Mental Health Costs and Access Under Alternative Capitation Systems in Colorado

Joan R. Bloom · Teh‐wei Hu · Neal Wallace · Brian J. Cuffel · Jaclyn W. Hausman · Mei‐Ling Sheu +1 more

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Healthcare Policy and Management Psychiatric care and mental health services Mental Health Treatment and Access

Abstract

OBJECTIVE: To examine service cost and access for persons with severe mental illness under Medicaid mental health capitation payment in Colorado. Capitation contracts were made with two organizational models: community mental health centers (CMHCs) that manage and deliver services (direct capitation [DC]) and joint ventures between CMHCs and a for-profit managed care firm (managed behavioral health organization, [MBHO]) and compared to fee for service (F.F.S.). DATA SOURCES/STUDY SETTING: Both primary and secondary data were collected for the year prior to the new financing policy and the following two years (1995-1998). STUDY DESIGN: A stratified random sample of 522 severely mentally ill subjects was selected from comparable geographic areas within the capitated and FFS regions of Colorado. Major variables include service cost, utilization, and access (probability of service use) derived from secondary claims data, subject reported access collected at six-month intervals, and baseline outcomes (symptoms, functioning, and quality of life). PRINCIPAL FINDINGS: In comparison to the FFS area, cost per person was reduced in the capitated areas in each of the two years following implementation. By the end of year two, cost per person was reduced by two-thirds in the MBHO areas and by one-fifth in the DC areas. Reductions in access were found for both capitated areas, although reductions in utilization for those receiving service were found only in the MBHO model. CONCLUSIONS: Medicaid mental health capitation in Colorado resulted in cost reducing service changes for persons with severe mental illness. Assessment of outcome change is necessary to identify cost effectiveness.

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1988The Nonprofit Economy 1998The logged dependent variable, heteroscedasticity, and the retransformation problem 2013The Non-profit Enterprise in Market Economics 1991Strategies for Integrating Public Mental Health Services 1986On the Limits of Expanding Health Care Reform: Chronic Care in Prepaid Settings 1997Savings from a Medicaid carve-out for mental health and substance abuse services in Massachusetts 1992Does capitation affect the health of the chronically mentally ill? Results from a randomized trial 1996Some Economics of Mental Health 'Carve-Outs'

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