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Behavioral health care is in crisis – but payers have the opportunity to shape a better future

Payment reform can drive the development of a behavioral health system that is flexible and responsive, especially during times of higher demand.  I wanted to share a summary of what Dr. Kate Hobbs Knutson and I describe in our latest piece on Health Affairs blog.

The crisis in behavioral health can be described with three statistics:

  1. Rising suicide rates
  2. Increases in drug overdose deaths
  3. Substantially lower life expectancy among people with serious mental illness

One major problem is that access to behavioral health care is limited. There’s a shortage of behavioral health providers, and many behavioral health providers don’t join insurance networks due to low reimbursement. Lastly, while evidence-based behavioral health treatments exist, not enough providers deliver these interventions with fidelity. Less than 50 percent of Americans with behavioral health disorders access care. And when they do, the quality of the treatment may be questionable.

Our long-term strategy is focused on improving behavioral health access, quality and efficiency with a five-step approach:

1. Eliminating our carve-out

Many payers contract with managed behavioral health care organizations, effectively carving out management and reimbursement for behavioral health services so they are separate from physical health. This legacy structure is the opposite of offering whole-person health. The carve-out causes fragmented delivery and perverse incentives to reduce the use of mental health and substance use disorder services. To remove the carve-out, Blue Cross and Blue Shield of North Carolina (Blue Cross NC) simply added behavioral health to its existing functions. All behavioral health staff directly report through the same management structures as physical health. Case managers, nurses and physicians on our team now review physical and behavioral health cases together. By removing third-party vendors we streamlined the ability to implement changes for members and providers. For example, in response to COVID-19, we were able to change our policies to increase access to behavioral health care (including telehealth) in line with our COVID-19 strategy for physical health.

2. Integrating care

We aim for 90 percent of our network primary care practices to deliver integrated care by 2022. Integrated care is THE workforce multiplier for behavioral health. A broader population can access behavioral health care by how we proactively enable primary care providers (PCP) to delivery first-line treatment.

3. Increasing payment through value-based reimbursement

To drive efficiency and align with our overall transition to value, we are tying increased reimbursement for behavioral health providers to improved access, quality and totally health care costs. Performance is rewarded through two different value-based contracts:

  • Basic pay for performance: This model is upside only, limiting financial risk for smaller practices. Based on performance, behavioral health providers can earn an additional 10% of their annual reimbursement.
  • Advanced payment model where we share accountability with providers for behavioral health quality and total cost of care: This reimbursement model is designed for larger multidisciplinary practices that address a variety of behavioral health disorders.

4. Deploying point solutions at scale

Substance use disorders (SUD) are major drivers of poor health and high cost in Blue Cross NC membership. For our commercial members with SUDs, total health care costs are three to five times higher than the general population. High medical expenses suggested an inadequate supply of providers in more cost-effective outpatient and community-based settings. That’s why we helped launch Eleanor Health, a comprehensive provider of outpatient SUD treatment. This model involves in-person and virtual care and the delivery of medication and therapy to address opioid and other SUDs, as well as co-occurring mental health conditions such as depression and the effects of trauma. Eleanor Health aims to grow to 10 clinics in North Carolina by the end of the year.

5. Measuring impact

Blue Cross NC is measuring the impact of these interventions both in isolation and collectively across our membership, using a quasi-experimental approach. To start, we’re measuring changes in behavioral health service use. We’re expecting increases in outpatient services and reduction in avoidable use of emergency departments and inpatient units by 2021. Prior to COVID-19, based on national estimates, we anticipated a 152 percent return on behavioral health investments through medical expense savings.

We’re in our second year of this long-term strategy to drive improvements in behavioral health access, quality and efficiency. This is only the beginning.

authors photo
Rahul Rajkumar, MD
Rahul Rajkumar, MD

Rahul worked as senior vice president and chief medical officer at Blue Cross NC until 2020.

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