By Monica E. Oss, Chief Executive Officer, OPEN MINDS
Consumers with serious mental illnesses (SMIs) remain a priority population for policymakers, payers, and health plan executives. This group of consumers has a life expectancy 10 to 20 years shorter than the general population, with the majority of premature deaths attributed to underdiagnosed and undertreated physical health conditions. Additionally, inappropriate polypharmacy and inconsistent monitoring of medication side effects compound these difficulties.
Not surprisingly, this group of consumers has high rates of acute care utilization and associated costs. In fact, spending for Medicaid beneficiaries with a mental illness is twice that of those without—about $14,000 per year—compared to roughly $7,000 for those without a mental health diagnosis. Spending is highest among adults diagnosed with a serious mental illness, at approximately $21,000 per enrollee per year, which is three times higher than the annual spending for those without a mental illness.
Despite the human toll and the unnecessary health care spending, services designed to address their health needs remain fragmented and difficult to access in most settings. That was the conclusion of a new study, Strengthening The Delivery Of Integrated Care For Individuals Experiencing Serious Mental Illness Within Mental Health Settings: A Qualitative Description Of Health Provider Perspectives.
The research identified several challenges to providing a whole person approach in integrated settings for consumers with SMIs—most of which stem from payer policies and health plan reimbursement models. Key barriers include insufficient resources or funding structures to support integrated care, misalignment between primary care practices and the needs of individuals with SMI, extended wait times for care, and lack of interoperability in health data systems. The authors emphasized that the fee-for-service (FFS) model is particularly ill-suited for treating consumers with SMI, as that model fails to support the longer visits and care coordination often required. This reimbursement structure ultimately discourages provider organizations from delivering high-quality, effective care.
The likelihood of improving the health outcomes of consumers with SMIs depends on their health plan and the health plan policies specific to integrated behavioral/primary care delivery for those consumers. A new analysis by the OPEN MINDS team, Health Plan Enrollment Of Consumers With Serious Mental Illnesses: An OPEN MINDS Market Intelligence Report, provides a framework for looking at health plan coverage of consumers with SMIs.
Among U.S. consumers with an SMI (defined as long-term psychiatric conditions—such as schizophrenia, bipolar disorder, and severe forms of depression, anxiety, or personality disorders—causing substantial impairment and challenges to daily living), 95.3% are insured (approximately 25.3 million), while 4.7% (1.2 million) remain uninsured. Of those with insurance, the majority—79.1%—are enrolled in managed care plans, with only 20.9% in FFS models.
Within the insured population, 24.7% are covered by commercial plans (6.5 million). Following that, 20% are covered by Medicare Advantage (5.3 million), 19.4% by Medicaid managed care (5.1 million), 14.7% are covered by Medicare FFS (3.9 million), 9.5% are dual eligible for both Medicare and Medicaid (2.5 million), 5.2% in Medicaid FFS (1.4 million), and 1.9% in TRICARE (500,000).
Payers and health plans are starting to change their approaches to managing the care of consumers with an SMI. Whole person care is being operationalized through integrated delivery systems, cross-sector partnerships, and expanded care coordination. These approaches are designed to simultaneously manage physical, behavioral, and social health needs within a unified framework. As a result, there are now over 80 different whole person care models in the market.
In our last survey of health plan executives, Trends In Behavioral Health Guidebook, 4th Edition – Volume 3: Population Health Management & Service Innovation For Patients With Behavioral Disorders, 86% of health plan executives reported paying for some type of integrated care strategy (like co-location or collaborative care). And 68% have emergency department diversion initiatives specifically targeting behavioral health crises.
And there are a growing number of non-fee-for-service models being introduced by health plans. There is an increasing number of CCBHC programs reimbursed with prospective payment. There are SMI-specific health home programs with capitated management fees. And health plans are also embracing behaviorally-led primary care models with capitated reimbursement.
Our new market intelligence report, Health Plan Enrollment Of Consumers With Serious Mental Illnesses: An OPEN MINDS Market Intelligence Report, identifies the health plans in every state with the largest number of consumers with SMIs. Entrepreneurial provider organization executives should assess their market and be part of the move to behavioral-led primary care models that move from pay-for-volume to addressing the needs of consumers with an SMI.