Managed care programs for both medical care and behavioral services are evolving into new models.
This evolution is being supported and even promoted by public sector payers, as managed care is increasingly embraced by states for Medicaid and other health and human services spending.
Furthering this movement are new organizations beyond the specialty proprietary organizations’ in the managed behavioral health market, such as provider-sponsored integrated delivery systems, HMO based mental health departments along with newly created government authorities.
Public purchasers will continue to blend a variety of health and social service funding streams to both improve consumer access and service coordination. One result of these new managed care applications and mounting reimbursement pressure is a greater proportion of individuals with chronic problems in service systems with risk based financing. We should be concerned since the use of risk based financing criteria has increased at all levels of this service delivery system.
Predictably, we are also beginning to see the decline of total behavioral health spending per individual, a development that will continue the downward pressure on reimbursement of services.
The need for more specific strategies by behavioral health organizations will intensify, as will the competition for specific market segments. This will ultimately dissolve the artificial distinctions among a wide variety of social service providers, many of them artifacts of previous legislation and funding streams. This could easily lead to reducing the distinctive market positions of some Behavioral Health organizations.
The far-reaching consequence of these trends will impact service providers previously unaffected by managed care.
Those human service organizations guided by haphazard strategic planning, market analysis, and limited service options are placing their very survival at risk. Those who endure, and are able to prosper during the next few years will be those organizations that best manage their unit and patient case load costs.
