Single-Payer and the Crisis in Mental Health Care

1. Single-Payer and the Crisis in Mental Health Care Stephen Kemble, MD for PNHP Annual Meeting New Orleans, November 15, 2014

2. Disclosure • No financial conflicts of interest to disclose. • I receive no money whatsoever for any of my involvement in health care reform and health policy activities.

3. Three Systems for Mental Health Care • 1970’s: Cambridge Hospital • Community psychiatry for Medicaid • 1980’s: Hawaii’s FFS Medicaid • Weak public system (clinics, state hospital) • Widespread private sector participation • Hawaii’s Medicaid Managed Care • 1990’s: Local not-for-profit Medicaid managed care for GA and AFDC • 2009: For-profit Medicaid Managed care for ABD Medicaid

4. Community Psychiatry at Cambridge Hospital • Dept. of Psychiatry -contracted for all Medicaid mental health for Cambridge and Somerville • NO competing managed care plans • Comprehensive services and programs • Reach out to meet needs of pts and community • Interdisciplinary team care, good coordination • High morale, low administrative cost, good care • No central management of care by insurance plans or government • BUT, two-tier system

5. Hawaii FFS Medicaid (prior to 1994) • Weak Public MH System • Dept. of Health clinics run by AMHD/CAMHD • State Hospital – attempted closure, became forensic only • Ranked 51st in US, Felix Consent Decree • Widespread participation by private sector psychiatrists • Most built practices with Medicaid • Psychiatric units in general hospitals • Specialized SMI and substance abuse programs • Generally good access in private sector • Generally adequate supply of psychiatrists • Relative shortages on neighbor islands • BUT, 1st for-profit psych hospital in late 1980’s

6. Hawaii’s Medicaid Managed Care Experience • Converted FFS Medicaid to MCOs - 1994, 2009 • Increased administrative hassles (and cost) • Declining MD participation • Worsening access problems • Accelerated cost increase – 2.7% > US average • Worst for mental illness – 4 yr after Medicaid managed care, > half of psychiatrists dropped out, MH ER and hospital costs increased 30%!! Kaiser State Health Facts FY ‘90-’10, Hawaii Health Information Corp 06-26-13

7. MH Managed Care Outcomes • Managed care worst for psychiatry • 100% Prior Authorizations • Restricted formularies, extensive PA’s • Cutting off GA benefits for missed appointments • Disrupting long-term doctor-patient relationships • Psychiatrists restricted to med management only • Demoralized work force • Declining interest in psychiatry as a specialty • Rapid move to self-pay only, concierge practices • Drastic reduction in access to care • SMI patients • Medicaid patients generally

8. Motivating Doctors to Improve Care • Intrinsic motivation: • Helping people • Intellectual challenge, expanding knowledge • Professional ethics • Extrinsic Motivation: • Financial incentives and penalties – “carrots and sticks” • Central management by MBAs • Manage what you measure – • Metrics • Quality scores • Pay-for-performance

9. Daniel Pink – Drive: The surprising Truth About What Motivates Us CARROTS AND STICKS: The Seven Deadly Flaws 1. They can extinguish intrinsic motivation. 2. They can diminish performance. 3. They can crush creativity. 4. They can crowd out good behavior. 5. They can encourage cheating, shortcuts, and unethical behavior. 6. They can become addictive. 7. They can foster short-term thinking.

10. Daniel Pink – Drive: Fostering Motivation: 1. Autonomy (practice within scope) 2. Excellence (continuous improvement) 3. Pursuit of a goal larger than oneself. Pink, Thomas H. Drive: The surprising Truth About What Motivates Us. Riverhead Books, 2014

11. Don Berwick – The Toxicity of Pay-for-Performance “Despite their superficial logic, systems of merit pay or pay for performance have features that are toxic to systemic improvement. Contingent rewards doled out by supervisors cause decreased focus on customer needs, loss of accurate information about defects and improvement opportunities, avoidance of stretch goals, and decreased innovation. They may also erode teamwork. Pay for performance may mark a naive understanding of the complexity of human motivation.” • Berwick DM. The Toxicity of Pay-for-Performance. Quality Management in Health Care, 1995, 4(1), 27-33.

12. Single-Payer Cost Control • Assure access to cost-effective care for all • Simplify, streamline administration • Use administrative savings to reduce prices • Hospitals - global budgeting • Doctors – negotiated fees, simplified admin, support for quality improvement • Drugs and medical equipment -negotiated prices, bulk purchasing

13. Mental Health Care under Single-Payer Physician Pay: • Same for all patients • regardless of socio-economic status or source of funding • Make payment system administratively simple • No administrative barrier to practice in rural or under-served areas • Incentive-neutral pay • Salary, or fee-for-time • adjusted for training and practice costs • Not tied to complex coding, E&M, RBRVS • Higher pay for child psychiatry services • More training • More time to deal with family, schools, etc.

14. Mental Health Care under Single-Payer Physician-Driven Management of Care • No corporate Managed Care organizations • Expanded formulary, minimize PA’s • Use bulk purchasing, not formulary restrictions, to control drug prices • Quality Improvement • Local projects, developed and controlled by physicians and other health professionals involved in care delivery • Rely on intrinsic motivation • No pay-for-performance incentives

15. Mental Health Care under Single-Payer Specialized Services for SMI and Substance Abuse: • Set up as “public utilities” • Available to entire community based on patient need • Publicly funded, global budgets • Interdisciplinary, team-based care

16. Mental Health Care under Single-Payer Specialized SMI/SA Services: • Crisis intervention, hotlines, crisis shelters • Residential & day programs, including for dual diagnosis • Psychosocial rehab • Substance Abuse - residential, intensive out-patient • Community consultation • Community outreach & home visit capabilities • Coordinated with primary psychiatrist, psychologist, or PCP

17. Mental Health Care under Single-Payer Training: • Focused on treatment of SMI population • Interdisciplinary care • Strong substance abuse component • Ensure newly trained psychiatrists are comfortable with patient populations with greatest need • Psychiatrists more likely to continue with these populations when in practice • Integrative care – psychiatrists collaborating with primary care for management of psychiatric patients

18. Fighting Medicaid Managed Care in Hawaii • Op-Eds in Honolulu Papers • “For Health Care, Single-Payer System is Best” - Jan 23, 2009 • “Competition in Health Care Problematic” – Nov 15, 2009 • “Consolidating all Medicaid programs would save money and expand access” – July 27, 2011 • “State should end Medicaid managed-care model” – April 21, 2013 • “More health care regulations mean more middlemen, fewer doctors” – Nov 27, 2013 • “Medicaid Red Tape Crippling Good Health Care” - April 6, 2014 • “Healthcare Pay-For-Performance Folly” July 7, 2014 • “Let’s Reduce Administrative Burdens in Health Care” -Nov 2014 • Testimony on Medicaid Section 1115 Waivers • Hawaii Health Authority

19. Everybody In, Nobody Out If - • Everyone had the same comprehensive coverage • It were administratively simple to practice any specialty in any location • MD pay were equitable, based on training + practice cost • MD pay were not skewed toward procedures or by pay-for-documentation and pay-for-performance incentives, Then - • Many more MD’s would choose primary care and psychiatry again • Patients would have access to care based on need • US health spending would be similar to other developed countries