by Lisa Hanchey

Dr. Cheryll Bowers-Stephens

Responding to rumblings about provider abuse, Louisiana's Department of Health and Hospitals is making sweeping changes to its Mental Health Rehabilitation Program. About 121 agencies currently participate in this project, which services adult Medicaid recipients with serious mental illness and children with emotional/behavioral disorders. But, this number could dwindle as providers struggle to comply with the stringent new requirements.

Effective June 1, private participants will no longer be reimbursed on a capitated basis. Under the former system, mental health providers were paid a set rate per month for each patient. Now, agencies will be compensated using a fee-for-service approach. "What we're going to be moving to is called fee-for-service, meaning that each person that was being served by the program will have an individualized service plan developed," explains Dr. Cheryll Bowers-Stephens, assistant secretary for DHH's Office of Mental Health. "The agencies will get reimbursed for each and every service they provide, rather than getting one flat fee for providing everything."

According to DHH's Communications Director, Bob Johannssen, the rates were developed by Louisiana's Medicaid program through conducting surveys of other states. Medicaid compared fees for comparable services, then adjusted them for this state's economic factors, such as cost of living, median household income and salaries in selected service professions.

Anticipating these payment changes, at least one Acadiana agency, CenLa Community Service in Marksville, which is in Avoyelles Parish, closed at the end of April. Former owner Suzonne Alford says that because of the nature of mental illness, it is difficult to administer treatment on a fee-for-service basis. "You have to take the medicine for quite some time before you see a difference," she explains. "You also have to establish a relationship with the people that work for you and the people that you work with. And now, because of the fee-for-service, I couldn't make ends meet."

Some local providers fear that the fee-for-service approach will affect quality of services, as well as access to care. "My first concern with the new changes is that the level and quality of services is going to have to drop," says psychiatrist Bob Winston. "Secondly, with programs such as in Avoyelles Parish where they are just closing down, you are going to have 60 people that are suddenly going to be in the mental healthcare system that cannot be accommodated. These people are not going to get their medications, they are not going to get the services that they need. They are going to be hospitalized at a higher cost to the state than would otherwise have been incurred."

DHH believes that the new regulations are necessary to address some abuses in the captitated rate system. In 2003, the Advocacy Center, which is the state's watchdog for persons with disabilities, released a comprehensive report finding serious deficiencies in the MHR program. The most common offenses were having unqualified providers render services and billing for nonexistent or unnecessary services.

Based on the AC's investigation, DHH started cracking down on non-compliant MHR providers. As a result, some participants were suspended from the program. Among the most recently excluded agencies are Crossroads in Plaquemine, Reaching Out in New Orleans and Shifa in Baton Rouge. Johannessen says that more exclusions are expected shortly, but none from the Lafayette area.

To prevent future problems, DHH is now conducting in-depth monitoring of providers. Additionally, participating agencies will be required to be nationally accredited by CARF (Commission on Accreditation of Rehabilitation Facilities), JCAHO (Joint Commission on Accreditation of Healthcare Organizations) or COA (Council on Accreditation).

Even with these changes, the MHR program still has a long way to go. Over a five-year period, the program has grown from $18 million to $50 million, and is expected to cost $62 million for the current fiscal year ending June 30. Despite this growth, the State is scraping to serve its growing mentally ill population.

"We, as doctors, are all concerned not just about this issue [MHR changes] but, in general, access to treatment and care for the patients," Winston explains. "We are also concerned that these people will end up in the emergency room in an already overburdened system. In general, we are all concerned because access to treatment is limited and becoming even more so."

With rural facilities already straining to survive, Winston says that he is particularly worried about patients' access to treatment in those areas. Bowers-Stephens says that OMH is in the process of addressing this concern. "The issue was raised that smaller agencies don't have a certain number of staff and certain number of clients, so then they don't feel that they can continue to operate," she confirms. "Right now, we are going through some cost modeling to see what we can do in particular situations. So, yes, we are attempting to address that."

Once these new rules and regulations go into effect on June 1, Bowers-Stephens hopes that their purpose will be achieved. "The goal is, first and foremost, to improve the quality of the delivery of services by doing what's called really good prior authorization, monitoring and training," she says. "The second goal is to make sure that we are delivering these services in the most cost-efficient manner possible."