Funding approaches for mental health services: is there still a role for clustering?

Abstract

Funding for mental health services in England faces many challenges including operating under financial constraints where it is not easy to demonstrate the link between activity and funding. Mental health services need to operate alongside and collaborate with acute hospital services where there is a well-established system for paying for activity. The funding landscape is shifting at a rapid pace and we outline the distinctions between the three main options – block contracts, episodic payment and capitation. Classification of treatment episodes via clustering presents an opportunity to demonstrate activity and reward it within these payment approaches. We have been engaged in research to assess how well the clustering system is performing against a number of fundamental criteria. Clusters need to be reliably recorded, to correspond to health needs, and to treatments that require roughly similar resources. We find that according to these criteria, clusters are falling short of providing a sound basis for measuring and financing services. Yet, we argue, it is the best available option and is essential for a more transparent funding approach for mental health to demonstrate its claim on resources, and that, as such, clusters should be a starting point for evolving a better funding system.

Evaluation of Flexible and Integrative Psychiatric Treatment Models in Germany—A Mixed-Method Patient and Staff-Oriented Exploratory Study

“…In addition, legislation aimed at a more rational use of resources, based upon the assumption that the fragmented nature of the German mental health care system also leads to wastage. Many of these legislations allowed for the use of either capitation-based funding approaches or block contracts that both aim at incentivizing cooperation across various sectors and institutions (10). This resulted into various forms of flexible and integrative treatment (FIT) models, many of which being hospital-based, such as the well-known regional budget (11–14) or specific home treatment programs (15–17).…”

Effectiveness of Global Treatment Budgets for Patients With Mental Disorders—Claims Data Based Meta-Analysis of 13 Controlled Studies From Germany

“…to jointly establish contracts that represent a hybrid installment of both capitation budget (19)(20)(21)(22) and block contract (23)(24)(25). According to these contracts, each hospital has an overall fixed annual budget for all patients including inpatient care, day care, and outpatient care.…”

Implementation of a Global Treatment Budget in Psychiatric Departments in Germany—Results and Critical Factors for Success From the Staff Perspective

“…The lump sum is set irrespective of the number of patients treated or the amount of therapeutic engagement that is undertaken. Capitation payment involves payment of an annual lump sum for a given number of patients in the target population, irrespective of how many services the patients may receive ( 16 – 19 ). While capitation payment entails uniform remuneration per treated patient (bottom-up computation), GTB is based upon case numbers of the years prior to the contract (top-down computation).…”