Managed Behavioral Health Care Carve-Outs: Past Performance and Future Prospects

Abstract

As the managed behavioral health care market has matured, behavioral health carve-outs have solved many problems facing the delivery of behavioral health services; at the same time, they have exacerbated existing difficulties or created new problems. Carve-outs developed to address rising inpatient behavioral health costs and limited insurance coverage. They are based on the economic principles of economies of specialization, economies of scale, price negotiation, and selection. Literature shows that carve-outs have been successful in lowering costs and maintaining or improving access, but results on their impact on quality of care are mixed.

Cost-Sharing: A Blunt Instrument

“…Stein and colleagues (55) examined cost-sharing within a managed behavioral care plan, a very common arrangement in which behavioral health is "carved out" by the main insurer and covered by a plan that specifically handles behavioral health (17). They found that among those discharged from inpatient detoxification, having a copayment reduced the likelihood of patients seeking recommended outpatient follow-up treatment and, furthermore, that the higher the copayment, the lower the likelihood.…”

Directions for Future Patient-Centered and Comparative Effectiveness Research for People With Serious Mental Illness

“…229 Carve-outs are based on the economic principles of economies of specialization and economics of scale, price negotiation, and selection. 230 While carve-outs can create economics of scale for specialized services, separating mental health from other health services with respect to payment and management also fragments care delivery, and it creates incentives that further dissociate primary care providers from clients needing mental health services.…”

“…Costs and Utilization Behavioral health carve-outs have been widely reported to result in cost reductions in both private-sector MBHCOs 205,230,231,[239][240][241][242][243][244] and state Medicaid programs. 232,[245][246][247][248] Grieve et al 246 further concluded that in Colorado, the capitated model with a forprofit component (the "joint venture" model) was more cost-effective than the not-for-profit capitated or fee-for service models.…”

“…Results remain unclear, 254 are missing from analyses altogether, 247,248 or are mixed. 230,249,251,255 Cohen and Bloom 256 reported that continuity of care, an important aspect of care from the service user's perspective, was greater in capitated models than in a traditional fee-forservice model. Similarly, Cuffel et al 232 found no significant differences in outcomes among different models of capitation but did find a difference between capitation and fee-for-service models.…”

Patterns of Service Use in Two Types of Managed Behavioral Health Care Plans

“…Studies have analyzed utilization patterns within MBHO-covered populations, but few have examined single-source EAP/MBHC plans. [6][7][8] One study by Cuffel and colleagues found a higher marginal increase in access per additional dollar spent on behavioral health benefits in single-source EAP/MBHC plans compared to plans with non-integrated EAP benefits; however, the main focus was the relationship between spending and access. [9] We are not aware of studies describing utilization patterns for specific services under the two types of plans.…”