2022 California Council of Community Behavioral Health Agencies (CBHA) Conference

The NYSPA Report – Medicaid Redesign and the Public Mental Health System in NYS

In my last piece for Mental Health News I presented an overview of the attack on Medicaid, including mental health services, taking place across the nation. I expressed my belief that given NYS’s expenditures on Medicaid, which are far higher than any other state, reductions were necessary, although not welcome, in the current dismal economic climate and that we are fortunate that the changes in NYS are being implemented in a thoughtful manner meant to preserve the gains made in the delivery system in recent years and, perhaps, even to improve that system of care.

The work of fostering the wide-ranging transformation of the mental health system and the Medicaid system more broadly in NYS has been developed under the aegis of the semitransparent/semi opaque MRT (Medicaid Redesign Team) process and its Behavioral MRT subcommittee working group. All of the changes in our system are playing out against the vast array of changes occurring nationally which include the implementation of ARRA, American Recovery & Reinvestment Act, and the PPACA, Patient Protection & Accountable Care Act.

How NYS’s system of public health care will look in the future hangs in the balance and will be based on how well these state and national changes are implemented and work together. Needless to say, we all hope for the best, as our ability to provide care for those we serve as well as our professional practices and the care we ourselves receive depend on it. (Yes, given the dependence of NYS’s hospitals on Medicaid reimbursement, the quality of care all New Yorkers receive in hospitals depends on the hospitals’ Medicaid revenue.) At the same time, it would not be inappropriate to remain skeptical that it will all come out right. Some steps taken give reason for hope while others do not.

The 2011 NYS budget affected wide ranging reductions to the Medicaid program. The resulting changes included but were not limited to: a 2% reimbursement cut for hospitals, including most mental health services both inpatient and outpatient; creation of thresholds for outpatient mental health and drug & alcohol visits which, when exceeded, result in automatic reimbursement reductions; reduction of reimbursement for Continuing Day Treatment Programs (CDT) to the extent that many were shuttered or changed to PROS (Personalized Recovery Oriented Services) programs; transition of the NYS Medicaid formulary to Medicaid HMO based formularies, a limited formulary for those enrollees remaining in the Medicaid Fee For Service (FFS) system and repealed the long standing statutory requirement that when a difference exist between a physician and a Medicaid formulary, the “physician prevails”; the process of moving all of those covered under the Medicaid FFS system in to a fully managed system; initiation of a process of creating Health Homes to provide varying intensities of case management to a “high user” population composed persons with SPMI and/ or chronic medical diseases.

What questions should NYSPA and other advocates be asking and, based on answers received, what policies and programs should be advocated for or against? Concern needs to be raised about the “Tower of Babel” towards which we have moved as a result of changes made to the Medicaid formulary. Rather than leveraging NYS’s immense purchasing power to realize savings, as NYSPA’s advocated in its 2005 position paper on the Preferred Drug List, NYS now requires of each Medicaid HMO the task of creating its own formulary. The result is a capricious process resulting in a multitude of differing formularies for psychoactive medications. Many of the HMO formularies do not conform to the NYS OMH PSYCKES Quality Initiative, the goal of which is to minimize exposure of those requiring atypical antipsychotics to risks such as Cardiometabolic Syndrome. The state’s own formulary is similarly flawed. Also, given the limitations on drugs, doses and numbers of pills dispensed, psychiatrists are forced to expend treatment time on these matters during patient visits. The new approach is especially problematic when patients are seen in the Emergency Department. NYSPA provided testimony on this matter to a Hearing held by Assemblyman Richard Gottfried, Chair of the Assembly Health Committee, who scheduled the hearings because of his own concern about these matters. The loss of “physician prevails” was ill advised, harmful for patients and deserves to be reversed.

Psychiatrists’ experience with managed care has been a particularly difficult. Thus, the news that all NYS Medicaid enrollees will be moved into managed care over the next several years was not good news! However, we are pleased that the transition is a phased one, providing an opportunity to create a more collaborative, less adversarial form of care management. By designating 5 regional carve out BHOs (Behavioral Health Organizations) which will gather data and engage in collaborative management for the next year or so, the state and the providers will gain information that should inform decisions when risk bearing entities are contracted with in 2013 or thereafter. Mental health advocates often have seen their interests decimated when they are drawn into full service medical managed care and often have been savaged by commercial carve out managed care, which are notorious for “just saying no” without helping to solve clinical problems. Hopefully, nonprofit carve out managed care will provide a more collaborative route, one which NYS will hopefully embrace going forward.

Health Homes, encouraged by the PPACA, will replace Targeted Case Management (TCM) over the next couple of years. They will seek to incorporate more than 700,000 persons enrolled in NYS’s Medicaid program who by virtue of their having SPMI and/ or multiple chronic medical diseases cost the system disproportionately large amounts of money. While NYS will be advantaged by the federal governments assuming 90% of the cost for the first 2 years, it remains unclear given the reimbursement scheme whether there will be adequate funding to realize the cost saving goals of the effort, especially given the limited funding for the high need SPMI cohort when contrasted with current funding of the TCM program, an approach tailored specifically for those with SPMI. Ultimately, how Health Homes and BHOs work together and align their goals or trip over each other remains an open question with serious potential consequences for patients and providers.

NYS OMH has sought to move the mental health system towards a person centered, recovery-oriented approach. The agency has also expressed its belief in a data driven system and one in which consumers should experience more choices of accessible services. Recent years have seen reimbursement for CDT programs so reduced as to force the closure of many across the state in favor of pushing for the opening of PROS (Personalized Recovery Oriented Services) programs. Many clinicians remain skeptical of this programmatic realignment, believing that for an important cohort of vulnerable persons with SPMI, CDT offered an important level of care, given its focus on stability and protection, which PROS does not offer given its emphasis on focused skills training and shorter stays. Those clinicians believe that one program should not have been endorsed at the expense of the other and that both might have continued to be viable, thus providing consumers with a broader array of therapeutic options. It also would have been appropriate to collect data on the impact of the shift, especially on metrics such as success with independent living and avoidable inpatient readmissions, which has correctly been identified as an important focus of BHOs. Unfortunately, data by which to evaluate PROS has not been sought. Furthermore, as the shift to full risk contracting for mental health services under Medicaid occurs, the future of PROS remains uncertain.

This piece can only begin to focus the readers’ attention on the tectonic areas of transformation which the health and mental health systems in NYS and the nation are undergoing. As it has in the past, NYSPA will continue to advocate to prevent or minimize harm to persons we serve and to our profession during this time of radical system change.

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