Care Management and Cost Control | Managed Behavioral Health

Care Access

MBHOs traditionally require preauthorization to access treatment. MBHOs generally operate their own customer service centers, and when a member calls for a referral, an intake specialist asks the member a series of questions to establish the reason for the call, assess risk, acuity, specialty needs and member preference. After listening to the caller's concerns and explaining the nature of the caller's benefits, the intake specialist separates routine from urgent and emergency situations. More than 80 percent of incoming calls are generally for routine referrals; industry standards dictate that members receiving routine referrals must be seen by a provider within 10 business days. If a member's needs are urgent, an appointment is arranged within 48 hours, although the more stringent standard of 24 hours is adopted for some contracts. If an individual requires immediate, emergency services (e.g., he or she is suicidal or homicidal), referral is generally made to a hospital or inpatient facility if an immediate appointment is not available with a network practitioner. Most MBHOs employ a dedicated team of licensed crisis care managers, who are specially trained in emergency protocol, active listening, diffusing, and referral. Use of ambulance services and/or police may also be involved in diffusing hostile situations and transferring an individual to psychiatric facilities.

Predictive Modeling and Risk Assessment

High-service utilizers—generally individuals with severe and persistent mental illnesses such as schizophrenia and major recurrent depression—represent a small percentage of overall service users but account for a disproportionate, higher percentage of treatment resources and claims costs. MBHOs analyze claims and treatment data to identify high-risk members who have a history of high utilization and repeated hospitalizations.

Predictive modeling is the ability to forecast who those high-risk, potentially high-cost members are, and intervene in time to avoid preventable treatment costs. The degree of risk can be identified and members stratified accordingly, so care management resources can be applied most effectively and efficiently. MBHO care management resources tend to be in short supply, so it pays to use those limited resources to deliver the best clinical and economic value to both the member and the payer.

Performance Measurement

MBHOs typically measure provider network performance through a number of variables that include accessibility, utilization, and adequacy and appropriateness of treatment. Traditionally these performance data are collected after-the-fact through provider assessment reports and claims data. Today, however, some MBHOs are collecting member-reported and provider-reported data earlier on in the process to guide timely treatment interventions that can avert unnecessary emergency hospitalizations and contribute to more effective treatment outcomes. Profiling provider performance on clinical outcomes is an important step forward in the performance measurement arena.

Case Management

Case management is a term that refers to oversight of an MBHO member's treatment to ensure it is appropriate. Case managers employed by the MBHO coordinate the member's care in collaboration with treating providers, facilities and community resources, and often work with members and their families to ensure they continue to receive the appropriate level of care for their fluctuating needs. This ensures a cost-effective course of treatment in an appropriate setting. Potentially high service utilizers are identified so case managers can focus on those individuals with the greatest needs to ensure they continually receive appropriate treatment levels. Most MBHOs use an escalating series of models or protocols based on the patient's level of acuity and chronicity, which determine how frequently case managers monitor treatment. Case management goals are crisis stabilization, prevention of long-term disability, and reduced reliance on hospital care by facilitating patient engagement in outpatient treatment and community resources.

Utilization Review and Management

Utilization review is an activity that determines the medical necessity and appropriateness of treatment being provided, and is performed at various times including at the point of care (prospective review), during care (con-current review) and after treatment (retrospective review). While MBHOs generally perform this function, self-funded employers and health plans may purchase this service from stand-alone utilization review organizations. MBHOs utilize written criteria based on clinical evidence to guide the evaluation of the medical necessity, appropriateness, and efficiency of mental health and chemical dependency services.

Outcomes Management

In recent years, MBHOs have developed tools to assess treatment effectiveness and quantify outcomes, bringing technology, data, and increased objectivity to a field once dominated by subjective assessment. The measurement of outcomes concurrent with the treatment process is the most powerful approach to outcomes management because feedback to clinicians can shape care as it is being delivered. The objectives of outcomes management are to identify risks early so treatment interventions contribute to more positive outcomes, as well as prevent emergencies and unnecessary hospitalizations.

Coordination of Care

Behavioral disorders often coexist with each other (e.g., depression and substance abuse), and with medical disorders (e.g., depression and chronic heart disease). An individual may be seeing his or her primary care doctor for treatment of a physical disorder and a behavioral specialist for treatment of a mental disorder. Coordination of medical and behavioral health care services results in improved treatment outcomes for patients. When coordination of care does not take place, there are increased risks such as repeated or unnecessary testing and adverse drug reactions. A consumer in today's complex health care environment is faced with a mind-boggling array of organizations, programs, services, and providers, each of which can play a vital role in his or her care and successful recovery. Patients benefit from an interconnected series of care coordination protocols between behavioral health specialists, primary care/medical doctors, medical plans, MBHOs, pharmacy benefit managers and community affiliates.

Health care accrediting and regulatory bodies are pressing the managed care industry to integrate behavioral care into medical delivery systems. Even though progress has been made, much work is needed to create a truly integrated health care system.

Depression Disease Management Programs

Depression is a mental illness that often goes unnoticed, and it co-occurs with many physical illnesses such as diabetes and heart disease. It is increasingly a focus of disease management initiatives because of its chronic nature and large economic impact. MBHO depression disease management programs support the clinician–patient relationship and plan of care, and emphasize prevention of disease-related exacerbations and complications using evidence-based guidelines and patient empowerment tools. These programs require coordination among health plans, physicians, pharmacists, and patients. Disease management can improve patient outcomes and quality of life while potentially reducing overall health care costs.

Substance Abuse Relapse Programs

Addiction to alcohol and other drugs is a chronic condition, characterized by relapses. Therefore, the prevention of relapse is one of the critical elements in successful treatment. Standard chemical dependency treatment was once a 28-day inpatient treatment program. Since detoxification on an outpatient basis is more often recommended today than in the 1980s, only persons with severe withdrawal and other medical complications now require hospitalization (IOM, 1990a). Most substance abuse treatment experts today consider intensive outpatient treatment more effective for most patients in treating chemical dependency. Outpatient programs encourage individuals to remain sober while confronting their day-to-day living situations. In addition, most MBHOs today offer after-care programs to their members who complete a course of chemical dependency treatment. The programs are aimed at preventing relapse and often include telephonic support and self-help tools.

CONTROL

Control over the implementation of pay policies generally and payroll costs in particular will be easier if it is based on:

• a clearly defined and understood pay structure;
• clearly defined pay review guidelines and budgets;
• well-defined procedures for grading jobs and fixing rates of pay;
• clear statements of the degree of authority managers have at each level to decide on rates of pay and increases;
• a personnel (HR) function which is capable of monitoring the implementation of pay policies and providing the information and guidance managers require and has the authority and resources (including computer software) to do so;
• a systematic process for monitoring the implementation of pay policies and costs against budgets.

These aspects of control have been covered elsewhere in this book, but there are three further features of a control system which need to be considered; namely, the control of grade drift, the problem of devolving authority to managers to develop 'ownership' of the reward management processes in their departments while still retaining control, and the provision of control information.

Control of Grade Drift

Grade drift - the tendency for people to be upgraded without a justifiable increase in their job size - can be controlled by the following methods:

• using a strong evaluation panel trained in the job measurement methodology on a formal basis and advised as necessary by an independent expert;
• insisting on rigorous comparisons with well-established benchmark jobs - the re-evaluation of such jobs should be a major exercise;
• ensuring that panels ask pertinent questions on any claims that an increase in responsibility justifies regrading - among these questions it is useful to ask, not only what the increased responsibilities are, but also how they have arisen and what effect this will have on another job if it has lost those responsibilities;
• requiring a sponsoring manager to provide supporting justification;
• resisting demands from managers for jobs to be regraded simply because of market rate pressures, difficulties in recruitment or threats to leave to get more money. If these concerns are genuine there are better ways of dealing with them than upgrading by, for example, reconsidering market stance policies, market rate premiums or creating special market groups. What must not be allowed to happen is upgrading someone simply in response to threats.
  
  

Developing Ownership Without Losing Control

We have frequently referred to the concept that line managers should take ownership of reward practice. This is an aspect of empowerment - devolving down the line the responsibility for making decisions on key management issues - and pay is definitely one of these issues.

Devolution does not mean abdication, and the following steps are required to ensure that freedom is exercised within the framework of generally understood guidelines on corporate pay policies and how they should be implemented:

• Discuss and agree with managers, team leaders and staff the key reward processes which will maintain standards throughout the organization - these will include processes for job evaluation, tracking market rates, performance management, performance rating and paying for performance, skill or competence.
• Ensure that all concerned thoroughly understand and appreciate the new freedoms and their associated responsibilities.
• Train managers and team leaders so that they have the level of knowledge required to make informed, business-led decisions about reward - the aim is to ensure that they are 'pay literate'.
• Develop computerized personnel information systems that reduce all the bureaucratic reporting which has been necessary in the past. As Clive Wright, then Manager, Corporate Remuneration, ICL, said at the Compensation Forum in January 1993:

  Recording and reviewing the key business numbers at the centre, without involvement of the line operations, is essential, if you want to convince people that empowerment and reduced bureaucracy is actually happening. As long as we keep asking people to send in reports, fill out forms, and sign off changes at detailed levels, no one will believe anything has really changed.

• Ensure that the central remuneration specialists change from a controlling to a guidance and support role.
• Spell out to all concerned that in providing this guidance and support the HR function has a duty to audit reward management processes departmentally to ensure that they are being used in the most effective way. It must be emphasized that the organization has every right to see that proper procedures are being followed and that, where appropriate, consistent policies are being applied.
• Ensure that managers understand and accept the principle that while they may have a fair degree of independence they are still interdependent with other operating units. They must therefore consider the implications of what they are doing on other parts of the business.
• Achieve, as far as possible, a reasonable balance between empowerment and control. The aim must be to give managers the maximum space and freedom to act. But it is still necessary to ensure that their actions do not contravene fundamental reward management policies and guidelines, or prejudice the overall impact of reward processes as a means of helping the organization as a whole to move forward in accordance with its strategic plans.
  
  

Pay Review Documentation

The pay review documentation for line managers is best dealt with by a spreadsheet. The information should consist of:

• name, job title and present salary of job holder;
• details of last pay increase - amount, date and reason;
• performance rating;
• proposed increase - amount and percentage.

The individual details on this spreadsheet should be totalled so that the percentage increase to payroll overall can be calculated and compared with the budgeted figure.

Claims Review, Preventive Care, Encouragement of External Cost-Control Systems

Claims Review
There is no doubt that claims review can generate substantial cost savings. In general, this review is done not by the employer but by the provider of medical expense benefits, a third-party administrator, or some independent outside organization. At a minimum, claims should be reviewed for patient eligibility, eligibility of the services provided, duplicate policies, and charges that are in excess of the usual, customary, and reasonable amounts. Many medical expense plans routinely audit hospital bills, particularly those that exceed some stipulated amount, such as $5,000 or $10,000. They check for errors in such items as length of stay, services performed, and billed charges. Many insurance companies have found that each dollar spent on this type of review results in two or three dollars of savings.

A newer trend in claims review is utilization review or case management, which may be done on a prospective basis, a concurrent basis, a retrospective basis, or a combination of the three. A prospective review involves analyzing a case to see what type of treatment is necessary. Hospital preadmission authorization, second surgical opinions, and predetermination of dental benefits fall into this category. However, when a patient is hospitalized, concurrent review can lead to shorter stays and the use of less expensive facilities. Concurrent review is normally carried out by a registered nurse and typically begins with precertification of a hospital stay for an initial specified length of time. The nurse then works with the patient's physician to monitor the length of stay and to determine whether other alternatives to hospitalization—such as hospice or home health care—can be used. Many providers of medical expense benefits pay for these alternative forms of treatment even if they are not specifically covered under the medical expense plan, as long as their cost is lower than the cost of continued hospitalization.

A retrospective review involves an analysis of care after the fact to determine if it was appropriate. Such a review may lead to a denial of claims, but its purpose is often to monitor trends so that future actions can be taken in high-cost areas. For example, a retrospective review may lead to the establishment of a concurrent review program for a hospital with excessive lengths of stay.

Health and Preventive Care
There is little doubt that persons who lead healthy lifestyles tend to have fewer medical bills, particularly at younger ages. It is also evident that healthier employees save an employer money by taking fewer sick days and having fewer disability claims. For these reasons, employers are increasingly establishing wellness programs and employee-assistance plans. With increasing health awareness among the general population, the existence of these programs has a positive side effect—the improvement of employee morale.

Encouragement of External Cost-Control Systems
While a certain degree of cost containment is within the control of employers, the proper control of costs is an ongoing process that requires participation by consumers (both employers and individuals), government, and the providers of health care services. Many agencies and committees of the Department of Health and Human Services carry out these activities at the federal level. This government department has the primary responsibility for identifying health care needs, monitoring resources, establishing priorities, recommending courses of action, and overseeing laws that pertain to health care.

At the state and local level, many employers are active in coalitions whose purpose is to control costs and improve the quality of health care. These groups—which may also involve unions, providers of health care, insurance companies, and regulators—are often the catalyst for legislation, such as laws authorizing PPOs and establishing hospital budget-review programs. Some coalitions act as purchasing groups to negotiate lower-cost coverage for members. For example, one midwestern coalition consists of several large corporations and offers a uniform health plan to the 50,000 employees of its members. The plan is self-funded by the coalition and utilizes the services of about 1,000 primary care physicians and 4,000 specialists. Another coalition, an example of a different approach, represents over 10,000 companies with fewer than 150 employees each. The coalition negotiates with providers of medical expense coverage and offers its members a choice of about a dozen different group plans. The annual increase in cost to coalition members has been significantly less than the annual increase in cost for other companies in the area that do not belong to the coalition.