FINANCIAL INCENTIVES AND TREATMENT DECISIONS
FOR DEPRESSION, ANXIETY, AND SUBSTANCE ABUSE
Richard Frank, Haiden Huskamp, Shelly Greenfield
The study represents a collaboration between Harvard Medical School, Massachusetts Institute of Technology (MIT), United Behavioral Health (UBH), Eli Lilly, and ten large employers that contract with UBH. We will examine the impact of variations in benefit design, vendor contract incentives, and provider payment and management incentives (including utilization review and an exclusive provider network) on treatment choice, appropriateness and cost for three common mental health and substance abuse conditions: depression, anxiety disorder, and alcohol abuse. For those firms that can provide appropriate data, we will also examine the impact of these incentives on workplace performance (including absenteeism and productivity) of enrollees.
IMPACT OF FINANCIAL AND ORGANIZATIONAL
ARRANGEMENTS ON UTILIZATION PATTERNS AND COST OF TREATMENT FOR MENTAL HEALTH
AND SUBSTANCE ABUSE CONDITIONS
Richard Frank, Haiden Huskamp
During the period 1993-1997, the Prudential HealthCare System used a variety of different approaches to organizing, financing, and managing the mental health and substance abuse (MHSA) benefit across the firm's regional health plans. Some plans chose to carve out the MHSA benefit while others managed it internally. Plans that carved out the benefit contracted with vendors of different organizational structures and used different payment and management approaches. The overall goal of the project was to assess the impact of various organizational arrangements on the quality, cost and utilization of Mental Health/Substance Abuse (MH/SA) care. This study provided empirical analyses that quantified the effects of key strategic decisions in the design of managed MH/SA programs. Specifically, they provided estimates of the impact of risk sharing arrangements, provider incentives, and certification policy on costs and patterns of service utilization.
CARVING OUT BEHAVIORAL HEALTH
Haiden Huskamp
In her Sloan-funded dissertation research, Haiden Huskamp examined the impact of the shift to a behavioral health carve-out method of organizing and funding mental health and substance abuse care for state employees in Massachusetts. She found reductions on the order of 35% in overall behavioral health care spending. She also found important shifts in patterns of care. Specifically, she found a large shift away from hospital care. This occurred in the context of very modest financial incentives to reduce costs. Equally significant is that this occurred in conjunction with an expansion in coverage for mental health care. Both the State of Massachusetts and the industry have used the results in their choices regarding the design and bidding for the new contract in Massachusetts. In addition, the results from this body of research are being incorporated into actuarial models used to predict spending on mental health care under managed care.
RISK-SHARING ARRANGEMENTS AND DELEGATION
IN BEHAVIORAL HEALTH
Meredith Rosenthal
Meredith Rosenthal's dissertation research on delegation of clinical management and risk sharing for behavioral health care examined the impact of use of risk sharing on indicators of quality. She showed that along several dimensions there was either no impact (the Global Assessment of Functioning Scale) or an improvement (use of adjunct services such as self help groups). At the same time she also provided some evidence of negative consequences tied to use of risk sharing and more delegation of utilization management. She reported higher rates of patients dropping out of treatment prematurely under the risk sharing-delegation arrangements. These results are important and require further probing. Professor Rosenthal is continuing to work with the senior management at PacifiCare Behavioral Health to interpret and refine her (and their) understanding of the implications of her findings.