The journal of mental health policy and economics
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J Ment Health Policy Econ · Sep 2001
Financial Burden and Out-of-Pocket Expenditures for Mental Health Across Different Socioeconomic Groups: Results from HealthCare for Communities.
Mental health benefits have traditionally been much less generous than benefits for physical health care, with separate deductibles, higher copayments or coinsurance, and lower limits on covered services, a trend that continues despite a recent wave of 'parity' legislation. In spite of the current policy debates on mental health insurance reforms, little is known about the burden of mental health out-of-pocket expenditures. AIMS OF THE STUDY: This study examines differences in out-of-pocket expenditures and their burden across different populations, stratified by insurance status, age, ethnicity, and socioeconomic groups. ⋯ Although there is a common perception that out-of-pocket expenditures for mental health services represent a significant burden for service users, the estimates suggest that this is not the case. In fact, across the three measures of out-of-pocket expenditures as a share of income the estimates are under 10 percent for most groups. However, there is some variation in burden across groups with people who are older, uninsured, or minority spending a larger share of their income out-of-pocket. Since many insurance plans have limits on the number of visits covered and on the total amount that the insurer will pay for mental health services, the share of total mental health expenditures that are paid by individuals is another important measure of the burden faced by people with mental health service needs. We estimate that the mean out-of-pocket share of total expenditures for the group as a whole is 25 percent. In addition, we find that the burden varies across groups with older, more educated, or privately insured individuals paying a larger share of expenditures out-of-pocket. DISCUSSION: Although the overall picture regarding the burden of out-of-pocket costs relative to income is encouraging, it is also important to keep in mind that individuals make treatment decisions based on their available income. The fact that the burden of actual out-of-pocket payments is relatively low may also reflect decisions to forego potentially valuable care. Nevertheless, the results for mental health do not suggest that out-of-pocket costs are currently a major burden for most users. This situation may reflect a major change from the past given the recent shifts towards managed care, however there are no comparable data available to test this hypothesis empirically. IMPLICATIONS FOR HEALTH POLICY FORMULATION AND FURTHER RESEARCH: It may be tempting to attribute the low estimates of out-of-pocket expenditures as a share of income in this paper to recent parity legislation. However, recent research shows that parity legislation has not led to significant changes in benefit design. In fact the high ratio of out-of-pocket payments relative to total mental health care expenditures presented in this paper are consistent with a limited role of parity legislation. Another possible explanation for the observed results is the growth of managed care and the shift in treatment style towards greater use of medications, which are comprehensively covered in most private insurance plans, has reduced total treatment costs and consequently the size of out-of-pocket payments.
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J Ment Health Policy Econ · Jun 2001
How do Trends for Behavioral Health Inpatient Care Differ from Medical Inpatient Care in U.S. Community Hospitals?
Inpatient care in the United States accounts for one third of the health care expenditures. There exists a well-established trend towards fewer inpatient admissions and shorter lengths of stay for all inpatient care, which can be attributed to cost containment efforts through managed care and advances in treatment technologies. However, different illnesses may not necessarily share the same pattern of change in inpatient care utilization. In particular, mental health and substance abuse (MHSA) care has experienced a particularly dramatic growth of specialized managed behavioral organizations, which could have led to an even faster decline. AIMS OF THE STUDY: This study contrasts the trends of MHSA inpatient care in U.S. community hospitals with medical inpatient care over the years 1988 to 1997. It also analyzes the trends for subgroups of MHSA stays by diagnostic groups, age and primary payer. ⋯ Population-adjusted MHSA discharges from community hospitals increased by 8.1% over the study period, whereas discharges for all conditions decreased. Within MHSA discharges, the 20-39 and 40-64 age groups experienced significant increase relative to other age group; the increase was particularly high for affective and psychotic disorders, which are only partially offset by a decrease for other diagnostic groups. Hospitalization for both MHSA and medical conditions displayed trends towards shorter lengths of stay, but with the decline for MHSA stays steeper (40%) than for all stays (21%). The reduction in length of stay not only applied to the privately insured, for which managed behavioral health care had the highest penetration rate, but held for all other payers as well, although the rate of decline is higher for private insurance than for other insurance. Inpatient stays with pre-adult disorders displayed the greatest percentage decline for both population-adjusted discharges and average length of stay. IMPLICATIONS FOR HEALTH CARE PROVISION AND USE: Different pattern of utilization emerged for MHSA inpatient care as compared to hospitalization for all medical care over the years 1988-97. The more rapid decline in length of stay for MHSA stays than for all stays may have been a result of greater incentive for cost containment and therefore more intensive care management, and advances in treatment technology, especially medication. However, the fast decline in length of stay may also have led to repeat hospitalization as a result of premature discharges for patients with affective or psychotic disorders. Some financial incentives, such as case-rates or DRG-type payments to hospitals could have contributed to such adverse effects. Increases in discharges for severe disorders could also be a consequence of shifts from long-term facilities (for which no comparable data are available) to community hospitals, although the largest absolute and relative increases were for affective disorders rather than schizophrenia or other psychoses, the two disease subgroups that make up the majority of the institutionalized patients. International comparisons, assisted by new data, may help disentangle the effect of institutional change and that of development in treatment technology or practice pattern.
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J Ment Health Policy Econ · Dec 2000
Antidepressant treatment for depression: total charges and therapy duration*
The economic costs of depression are significant, both the direct medical costs of care and the indirect costs of lost productivity. Empirical studies of antidepressant cost-effectiveness suggest that the use of selective serotonin reuptake inhibitors (SSRIs) may be no more costly than tricyclic antidepressants (TCAs), will improve tolerability, and is associated with longer therapy duration. However the success of depression care usually involves multiple factors, including source of care, type of care, and patient characteristics, in addition to drug choice. The cost-effective mix of antidepressant therapy components is unclear. AIMS OF THE STUDY: Our study evaluates cost and antidepressant-continuity outcomes for depressed patients receiving antidepressant therapy. Specifically, we determined the impact of provider choice for initial care, concurrent psychotherapy, and choice of SSRI versus TCA-based pharmacotherapies on the joint outcome of low treatment cost and continuous antidepressant therapy. ⋯ SSRIs substantially reduce the incidence of patients discontinuing pharmacotherapy while leaving charges largely unchanged. The relative effectiveness of SSRIs in depression treatment is independent of the patient's personal characteristics and dominates the consequences of other treatment dimensions such as seeing a mental health specialist and receiving concurrent psychotherapy. Initial provider specialty is irrelevant to the continuity of pharmacotherapy, and concurrent psychotherapy creates a tradeoff through reduced pharmacotherapy interruption with higher costs. DISCUSSION: Longer therapy duration is associated with SSRI-based pharmacotherapy (relative to TCA-based pharmacotherapy) and with concurrent psychotherapy. High cost is associated with concurrent psychotherapy and choice of a specialty provider for initial care. In our study cost-effective care includes SSRI-based pharmacotherapy initiated with a non-specialty provider. Previous treatment history and other unobserved factors that might affect antidepressant choice are not included in our model. IMPLICATIONS FOR HEALTH CARE PROVISION: The decision to use an SSRI-based pharmacotherapy need not consider carefully the patient's personal characteristics. Shifting depressed patients' pharmacotherapy away from TCAs to SSRIs has the effect of improving outcomes by lowering the incidence of discontinuation of pharmacotherapy while leaving largely unchanged the likelihood of having high overall health care charges. Targeted use of concurrent psychotherapy may be additionally cost-effective. IMPLICATIONS FOR HEALTH POLICIES: The interaction of various components of depression care can alter the cost-effectiveness of antidepressant therapy. Our results demonstrate a role for the non-specialty provider in initiating care and support increased use of SSRIs as first-line therapy for depression as a way of providing cost-effective care that is consistent with APA guidelines for continuous antidepressant treatment. IMPLICATIONS FOR FURTHER RESEARCH: Further research that improves our understanding of how decisions regarding provider choice, concurrent psychotherapy, and drug choice are made will improve our understanding of the effects treatment choices on the cost-effectiveness of depression care. We have suggested that targeted concurrent psychotherapy may prove to be cost-effective; research to determine groups most likely to benefit from the additional treatment would further enable clinicians and healthcare policy makers to form a consensus regarding a model for treating depression.
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J Ment Health Policy Econ · Sep 2000
Risk adjustment for high utilizers of public mental health care.
Publicly funded mental health systems are increasingly implementing managed care systems, such as capitation, to control costs. Capitated contracts may increase the risk for disenrollment or adverse outcomes among high cost clients with severe mental illness. Risk-adjusted payments to providers are likely to reduce providers' incentives to avoid or under-treat these people. However, most research has focused on Medicare and private populations, and risk adjustment for individuals who are publicly funded and severely mentally ill has received far less attention. AIMS OF THE STUDY: Risk adjustment models for this population can be used to improve contracting for mental health care. Our objective is to develop risk adjustment models for individuals with severe mental illness and assess their performance in predicting future costs. We apply the risk adjustment model to predict costs for the first year of a pilot capitation program for the severely mentally ill that was not risk adjusted. We assess whether risk adjustment could have reduced disenrollment from this program. ⋯ We find that the model that incorporates demographic characteristics, diagnostic information and cost data from two previous years explains about 16 percent of the in-sample variation and 10 percent of the out-of-sample variation in costs. A model that excludes prior cost covariates explains only 5 percent of the variation in costs. Despite the relatively low predictive power, we find some evidence that the disenrollment from the pilot capitation initiative input have been reduced if risk adjustment had been used to set capitation rates. DISCUSSION: The evidence suggests that even though risk adjustment techniques have room to improve, they are still likely to be useful for reducing risk selection in capitation programs. Blended payment schemes that combine risk adjustment with risk corridors or partial fee-for-service payments should be explored. IMPLICATIONS FOR HEALTH CARE PROVISION, USE, AND POLICY: Our results suggest that risk adjustment methods, as developed to data, do not have the requisite predictive power to be used as the sole approach to adjusting capitation rates. Risk adjustment is informative and useful; however, payments to providers should not be fully capitated, and may need to involve some degree of risk sharing between providers and public mental health agencies. A blended contract design may further reduce incentives for risk selection by incorporating a partly risk-adjusted capitation payment, without relying completely on the accuracy of risk adjustment models. IMPLICATIONS FOR FURTHER RESEARCH: Risk adjustment models estimated using data sets containing better predictors of rehospitalization and more precise clinical information are likely to have higher predictive power. Further research should also focus on the effect of combination contract designs.
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J Ment Health Policy Econ · Dec 1999
Economic evaluation and mental health: sparse past. fertile future?
Demands for economic inputs to mental health policy-making, practice decisions and research evaluations have grown considerably in recent years, but the overall supply response has been modest and uneven. AIMS: This paper examines the key historical phases in the development of mental health economics research, and what they imply for the way economics is received and employed. Focusing on the quest for cost-effectiveness, the paper considers challenges for mental health economics. ⋯ Five historical development phases characterize this growth. Initially, the dominant feature is innocence or neglect of scarcity. Cost measures are rarely calculated, cost-effectiveness is not part of the decision-making lexicon and the potential for inefficiency is huge. In the second phase, innocence turns to criticism of attempts to introduce resource rationality, and many clinicians actively reject economics. Health is seen as priceless, and not to be compromised by the pursuit of efficiency. After a period of reluctance there follows impetuosity as the need for economic insights is recognized, but the search for data is desperate and undiscriminating. Poor quality research is conducted, with the risk that decisions are misinformed and perhaps damaging. Once again, resources are inappropriately used. Next follows the constructive development phase: previous mistakes are appreciated and the standards of evaluation improve markedly. Studies are better designed, more likely to be integrated into clinical or policy evaluations, carefully conducted and sensibly interpreted. Inefficiency should be reduced, along with inequity. Finally, there is perhaps a nirvana-like fifth phase in which sophisticated economic studies are widely undertaken, where systematic reviews and meta-analyses help to reveal the wider picture and where findings are readily available to clinicians, managers and providers. Whether such a stage is attainable is open to question. DISCUSSION: Although the number and sophistication of economic evaluations have both increased noticeably over recent years, there remain imbalances. There is little economics evidence on care arrangements or treatments for dementia, most of the neuroses and the disorders of childhood and adolescence. There are many fewer good evaluations of psychological interventions than of drug treatments. Geographically, few economic evaluations are conducted outside Western Europe, North America or Australasia. IMPLICATIONS FOR DECISION-MAKERS AND RESEARCH: Many challenges consequently face the next generation of mental health economics evaluations, both for research economists and for those health care decision-makers who find themselves increasingly having to draw on economics evidence. One challenge is to be fully aware that the information that economists can currently offer may fall short of what decision-makers need. The gap between the two must be fully appreciated. Building more comprehensive pictures of the cost and outcome consequences of different care policies and treatment interventions is one way to bridge this gap. At the same time a sense of perspective must be maintained and promoted. For example, there is growing concern across the world about the high prices of new drugs, yet drug acquisition costs usually represent only a small proportion of total costs. Decisions sometimes appear to be disproportionately focused on small parts of the overall mental health care picture. A similar tendency prompts another challenge, which is to undertake and interpret research so as to overcome, or at least not to exacerbate, the boundary problems that characterize the multi-service, multi-agency reality of many mental health care systems. The adequacy of short-term evaluations - which dominate our field - must be questioned in light of the chronicity of many mental health problems, and of their externality effects (including inter-generational transmission of problems). Although funding will always be a problem, longer-term evidence is needed. So, too, is research that looks at the reasons for inter-individual cost and outcome variations. Economic evaluations should also pay more attention to equity as well as efficiency as a criterion of improved resource allocation. Finally, more economic data should be gathered alongside and not after clinical data, particularly as economic assumptions often appear to drive key practice and policy changes.