Practices

Elected officials increasingly are focused on ensuring that investments in healthcare services be assessed routinely and that services be improved continually. This heightened accountability is important and should continue.

In response to increased performance expectations, behavioral health stakeholders must work together to transform the system by supporting the implementation of evidence-based practices (EBPs) and by building service agencies' capacity to effectively evaluate program outcomes. Pay-for-performance initiatives, as well as EBPs that provide clear guidelines for service delivery, need to be encouraged.

EBP implementation is challenging because change can be difficult for some organizations. In addition to supporting organizational readiness and investing in extensive training, organizations need to ensure the fidelity of EBP implementation over time. Community Care recently led a multiyear project designed to build the EBP evaluation capacity of four community-based organizations delivering peer-support services to individuals with addictions. Not only did the agencies' assessment capacity improve, but the evaluation project affirmed the peer supports' effectiveness.

Furthermore, investments must be made in behavioral health services research so that promising practices can be evaluated and successful initiatives added to the growing library of EBPs shown to improve Medicaid recipients' quality of life. To support this development, Community Care has created a Department of Research, Evaluation and Outcomes led by a child psychiatrist with a strong research background.

Community Care has improved provider-delivered case management services as a result of a series of interventions that includes rewarding organizations that reach defined targets. To address opportunities for improvement, revised case management performance standards and claims-based performance indicators were developed. Providers' rate increases were tied to their success in meeting performance targets. During the first year, 4 of 11 case management providers received a 4% rate increase. During the second year, 8 of 11 providers met targets and received a rate adjustment. This collaborative undertaking is expected to improve consumers' functional outcomes.

Community Care also has worked closely with network providers to support the delivery of consistent, cutting-edge, high-quality, recovery-oriented wraparound services to children. These services include a range of primarily individualized behavior management treatment and rehabilitation services provided in community settings and follow the six Child and Adolescent Service System Program (CASSP) principles of wraparound. Through the integration of continuous quality improvement principles and learning theory, Community Care created a comprehensive outreach program to better manage resources, improve member outcomes, and increase service access for more children. As a result of this initiative, Community Care has been successful in reinforcing practice changes needed to promote improved outcomes. The result of this multiyear initiative in one contract was a 107% increase in the number of members gaining access to wraparound services, while increasing units of service by only 42% and dollars spent by only 66%. Service waiting lists also were eliminated.

Budget Investments

When legislators make decisions about behavioral health funding changes, it is vital that the assessment is completed within the context of funding a recovery model. Unfortunately, the President's FY 2008 federal budget includes a number of proposed Medicaid reductions inconsistent with the key tenets of the New Freedom Commission's final report.

Most public mental health services are funded under Medicaid's Rehabilitation or Targeted Case Management category. The proposed 2008 federal budget cuts $25 billion over five years through two ways. First, it proposes reducing the federal contribution to the cost of targeted case management for Medicaid recipients, including those with serious mental disorders. Second, it proposes restricting the allowable services under the rehabilitation service category, but these services, such as skills training, illness self-management, peer services, and intensive in-home services, support recovery, as described in the New Freedom Commission's report.

Other proposed budget reductions may affect consumers' access to important behavioral health drugs. The President's proposed budget includes a plan to amend the federal upper limit (FUL) to 150% of the average manufacturers price (AMP) for multiple source drugs, a significant change from the current FUL of 250% of AMP. The 2008 budget also proposes allowing states to use managed formularies, a common cost control tool for private insurers. (State Medicaid programs must cover any drug for which the manufacturer has agreed to pay a statutorily defined rebate. Therefore, states are not able to manage formularies as efficiently as Medicare can.) Both of these changes could result in limits on behavioral health medications essential for recovery.

Rather than restrict access to pharmaceuticals, a far better solution to controlling costs would be to implement behavioral health pharmacy management programs to educate both prescribers and consumers about effective prescribing practices and encourage coordination with other healthcare services providers. Research has demonstrated that such pharmacy management programs positively impact clinical and financial outcomes.

To enhance the value of the investment in pharmaceuticals, Community Care has implemented a behavioral health pharmacy management program, which incorporates key philosophical elements of the recovery model. The commitment to pharmacy management recognizes the impact that effective prescribing practices and improved adherence to medication plans can have on behavioral health outcomes, including members' quality of life.

Medicare-Medicaid Interface

A large number of citizens are eligible for both Medicaid and Medicare. Given the size of this segment of the population, processes should be developed that result in better managing the services required to effectively meet the healthcare needs of dually eligible individuals.

Although special needs plans have been introduced, more work needs to be done to address the constraints imposed by Medicare and Medicaid policies and regulations. Attention also needs to be given to addressing directives that appear to be in conflict. In addition to looking at better linkages among funding programs, an effort needs to be made to integrate the service delivery systems for those who are dually eligible.

Community Care partnered with the University of Pittsburgh Health Plan to create a special needs plan called UPMC for Life. This plan not only combines the coverage and protection of Medicare and Medicaid, it supports those who are dually eligible and have significant behavioral health needs. This program successfully brings together the elements needed to support the aging behavioral health population.


A great deal has been done to improve our understanding of effective behavioral health services delivery. This information should be reviewed thoroughly by key policy makers as plans for the future are put in place. The growth and evolution of EBPs, community-based and recovery-oriented services, and behavioral health services research provide hope for system transformation that supports recovery. We should settle for nothing less than an approach that effectively uses our limited resources to deliver services and supports that improve the quality of life for consumers.



James Gavin, MSW, is President and CEO of Community Care Behavioral Health in Pittsburgh.

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Title Annotation:MEDICAID
Author:Gavin, James
Publication:Behavioral Healthcare
Geographic Code:1USA
Date:Jun 1, 2007
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