How Payers Are Curbing Behavioral-Health Cost Drivers

Healthcare organizations are discovering untapped value in providing mental health and substance abuse services to super-utilizers of medical services.

Health plans are starting to focus on finding and engaging hard-to-serve beneficiaries who have been falling through the healthcare industry's cracks for decades.

"We're increasingly aware of the impact of behavioral health conditions, whether they are mental health or substance abuse, on physical health issues," Ian Shaffer, executive medical director at New York-based Healthfirst Inc., told me recently.

A mountain of evidence, demonstrating that behavioral health conditions are a major driver of healthcare costs, is accumulating.

In a study of 2 million Medicare Advantage beneficiaries released last month, Bowie, MD-based Inovalon reported data showing that a range of mental health conditions inflate hospital readmission rates. The readmission rates for MA beneficiaries was:

• 15.5% overall
• 23.8% for those with anxiety
• 26% for those with schizophrenia

The report's lead author, Christie Teigland, PhD, wants federal officials to consider including behavioral health in MA's risk-adjustment factors. "They already adjust risk factors for age because older beneficiaries are more likely to end up back in the hospital. Our research shows mental health issues also increase the risk of ending up back in the hospital," she told me.

Red Ink
The CEO of Boston-based Commonwealth Care Alliance (CCA) says the legacy of de-institutionalizing behavioral health is splashing red ink on the Medicare budget and health plan balance sheets.

"For 40 years, we've underfunded the community capacity to care for these people," Robert Master, MD, says, noting that there is a nationwide shortage of community-based respite and transitional housing facilities for individuals with mental illness. "In some cases, they're not ready to be thrown out of the hospital… What is missing is the appropriate gradient of facilities."

Master says state governments have struggled to rise to the behavioral health challenge. "There is so much competition for state tax dollars. What you're doing is cost shifting to the federal government. Medicare pays for that hospitalization."

CCA has 16,000 enrollees, with severe mental illness or substance abuse conditions afflicting 2,000 beneficiaries. The staff at CCA, which Medicare classifies as a Fully Integrated Dual Eligible Special Needs Plan, views the organization as a "care delivery system" that has adopted reducing psychiatric hospitalizations as a core mission.

Master says the vast majority of people with behavioral health or substance abuse conditions do not need to be in a hospital, where Medicare pays $1,100 per day for a bed and psychiatric services. "Most would be better served in a community-based, lower-cost setting."

Transitional Housing 'Just the First Step'
To reduce costs and improve quality of care, CCA is stepping in where de-institutionalization of behavioral health left off. "We have to create the capacities that are missing," Master says.

Last month, CCA started leasing a "mothballed ward" at Carney Hospital in the Dorchester neighborhood of Boston to provide transitional housing for beneficiaries after their release from psychiatric hospitals. It immediately filled the 10 beds and plans to open at least three more similar facilities over the next year.

The transitional housing unit has living room and kitchen space, and "referrals come from the enrollees' own physicians," Master says. But "This doesn't solve the problem. This is just the first step."

Elsewhere, Shaffer says Healthfirst is tackling behavioral health through a new approach to primary care medicine. "Healthcare is a team sport now. We really need to look at it as a team effort to be effective."

Healthfirst is encouraging primary care practices to incorporate behavioral health screening and referrals into their workflow. "It's all driven around the concept of integrating all the services people need," he says.

"We need to get away from primary care physicians either spending two hours with a challenging patient or not spending any time… The [best] intervention may well be encouraging that individual to stick with the appropriate treatment."

Shaffer says the healthcare industry is "reaching a tipping point" on behavioral health. "We're learning more. We tended to bifurcate mental health services and kept them separate from physical health services. Now we're adding them back in."

Reaching Out to Engage Beneficiaries
Owings Mills, MD-based Integra ServiceConnect is also thinking outside the historical parameters of the healthcare box to help health plans engage beneficiaries who have behavioral health conditions.

"We start with the notion that [there is] a small number of people who are driving a large amount of healthcare services," Integra President and CEO Michael Yuhas says. "You need to be able to connect with people on their level."

One of the key ingredients in Integra's secret sauce is community coordinators who find and engage health plan beneficiaries where they live, which is often in disadvantaged neighborhoods.

"This is not a healthcare intervention we're talking about," Yuhas told me. "We've been taught historically that when something breaks, you bring the patient in to fix it. But once you find [a beneficiary with a behavioral health condition], that's not enough. You have to engage them. You have to let them know you're friend and not foe. We've created a science of finding people, engaging them, and connecting them to the services they need."

Integra looks for a set of qualities when it hires community coordinators, few of which are directly related to traditional healthcare industry skills. "It's in their fabric to help people," Yuhas says. Community coordinators live in the areas they serve and are persistent, compassionate, street smart, and resourceful. "We look for people who won't give up. We look for people who are just creative."

I asked whether someone like the rapper and actor Tracy "Ice-T" Marrow, known for his resourcefulness, would make a good community coordinator. "We'd hire Ice-T if we could, but we hire people who know where Ice-T is. We hire people who can find community ambassadors," Yuhas told me. "Mostly, it's the notion of not giving up. We connect with the people others have given up on."

Covering the Basics
Another ingredient in Integra's secret sauce is strictly business-related.

The company helps health plan beneficiaries meet basic needs, which the healthcare industry has long considered insignificant. A change in mindset is long overdue.

"We contract with our clients as a vendor, not as a clinical provider of care… We get paid on the basis of a monthly fee to make sure the member's needs are being met," Yuhas says. This kind of work "doesn't lend itself to the typical billing code."

For example, community coordinators have taken health plan beneficiaries to consignment shops to buy coats to stave off the chill of winter and hospitalizations linked to exposure. "When we buy a coat, we don't bill for a coat."

Yuhas says Integra's efforts are "life-changing" for many health plan members: "We're working with members who are not accustomed with people coming out into their neighborhoods and actually helping them."