An Introduction to Mental Health Services

1
An Introduction to Mental Health Services

• Susan L. Ettner, Ph.D.
• Professor
• UCLA Schools of Medicine
• and Public Health

2
What is a Mental Disorder?

• Significant clinical syndrome with behavioral
  and psychological symptoms, causing distress or
  impairment in functioning (DSM-IV)
• Symptoms of prevalent mental disorders include
• Anxiety (fear and dread)
• Psychosis (hallucinations and delusions)
• Mood disturbance (prolonged sadness or euphoria)
• Cognitive impairment (ability to organize,
  process and recall information)
• Somatic symptoms (decreased appetite, insomnia,
  pain, hyperventilation)

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Other Important Definitions

• Substance Abuse Disorder
• A maladaptive pattern of substance use leading to
  clinically significant impairment or distress
  (DSM-IV)
• Severe Mental Illness (SMI)
• Any DSM-III-R mental disorder that leads to
  substantial interference with one or more major
  life activities (PL 102-321)
• Severe and Persistent Mental Illness (SPMI)
• Disorders that are chronic in addition to causing
  severe functional impairment
• Serious Emotional Disturbance (SED)
• Conditions associated with severe functional
  impairment in children.

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Why Is Mental Health Different?

• Greater stigma, especially among certain groups
  (e.g. elderly, some minority populations)
• Greater information deficits
• Cognitive and perceptual impairment
• Lack of family to act as health care proxies
• Greater variability in treatment, due to
  uncertainty about diagnosis and treatment
  effectiveness
• Although DSM is the gold standard for
  diagnoses, mental health is a continuum on which
  the threshold for specific disorders is not
  always clear
• Difficult to standardize psychosocial treatments

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Why Is Mental Health Different?

• Strong barriers to purchasing individual
  insurance coverage
• Only 11 states guarantee some form of access
• In other states, carriers deny access to persons
  with mental disorders more frequently than
  persons with comparable medical conditions (52
  of the time vs. 30)
• Even among insured, less generous coverage under
  both private and public insurance programs
• Larger role of federal, state, and local
  government in both financing and delivery

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Prevalence and Cost of MH/SA disorders
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Point 1 Mental Disorders Are CommonEstimated
12-month Prevalence of Mental Disorders, SMI and
SPMI
 
Any MH disorder 23.9   SMI 5.4   SPMI 2.6
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Prevalence by Type of MH Disorder
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International Comparisons
Twelve-month Prevalence of MH/SA Disorders
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Point 2 MH/SA Disorders Are Costly

• Global Burden of Disease Study Neuropsychiatric
  disorders account for 24 of all
  disability-adjusted life years (DALYs) lost
• MH/SA disorders often have early onset, resulting
  in high lifetime costs

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MH/SA Treatment Costs

• Treatment costs (2001)
• 85 billion for mental disorders
• 18.3 billion for substance abuse
• Prevention less of an option because etiology of
  psychiatric disorders generally uncertain
• Difficulty in obtaining data to study this.
  Would need panel data that follows infant through
  adulthood.
• Genes vs. environment debate
• Work done on prevention tends to focus on children

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Point 3 MH/SA Treatment Is Cost-Effective

• Despite the high cost of MH/SA services,
  treatment is often cost-effective because of the
  high social costs.
• Example Clark et al. (1999)
• Found that the effective treatment of substance
  abuse disorders among persons with mental illness
  was associated with fewer arrests and
  incarcerations.
• Mean cost associated with an arrest was 2,295
  per person.
• Thus, if effective treatment results in fewer
  arrests, this may result in substantial savings
  for the legal system.

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Brief History Development of the U.S. MH
Treatment System
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Brief History Financing, Organization, and
Delivery of Mental Health Services

• Colonial era
• People with mental illness largely cared for by
  families no available treatments.
• Early 19th century (urbanization begins)
• Treatments were very crude. Little scientific
  understanding of mental illness.
• Most moderate mental disorders received no
  treatment other than the care from general
  physicians, family, friends, and clergy.
• Those with SMI who were perceived as a threat to
  their family and community were sent to isolated
  asylums.
• States had sole responsibility for financing and
  delivery of MH services until WWII.

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Brief History Financing, Organization, and
Delivery of MH Services (1940s)

• Mental Health Act of 1946 introduced federal role
  in financing by providing funding for research
  into the causes, prevention, and treatment of MH
  disorders.
• In 1949, the National Institute of Mental Health
  was formed.

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Brief History Financing, Organization, and
Delivery of MH Services (1950s)

• Split between MH delivery systems
• Psychiatrists rejected a medical model of
  treatment and were oriented to affluent private
  patients in office-based practice. Some of these
  patients sought treatment because it was
  culturally attractive as a self-realization
  experience.
• Few psychiatrists worked in U.S. public mental
  hospitals where persons with severe mental
  illness were cared for.

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Brief History Financing, Organization, and
Delivery of MH Services (1960s-70s)

• The two MH delivery systems begin to merge.
• The Community Mental Health Center Act of 1963
  paved the way for deinstitutionalization.
• Costs shifted from state psychiatric hospitals to
  Federally-funded outpatient CMHCs.
• The growth of public and private health insurance
  for MH/SA care allowed development of specialized
  MH and SA units in general hospitals.
• Expanded training of psychologists and social
  workers.
• Development of new antipsychotics
  antidepressants.

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Brief History Financing, Organization, and
Delivery of MH Services (1980s)

• Although psychiatry tilted towards a medical
  model, treatment standards remained unclear.
• MH/SA insurance continued to expand, but
  employers and insurers limited their liability by
  using greater limitations than for medical
  services.
• Managed behavioral health organizations (MBHOs)
  began to emerge in response to rising behavioral
  health care costs.
• Mental disorders continued to be stigmatized.

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Decade of the Brain (1990s)

• Congress declared the 1990s to be the Decade of
  the Brain
• Improved biological understanding of mental
  illness through advances in neuroscience,
  behavioral science, and genetics
• New psychotropic drugs with fewer side effects
  (e.g. Prozac, Clozapine, Risperadone)
  revolutionized treatment.

20
Financing, Organization, and Delivery of MH/SA
Services Since the 1990s

• The Shift from Inpatient to
• Outpatient Care

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Shift from Inpatient to Outpatient Care

• Development of new psychotropic medications with
  better tolerated side-effect profiles made the
  treatment of many MH disorders on an outpatient
  basis more feasible.
• As a result of growth in managed care, outpatient
  care emphasized in lieu of inpatient care in
  order to contain MH/SA expenditures.

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Shift from Inpatient to Outpatient Care
Distribution of MH/SA spending in the private
sector
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Financing, Organization, and Delivery of MH/SA
Services Since the 1990s

• Barriers to MH/SA Care

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Difficulties in Obtaining Needed Mental Health
Services Anecdotal Evidence

• Informal survey by APA members reported
  psychiatric bed shortages in 16 states.
• Psychiatric beds in the Twin Cities area are in
  such short supply, patients often travel out of
  state for inpatient care.
• In Massachusetts, CMHCs are turning away
  uninsured patients because the state provides no
  funding to these clinics for outpatient care.
• A Washington Post story reported that a mother in
  Maryland called 30 clinicians to obtain MH care
  for her daughter, but none of them would accept
  the fees paid by her MBHO.

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Major Barriers to Optimal MH/SA Care

• Stigma attached to mental illness
• Fragmentation of the delivery system
• Geographic disparities
• Racial and ethnic disparities
• Mismatch between use and need for services
• Inadequate insurance coverage (lack of parity)
  and/or financial resources by the affected
  population

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Stigma

• Stigma of persons with MH disorders has persisted
  throughout history. Two of the important roots
  of stigma come from
• Misguided split between mind and body first
  proposed by Descartes.
• 19th century split between the MH treatment
  system and mainstream medical care.
• Stigma causes others to avoid working with,
  socializing with, renting to, or employing
  persons with mental disorders.
• Stigma deters the public from seeking needed
  MH/SA services or from wanting to pay for care.

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Fragmentation

• Financing, organization, and delivery of MH
  services is very fragmented. The federal
  government alone operates 42 different programs
  that serve those with mental disorders.
• Delivery of services provided within four general
  sectors without coordination (de facto system).
• Mental health specialty sector
• General medical providers
• Human services (e.g. social welfare, schools)
• Voluntary support network

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De Facto Mental Health Services Delivery System
Although not included on the chart, informal
care givers also play an important role.
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Geographic Disparities

• Relative to those in urban areas, those with MH
  disorders in rural areas often have
• inadequate access to care
• lower family incomes
• greater social stigma
• lower likelihood of having private health
  insurance
• Almost all rural counties in the U.S. have a
  shortage of psychiatrists, psychologists, and
  social workers.
• Many primary care physicians in rural areas are
  unprepared to treat mental illnesses.

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Geographic Disparities (contd)

• As a result of these barriers, those with MH
  disorders in rural areas
• Enter care later in the course of their disease
  than their urban counterparts
• Enter care with more serious, persistent, and
  disabling symptoms than their urban counterparts
• Require more expensive and intensive treatment
  than their urban counterparts

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Racial and Ethnic Disparities

• Treatment system has not incorporated
  understanding of the histories, traditions,
  beliefs, languages, and value systems of
  culturally diverse groups.
• Racial and ethnic minorities are
  under-represented among mental health
  professions.
• Native Americans, African-Americans, Asian-
  Americans and Latinos bear a disproportionately
  high burden of disability from mental disorders.
• Higher burden is not due to higher prevalence
  rates
• Due instead to barriers to high quality care,
  e.g., African-Americans are more likely to be
  overdiagnosed for schizophrenia and
  underdiagnosed for major depression.

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Racial and Ethnic Disparities (contd)

• The report Mental Health Culture, Race, and
  Ethnicity, A Supplement to Mental Health A
  Report of the Surgeon General highlighted the
  following disparities for minorities in the MH
  treatment system.
• They are less likely to have access to available
  MH services
• They are less likely to receive needed MH care
• They often receive poorer quality of care
• They are significantly under-represented in MH
  research

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Mismatch Between Use and Need (1)

• Studies have reported that the use of mental
  health services is poorly matched to need
• 15 of adults receive mental health services each
  year
• Of the adults who receive mental health services
  each year, only 1/2 have a diagnosable disorder.
• Of the adults with a diagnosable disorder, only
  1/3 obtain mental health services.
• 21 of children receive mental health services
  each year
• More than half of children with diagnosable
  disorders do not receive treatment.

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Mismatch Between Use and Need (2)

• Studies of mismatch used the prevalence of MH
  disorders as the yardstick to measure need.
• Others have argued that prevalence is not the
  best measure of need for MH treatment
• For example, MH prevalence estimates from the
  National Comorbidity Survey are said to be
  inflated because its definitions are too
  expansive.

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Mismatch Between Use and Need (3)

• Possible definitions of need
• Felt need- What people say they want or what they
  think their problems are.
• Expressed need- Demonstrated by peoples use or
  demand for services.
• Normative need- Determined by experts on the
  basis of research or professional opinion.
• To appropriately define need for MH services, one
  must consider the following for each individual
• Duration and re-occurrence of the MH disorder
• Associated distress and disability of the MH
  disorder
• Likelihood that treatment will be beneficial

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Mismatch Between Use and Need (4)

• Another way to examine the mismatch between use
  and need is to examine the use of services by
  severity.

• Even among those with a serious MH disorder,
  only half received MH treatment. These figures
  may provide a more accurate picture of the
  mismatch between use and need.

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Inadequate Insurance Coverage

• High out-of-pocket costs pose a major impediment
  to peoples willingness and ability to obtain
  psychiatric treatment
• Question Why is insurance coverage worse for
  mental health and substance abuse services?
• Stigma (already discussed)
• Adverse selection
• Moral hazard

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Adverse Selection

• Persons with mental disorders more likely to
  self-select into generous insurance plans
• MH/SA disorders are often chronic and severe
• Patients have higher medical as well as
  behavioral health care costs
• Risk adjustment doesnt work well enough to
  compensate plans for enrolling sickest patients
• Insurer response is to avoid these patients by
  offering minimal MH/SA coverage and poor quality
  in a rush to the bottom

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Moral Hazard

• Moral hazard is the demand response to enhanced
  insurance coverage
• Demand response is much larger for mental health
  services than general medical care
• Results from the RAND Health Insurance Experiment
  suggested that MH costs increase twice as much as
  medical costs when cost-sharing requirements are
  lowered by equal amounts
• Insurer response is to increase cost-sharing or
  use gatekeeping mechanism

40
Financing, Organization, and Delivery of MH/SA
Services Since the 1990s

• Role of Insurance

41
Role of Public Insurance

• The public sector plays an important role in the
  organization and delivery of MH services
• Historical reasons Public sector role predates
  modern insurance markets.
• Externalities Mental illness leads to
  unemployment, caregiver burden, violence,
  homelessness, motor vehicle accidents, child
  abuse and neglect, unsafe sex, etc.
• Disability Mental illness can lead to
  substantial disability and functional impairment.

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Public Insurance Programs

• The public sector often serves those with the
  most severe and disabling MH disorders, such as
  schizophrenia and bipolar disorder.
• Some of these programs include
• State mental health and substance abuse agencies
• Medicare and Social Security Disability Insurance
  (SSDI)
• Medicaid and Supplemental Security Income (SSI)
• Department of Veteran Affairs

43
State- and County-Funded Services

• The role of state and county psychiatric
  hospitals has been declining between 1972 and
  2000, the number of beds dropped from 361,765 to
  54,000.
• The closing of state-run psychiatric hospitals
  has led to concerns about access to care for the
  most vulnerable patient populations. State-run
  hospitals were providers of last resort for
  patients who
• are violent or disruptive
• require long stays
• are uninsured
• Private hospitals thought to engage in
  cream-skimming and dumping wont pick up
  slack?

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Medicare

• Medicare imposes stricter limits on coverage for
  MH/SA than medical care.
• 50 coinsurance rate for MH/SA outpatient visits
  other than initial evaluation and psychotropic
  drug management
• Coinsurance for medical services is only 20
• 190-day lifetime limit on psychiatric hospital
  stays, but no limit on general hospital days
• Benzodiazepines one of the few drugs that are
  specifically excluded from MMA coverage

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Medicaid

• Medicaid also imposes special restrictions on
  MH/SA coverage.
• Does not pay for adult (age 22-64) stays within
  institutions for mental disease (IMD).
• IMDs include psychiatric hospitals and nursing
  homes specializing in psychiatric services
• Elderly covered because Medicaid is secondary
  payer, after Medicare
• Some states also exclude psychiatric hospital
  care for children.

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Private Insurance

• 75 of employers restrict coverage more for
  behavioral health care than for medical care,
  although there is some evidence this disparity
  may be declining over time.
• Restrictions may include
• Lower inpatient day limits
• Lower lifetime expenditure caps
• Lower annual dollar limits
• Lower outpatient visit limits
• Higher coinsurance and/or copayment
• Gatekeeping (even when medical care is
  unmanaged)

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Comparison of Selected Design Features for a
Typical Employer Health Planin 1999
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Managed Mental Health Care

• The application of managed care to mental health
  takes several forms
• HMOs, PPOs, and POS plans typically provide some
  coverage for MH/SA services within their broader
  benefits package.
• Employers, HMOs, PPOs, and POS plans may contract
  with managed behavioral health organizations
  (MBHOs), also known as carve-outs, to manage the
  MH/SA services of their enrollees.
• MBHOs are managed care organizations that
  specialize in MH/SA services.

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Growth of Managed Mental Health Care

• Percent of Medicaid beneficiaries enrolled in
  managed care organizations (MCOs) rose from 14
  in 1993 to 59 in 2003
• All but three states have some form of Medicaid
  managed care program
• MBHOs dominate the market for private mental
  health coverage, with enrollment climbing from
  from 70 million in 1993 to 169 million in 2000

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Enrollment in Managed Behavioral Health Care
Industry
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Arguments in Favor of Carve-Outs

• Vendors specializing in behavioral health are
  better able to manage quality and costs
• Economies of scale and scope in setting up
  specialty networks
• Separate budget protects MH/SA funding
• Carve-outs prevent adverse selection by patients
  and cream-skimming and dumping by competing
  insurance plans
• Only works if single vendor is used

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Arguments Against Carve-Outs

• Poor integration of medical and behavioral health
  care, especially for elderly
• Unclear whether managed care plans can meet the
  needs of chronically ill patients
• Higher administrative costs
• Incentives for cost-shifting between the medical
  and behavioral health care vendors
• May be beneficial if cost-shifting leads to
  greater detection
• Stigmatization of carved-out services
• Potentially less control over providers, since
  carve-outs tend to use FFS reimbursement

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Addressing the Barriers to MH/SA Treatment

• The Push for Parity

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The Push for Parity

• Problem Different coverage of MH/SA disorders
  and general medical care leads to financial risk
  and inequities for those with behavioral health
  conditions.
• Recent efforts to pass parity laws to level the
  playing field.
• Federal parity law passed in 1996 is weak, so
  there has been a push to pass state parity
  legislation.

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Federal Mental Health Parity Act of 1996

• Plans offering MH benefits could no longer have
  lower annual and lifetime spending limits on MH
  services than general medical services.
• Many exemptions
• Individual coverage
• Employers with lt50 employees
• Group plans whose claims costs increased gt1
• Also did not prevent plans from requiring higher
  cost-sharing for MH, imposing visit limits, or
  dropping MH benefits altogether.

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Impact of 1996 Mental Health Parity Act

• Among 863 employers answering a GAO survey who
  were subject to the law, percent reporting parity
  in dollar limits grew from 55 in 1996 to 86 in
  1999
• However, most of the newly compliant employers
  reported changing plans to be more restrictive in
  terms of utilization limits
• Law rarely resulted in higher claims costs
• However, effects of parity legislation will
  depend on how managed the care is

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Impact of 1996 Mental Health Parity Act
Compliant Employer Plans Reporting More
Restrictive Limits on MH Benefits than for
General Medical Services
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Impact of 1996 Mental Health Parity Act
Employers Plans That Have Further Restricted MH
Benefits Since 1996
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State Mental Health Parity Legislation

• By 1994
• Only 22 states required plans to cover any MH
  Services
• 9 states required only that plans make coverage
  available
• 19 states had no mandate
• 1996- Federal parity law passed
• By 1998
• 14 states had passed stronger parity legislation
  than Federal law
• However, ERISA makes it impossible for states to
  mandate benefits for all privately insured, since
  self-insured are exempt
• 2000- California passed a parity law

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California State Assembly Bill 88(Mental Health
Parity Law)

• As of July 2000, plans required to cover the
  diagnosis and medically necessary treatment of
  selected mental conditions under the same terms
  and condition applied to other medical
  conditions
• Benefits include outpatient, inpatient, partial
  hospitalization, and (if applicable) prescription
  drugs

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CA State Assembly Bill 88 (contd)

• Covered conditions include
• Schizophrenia
• Schizoaffective disorder
• Bipolar disorder
• Major depression
• Obsessive-compulsive disorder
• Panic disorder
• Eating disorders (anorexia/bulimia)
• SED for children and adolescents

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CA State Assembly Bill 88 (contd)

• Terms and conditions covered by law include (but
  are not limited to) the following
• Maximum lifetime benefits
• Copayments
• Individual family deductibles
• As usual, self-funded medical plans are
• exempt under ERISA.

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Addressing the Barriers to MH/SA Treatment

• The Presidents New Freedom Commission on Mental
  Health

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The Presidents New Freedom Commission on Mental
Health

• April 2002- President Bush announced the creation
  of a committee to conduct a comprehensive review
  of MH care in the U.S.
• Main goal Recommend improvements to enable
  adults with SMI and children with SED to live,
  work, learn, and participate fully in their
  communities.
• The commissions assessment The mental health
  system is in shambles.

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The Presidents New Freedom Commission on Mental
Health

• The commissions final report was released on
  July 22, 2003. Six main goals put forth in this
  report were
• Understanding that mental health is essential to
  overall health
• Making mental health care consumer-driven and
  family-driven
• Eliminating disparities in MH services
• Making early MH screening, assessment, and
  referral to services common practice
• Delivering excellent MH care and accelerating
  research
• Using IT to improve access to MH care and
  information

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The Presidents New Freedom Commission on Mental
Health

• Each of these goals included numerous
  recommendations by the commission, including the
  support of stronger federal legislation for MH
  parity.
• In spite of the blunt assessment of the MH
  treatment system, there was one key
  recommendation missing from the final report The
  investment of new resources to accomplish these 6
  goals
• Stronger parity legislation has still not passed
  because the Republican committee chairmen and
  party leaders have not pressed for its enactment.

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THE END