Evaluation Results of the Prepaid Mental Health Demonstration: Year 7 - Areas 1 and 6 Briefing for the Substance Abuse and Mental Health Corporation August 4, 2004 David L. Shern, Ph.D.

and the Evaluation Team Louis de la Parte Florida Mental Health Institute

Framing Evaluation Questions

 What are the implementation issues related to systems redesign and expansion?

 What is the impact of managed care on Medicaid enrollees’  Access to care?

  Health and mental health status?

Costs of care?

Financial Risk Arrangements Financing Condition

Areas 1 & 6 MediPass/PMHP Areas 1 & 6 HMOs Areas 2, 4, & 7 MediPass

Health Mental Health Pharmacy

No Risk At Risk No Risk At Risk At Risk At Risk No Risk No Risk No Risk

Integrated Sub-Studies

• Implementation Analysis – Review of Contracts – Surveys of Key Informants and Stakeholders • Administrative Data – Medicaid Enrollment and FFS Claims – Managed Care Encounter Data – Pharmacy Claims Data – Global Functioning Measures for Service Users • Adults with SMI Intensive Interview Study – Mental Health Status and Satisfaction Data – Social Cost Analysis • Medicaid General Population Mail Survey

Description of the Provider Networks

Area 6

– HMOs primarily use the 5 main Community Mental Health Centers in the area • All Fee-For-Service in the beginning – Shifted to capitation over time, but some Fee-For-Service still present – PMHP uses the same 5 Community Mental Health Centers - stable structure over time • Use risk adjusted capitation to Community Mental Health Centers

Area 6 Funding Streams as of 4/04 Agency for Health Care Administration FHP/VO STAY HE AmG UHC MG MHC Northside PR WH WBH UBH

AssociateProv. Community Mental Health Centers Other Providers Solid line – Capitation Dotted line – Fee for service SA, SIPP, FACT, BHOS, STFC, & Comprehens. Assessment Medicaid enrollees not eligible for managed care Providers

Provider Networks

Area 1

– The PMHP and HMO have different provider networks – Fee-For-Service for HMO Relationships – Capitation for PMHP

Area 1 Funding Streams as of 6/04 Agency for Health Care Administration

SA, SIPP, FACT, BHOS, STFC, & Comprehens. Assessment

ABH LVC HE BW COPE WCBH Associate Providers

Providers (excluding LV)

Solid line – Capitation Dotted line – Fee-for-service

Medicaid enrollees not eligible for managed care

Providers

What Have We Learned?

The HMO Business Arrangements Have been Accompanied by Greater Instability and Complexity in Organizational Arrangements

Organizational Structure: Funding Streams as of 1/00

Agency for Health Care Administration Value Options FHP MG MHC Northside PR WH

AssociateProv.

St.A. FL 1st PHP STAY UHC HE PCA ALP WEL BHM APS MHC (CMHC) Horizon UBH CBC MHC (CMHC) MAG

Community Mental Health Centers Other Providers

Area 6 Funding Streams as of 3/02

Agency for Health Care Administration FHP/VO FL 1st STAY ST.A

PHP HE UHC MG MHC Northside PR WH HZ CBC CMHC UBH

AssociateProv. Community Mental Health Centers Other Providers Black = FFS Red = Outpatient & Inpatient capped Blue = Outpatient capped only Dotted line = Risk Sharing

Figure 6. Area 6 Funding Streams as of 4/04 Agency for Health Care Administration FHP/VO STAY HE AmG UHC MG MHC Northside PR WH WBH UBH

AssociateProv. Community Mental Health Centers Other Providers Solid line – Capitation Dotted line – Fee for service SA, SIPP, FACT, BHOS, STFC, & Comprehens. Assessment Medicaid enrollees not eligible for managed care Providers

Implementation of Managed Care Has Not Resulted in Improved Access to Services

Average 6-Month Penetration for Carve-Out Services: Areas 1, 2, and 4

Case Mix Adjusted

17.5% 15.0% 12.5% 10.0% 7.5% 5.0% 2.5% 0.0% PMHP Area 1 HMO Area 1 MP Area 2 MP Area 4 Jul-Dec 2001 Jan-Jun 2002 Jul-Dec 2002

Fiscal Year

Jan-Jun 2003

Average Annual Penetration for Carve-Out Services Only: Areas 6, 4 and 7

Case Mix Adjusted

25% 20% 15% 10% PMHP Area 6 HMO Area 6 MP Area 7 MP Area 4 5% 0% 95-96 96-97 97-98 98-99 99-00 00-01 01-02 02-03

Fiscal Year

People with Schizophrenia enrolled in HMOs, which are at risk for pharmaceutical expenses, are less likely to receive atypical antipsychotic medications

Atypical Penetration Areas 4 & 6 Adult Schizophrenia Diagnosis Only 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 9596 9697 9798 9899 9900 '0001 '0102 '0203 HMO PMHP MP 4

Enrollees are Receiving Fewer Services or Less Intensive Services in the Managed Care Conditions HMO Enrollees Receive Fewer Services than Persons in the PMHP

PMPM Standard Costs by Category: Areas 1, 2 & 4 (Case Mix Adjusted) Expenditure Category

Carve Out Mental Health Mental Health Services in the Health Sector Substance Abuse Services Paid by MCO

Total Non-Pharmacy MH/SA Expenditures in Plan

Pharmacy

HMO 1

$16.64

.86

1.08

$18.57

13.47

2.69

PMHP 1

$23.86

4.71

.00

$23.87

(rows 1+3)

21.01

5.46

MP 4

$29.36

4.02

$33.38

23.94

5.72

Fee for Service MH Services Outside of Carve Out Fee for Service SA

Total Mental Health

.14

$34.87

1.51

$56.56

1.67

$64.70

MP 2

$30.71

3.22

$33.93

20.09

5.31

1.16

$60.49

PMPM Standard Costs by Category: Areas 6, 4 and 7 (Case Mix Adjusted) Expenditure Category

Carve Out Mental Health Mental Health Services in the Health Sector Substance Abuse Services Paid by MCO

Total Non-Pharmacy MH/SA Expenditures in Plan

Pharmacy Fee for Service MH Services Outside of Carve Out Fee for Service SA

Total Mental Health HMO 6

$6.94

1.12

0.94

$9.00

7.71

3.29

.15

$20.15

PMHP 6

$11.85

5.60

0.01

$11.86

(rows 1+3)

22.83

4.71

1.70

$46.70

MP 4

$28.72

5.89

$34.61

25.53

7.22

1.75

$69.11

MP 7

$31.46

9.05

$40.51

28.83

6.64

1.43

$77.41

Reduced Intensity of Services has Generally Not Been Associated with Poorer Outcomes for Managed Care Enrollees Youth in Area 1 Require Further Study to Explain Poor Outcomes

Change in Predicted GAF Score Over Time For Ages 21-64 in Areas 1, 2, and 4 (n=5,278)

Financing Conditions differ p <.001

Time p < .001; Interaction - NS

55 53 51 49 47 45 PMHP Area 1 HMO Area 1 MP Area 2 MP Area 4 0 3

Time in Months

6

Based on Our Social Cost Analysis, Reduced Intensity of Services for Medicaid Funded Services May be Offset by Higher Expenditures by Other Payers

Case-Mix Adjusted Annualized Costs for Adults with Severe Mental Illnesses

p for

Two Way Comparison* HMO PMHP FFS Total (n=250) (n=208) (n=171) (N=629) HMO vs. PMHP PMHP vs. FFS HMO vs. FFS

$ 5,681 $ 9,844 $ 8,414 $ 7,725 .01

.30

.02

Medicaid costs* Other public costs** Private costs*** Societal costs

$ 8,162 $ 5,587 $19,199 $ 7,457 $ 5,744 $22,062 $ 6,464 $ 1,060 $15,967 $ 7,588 $ 4,258 $19,399 .12

.86

.15

.04

.00

.00

.00

.00

.00

* Medicaid costs include health care and transportation.

** Other public costs include off budget health care cost, housing subsidies, legal service, and volunteer cost.

***Private costs include informal service provided by families/friends, earned income, and out of pocket fee if earned income equal to zero.

Service and Organizational Recommendations

Service Recommendations

• Set Access Targets for Carve-Out Services at Pre-Implementation Levels at a Minimum in All Areas • Assure that the Service Network is Adequate to Provide Services to Persons with More Severe Illnesses

Service Recommendations

• Assure Provision of Evidence Based Care for both Treatment and Rehabilitation – Fidelity Measurement – Benchmarked Outcome Data • Explore Methods to Appropriately Expand Consumer Knowledge about and Direction of Care – Particularly for Persons with More Chronic Care Needs

Organizational Recommendations

• Implement Strategies to Independently Assure Adequacy of Data for System Monitoring – Anticipate the Loss of Outcome Data for Networks Like those Used in Area 1 HMO – Investigate Methods for Independently Collecting Encounter Data Including Sources of Care from Other Public and Private Payers

Organizational Recommendations

• Assure Readiness to Provide Comprehensive Mental Health Benefits – Demonstrated Capacity in MIS – Demonstrated Management Capacity for Authorization and Payment – Adequate Transition Strategies and Ramp-up Time

Organizational Recommendations

• AHCA Should Develop, Test and Implement a Method to Assure Compliance with the 80% Rule – Incomplete Encounter Data Frustrates Adequate Monitoring • Consider Expanding Range of Carve-Out Services to Limit Cost Shifting within Medicaid Budgets – Carefully Monitor Access to Specialized Services for Managed Care Enrollees – Exclude Pharmacy Benefit and Explore other Methods to Control Pharmacy Costs – Include Substance Abuse Services with Adequate Capitation Rate

Organizational Recommendations

• Coordinate Efforts with DCF and Other Relevant Providers (Child Welfare, JJ, etc.) to – Reduce Cost Shifting Among Public Payers – Assure Most Effective and Efficient Delivery Strategies

Framing Evaluation Questions

 What are the implementation issues related to systems redesign and expansion  What is the impact of managed care on Medicaid enrollees ’   Access to care Health and mental health status  Costs of care

Table 9. Annualized Formal Costs for Health Services On and Off Budget (Adjusted)

PH - On Off HMO (n=250)

$2,229 $ 33

PMHP (n=208)

$5,018 $ 57

FFS (n=171)

$2,021 $ 14

Total (N=629)

$2,886* $ 37*

MH - On Off Rx - On

$2,387 $ 166 $1,003 $2,117 $ 255 $2,536 $3,563 $ 367 $2,469 $2,815 $ 294 $1,885**

Off

$ 314 $ 88 $ 107 $ 195**

Total - On Off Grand Total

$5,640 $ 513 $6,153 $9,747 $ 398 $10,146 $8,319 $ 487 $8,806 $7,641* $ 526 $8,167*

Health services include general medical, vision and dental care excluding transportation.

* Significant at the 5 percent level. ** Significant at the 1 percent level.

Managed Care Arrangements, Particularly in the HMO Condition, have been Accompanied by Consistent and Significant Problems with Encounter Data - Frustrating Accountability

If Managed Care is to Accomplish its Goal of Giving More to the State through Greater Efficiency and Effectiveness of Management, We Must Get More from Managed Care

Service and Organizational Recommendations

Service Recommendations

• Set Access Targets for Carve-Out Services at Pre Implementation Levels at a Minimum in All Areas • Assure that the Service Network is Adequate to Provide Services to Persons with More Severe Illnesses

Service Recommendations

• Assure Provision of Evidence Based Care for both Treatment and Rehabilitation – Fidelity Measurement – Benchmarked Outcome Data • Explore Methods to Appropriately Expand Consumer Knowledge about and Direction of Care – Particularly for Persons with More Chronic Care Needs

Organizational Recommendations

• Implement Strategies to Independently Assure Adequacy of Data for System Monitoring – Anticipate the Loss of Outcome Data for Networks Like those Used in Area 1 HMO – Investigate Methods for Independently Collecting Encounter Data Including Sources of Care from Other Public and Private Payers

Organizational Recommendations

• Assure Readiness to Provide Comprehensive Mental Health Benefits – Demonstrated Capacity in MIS – Demonstrated Management Capacity for Authorization and Payment – Adequate Transition Strategies and Ramp-up Time

Organizational Recommendations

• AHCA Should Develop, Test and Implement a Method to Assure Compliance with the 80% Rule – Incomplete Encounter Data Frustrates Adequate Monitoring • Consider Expanding Range of Carve-Out Services to Limit Cost Shifting within Medicaid Budgets – Carefully Monitor Access to Specialized Services for Managed Care Enrollees – Exclude Pharmacy Benefit and Explore other Methods to Control Pharmacy Costs – Include Substance Abuse Services with Adequate Capitation Rate

Organizational Recommendations

• Coordinate Efforts with DCF and Other Relevant Providers (Child Welfare, JJ, etc.) to – Reduce Cost Shifting Among Public Payers – Assure Most Effective and Efficient Delivery Strategies