Integrating Medical Care with Mental Health and Substance Use Disorder Services in L.A. County: A Status Report

October 31, 2012

An opportunity exists to integrate mental health and substance use disorder (SUD) services with medical care in a patient-centered manner under the Patient Protection and Affordable Care Act (ACA) and federal parity requirements. Survey results on health care preferences of low-income Californians suggest that the safety net should provide more patient-centered, responsive services to compete in an environment with significantly increased consumer choice post-reform.  Providing bidirectional integrated care, which means offering mental health/SUD services in primary care settings as well as primary care in mental health/SUD settings, will be required to meet the Triple Aim to improve the patient experience of care, improve population health, and reduce costs in order to optimize system performance.  Mental health and SUD services are fragmented and poorly coordinated with physical health services due to structural, financial, clinical, and operational barriers.  Although L.A. County faces challenges in achieving integration, it has the opportunity to lead and shape behavioral health policy in order to promote patient self-determination and dignity.  This report will review what integration means; provide information on revenue streams, the policy context, and key behavioral integration examples in L.A. County; and offer recommendations moving forward as full implementation of the ACA approaches.

Integrating services has various meanings given the differing orientations within the health, mental health, and SUD systems and other barriers that have resulted in siloed care. In moving towards a managed care environment in which decreasing costs while improving patient outcomes will be rewarded, the goal should be clinical integration.  While many people with mild to moderate mental health and SUD issues seek care in a primary care setting, individuals in behavioral health settings often experience medical and public health issues.  Addressing issues including but not limited to financing and reimbursement mechanisms, confidentiality of patient information, workforce issues, and practice settings, and using new technologies such as telehealth will be required.

California has a complicated patchwork of funding for health, mental health, and SUD services, spending $41.3 billion for Medi-Cal and indigent health care and an additional $5.5 billion on mental health and SUD treatment.  While 11% of total expenditures are allocated towards mental health, only 1% is spent on SUD treatment.  While California will benefit from significant federal dollars once ACA takes full effect, it will continue to struggle with persistent state deficits.  Counties have been facing budget deficits.  The Mental Health Services Act has been a crucial source of funding for public mental health services to create a state-of-the-art, culturally competent system that promotes recovery, wellness, and resiliency for unserved and underserved population.  Mental Health America of Los Angeles played an instrumental role in the Act’s development and passage.  While the Act’s revenue has supported integration of mental health and some SUD services into other care settings, a comparable SUD funding stream does not exist.

An overview of the dynamics currently influencing  the future role of counties in achieving behavioral health policy integration, including the interactions among these multiple forces, is provided. The state has been awaiting federal guidance on the Medicaid Benchmark Benefit and Medicaid Behavioral Parity before several key ACA implementation decisions are made; these regulations should be released by the end of the year.  Governor Brown announced to California’s leadership his intention to convene a special legislative session to address issues related the California Health Benefit Exchange and the Medicaid expansion once federal guidance is received.  While California has enacted laws that provide mental health parity, a similar requirement does not exist for SUD treatment.  The ACA presents an opportunity to upgrade the SUD benefit.  However, parity language is somewhat vague and allows considerable discretion to states.  Counties have additional revenue through the “Bridge to Reform” waiver and the 2011 realignment of financing and responsibility for behavioral health and community corrections from the state level.  It is possible that the Medi-Cal could have two tiers of benefits post-reform, one for the newly eligible and another for individuals eligible under traditional rules.  Counties will have to carefully calibrate the managing of funds for federal entitlements and construction of provider networks, while health plans will become the accountable entity for patients under ACA coverage expansions.

Background information on L.A. County’s major systems that provide physical health, mental health, and SUD services to low-income communities is provided, including the L.A. County Departments of Health, Mental Health, and Public Health; Medi-Cal managed care plans (L.A. Care Health Plan and Health Net); community health centers and clinics; inpatient and emergency services; and school health centers.  These public and private providers offer a patchwork of safety net services to different but overlapping populations.  While planned collaboration does exist, services are often provided in a fragmented and poorly coordinated manner, which will need to evolve to develop patient-centered, high quality care in an environment of increased consumer choice.  In addition, populations in L.A. County that encounter high rates of a combination of physical health, mental health, and SUD conditions are described, including the homeless, persons exiting the corrections system, and individuals with SUD disorders.  These individuals are expected to represent a significant portion of the Medicaid expansion due to the ACA’s new eligibility rules.  They will require a special focus to ensure enrollment into coverage and integrated care happens to manage their complex conditions while improving health outcomes and controlling costs

L.A. County has embarked on a number of efforts to integrate care.  Often, the focus has been on piloting approaches in certain areas and particular populations given the geographic variation throughout the county, high levels of unmet need, and pronounced differences in regional delivery systems, rather than on building an integrated system of care.  An overview of integrating care in order to improve outcomes and reduce costs in L.A. County is provided.  This includes efforts funded by the Mental Health Services Act, the Integrated Behavioral Health Project, the “Bridge to Reform” waiver’s Low Income Health Program and Delivery System Reform Incentive Pool project, integrated school health centers, emergency services, homeless initiatives, jail reentry, transitions into managed care including Seniors and Persons with Disabilities with Medi-Cal only coverage and persons dually eligible for Medicaid and Medicare, and federal initiatives.  While this review is not meant to be an exhaustive one, it is intended to bring to light major initiatives that involve cross-sector collaboration, promising results, and potential for replication.

At the crossroads of systems transformation as full ACA implementation approaches in 2014, L.A. County has the opportunity to begin the safety net transformation process towards patient-centered, bidirectional, integrated care.  L.A. County’s goal should be clinical integration that increases patient satisfaction and promotes consumer self-determination.  While significant progress made in the last few years under L.A. County’s dynamic leadership supported by financing streams such as the Mental Health Services Act and the “Bridge to Reform” waiver, additional planning and collaboration will be required to ensure that the L.A. County safety net system will be a provider of choice post-reform. Based on the review of the policy environment, L.A. County’s physical health, mental health, and SUD systems, and integration efforts taking place, the following recommendations are offered:

  • Patients should be involved in integrating and transforming safety net systems into high quality, responsive providers of choice in a post-reform world.
  • L.A. County should design a system of integrated care to serve patients regardless of the door through which they enter.
  • The expansion of managed care in public health coverage provides an opportunity to provide high quality, integrated care that improves patient outcomes and reduce costs.
  • Detection and early intervention of mental health and SUD issues should be incorporated into the primary care setting, which may be particularly important in providing care to underrepresented racial/ethnic groups.
  • Particular attention should be paid to integrating SUD services.
  • Training and practice should evolve towards integrated care.
  • Care coordination and management, information exchange mechanisms, and new technologies should be maximized to facilitate and promote the delivery of patient-centered care.
  • Financial and reimbursement incentives should be aligned to ensure the goal of achieving clinical integration.

Significant planning and collaboration efforts will be required to transform local safety net systems in order to become a provider of choice for patients post-reform. Integration may offer a chance to learn from the strengths that each of the three systems of physical health, mental health, and SUD treatment has to offer and move to a person-centered, recovery-oriented wellness model that promotes two-way communication to support the provider-patient relationship.

The full report is available for download below:

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