Inpatient alcohol treatment in a private healthcare setting: which patients benefit and at what cost?

This study investigated whether selected patients have better outcomes with inpatient than outpatient treatment. There were 93 inpatients and 80 outpatients with alcohol dependence who were evaluated at treatment entry to a private healthcare setting. Patients with multiple drinking-related consequences were less likely to return to significant drinking in the first 3 months after treatment ended if they had attended inpatient compared to outpatient treatment. Thus, inpatient appeared to have some advantage over outpatient treatment in the early recovery period for patients with multiple drinking-related consequences. The gap between inpatient and outpatient costs was also reduced when computed as a cost-effectiveness ratio, although treatment costs continued to remain proportionally higher with inpatient than outpatient treatment.

The impact of closing a state psychiatric hospital on the county mental health system and its clients

OBJECTIVE

This three-year study examined the impact of closing a state psychiatric hospital in 1991 on service utilization patterns and related costs for clients with and without serious mental illness.

METHODS

The cohort consisted of all individuals discharged from state hospitals and those diverted from inpatient to community services and enrolled in the unified systems project, a state-county initiative to build up the service capacity of the community system. The size of the cohort grew from 1,533 enrollees to 2,240 over the three years. Information on the types, amounts, and cost of all services received by each enrollee was compiled from multiple administrative databases, beginning two years before enrollment and for up to three years after. The data were analyzed to reveal patterns of and changes in service utilization and related costs.

RESULTS

Replacement of most inpatient services with residential and ambulatory services resulted in significant cost reduction. For project enrollees, a 94 percent reduction in state hospital services resulted in cost savings of more than $45 million during the three-year evaluation period. These savings more than offset the funds used to expand community services. Overall, the net savings to the system for mental health services for this group was $3.4 million over three years.

CONCLUSIONS

The hospital closure and infusion of funds into community services produced desired growth of those services. The project reduced reliance on state psychiatric hospitalization and demonstrated that persons with serious mental illness can be effectively treated and maintained in the community.

Service utilization and cost of community care for discharged state hospital patients: a 3-year follow-up study

OBJECTIVE

This study examined the mental health service utilization and costs of 321 discharged state hospital patients during a 3-year follow-up period compared with costs if the patients had remained in the hospital.

METHOD

The study subjects were long-stay patients discharged from Philadelphia State Hospital after 1988. A longitudinal integrated database on all mental health and medical services reimbursed by Medicaid and Medicare as well as state- and county-funded services was used to construct service utilization and unit cost measures.

RESULTS

During the 3-year period after discharge, 20%-30% of the patients required rehospitalization an average of 76-91 days per year. The percentage of rehospitalized patients decreased over time, but the number of hospital days increased. All of the discharged patients received case management services, and a majority also received outpatient mental health care (66%-70%) and residential services (75%) throughout the follow-up period. The total treatment cost per person was approximately $60,000 a year after controlling for inflation, with costs rising slightly over the 3-year period. The estimated cost of state hospitalization, with the use of 1992 estimates, would have been $130,000 per year if the patients had remained institutionalized.

CONCLUSIONS

This analysis suggests that most former long-stay patients are able to live in residential settings while receiving community outpatient treatment and intensive case management services at a reduced cost. There is no indication of cost shifting from the psychiatric to the health care sector; however, some cost shifting from the state mental health agency to the Medicaid program has occurred, since most psychiatric hospital care now takes place in community hospitals.

A reexamination of the reported decline in partial hospitalization

This study examines recent trends in the organization of partial-hospitalization services in the United States. Contrary to two recent reports describing declining support for partial hospitalization, data from the National Institute of Mental Health's Inventory of Mental Health Organizations reveal that the number of "partial-care" providers increased by 20% between 1984 and 1988, with increases occurring among privately and publicly funded programs. However, there has been a 56% decline in the average length of stay, with both privately and publicly funded programs showing proportional shifts to more acute care. An increase in the number of long-stay "day care" programs may be attributable to educational and rehabilitation programs that report as partial-care providers. Future study is proposed to create a better typology of partial-hospitalization programs.

Prevalence of treated behavioral disorders among adult shelter users: a longitudinal study

Of 27,638 homeless adults admitted to Philadelphia public shelters in the years 1990 through 1992, 20.1% received treatment for a mental health disorder, and 25.3% for a substance use disorder in the years 1985 through 1993. An additional 20.7% were identified as having untreated substance use problems. Overall, a total of 65.5% of adult shelter users were identified as ever having had a mental health or substance use problem, treated or untreated.

Are supplementary services provided during methadone maintenance really cost-effective?

OBJECTIVE

Previous research has suggested that support services supplementing methadone maintenance programs vary in their cost-effectiveness. This study examined the cost-effectiveness of varying levels of supplementary support services to determine whether the relative cost-effectiveness of alternative levels of support is sustained over time.

METHOD

A group of 100 methadone-maintained opiate users were randomly assigned to three treatment groups receiving different levels of support services during a 24-week clinical trial. One group received methadone treatment with a minimum of counseling, the second received methadone plus more intensive counseling, and the third received methadone plus enhanced counseling, medical, and psychosocial services. The results at the end of the trial period have been published elsewhere. This article reports the results of an analysis at a 6-month follow-up.

RESULTS

The follow-up analysis reaffirmed the preliminary findings that the methadone plus counseling level provided the most cost-effective implementation of the treatment program. At 12 months, the annual cost per abstinent client was $16,485, $9,804, and $11,818 for the low, intermediate, and high levels of support, respectively. Abstinence rates were highest, but modestly so, for the group receiving the high-intensity, high-cost methadone with enhanced services intervention.

CONCLUSIONS

This study suggests that large amounts of support to methadone-maintained clients are not cost-effective, but it also demonstrates that moderate amounts of support are better than minimal amounts. As funding for these programs is reduced, these findings suggest a floor below which supplementary support should not fall.

"Unbundling" of state hospital services in the community: the Philadelphia State Hospital story

This paper describes the organizational, financial, and programmatic changes surrounding the closure of Philadelphia State Hospital, and the conceptual model employed for "unbundling" or disaggregating the state hospital's services into community programs run by private non-profit agencies. The current status of the project is discussed as well as the long-term policy and research questions that remain to be answered.

The rate of public shelter admission among Medicaid-reimbursed users of behavioral health services

This study examined the rate of admission to public shelters between 1990 and 1992 among persons who received Medicaid-reimbursed inpatient and outpatient psychiatric services and inpatient substance abuse services in Philadelphia between 1985 and 1993. Results show that 7.5 percent of such persons were admitted to public shelters during the three-year period, nearly 2.7 times the rate of shelter use by the general population (2.8 percent). Medicaid recipients treated for serious mental disorders had a three-year rate of shelter use of 8.4 percent. Those receiving inpatient treatment for substance use disorders, including detoxification services, had a three-year rate of shelter admission of 10.2 percent.

Community Treatment Teams: an alternative to state hospital

This article describes the implementation of Community Treatment Teams as a strategy to provide services to patients discharged from a state psychiatric hospital. The closing of Philadelphia State Hospital was the impetus for the development of an alternative long term care treatment system for the seriously mentally ill which was based on a variation of the community treatment team model. This article provides a description of the teams, their functioning, structure, and the impact they have had on the service system.

For-profit versus non-profit freestanding psychiatric inpatient facilities: an update

Although several studies have examined the trend toward the decreasing differentiation of non-profit from for-profit general hospitals, few have focused on freestanding psychiatric hospitals. This study updates previous research that used psychiatric hospital data from calendar year 1986 with data from 1990. In addition, a preliminary examination of the influence of market competition on the behavior of non-profit psychiatric facilities was conducted. Results confirm a converging trend between for-profit and non-profit facilities that is related, in part, to competition.

Effects of mental health services reform on clinical practice in the United Kingdom

In the last few years, the British National Health Service, local government social services departments, the welfare benefits system, and the organization of primary health care in the United Kingdom have undergone major reforms that have had significant effects on mental health services. Local social service departments were given the lead role in purchasing and coordinating community supports for persons with mental illness, but were not given enough funds to arrange adequate services. In the National Health Service, an internal-market approach, in which local health authorities could contract with any provider or group of providers, was introduced. This purchaser-provider split has created a climate of competition in a traditionally collaborative environment and has reduced staff morale. Similar but separate case management models were introduced in both the health service and the social service departments, which has led to inefficiency in planning care for individual patients. Opportunities were created for general practitioners to use capitated funds to purchase specialty care directly from providers. This arrangement resulted in an initial emphasis on care for less severely mentally ill patients, although some general practitioners are beginning to explore new approaches for supporting severely ill patients in the community. On the positive side, the reforms have led to greater involvement of patients and their families in planning service delivery. However, the authors suggest that policy makers in the U.K. seem to be repeating many of the mistakes made by American mental health systems in the 1960s and 1970s.

Old and new: a comparison of state psychiatric hospitals

The study examined whether state hospitals in operation before deinstitutionalization still carry vestiges of older models of psychiatric care. Using a national database, the authors compared 166 state hospitals built before 1949 with 80 state hospitals built after that time. The old hospitals treated fewer children and adolescents, received more state funding and less third-party funding, had fewer professional clinical staff, spent less on salaries and maintenance, and had more beds, a lower turnover rate, and a longer average length of stay. Findings suggest that planners and policymakers should take into account a facility's history when attempting to introduce innovations.

Effect of recent health and social service policy reforms on Britain's mental health system

The introduction of new policies in health and social services in Britain has changed the way community care is provided to seriously mentally ill people. Britain is creating the same problems that have existed in the United States, whereby clinicians struggle to provide services in an environment with multiple payers and perverse incentives. A simple system in Britain has been replaced with complicated organisational and financial structures that require almost impossible feats by local health and social service staff to coordinate care for patients for whom continuity of care is critical for their survival in the community and their wellbeing. Seriously mentally ill people are in the middle of these complicated problems. The creation of a local mental health authority that could be held responsible for community care, as exists in some American states, may be one solution.

The current practice of child and adolescent partial hospitalization: results of a national survey

OBJECTIVE

In 1992, the American Association for Partial Hospitalization initiated a national survey of partial hospitalization providers to investigate their present status (programming, staffing, and pricing), to track market trends, and to improve advocacy for appropriate utilization and reimbursement.

METHOD

Instrument development and field testing preceded widespread distribution of the survey. From survey data, a description of child and adolescent partial hospital services based on statistical averages is reported as are analyses of program differences by length of stay and for-profit/not-for-profit status.

RESULTS

Of the 580 programs responding, 95 indicated that at least 50% of their patient population consisted of children and adolescents. Descriptive statistics on this subsample suggest continued variability in child and adolescent partial hospital programming. Program differences in referral and discharge patterns, population and programming, and utilization and funding patterns based on length of stay and profit status are presented.

CONCLUSIONS

The pattern of significant program differences between acute-care and long-term child and adolescent partial hospital programs and for-profit/not-for-profit programs (along with the absence of for-profit programs treating children and adolescents in long-term programs) points to an evolving system of care.

The status of community mental health centers ten years into Block Grant Financing

This study tracks the 761 community mental health centers which received federal grants as of 1981 and assesses their status 10 years after the shift to Block Grant financing. Contrary to what had been predicted (Biegel, 1982), the vast majority of centers remained open (88.3%), a small proportion were involved in mergers (8.5%) and an even smaller percentage closed (3.3%). No pattern was evident as to which centers closed or merged by type of initial funding, although some states showed a concentration of mergers and closures. Data from the 1988 Inventory of Mental Health Organizations are used to characterize the centers still in operation by facility type, ownership, service mix and revenue mix. In 1988, federally funded CMHCs accounted for 34% of the total patient episodes treated and 22.7% of the total revenues reported by specialty mental health providers in the United States.

The discriminating characteristics of for-profit versus not-for-profit freestanding psychiatric inpatient facilities

This study examines the characteristics that discriminate between ownership types among private, freestanding psychiatric inpatient facilities in the United States. Use of data from the Inventory of Mental Health Organizations (National Institute of Mental Health 1983, 1986), revealed that not-for-profits provide more services and serve more of the underinsured, while for-profits serve the better insured, concentrate primarily on inpatient services, and serve more children, adolescents, and substance abusers. A surplus bed capacity among for-profit psychiatric hospitals is presumed to contribute to lower occupancy rates and less turnover in the for-profit sector. Not-for-profit psychiatric facilities are also found to be more involved in professional training and to be more accessible through emergency services. However, the misclassification test in the discriminant procedure reveals that a significant group of not-for-profit facilities looks more like its for-profit counterpart group than like other not-for-profits. Study findings are interpreted both in terms of debates over the tax-exempt status of not-for-profit hospitals and the potential negative service effects of proprietization.

Philadelphia's capitation plan for mental health services

Dr. Sharfstein's Introduction: Prospective payment is the major economic change that is reshaping the delivery of medical care. Capitation financing for the chronic mentally ill is an innovative and promising alternative to underfunded and bureaucratically rigid public programs on the one hand and underfunded retrospective cost-based Medicaid programs on the other. This month's column describes one such capitation plan. Its impact on the target population as well as on the use of resources by persons with long-term and severe mental illnesses will require close evaluation.

Opportunities and risks in Philadelphia's capitation financing of public psychiatric services

The city of Philadelphia was one of nine sites selected by the Robert Wood Johnson (RWJ) Foundation and the U.S. Department of Housing and Urban Development (HUD) to receive five-year funding to improve the delivery, quality and cost efficiency of public mental health services to its chronically mentally ill population. As part of the RWJ project, the city plans to restructure its delivery and reimbursement system, creating a not-for-profit central authority which will function as a health insurance organization (HIO) responsible for coordinating and managing psychiatric care to Medicaid clients. Operating under a model of capitation, the central authority will employ diverse funding mechanisms to finance and manage service delivery. This paper examines the benefits and risks inherent in the reorganization of Philadelphia's mental health service system under a capitation financing model. Issues considered include cost and utilization patterns, treatment outcomes, providers and their staffing patterns, service mix and the overall impact of capitation on clients.

Accreditation, certification, and the quality of care in state hospitals

Data on 216 state psychiatric hospitals were analyzed to determine whether accreditation by the Joint Commission on Accreditation of Healthcare Organizations (JCAHO) or certification by the Health Care Financing Administration (HCFA) were related to seven hospital characteristics generally accepted as reflecting quality of care. The characteristics were average cost per patient, per diem bed cost, total staff hours per patient, clinical staff hours per patient, percent of staff hours provided by medical staff, bed turnover, and percent of beds occupied. While a majority of the hospitals had either JCAHO accreditation, HCFA certification, or both, analysis revealed a weak relationship between accreditation or certification status and the indicators of quality of care. Accredited or certified hospitals were, however, more likely to have higher values on specific indicators than hospitals without accreditation.

Use of manpower data in an integrated database for program efficiency analysis: an example from a statewide community mental health system

This article describes a method for systematically utilizing manpower data to analyze program efficiency of community mental health services. Examples of how analyses of performance data can be substantially enhanced by integrating manpower staffing data with other key financial, client, and service volume variables are provided.