Behavioral Health Under Risk

This is the lesson the rest of the course is built around. When accountability for behavioral health spending has been created, what happened?

What the evidence found

A systematic review of alternative payment models for mental health and substance use disorders, covering 27 studies, found these models were associated with “reductions in MH/SUD utilization, and decreases in spending.”

Then the finding that matters: clinical outcomes were measured in only 5 of the 17 payment models evaluated, about 29 percent. Of the eight models assessed for gaming and adverse selection, one showed evidence of gaming and three showed evidence of adverse selection, meaning organizations avoiding expensive patients.

Stated plainly: under models that made someone accountable for behavioral health costs, utilization fell, spending fell, and in most cases nobody checked whether patients were better. Where investigators looked for organizations avoiding costly patients, they frequently found it.

The same pattern in the best commercial contract

The commercial course covered the Alternative Quality Contract as the strongest published evidence for population-based payment. On behavioral health specifically, an evaluation found enrollees in participating organizations were “slightly less likely to use mental health services,” a decline concentrated in the organizations that had accepted financial risk for behavioral health. The contract’s own participants said the arrangements “did not meaningfully affect mental health care delivery in the program’s initial years.”

So the model with the best overall results produced a decline in behavioral utilization, concentrated exactly where the financial incentive was strongest.

Why this is ambiguous rather than damning

A fall in mental health utilization inside a risk contract is not self-evidently bad. It may mean care was delivered more efficiently, with fewer low-value visits and better-targeted treatment. It may mean people did not get care they needed.

Those two possibilities look identical in a spending report. They are distinguishable only by measuring outcomes, which is what mostly was not done.

Worth remembering: in most of medicine, lower utilization with stable quality measures is a reasonable proxy for value. Behavioral health is where that heuristic is most likely to be confidently wrong, because undertreatment is the historical norm. A model that rewards reduced behavioral spending in a population where four in ten receive nothing may simply be paying for the status quo. This is the single most important idea in the course: the standard playbook is not merely less effective here, it can invert, rewarding exactly the outcome the field is trying to fix.

What follows for design

Three requirements follow directly from the evidence:

• Outcome measurement is not optional. An arrangement that puts an organization at risk for behavioral spending without measuring whether patients improved is a budget cap, not a value-based model.
• Adverse selection needs active surveillance. Evidence that organizations avoid expensive behavioral patients was found wherever people looked for it. Attribution and risk adjustment must be tested against that specific failure.
• Utilization floors deserve consideration. In a domain where the baseline is undertreatment, a declining utilization trend should trigger review rather than a celebration slide.

Key takeaways

• Alternative payment models for behavioral health reduced utilization and spending across 27 studies.
• Clinical outcomes were measured in only 5 of 17 models; adverse selection appeared in 3 of 8 assessed.
• The Alternative Quality Contract showed slightly lower mental health service use, concentrated in risk-bearing organizations.
• Efficiency and denied access are indistinguishable in a spending report, which makes outcome measurement mandatory here.

Sources

• Carlo et al., Association of Alternative Payment and Delivery Models With Outcomes for Mental Health and Substance Use Disorders: A Systematic Review, JAMA Network Open 2020 (opens in a new tab)
• Barry et al., The Early Impact of the Alternative Quality Contract on Mental Health Service Use and Spending in Massachusetts, Health Affairs 2015 (opens in a new tab)