Mental Health Association of Greater St. Louis	1905 S. Grand Blvd. St. Louis, MO 63104 314-773-1399 Info@mhagstl.org	The Mental Health Association is a United Way Agency.  Click on the logo above to go to the United Way website.

Mental Health Association Fact Sheet

 SB 577 – Experimenting with people with mental illness

Overview

“Missouri is a state in which the legislature has pounded the public mental healthcare system with budget cuts.  At some point, cuts mean more than trimming fat or saving money; instead, they become harms, cutting muscle and bone, translating to needless suffering and early deaths.”¹ 

SB 577 is the proposal to revamp the Missouri Medicaid program including managed care for the permanently and totally disabled population. 

To control healthcare costs, states turned to managed care for the healthier populations within Medicaid during the 1990s.  Increasingly, people with disabilities are being added to managed care.  The Economic and Social Research Institute warns that managed care if not properly designed and monitored can pose serious threats to the health and well being of people with disabilities.²

Managed care can bring risks of undertreatment and poor quality. Potentially at risk are the populations currently served by Medicaid including people with severe mental illness.³ Although managed care is becoming a model, there is very little consensus on quality management.[5] 

In fact, a committee studying managed care found that many concerns were unique to behavioral health.[6] Managed care has grown around the private sector. However, the public sector delivers services to continuous users, a totally separate population.⁶

The Kaiser Commission on Medicaid for the Uninsured says, “Involve consumers. Involve consumers. Involve consumers.”⁷ The Missouri Healthnet recommendations and the development of SB 577 were both done without consumer input.

The Record

Very few studies have looked at utilization of services, outcomes, coordination of care, or overall satisfaction for the population proposed.⁸   In fact, the present proposal (SB 577) could lead to adverse selection with the state’s Medicaid program retaining the highest cost participants. 

Cost shifting back to the public system could become a factor if cost controls override quality of care.⁹  Cost shifting in the Missouri MC+ program already happens.  In FY 2006, Missouri hospitals received nearly $40 million¹⁰ from the Division of Medical Services for hospital care.  Given that the state pays these fees then it follows that hospital care is inappropriately denied by MC+ companies. 

Also troubling is the lack of wraparound services and other services required for people with mental illness to recover.¹¹ Many managed care plans specifically exclude social and support services because acute care is emphasized.¹²

In addition, medication so important to recovery can become very difficult to access¹³ due to limited formularies, fail first polices and prior authorization. 

Rural areas are less appealing for managed care companies because of limited numbers of providers and the size of the market.¹⁴

Florida, Kentucky, Michigan and New Mexico expressed pride in improving quality and access in managed care but were reluctant to claim this success with behavioral health managed care.¹⁵

Missouri’s Record

In the aftermath of MC+ implementation, so few people were able to access substance abuse services that the Division of Medical Services carved out alcohol and drug services to ensure continued availability of those services.¹⁶

Managed care companies do not provide specialty mental health services required for recovery for some people in MC+.¹⁷  When advocates questioned a suicide in the MC+ program, the Division of Medical Services moved to eliminate suicides as an indicator of program success.¹⁸

 Managed care will drive up costs quicker.  A study of price increases from FY 2000 through FY 2006 showed that managed care prices increased by 58.07% while the per person increase for permanently and totally disabled Medicaid recipients increased by 21.35%.  In other words, cost increases were nearly triple.¹⁹

Conclusion

 Placing people in mental health managed care is fraught with much danger as evidenced in the preceding information.

Recommendation

 All people with serious and persistent mental illness diagnoses should be carved out of SB 577 and managed by the Missouri Department of Mental Health using managed care technology appropriate to the population.

 Footnotes:

¹ A Report on America’s Health Care System for Serious Mental Illness – Grading the States. NAMI. March, 2006. pg. 108

² Regenstein, Marsha, Ph.D., Schroer, Christy, M.H.A., Meyer, Jack A., Ph.D.  Medicaid Managed Care for Persons with Disabilities: Case Studies of Programs in Florida, Kentucky, Michigan and New Mexico. The Economic and Social Research Institute. April 2000. pg. 1

³ Summary: Managing Managed Care: Quality Improvement in Behavioral Health. http://www.nap.edu/openbook/030905642Xa/html/6.html. The National Academy of Sciences. 2000. pg. 9

4 Ibid. pg. 6

5 Ibid. pg. 11

6 Egnew, Robert. Public Workshop. National Association of County Managed Behavioral Healthcare Officials. Irvine, CA. May 17, 1996.

7 Medicaid Managed Care for Individuals with Disabilities: A Closer Look. Kaiser Commission on Medicaid and the Uninsured.  April 2000. pg. vi

8 Ibid. pg. iv

9 Summary: Managing Managed Care: Quality Improvement in Behavioral Health. http://www.nap.edu/openbook/030905642Xa/html/6.html. The National Academy of Sciences. 2000. pg. 17

10 Schneider, John . Division of Medical Services Email to James House. January 8, 2007.

11 Summary: Managing Managed Care: Quality Improvement in Behavioral Health. http://www.nap.edu/openbook/030905642Xa/html/6.html. The National Academy of Sciences. 2000. pg.22

12 Ibid. pg. 25

13 Medicaid Managed Care for Individuals with Disabilities: A Closer Look. Kaiser Commission on Medicaid and the Uninsured.  April 2000. pg. v

14 Medicaid Managed Care Cost Savings – A Synthesis of Fourteen Studies, Final Report. The Lewin Group. July 2004. pg. 5

15 Medicaid Managed Care for Individuals with Disabilities: A Closer Look. Kaiser Commission on Medicaid and the Uninsured.      April 2000. pg. 27

16 Medicaid Reform Commission Report (Missouri). December 2005. pg. 38

17 Ibid.

18  “Hopeless Crisis?” Medicaid Managed Care (MC+) and Mental Health: An Update. Mental Health Association of Greater St. Louis. November 1999. pg. 4

19 Medicaid Facts and Fictions.  Mental Health Association of Greater St. Louis. September 2006.