U.S. Department of Health and

Human Services

Substance Abuse and Mental Health

Services Administration

Center for Mental Health Services

Office of Managed Care

5600 Fishers Lane

Rockville, MD 20857

Special Report
ii Special Report

Acknowledgments

This report was prepared by the Lewin Group of Falls Church, VA. Lucia Davidson was lead

editor and was assisted by Sara Cooper and Eron Sturm of the Lewin Group. Shelagh Smith,

M.P.H., was the government project officer. The report incorporates and updates an earlier bibliography, through 1994, prepared by Jane Kramer and Saul Feldman, published by the

Substance Abuse and Mental Health Services Administration (SAMHSA).

Disclaimer

Material for this report was prepared under contract by the Lewin Group for SAMHSA.

The content of this publication does not necessarily reflect the views or policies of SAMHSA

or the U.S. Department of Health and Human Services.

Public Domain Notice

All material appearing in this report is in the public domain and may be reproduced or

copied without permission from SAMHSA. Citation of the source is appreciated.

Access to Publication

This publication can be accessed electronically at http://www.mentalhealth.org.

Additional copies may be obtained by calling the Center for Mental Health Services

Knowledge Exchange Network, 1-800-789-2647.

Originating Office

Office of Managed Care

Center for Mental Health Services

Substance Abuse and Mental Health Services Administration

5600 Fishers Lane, Room 15-87

Rockville, MD 20857

April 2000

DHHS Publication No. (SMA) 00-3424

Suggested Citation

Center for Mental Health Services, Substance Abuse and Mental Health Services

Administration 2000. Annotated bibliography on managed behavioral health care, 1989–1999

(DHHS Publication No. [SMA] 00-3424). Rockville, MD: Author.
Table of Contents

I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

II. Benefit and System Design . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

III. Capitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

IV. Community Mental Health Services . . . . . . . . . . . . . . . . . . . 41

V. Diagnosis-Related Groups (DRGs) . . . . . . . . . . . . . . . . . . . . 43

VI. Economics, Forecasting, and Pricing . . . . . . . . . . . . . . . . . . . 49

VII. Employee Assistance Programs (EAPs) . . . . . . . . . . . . . . . . . 55

VIII. Health Maintenance Organizations (HMOs) . . . . . . . . . . . . . 57

IX. Law and Ethics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73

X. Provider Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81

XI. Public Sector . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97

XII. Quality Assurance and Outcomes . . . . . . . . . . . . . . . . . . . . 111

XIII. Special Populations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129

A. Children . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129

B. Elderly . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134

C. Ethnic Groups . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135

D. Women . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135

XIV. Substance Abuse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137

XV. Training and Education . . . . . . . . . . . . . . . . . . . . . . . . . . . 145

XVI. Utilization Management . . . . . . . . . . . . . . . . . . . . . . . . . . . 151

XVII. Author Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 159

XVIII. Keyword Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169

Annotated Bibliography iii
I.

Annotated Bibliography 1

This publication expands and updates an earlier annotated

bibliography on managed behavioral health edited by Jane

Kramer and Saul Feldman, published by SAMHSA. The

original bibliography included 250 abstracts that covered the published

literature on managed behavioral health over a 5-year period from

January 1989 through mid-1994. 

Introduction

The current publication updates the bibliography from mid-1994 through June 1999.

The additional documents were located

through a search of the journal literature

and a scan of a number of organizational

Web sites. Bibliographic databases searched

to identify journal articles include Medline,

HealthStar, Psycinfo, ABI/Inform, Insurance

Periodicals Index, and Econlit. Web sites

include the National Clearinghouse for

Alcohol and Drug Abuse Information,

CMHS’s Knowledge Exchange Network,

Georgetown University Center for Child

Health and Mental Health Policy, Florida

Mental Health Institute, American

Psychological Association, American

Psychiatric Association, National Alliance

for the Mentally Ill, National Mental Health

Association, Bazelon Center for Mental

Health Law, the National Council for

Community Behavioral Healthcare,

Mathematica Policy Research, R.O.W.

Sciences, Westat, Research Triangle Institute,

and the Institute for Behavioral

Health/CentraLink. 

For the reader’s convenience, this report

has two indexes: an Author Index and a

Keyword Index. Each abstract has keywords

listed and corresponds to the Keyword

Index at the end. The Keyword Index lists

key topics alphabetically, followed by the

abstract numbers for the abstracts that

contain these topics.

1
II.

Annotated Bibliography 3

Benefit and

System Design

1. Abrams, H. S. (1993). Harvard Community Health Plan’s mental health

redesign project: A managerial and clinical partnership. Psychiatric

Quarterly, 64, 13–31.

The Harvard Community Health Plan (HCHP) redesigned its program in an effort to address

high costs and member and clinician dissatisfaction in the delivery of its mental health services.

In an extensive needs assessment, members, clinicians, and managers identified a number of problems in the HCHP mental health care delivery system. These included lack of access, inconsistent

service delivery between sites, lack of systematic utilization management, and lack of diverse

treatment programs and models. On the basis of this assessment, HCHP developed a method of

categorizing patients, restructuring the delivery system, and redesigning the mental health benefit.

This article describes the process and politics of the redesign effort, including the development of

the mental health patient-assessment tool. Also outlined are delivery system changes, such as selfreferral and group therapy, and how HCHP communicated its new benefits to members.

Keywords: private sector programs

2. Afield, W. E. (1990). Managed mental health care: Curbing costs in the

1990s. Medical Interface, 14, 26–34.

Expenditures on mental health account for almost one-third of total health care dollars spent

in this country. This article documents ways in which the insurance industry has led to inappropriate and costly use of mental health benefits. The article endorses managed mental health

care (including utilization control and quality assurance) as a solution to both the quality and

cost problems plaguing the current system.

Keywords: costs, quality assurance

3. Altman, L., & Price, W. (1993). Alcan Aluminum: Development of a mental

health “carve-out.” New Directions for Mental Health Services, 59, 55–65.

A growing number of companies are interested in “carving out” mental health services. This

chapter describes the development and implementation of a carve-out plan at the Alcan Aluminum Corporation. Alcan designed its network-based employee assistance program (EAP) and

managed mental health program to reduce costs, standardize its EAPs across the Nation, and

enhance the quality of services. Other objectives included enhanced case management for adolescents and increased access for employees in rural areas. The article describes lessons learned,

such as building consensus and creating links among vendors, administrators, and employees.

Keywords: carve-outs, EAPs, private sector programs

3
4. Arons, B. S., Frank, R. G., Goldman, H. H., McGuire, T. G., & Stephens, S.

(1994). Mental health and substance abuse coverage under health reform.

Health Affairs, 13(1), 192–205.

This article, written by several members of the President’s Task Force on Health Care Reform,

the Working Group on Mental Health, describes the basis for President Clinton’s health care

reform proposal in which mental health/substance abuse care is integrated with the proposed

health alliances. The authors examine the organizational and financing needs of mental health

and substance abuse to ensure a successful transition to a fully integrated system at parity with

other health services. The article makes a case for full integration, describes the complexity of

integration, and defines the financing, administrative, and monitoring steps necessary to implement an integrated plan. The authors examine some of the barriers to plan implementation,

and advise that, however problematic, they are not insurmountable obstacles to achieving a

fully integrated system before the year 2001. The authors also provide some thoughts on how

to assess whether the plan is proceeding on the right track during the transition.

Keywords: integration, legislation, parity, substance abuse

5. Bennett, M. J. (1994). Are competing psychotherapists manageable?

Managed Care Quarterly, 2(2), 36–42.

This article describes the major changes currently taking place in the way behavioral health

care is organized, financed, and delivered. The author argues that while much is uncertain,

there is wide commitment to two objectives: to improve access and increase efficiency. Meeting

both objectives requires improved coordination of resources on a wide basis and a movement

beyond utilization review. The article challenges the notion that market forces alone can overcome the barriers to reform and outlines a detailed five-step strategic plan. The strategies

include guaranteeing the right to necessary care, regionalizing resources under capped budgets,

replacing fee-for-service reimbursement with prospective payment, aligning continuing education requirements with performance-defined gaps in knowledge, and funding professional

retraining.

Keywords: overviews, providers, training, trends

6. Broskowski, A. (1991). Current mental health care environments:

Why managed care is necessary. Professional Psychology: Research

and Practice, 22 (1), 1–9.

As inpatient mental health costs have escalated rapidly in recent years, third-party payers and

employers have started to demand cost and quality controls on the care provided. This article

describes the trends in general and mental health care costs and describes a framework for

understanding the structure of managed mental health care. The author illustrates methods for

managing mental health costs and examines the evaluation of the impact of managed care on

cost and quality of care.

Keywords: costs, overviews, trends

4 Special Report
7. Broskowski, A. (1994). Current mental health care environments:

Why managed care is necessary. In R. L. Lowman & R. J. Resnick (Eds.),

The mental health professional’s guide to managed care (pp. 1–18).

Washington, DC: American Psychological Association.

An earlier version of this chapter appeared in Professional Psychology: Research and Practice.

Refer to Broskowski, 1991 for annotation.

8. Burton, W. N., & Conti, D. J. (1991). Value-managed mental health

benefits. Journal of Occupational Medicine, 33, 311–313.

This article describes the experience of the First National Bank of Chicago’s comprehensive

plan for mental health services. It contends that by managing a benefit plan assertively rather

than cutting it, the quality of mental health services can be enhanced while costs are contained.

The plan is based on an employee assistance program (EAP) that provides assessment, shortterm counseling and referrals, psychiatric hospital utilization review, and consulting psychiatrists. An internal evaluation of the program showed declines in the number of admissions, the

length of stays, and the costs of inpatient mental health.

Keywords: EAPs, evaluation, private sector programs

9. Busch, S. (1997). Carving-out mental health benefits to Medicaid

beneficiaries: A shift toward managed care. Administration and Policy in

Mental Health, 24(4), 301–321.

Since 1991, a number of states have initiated mental health carve-out programs for at least

some of their Medicaid population, providing mental health services through a separate program from physical health care. This paper outlines the choices States face in designing such

programs including cost considerations, political considerations, the procurement process,

reimbursement, eligibility, risk adjustment, and benefit design. The author relies on examples

from Massachusetts and Utah to illustrate differences between public and private models.

From the discussion, the author concludes that while carve-out programs have yielded some

initial savings, future research needs to focus on their effect on quality of care and general

health care costs.

Keywords: carve-outs, Massachusetts, Medicaid, public sector, Utah

10. Dickey, B., & Azeni, H. (1992). Impact of managed care on mental health

services. Health Affairs, 11(3), 197–204.

This article describes the use of two types of managed mental health care programs designed to

reduce inappropriate use of hospital services and compares their impact on the use of inpatient

services. Each of these programs represents a type of utilization review. The first is a mandatory preadmission screening program that requires certification, prior to or within 24 hours of it,

that the admission is medically necessary; the program also authorizes a set number of reimbursable days. The second program focuses on discharge planning and requires attending

physicians to detail treatment plans as they relate to discharge. Thus, the first program

Annotated Bibliography 5
attempts to reduce the numbers of admissions, while the second focuses on reducing length of

stay. Neither program was shown to be effective in reducing mental health spending. The

authors hypothesize several reasons for this, including the increase in pressures that drive up

the supply of and demand for mental health services, the growth of new psychiatric inpatient

programs, and physician noncompliance with reviews. The authors conclude with a discussion

of the limitations of the study and future research needs.

Keywords: evaluation, utilization management

11. Duhl, L. J. (1994). Can mental illness be prevented under managed

care? Managed Care Quarterly, 2(2), 7–9.

The author argues that the movement toward managed mental health care focuses narrowly on

intervention techniques and cost containment. These foci are inappropriate and will not lead to

an overall improvement in mental health for the majority of people who need and seek mental

health care. A more appropriate system would recognize the importance of the social and cultural context of individual lives and their social networks. From the author’s perspective, a

program that moves beyond the medical model and recognizes the importance of jobs, recreation, and education is more likely to have a positive impact on the mental health of individuals in a community than would the managed care approach.

Keyword: prevention

12. Durham, M. L. (1994). Health care’s greatest challenge: Providing

services for people with severe mental illness in managed care.

Behavioral Sciences and the Law, 12(4), 331–439. 

This article discusses the fundamental advantages of managed care for persons with severe

mental illness (SMI) and examines how this patient population is treated in actual practice.

Specifically, the author analyzes the advantages and the actual practice data for this population

for three primary aspects of managed care: institutional care, coordination of care, and prevention. Regarding these three principles of managed care, the author notes that SMI individuals

do not receive the best care possible, and the author offers solutions on how to best improve

care for these individuals within a managed care framework. Some of the solutions which are

suggested solely for the SMI population include specialized HMOs, training and support for

primary care physicians to better diagnose and refer individuals with SMI to the appropriate

treatment, financing schemes that decrease the copayments for SMI individuals, developing risk

assessment models specifically for the SMI populations, and developing clearer ethical guidelines for treating SMI patients. 

Keywords: serious mental illness

13. England, M. J., & Goff, V. V. (1993). Health reform and organized

systems of care. New Directions for Mental Health Services, 59, 5–12.

Several major companies are using organized systems of care (OSC), an integrated care

financing and delivery system. The authors argue that organized systems of mental health and

6 Special Report
substance abuse care can achieve both cost management and quality improvement through

the use of a select multidisciplinary panel of providers and the delivery of a continuum of

services from prevention and primary care through chronic care. The chapter provides two

examples of the development of OSCs. Finally, the chapter describes how OSCs are different

from current managed care systems.

Keyword: integration

14. England, M. J., & Vaccaro, V. A. (1991). New systems to manage

mental health care. Health Affairs, 10 (4), 130–137.

Early managed care arrangements focused primarily on reducing costs and only secondarily on

improving access or quality of care. This narrow focus contributed to the bitter opposition of

managed health care plans by clients and providers of mental health services. More recently,

managed mental health care organizations have demonstrated that managing care not only

reduces costs, but also potentially enhances early detection of mental health problems, offers a

broad range of services, provides continuity of care, reduces the costs shifted to individuals,

and prevents unnecessary hospitalization. The authors argue that managed care systems will

increasingly be required to demonstrate their quality of services provided in order to successfully compete for contracts with businesses. This article describes six case studies of businesses

that have introduced managed systems of care for their employees.

Keywords: private sector programs

15. Feldman, S. (Ed.). (1992). Managed mental health services (1st ed.).

Springfield, IL: Charles C. Thomas.

This book was written by those involved in or connected to the managed mental health system: as payors, providers, managers, health-benefit consultants, human resources and employee assistance program (EAP) staff, researchers and teachers, and public and private policymakers. The book’s wide range of topics includes the genesis of managed mental health and its

application to particular settings. Several viewpoints are represented, including those of corporations, of the purchasers of health care, and of the freestanding managed mental health firms.

One chapter describes the basics of a mental health evaluation system; another addresses the

special quality assurance needs that managed mental health firms have. Finally, the book raises, in separate chapters, clinical, ethical, and legal issues.

Keywords: ethics, managed behavioral health care organizations, overviews, performance measurement, quality assurance

16. Feldman, S. (1998). Behavioral health services: Carved out and

managed. The American Journal of Managed Care, 4, SP59–SP67.

Mental health and physical health have maintained the same relationship for the past 200

years—separate. The managed behavioral health carve-out (MBHCO) is the most current

demonstration of this separation, as it involves the same managed care philosophy that has

revamped the physical health industry, but it is not integrated with the physical health care

Annotated Bibliography 7
HMOs. This article examines the financial incentives that led to the development of the

MBHCO as well as their common characteristics. The author illustrates such typical components of an MBHCO as contracts, payment mechanisms, and provider networks and data collection, through the example of United Behavioral Health. He also highlights available research

on the effects of the MBHCO on cost and utilization, access, quality, and the relationship of

behavioral health services to physical health care and other human services. The author also

argues for further research in order to evaluate the qualitative aspects of care.

Keywords: carve-outs, managed behavioral health care organizations

17. Fishel, L., Janzen, C., Bemak, F., Ryan, M., & McIntyre, F. (1993). 

A preliminary study of recidivism under managed mental health care.

Hospital and Community Psychiatry, 44, 919–920.

This brief article reports on a study to determine the recidivism rates for mental health services

provided through HMOs, case-managed programs, and fee-for-service insurance plans. In the

article, recidivism rates are considered a proxy for quality of service. The records of all persons

(N=365) who were referred by an employee assistance program within a 24-month period

were examined. Those who made a second request for service at least three months after the

initial visit but still within the 24-month study period were considered “recidivists.” The study

found a higher rate of recidivism in the managed care programs than in the fee-for-service

plans. Limitations of this study are discussed, as are implications for future research.

Keywords: HMOs, performance measurement

18. Fisher, L., & Ransom, D. C. (1997). Developing a strategy for managing

behavioral health care within the context of primary care. Archives of

Family Medicine 6, 324–333. 

The authors report on findings of a review of the literature from 1970 to 1996 on factors that

predict the use of mental health and substance abuse services. The literature review was conducted as a means to guide the development of behavioral heath care programs that are compatible with the primary care environment. The authors develop a framework to represent the

main factors associated with mental health services use. They describe each of the domains and

summarize the essential research findings. The domains include patient characteristics, primary

care physician characteristics, practice settings, and managed care plan characteristics. Based

on the findings from the literature review, the authors argue that behavioral health programs

work best when they are decentralized to account for variations among primary care patients,

physicians, and practices; when they are integrated clinically, financially, and administratively

within the primary care setting; and when primary care physicians are active leaders in the

design and implementation of these services.

Keywords: integration, primary care

8 Special Report
19. Fitzpatrick, R. (1992). The Harvard Community Health Plan: An evolving

model of managed mental health care. In J. Feldman & R. J. Fitzpatrick

(Eds.), Managed mental health care: Administrative and clinical issues

(1st ed., pp. 385–399). Washington, DC: American Psychiatric Press.

This chapter describes how the Harvard Community Health Plan (HCHP) reassessed the

assumptions, scope, and benefits of their psychiatric and substance abuse services. The 5-year

process led to a series of evaluative conclusions on what was and was not working in the mental health program, as well as a set of guiding principles for change, a mission statement, and

new treatment modalities. The chapter describes the way in which this process was implemented, some of the findings, and the ways in which the HCHP has begun to implement some of

the new clinical, educational, and management programs. It also describes the way in which

the HCHP continues to evaluate the relative success of treatment options through clinical algorithms. Reports show increased patient and provider satisfaction as well as decreases in the

number of hospital admissions and the length of stay.

Keywords: performance measurement, private sector programs

20. Frank, R. G., Goldman, H. H., & McGuire, T. G. (1992). A model mental

health benefit in private health insurance. Health Affairs, 11(3), 98–117.

Mental health benefits in public and private insurance vary widely, from no coverage at all to a

wide range of benefits. Many mental health care benefits packages provide incentives for inappropriate types and amounts of treatment. In response to a Congressional request to the

National Institute of Mental Health (NIMH), the authors designed a model mental health benefit for the working population. Through both supply- and demand-side incentives, this plan

provides financial protection to both beneficiaries and their families, controls costs, and promotes cost-effective care. This article describes five principles that underlie the model plan and

outlines the model benefit package itself. The article also proposes a payment system that is

consistent with the development of provider networks that form the basis of many managed

care programs. One goal of the model benefit is to draw national attention to the need to

include mental health care in proposals for national health reform.

Keywords: health care reform, models, private sector programs

21. Frank, R. G., McGuire, T. G., Bae, J. P., & Rupp, A. (1997). Solutions for

adverse selection in behavioral health care. Health Care Financing Review,

18(3), 109–122.

In this article the authors address the adverse selection and benefits for behavioral health care

in the managed care era. The adverse-selection argument presents evidence that health plans

offering “good coverage” for behavioral health benefits attract the bad-risk patients and therefore, behavioral health benefits must be mandated either by a public entity or through some

other means. Suggested solutions include risk adjustment of capitation rates, carve-outs, and

cost- or risk-sharing between the payer and the plan.

Keywords: capitation, carve-outs, economics

Annotated Bibliography 9
22. Frank, R. G., McGuire, T. G., & Newhouse, J. P. (1995). Risk contracts

in managed mental health care. Health Affairs, 14(3), 50–64.

This article examines potential implementation methods for mental health/substance abuse

managed care coverage. The authors make the case for risk contracting in behavioral health

care, describing the economics of risk contracting and its implications for the quality and costeffectiveness of mental health/substance abuse service delivery. They state that in order to efficiently provide managed behavioral health services, it may be necessary to limit the choice consumers have in behavioral health care plans. As a result, the authors conclude that if

behavioral health is to be covered by managed care, recipients will receive different types of

care depending upon their payers’ emphases on the costs versus the benefits of services. 

Keywords: contracting, economics, substance abuse

23. Frank, R. G., McGuire, T. G., & Salkever, D. S. (1991). Benefit flexibility,

cost shifting and mandated mental health coverage. The Journal of Mental

Health Administration, 18, 264–271.

This article demonstrates an approach to evaluating a proposed change in mental health benefit design that was used in the Commonwealth of Virginia. The authors designed a simulation

model to allow for an assessment of costs and utilization patterns associated with four potential design options for insurance benefits. After analyzing each option, the authors selected the

one they believed has the potential to achieve the greatest gains in the context of the existing

mental health mandate. The article describes the methods used for selecting each option, the

authors’ assumptions when making the evaluation, and the analysis of each option.

Keywords: private sector programs, Virginia

24. Goldman, H. H., Adler, D. A., Berland, J., Docherty, J., Dorwart, R. A.,

Ellison, J. M., Pajer, K., Siris, S., & Kapur, S. (1993). The case for a servicesbased approach to payment for mental illness under national health care

reform. Hospital and Community Psychiatry, 44, 542–544.

In this position paper drafted by a committee of the Group for the Advancement of Psychiatry,

the authors describe the advantages and pitfalls of three approaches to achieve equitable coverage for the treatment of mental illness. The three strategies are achieving parity by diagnostic

status, by disability status, and by the set of services to be covered. After a comparative analysis of the three approaches, the authors advocate the services-based approach. They believe

that a services-based approach is nondiscriminatory, and that costs can be controlled through

managed care and through changes in the payment system or benefit design.

Keywords: health care reform, parity

25. Goldman, W. (1994). Myths and potentials. Managed Care Quarterly,

2(2), 51–52.

This article describes two competing myths embodied in the health reform debate. The first

myth is that the current health care system allows freedom of choice and access to health care.

The second is that competing organized health care systems, given economic pressures for cost

10 Special Report
containment, will correct the current inequities in the health care system and lead to the same

goals (of freedom of choice and access to competent, compassionate practitioners). The author

of this viewpoint piece argues that both myths obscure reality. He puts forth his vision of how

the shared goals of both camps can be reached through managed mental health care.

Keywords: health care reform, overviews

26. Goran, M. J. (1992). Managed mental health and group health

insurance. In S. Feldman (Ed.), Managed mental health services

(1st ed., pp. 27–44). Springfield, IL: Charles C. Thomas.

This chapter provides an overview of the evolution of managed care and how it affects mental

health service delivery. Group health insurance organizations are expanding their efforts to

control costs through aggressive use of managed care. A number of large employers have determined that fee-for-service plans are not containing costs as well as managed care networks that

are similar to HMOs. Although most employers are reducing the number of options they offer,

they are not inclined to “lock” employees into one choice. The chapter describes the key features of HMOs, preferred provider organizations (PPOs) and “carve-outs.” Also discussed are

criteria for deciding whether to use an HMO or a conventional indemnity plan.

Keywords: carve-outs, HMOs, overviews, PPOs, private sector programs

27. Grazier, K. L., & Eselius, L. L. (1999). Mental health carve-outs:

Effects and implications. Medical Care Research and Review, 56

(Supplement 2), 37–59.

An increasing number of employers and states are carving out behavioral health services, separating the provision of mental health and substance abuse services out from that of general

medical services. In this article, the authors examine various models for a carve-out and

describe the advantages and disadvantages of carve-outs as opposed to integrated models of

care. The paper summarizes recent public and private sector research on the impact of carveouts on access and utilization, cost savings and shifting, and quality of care. From this review

of previous research, the authors suggest that carve-out strategies may lead to increased access

to behavioral health services (particularly outpatient services) as well as to significant cost savings to sponsors through decreased inpatient utilization. 

Keyword: carve-outs

28. Iglehart, J. K. (1996). Managed care and mental health. New England

Journal of Medicine, 334(2), 131–135.

The author provides a brief overview of the managed behavioral health care market, in which

he discusses operating techniques, quality of care, the views of mental health professionals,

and the movement toward Medicaid-managed care. This report highlights the trade-off

between the substantial savings achieved by managed care and the potential that these lower

cost treatments are adversely affecting the lives of the mentally ill, by focusing on the outcomes

of certain American corporations that have used managed behavioral health care services.

Keywords: economics, overviews

Annotated Bibliography 11
29. Judge David L. Bazelon Center for Mental Health Law & Legal Action

Center (1998). Partners in planning: Consumers’ role in contracting for

public-sector managed mental health and addiction services: Vol. 10.

Managed care technical assistance series. Rockville, MD: Substance

Abuse and Mental Health Services Administration.

As public-sector managed mental health care and substance abuse services increasingly enter

into managed care arrangements, consumer groups have a unique opportunity to become

involved in the formulation of contract policies. This guide is geared toward enabling consumers, families, and advocates to identify and advocate for the most rewarding managed care

practices. The authors describe the intricacies of the contracting process, address the substance

and key provisions with respect to rights issues in a contract, identify critical issues with

respect to children and adolescents, suggest how consumer advocates can become involved,

and provide examples of good practices from current public managed care contracts. The

guide offers seven appendices including a glossary and a list of mental health and drug and

alcohol addiction organizations with state-based contacts.

Keywords: children, contracting, public sector, substance abuse, technical assistance

30. Kihlstrom, L. C. (1998). Managed care and medication compliance:

Implications for chronic depression. The Journal of Behavioral Health

Services & Research, 25(4), 367–376.

In an effort to better manage treatment compliance for chronically mentally ill patients, some

managed care organizations have initiated disease management (DM) programs for chronically

depressed individuals. By focusing on education, measuring patient outcomes when practice

guidelines are followed, and providing feedback to providers, DM programs claim to reduce

variations in care and to result in cost savings. This article examines the success of DM programs used by pharmaceutical benefit management firms (PBMs) in the management of prescription drugs. The author provides a brief overview of the basic functions and attributes of

PBMs, including a description of their disease management practices. The article then presents

and critiques five different theories regarding the issue of treatment adherence as well as findings from relevant studies in this area. Finally, the article discusses implications for behavioral

health services and directions for future research.

Keywords: depression, serious mental illness

31. Kunnes, R. (1992). Managed mental health: The insurer’s perspective.

In S. Feldman (Ed.), Managed mental health services (1st ed., pp. 101–126).

Springfield, IL: Charles C. Thomas.

Mental health costs have risen dramatically for a number of reasons: growing incidence of

mental health problems, “psychiatricization” of problems, expanding benefits for inpatient

psychiatric and substance abuse disorders, growth of inpatient chains and franchised vendors,

and more generous inpatient than outpatient coverage. Insurers have responded through the

use of reduced benefits, telephone utilization review and case management, claims management, and preferred provider organizations (PPOs). The author argues that none of these

12 Special Report
approaches has reduced costs, and outlines an ideal system from an insurer’s perspective.

Such a system would emphasize alternatives to inpatient care and provide for individualized

treatment plans. The system would feature a sole entry point; effective triage; use of alternative

services; coordinated services and settings; and experienced, specialized providers.

Keyword: models

32. Lee, F. C. (1991). Managing mental health care. Benefits Quarterly, 7(4),

91–100.

This article discusses new developments in the $500-million-a-year managed mental health

care industry. Managed mental health vendors are having a major impact on reducing length

of stay in inpatient alcohol rehabilitation programs. Several initiatives are under way to develop alternatives to inpatient care for adolescents, and to increase oversight of those admissions.

Managed mental health firms are also managing carve-outs of mental health benefits and

undertaking efforts to reduce worker’s compensation and disability claims. To address rising

mental health costs, corporations are using employee assistance programs, capitation, utilization review, alternatives to inpatient care, and specialty carve-outs. The author also predicts

several trends in managed care, such as self-regulation and the increased use of technology.

Keywords: managed behavioral health organizations, private sector programs, trends

33. Levin, B. L., Glasser, J. H., & Jaffee, C. L. (1988). National trends in

coverage and utilization of mental health, alcohol, and substance abuse

services within managed health care systems. American Journal of Public

Health, 78, 1222–1223.

This study reports the results of a 1986 national survey of mental health, substance abuse, and

alcohol services within HMOs in the United States. Ninety-seven percent of HMOs surveyed

offered mental health service coverage and two-thirds of these offered alcohol and substance

abuse service coverage, an increase since the 1982 survey. Annual mean mental health hospitalization was 36.90 days per 1,000 members and annual mean ambulatory mental health utilization was 0.29 physician encounters per member. Hospital and ambulatory costs for mental

health services nearly doubled since 1982.

Keywords: HMOs, substance abuse, trends

34. Lizanich-Aro, S., & Goldstein, L. (1988). A successful approach to the

start up of a mental health case management program. Quality Assurance

Utilization Review, 3(3), 90–94.

This paper describes how mental health professionals can design and implement a case management program. Quality assurance, which is based on the use of standards and normative

criteria for clinical decision making and review, is a key component of such a program. The

authors briefly outline examples of such criteria and their development, and discuss how to

design a peer-developed utilization review framework that fills in current gaps in mental

health review approaches. Using these criteria, reviewers should be better able to address a

number of case management questions, such as whether or not a treatment is appropriate.

Keywords: case management, quality assurance, utilization management

Annotated Bibliography 13
35. Lowman, R. L. (1994). Mental health claims experience: Analysis and

benefit redesign. In R. L. Lowman & R. J. Resnick (Eds.), The mental health

professional’s guide to managed care (pp. 119–136). Washington, DC:

American Psychological Association.

This chapter provides extensive mental health benefit analyses of corporate data, which

demonstrate cost problems and the financial effects of treating patients over time. The intention through these analyses is to assist psychologists in understanding the forces that promote

the growth of managed care. Four major issues are addressed: (1) national trends in health

care costs and in health service delivery; (2) comparable trends in mental health and substance

abuse treatment costs and service delivery; (3) the argument that managed care is a marketplace response to concerns on the part of employers and insurers; and (4) suggested opportunities for cost-effective services in a competitive market.

Keywords: costs, economics, overviews, trends

36. Mahoney, J. J. (1988). Future trends and emerging issues in alternative

delivery systems: A purchaser’s perspective. In D. J. Scherl, J. T. English,

& S. S. Sharfstein (Eds.), Prospective payment and psychiatric care

(pp. 139–154). Washington, DC: American Psychiatric Association.

This article provides a historical overview of the business community’s growing role in providing employee health care. The author describes the search for alternatives to fee-for-service reimbursement and discusses advantages and shortcomings of HMOs and preferred provider organizations for the business community. He concludes with a discussion of why managed care

holds great promise for the provision of quality and cost-effective mental health and substance abuse care.

Keywords: private sector programs, overviews, trends

37. Mayhugh, S. L., & Shueman, S. A. (1994). The development and

maintenance of provider networks. In S. A. Shueman, W. G. Troy, &

S. L. Mayhugh (Eds.), Managed behavioral health care: An industry

perspective (pp. 49–64). Springfield, IL: Charles C. Thomas.

This chapter describes the development, rationale, and maintenance of a provider network for a

managed behavioral health care program. The authors focus on recruitment and selection, network monitoring, and improvement of provider performance. The authors conclude that only

through collaborative efforts between the industry and professional mental health training programs will providers acquire the skills and attitudes necessary in the managed care environment.

Keyword: providers

38. McGuire, T. G., & Fairbank, A. (1988). Patterns of mental health

utilization over time in a fee-for-service population. American Journal of

Public Health, 78, 134–136.

This study of Massachusetts Blue Shield beneficiaries’ ambulatory mental health use found

that almost 70 percent of the individuals who received services in 1980 also used mental

14 Special Report
health services in 1981 or 1982. These beneficiaries were also likely to have higher costs

for medical services, which then decreased when therapy was terminated. A comparison of

these findings with a similar multiyear study in an HMO revealed that patients were more

likely to continue ambulatory mental health care in a fee-for-service system than in an HMO,

but found no difference between the two settings in the likelihood of initiating ambulatory

mental health care.

Keyword: utilization

39. Mechanic, D. (1997). Approaches for coordinating primary and

specialty care for persons with mental illness. General Hospital Psychiatry,

19, 395–402.

In this era of increasing managed care penetration, primary care doctors are often the main

source of treatment for a person with a psychological disorder. This paper examines six

different models for integrating behavioral health with primary care in an effort to better

manage patients’ care: mainstreaming, the liaison psychiatry/collaboration model, new practitioner models, independent carve-outs, functionally integrated carve-outs, and extended

care models. The author discusses the benefits and limitations of each model, noting that

certain models may be more successful with some patient populations and not as successful

with others. The author also identifies five barriers that often hamper primary care physicians

in managing psychological disorders. These are limited training in disorder diagnosis, lack

of time to deal with psychological issues, limited experience with psychiatric drugs, fear of

treating patients with psychiatric disorders, and difficulty getting patients to disclose symptoms of psychiatric disorders.

Keywords: integration, models, primary care

40. Mechanic, D. (1998). Emerging trends in mental health policy and

practice. Health Affairs, 17(6), 82–98.

This article presents an in-depth analysis of the issues surrounding managed care and mental

health services. The author describes current trends in the mental health care system that

provide a challenging context for the management of mental health services; these trends

include deinstitutionalization and the shift of patients into community care programs and

other residential facilities, parity of insurance coverage between mental and physical illness,

and integration between behavioral and general health services. Serious problems exist in

ensuring an appropriate range of services and programs for the seriously mentally ill residing

in community settings. The author argues for increased coordination between hospital and

community care and for the integration of hospital care into a more balanced system of

services. Managed care organizations do not have full responsibility for the future of mental

health services; these responsibilities are shared by purchasers, professionals, patient advocates, and the government.

Keywords: integration, overviews, parity, serious mental illness, trends

Annotated Bibliography 15
41. Mechanic, D. (Ed.). (1998). New Directions for Mental Health Services, 78.

The purpose of this book is to more carefully describe the developing system of managed care

in order to guide its future design. A collection of authors helped to compose this sourcebook;

initially, they present the current context of managed care by looking at a variety of issues such

as utilization review and carve-outs. The second section concentrates on special issues such as

contracting and special needs populations. The third section presents case study analyses from

Utah, Colorado, and Massachusetts, all of which are states that have implemented Medicaid

behavioral health managed care programs. The final section highlights arguments made in the

prior sections and presents some observations about the future of managed care. Ultimately,

the editor of this book looks to present an analysis that balances the views of managed behavioral health care critics and industry representatives. This effort intends to provide a clearer

understanding of the industry in order to more effectively improve it in the future. 

Keywords: carve-outs, Colorado, contracting, Massachusetts, Medicaid, public sector,

Utah, utilization management

42. Mechanic, D., Schlesinger, M., & McAlpine, D. D. (1995). Management

of mental health and substance abuse services: State of the art and early

results. The Milbank Quarterly, 73(1), 19–55.

This article is a review of research literature and anecdotal reports on mental health and substance abuse managed care programs. The authors conclude that managed mental health care

has the potential to reduce treatment costs and to apply uniform standards of appropriate

treatment for patients. While noting potential obstacles that managed mental health care plans

might encounter, the authors state that some forms of managed care have been successful at

incorporating more flexible benefits and more innovative treatment programs for private and

public mental health patients. The article encourages further research on the quality and costeffectiveness of managed mental health care.

Keyword: outcomes 

43. Milhalik, G., & Scherer, M. (1998). Fundamental mechanisms of

managed behavioral health care. Journal of Health Care Finance, 24(3),

1–15.

In this article, the authors describe the individual structures and components of managed

behavioral health care organizations (MBHOs) as a means of understanding the trend in

the evolution of behavioral managed care. In particular, the authors examine the advantages

and disadvantages of both carving in and carving out mental health care services, various

payment mechanisms and contracts between MBHOs and payers and the contracts between

MBHOs and their providers (including case rate contracts and withholds), utilization management systems, and models for the management and delivery of behavioral health care. 

Keywords: carve-outs, contracting, managed behavioral health care organizations

16 Special Report
44. Moss, S. (1998). Contracting for managed substance abuse and mental

health services: A guide for public purchasers: Vol. 22. Technical assistance

publication series. Rockville, MD: Center for Substance Abuse Treatment.

In response to the importance of establishing strong contracts between purchasers of health

care services and managed care organizations in the development of managed behavioral

health systems, this document provides information for public purchasers regarding the design

of requests for proposals (RFPs) and contracts in managed behavioral health care. The guide

includes eight separate chapters: (1) an overview of managed care and the importance of a

good contract, (2) a step-by-step process for designing and implementing a managed care system, (3) a discussion on essential decisions concerning services and medical necessity, (4) an

examination of the establishment and maintenance of provider networks, (5) an analysis of key

features of a management information system, (6) a discussion of issues pertaining to quality

of care, (7) an analysis of different aspects of financing in a managed care environment, and

(8) a look at consumer protection issues. The guide also provides a resource list of organizations involved in managed behavioral health care, a glossary, and nine appendices with examples of proposals, sample bidder letters, definitions of different services, criteria for the use of

block grant funds, outcome measures, and contract language.

Keywords: contracting, managed behavioral health care organizations, public sector,

substance abuse, technical assistance

45. Nauert, R. C. (1997). Managed behavioral health care: A key component

of integrated regional delivery systems. Journal of Health Care Finance

23(3), 49–61.

This article discusses the importance, in the current business environment, of a strong managed

behavioral health care component within regional integrated health systems. The author discusses current trends in the business environment and addresses a number of issues that need

to be considered when pursuing the behavioral health care market. The author provides an

overview of the alternative roles large hospitals and medical centers can take in responding to

market demands for managed behavioral health care. The author also discusses planning

assumptions and reviews the strengths and weaknesses of academic medical centers and large

hospitals, which can impact the successful development of behavioral health care. The author

provides a prototype of a managed behavioral health care strategic business unit as part of a

regional health system and discusses its advantages and pitfalls. The author concludes with a

discussion of capitation contracts, risk control and quality assurance, and the importance of

data tracking systems.

Keywords: integration, overviews

46. Ogles, B. M., Trout, S. C., Gillespie, D. K., & Penkert, K. S. (1998).

Managed care as a platform for cross-system integration. The Journal of

Behavioral Health Services & Research, 25(3), 252–268.

The implementation of managed care into public sector mental health care has raised concerns

about the ability of this previously private-sector strategy to provide services consistent with

Annotated Bibliography 17
the core values of an integrated system of care. This paper examines the basic arguments

on both sides of this debate, focusing on the recent changes in the mental health care system

and the potential benefits and drawbacks of incorporating into it managed care principles.

Using the example of Integrated Services for Youth, a private, nonprofit corporation in Ohio

designed to manage the care of children and adolescents who are involved with multiple

public-sector service systems, the authors demonstrate how managed care principles and

system-of-care values are not necessarily mutually exclusive and may even facilitate crosssystem integration of services for children and youth.

Keywords: children, integration, Ohio

47. Padgett, D. K., Patrick, C., Burns, B. J., Schlesinger, H. J., & Cohen, J.

(1993). The effect of insurance benefit changes on use of child and

adolescent outpatient mental health services. Medical Care, 31, 96–110.

This study examines the responsiveness of benefit changes on the use of outpatient mental

health benefits for children and adolescents. Between 1978 and 1983, Blue Cross and Blue

Shield Federal Employees Plan (FEP) benefits for dependent children and adolescents were cut,

and there was a shift from high- to low-option plan enrollment. During this time, there was a

slight increase in the proportion of clients who received outpatient benefits; however, the average number of visits decreased from 18.9 to 12.8. While benefit coverage was a strong predictor of the use of mental health benefits, ethnicity, parent’s education, type of provider, and type

of treatment setting were also significant predictors of use. The study found that 2.76 percent

of children in FEP used outpatient mental health services in 1983, representing approximately

one-half of the proportion of U.S. children estimated to be in acute need. These findings’ implications are discussed in the context of changes in the financing and delivery of mental health

services, especially with regard to managed care, and also in the context of the growing pressures for national health insurance.

Keyword: children

48. Patterson, D. Y. (1993). Twenty-first century managed mental health:

Point-of service treatment networks. Administration and Policy in Mental

Health, 21, 27–33.

Many public and private employers now favor the point-of-service (POS) plan that allows

the prospective patient to decide at the point of service delivery whether to use a contracted

or non-network provider. This article describes the nature of the POS plan and its impact

on employers and employees. The author argues that only by developing a POS choice that

is cost-neutral to the employer does a managed care network gain the moral authority and

leverage to design a high-quality and cost-effective system. The article describes the principles

guiding a rationally planned POS system and offers suggestions for internal and external

oversight and quality assurance.

Keywords: models, providers

18 Special Report
49. Patterson, D. Y. (1990). Managed care: An approach to rational

psychiatric treatment. Hospital and Community Psychiatry, 41, 1092–1095.

According to this author, managed care is not necessarily bureaucratic and dehumanizing,

nor is it a stop on an inevitable route toward health care rationing or a national health care

service. In contrast, he argues, the partnership of the right delivery model and the right

providers with the right financial incentives and proper management-consumer oversight can

lead to the most rational mental health care delivery possible. A rational mental health care

plan requires that a managed system be able to construct the right delivery model, select the

appropriate providers, employ judicious financial incentives, and undertake adequate oversight. The author describes the principles that he would include in an effective delivery model

for mental health care. 

Keyword: models

50. Patterson, D. Y., & Berman, W. H. (1991). Organizational and service

delivery issues in managed mental health services. In C. S. Austad &

W. H. Berman (Eds.), Psychotherapy in managed health care: The optimal

use of time and resources (1st ed., pp. 19–32). Washington, DC: American

Psychological Association.

In this chapter, the authors outline the organizational and structural components of managed

mental health care. They examine the types of managed mental health systems and their

advantages and disadvantages, the types of benefits and limitations that are likely under

various plans, and professional roles and conflicts in managed mental health service delivery.

These include referral procedures, staffing patterns, and inpatient and outpatient services.

Keywords: models, staffing

51. Pearson, J. (1992). Managed mental health: The buyer’s perspective.

In S. Feldman (Ed.), Managed mental health services (1st ed., pp. 127–142).

Springfield, IL: Charles C. Thomas.

Employers are finding that generic utilization review approaches are neither reducing mental

health costs nor delivering quality care. The author presents options that exist in managed

care, and the questions that employers should consider in deciding whether or not to implement such an approach. This chapter describes the advantages and disadvantages of employee

assistance programs, benefit redesign, strengthened existing utilization review, specialty case

management, and contracts with a preferred provider organization or exclusive provider

organization. The chapter discusses the factors and decision-making process that shape a

company’s managed mental health program. The author states that good cost and utilization

data are essential in determining how to reimburse a managed care firm and discusses the

critical role consultants play in the process of educating their client companies and helping

them to select an appropriate managed care firm.

Keywords: overviews, private sector programs

Annotated Bibliography 19
52. Penner, N. R. (1994). The road from peer review to managed care:

Historical perspective. In S. A. Shueman, W. G. Troy, & S. L. Mayhugh

(Eds.), Managed behavioral health care: An industry perspective (pp.

29–44). Springfield, IL: Charles C. Thomas.

This chapter describes the ways in which both the American Psychiatric Association and

American Psychological Association were pioneers in the managed mental health field

through the development of the Civilian Health and Medical Program of the Uniformed

Services (CHAMPUS). The authors highlight the program’s potential to provide the professions with the opportunity to shape the development of both public and private mental

health service delivery systems, as well as the program’s potential to create a system of

public accountability. The chapter describes the associations’ loss of this program and

reduced influence in shaping current managed systems.

Keyword: overviews

53. Pfaum, B. B. (1991). Seeking sane solutions: Managing mental health

and chemical dependency costs. Employee Benefits Journal, 31–40.

Studies have shown that mental illness and chemical dependency disorders are undertreated

and that treatment for these disorders is generally not delivered efficiently. Increasingly,

employers are recognizing the indirect costs of mental illness and chemical dependency disorders, such as increased absenteeism, lower productivity, and increased utilization of other

health plan benefits. This article discusses some of the factors that companies should consider

in designing a managed care program. Such a program should provide full coverage, control

access to care, facilitate early intervention, use alternative care to assist “high” users, and apply

appropriate screening criteria. The article also discusses factors to consider in using an employee assistance program, a utilization review, a preferred provider organization, or a carve-out

are also discussed. The author argues that these options can be used together, and outlines the

issues employers should consider in using HMOs to control mental health and chemical

dependency treatment costs.

Keywords: costs, overviews, private sector programs, substance abuse

54. Rodriguez, A. R. (1994). Mental health services under health reform:

The less government, the better. Managed Care Quarterly, 2(2), 10–12.

The author of this viewpoint article asserts that current health care reform proposals in favor

of government-backed managed competition are not in the best interest of patients. Such proposals will lead to increased cost and inefficiencies and decreased access to care. The author

advocates for privately managed mental health programs which he believes have already

demonstrated their efficiency in decision making, their economies of operation, their accountability to multiple constituencies, and their commitment to quality of service.

Keywords: health care reform

20 Special Report
55. Rogerson, C. L. (1994). Information system requirements for managed

care programs. In S. A. Shueman, W. G. Troy, & S. L. Mayhugh (Eds.),

Managed behavioral health care: An industry perspective (pp. 193–204).

Springfield, IL: Charles C. Thomas.

This chapter describes the importance of automating operations and program activities for

managed care companies. The author discusses several functions of an automated system and

offers guidelines for setting up such a system. He argues that while it is possible to operate a

small managed care program without an integrated information system, efficiency will be nevertheless hampered.

Keywords: information systems

56. Rosenbaum, S., Shin, P., Zakheim, M. H., Shaw, K., & Teitelbaum, J. B.

(1998). Special report of negotiating the new health system: A nationwide

study of Medicaid managed care contracts. Washington, DC: George

Washington University Center for Health Policy Research.

This special report analyzes Medicaid managed care contracts specific to mental illness and

addiction disorders. The report analyzes 54 contracts and related documents, 12 of which were

managed behavioral health care contracts that were in effect at the beginning of 1997.

Although this report considers Medicaid contracts, the authors contend that its findings are

relevant to all public purchasers of managed care services for mental illness and substance

abuse populations because, like Medicaid, these other sources of third-party payment have traditionally supported services that may or may not be customary for the insurance industry to

support. The report’s findings indicate that States are making an effort to design managed care

systems that function well for children and adults, but it also highlights the perceived inadequacies in the contracting abilities of public purchasers such as managed behavioral health care

carve-out contracts, which are frequently vague.

Keywords: contracting, Medicaid, public sector, substance abuse

57. Rosenbaum, S., Silver, K., & Wehr, E. (1997). An evaluation of contracts

between managed care organizations and community mental health and

substance abuse treatment and prevention agencies: Vol. 1. Managed care

technical assistance series. Rockville, MD: Substance Abuse and Mental

Health Services Administration.

This study is designed to help public policymakers, group purchasers, providers, and consumers understand the structure and content of provider network agreements between managed care organizations and community mental health and substance abuse treatment and prevention agencies. From their in-depth analysis of 50 selected contracts, the researchers explain

various aspects of contract provisions, including services, the duty to treat patients, the necessity of prior authorization, medical necessity, capitation agreements, fee-for-service agreements,

coordination of benefits, and numerous other clauses of the contracts. The paper includes conAnnotated Bibliography 21
clusions, recommendations, and two appendices covering methodology; the paper also has 28

different tables portraying the results of the study.

Keywords: community providers, contracting, managed behavioral health care organizations, substance abuse, technical assistance

58. Roy-Byrne, P., Russo, J., Rabin, L., Fuller, K., Jaffe, C., Ries, R.,

Dagadakis, C., & Avery, D. (1998). A brief medical necessity scale for

mental disorders: Reliability, validity, and clinical utility. The Journal of

Behavioral Health Services & Research, 25(4), 412–424.

While managed care organizations (MCOs) use the concept of “medical necessity” to determine whether to authorize treatment for an individual, there is currently no consistent measurement of medical necessity for a mental health condition. To address this need, the authors

have developed an instrument of 13 items relevant to the concept of medical necessity. In this

paper, they describe the medical necessity scale and present findings from their pilot testing of

this scale. In a study of 205 patients, they found that the internal consistency reliability and the

interrater reliability of the instrument were both acceptable. They conclude that the instrument

is able to measure the multiple aspects of a patient’s condition needed to make decisions on

medical necessity, although they advocate further studies with different patient populations and

staff interviewers to determine whether the reliability results are generalizable.

Keywords: medical necessity

59. Savitz, S. A., Grace, J. D., & Brown, G. S. (1993). “Parity” for mental

health: Can it be achieved? Administration and Policy in Mental Health, 21,

7–14.

Parity of insurance coverage for psychiatric and physical illness is a major issue in health care

reform. Proponents of parity and partial parity, such as the American Psychiatric Association

and the National Alliance for the Mentally Ill, argue that coverage for psychiatric and physical

illness should be equal with respect to dollar limits, deductibles, and coinsurance. Such an

approach is expensive. The authors describe strategies for achieving parity, such as capitation,

case management, and the use of provider networks. They propose a model to reduce high utilization of unnecessary care, that incorporates managed care strategies for the cost-effective

and equitable provision of behavioral health care.

Keyword: parity

60. Schwartz, B. J., & Wetzler, S. (1998). A new approach to managed care:

The provider-run organization. Psychiatric Quarterly, 69(4), 345–353.

For many psychiatric hospitals and teaching facilities, managed care has become synonymous

with shortened lengths of stay, reduced reimbursement, and the invasion of third-party care

managers into the client–patient relationship. In this paper, the authors describe an alternative

model to managed care, in which providers contract with HMOs directly, thereby eliminating

the need for intermediary managed care organizations. This provider-run, hospital-based

approach allows providers to regain control over service delivery. Through the example of

22 Special Report
one such organization, the authors discuss the philosophy behind this model, the legal

structures created to assume the financial risk, provider relationships, recruitment, management, reimbursement, the treatment paradigm, and the marketing strategies the new model

involves. From the utilization data already collected on this organization, the authors demonstrate that utilization in the provider-run approach is consistent with that of a highly managed

population.

Keywords: models, providers

61. Sederer, L. I., & Bennett, M. J., (1996). Managed mental health care in

the United States: A status report. Administration and Policy in Mental

Health, 23(4), 289–306.

The authors review managed mental health care in the United States. The report begins with

a brief history of managed mental health care and proceeds to concentrate on six major issues:

what is insurable, carve-ins, networks, contract and professional liability, ethics, and support

for teaching and research. The report’s final section discusses factors such as utilization management and economies of scale: factors that allowed managed care to achieve savings through

1996. The authors conclude with recommendations to the managed care industry and policymakers on how best to sustain these cost savings into the future.

Keywords: ethics, liability, overviews, utilization management

62. Sharfstein, S. S. (1988). Changing insurance markets. In D. J. Scherl, J.

T. English, & S. S. Sharfstein (Eds.), Prospective payment and psychiatric

care (pp. 121–128). Washington, DC: American Psychiatric Association.

The author describes the major trends in third-party financing of health care, in which the

third parties are government and business, and not only the insurance industry. These trends

include the growth of prospective payment, employer self-insurance, data gathering, both vertically and horizontally integrated systems (such as HMOs and hospital chains), and subspecialization in the insurance market. The author discusses cutbacks in private coverage resulting

from industry fears of adverse selection and moral hazard. Other issues raised in this piece

include lack of access, high administrative costs, and the decline of professional autonomy.

Keyword: trends

63. Shueman, S. A., & Troy, W. G. (1994). The use of practice guidelines

in managed behavioral health programs. In S. A. Shueman, W. G. Troy,

& S. L. Mayhugh (Eds.), Managed behavioral health care: An industry

perspective (pp. 149–164). Springfield, IL: Charles C. Thomas.

This chapter provides a historical perspective on the use of practice guidelines in managed

behavioral health programs. The authors discuss the evolution of practice guidelines and the

rationale for their use. They describe current professional guidelines and their uses in managed

behavioral care programs. The chapter also describes implications of practice guidelines in

Annotated Bibliography 23
managed mental health programs. The authors speculate about the future development and

implementation of practice guidelines.

Keywords: quality assurance, standards of care

64. Shueman, S. A., Troy, W. G., & Mayhugh, S. L. (1994). Principles and

issues in managed behavioral health care. In S. A. Shueman, W. G. Troy,

& S. L. Mayhugh (Eds.), Managed behavioral health care: An industry

perspective (pp. 7–28). Springfield, IL: Charles C. Thomas.

This chapter focuses on the basic principles and key issues in managed behavioral health care.

The authors discuss the health services and financing environment that was in place before the

1980s, which provided the foundation for managed care. Some specific cost and quality-ofcare issues are discussed as well as innovative strategies to manage the behavioral health service system. The chapter concludes with a discussion of some of the challenges to managed

behavioral health care companies.

Keyword: overviews

65. Smukler, M., Sherman, P. S., Srebnik, D. S., & Uehara, E. S. (1996).

Developing local service standards for managed mental health services.

Administration and Policy in Mental Health, 24(2), 101–116.

Capitated community mental health models may create incentives to withhold care. This study

describes a method for eliminating this problem by creating standards for minimal levels of

care. These standards, or Recommended Service Levels (RSLs), were created to test for the

minimum, appropriate services for consumers at several levels of need. The RSL project was

executed in five stages: (1) organizing the project participants, including an oversight committee and a clinical-expert panel; (2) developing RSLs based on provider recommendations for

specific consumer groups and the appropriate level of services for them, in order to achieve

acceptable outcomes for these groups; (3) creating an assessment instrument that could categorize consumer groups based on the level of services; (4) creating a decision tree that would

allow assessment data to categorize a consumer for the appropriate RSL; and (5) testing the

RSL in a sample of consumers. The field-test results showed that the RSL method has promise,

but that it needed to include the consumer in the RSL process; manage the tension between

developers of local standards and the managed care entity responsible for funding the service

system; and validate the RSL standards through outcomes data.

Keywords: standards of care

66. Spiro, A. H. & Stokes, L. Q. (1991). A multifaceted approach to

managed mental health care. American College of Medical Quality, 6(2),

54–58.

This article describes how an Independent Physicians Association (IPA) Model HMO with

approximately 100,000 members manages its own mental health utilization. The system

revolves around highly trained case managers who are granted tremendous leeway in directing

patients toward appropriate care. These care managers use flexible benefits, such as 100 per24 Special Report
cent outpatient care coverage, to reduce hospital use. The program also implements PATH

(Projects for Assistance in Transition from Homelessness), a crisis intervention team of clinical

psychologists that provides care in the home. An outside psychiatrist reviewer and psychiatric

case manager monitor inpatient care, authorize lengths of stay, and precertify admissions.

The program has resulted in dramatic decreases in hospital utilization.

Keywords: case management, utilization management

67. Sturm, R. (1997). How expensive is unlimited mental health care

coverage under managed care? Journal of the American Medical

Association, 278(18), 1533–1537.

This article analyzes data on behavioral health utilization for 24 new managed care plans in

1995 and 1996 and estimates the costs of removing different coverage limits for behavioral

health as required by the Mental Health Parity Act. The data were obtained from the UCLA/

RAND Research Center on Managed Care and purposely analyze managed behavioral health

carve-out plans that offered more generous coverage than discussed during the parity legislation debate. The author concludes that the policy decisions that gave rise to the Mental Health

Parity Act might have been based on incorrect assumptions and outdated data, which led to

dramatic overestimates. For mental health care, the consequences of improved coverage under

managed care are relatively minor. 

Keywords: carve-outs, costs, economics, legislation, parity

68. Substance Abuse and Mental Health Services Administration. (1997).

An evaluation of contracts between state Medicaid agencies and managed

care organizations for the prevention and treatment of mental illness and

substance abuse disorders: Vol. 2. Managed care technical assistance

series. Rockville, MD: Substance Abuse and Mental Health Services

Administration.

This study provides a point-in-time examination of service agreements in operation at the end

of 1995 between State Medicaid agencies and managed care organizations to provide mental

health and substance abuse services. This study represents a review of Medicaid comprehensive-risk agreements and requests for proposals from approximately 35 States. The contracts

reviewed include general service agreements covering primary health and several behavioral

health care carve-out contracts. This study concludes that the behavioral health care market

would benefit from the development of recommended specifications for managed care on treating and preventing mental health and substance abuse disorders, since these treatment initiatives were not in the normal domain of older commercial insurance concepts of coverage. 

Keywords: carve-outs, contracting, Medicaid, public sector, substance abuse, technical

assistance

Annotated Bibliography 25
69. Weiner, R. B., & Siegel, D. (1989). Managed mental health care issues

and strategies. Benefits Quarterly, 5(3), 21–31.

This article examines the scope of the problem of rising mental health and substance abuse

costs and the strategies that employers can use to reduce these costs. Cost increases, both direct

and indirect, are attributed to several causes: increased demand for expanded benefits, excess

supply of providers, ineffective benefit design, and lack of standards for diagnosis and treatment. The authors describe five cost containment strategies—restrictive/limited benefits, utilization management, employee assistance programs, carve-outs, and provider networks—and the

factors employers should consider in selecting a strategy. Employers are urged to be flexible so

that strategies reflect the changing needs of their workers.

Keyword: costs

70. Wells, K. B., Hosek, S. D., & Marquis, M. S. (1992). The effects of

preferred provider options in fee-for-service plans on use of outpatient

mental health services by three employee groups. Medical Care, 30,

412–424.

This quasi-experimental comparison-group study tests two hypotheses. The first is that

employees who use preferred provider organizations (PPOs) are more likely than those

enrolled in fee-for-service plans to use outpatient mental health care. The second hypothesis

is that employees enrolled in PPOs will use less mental health services in general than those

in fee-for-service plans. Use patterns before and after PPO implementation are compared for

three PPOs. A survey of 8,828 employees was conducted to evaluate intentions to use PPO

providers. Intention was measured using a battery to determine each respondent’s usual

source of medical care before and after PPO implementation. The study found that intent to

use PPOs did not significantly affect the probability of use of outpatient mental health services because of access barriers and referral patterns by PPOs. Finally, the study found that PPO

members use less outpatient mental health services than non-PPO members, despite lower

cost-sharing for services received from PPO providers.

Keywords: PPOs, utilization

71. Wells, K. B., Manning, W. G., & Valdez, R. B. (1990). The effects of a

prepaid group practice on mental health outcomes. Health Services

Research, 25, 615–625.

The study uses data from the RAND Health Insurance Experiment to test the hypothesis

that there is a difference in mental health outcome between those enrolled in HMOs and

those enrolled in comparable fee-for-service plans. Families in the Seattle area were randomly

assigned to either the Group Health Cooperative of Puget Sound (a prepaid group practice),

to a fee-for-service plan with a family coinsurance rate of 0 percent, or to family pay plans

with coinsurance rates of 25 percent, 30 percent, or 95 percent for outpatient mental health

services. Mental health status was assessed at enrollment and at the end of each year of participation. The study found no statistically significant or clinically meaningful differences in

26 Special Report
mental health outcomes among these groups. The authors argue that the less intensive style

of treatment in the prepaid group practice was not associated with noticeably worse mental

health outcomes.

Keywords: HMOs, outcomes

72. Wells, K. B., Marquis, M. S., & Hosek, S. D. (1991). Mental health and

selection of preferred providers: Experience in three employee groups.

Medical Care, 29, 911–924.

This study examines the effects of mental health status and the prior use of mental health

services on provider selection by employees enrolled in fee-for-service plans with a preferred

provider organization (PPO). For the study, claims and survey data were obtained from three

large employee groups. The authors found that among persons who used mental health services after implementation of the PPO, those who had previously visited providers who subsequently became part of the PPO panel tended to stay with those PPO providers. On the other

hand, those who previously visited providers who did not later join the panel did not select

from PPO providers for mental health care. The study demonstrates the importance of the

patient-provider relationship in the selection of a mental health provider.

Keywords: PPOs, providers

73. White, K., & Shields, J. (1991). Conversion of inpatient mental health

benefits to outpatient benefits. Hospital and Community Psychiatry, 42,

570–572.

This article uses a case-study approach to describe how the conversion of inpatient to outpatient mental health benefits can lead to cost savings as well as to improved mental health

outcomes. In 1987, Blue Cross-Blue Shield of Massachusetts revised the contract of a beneficiary who had used extensive inpatient treatment for multiple psychiatric diagnoses. During

1986 alone she had admissions costing over $100,000. In-between hospitalizations, she used

day treatment and lived in a halfway house. In 1987, her contract was revised to cover a variety of outpatient services including the halfway house, supplementary day treatment, and an

activity program. This revision eventually led to a cost of approximately $33,000 that year:

a considerable savings compared to the previous contract. The patient also showed marked

improvement. The authors attribute this to several factors including the use of new drugs and

behavioral therapy, an individualized program at the halfway house, and the use of a nurse

case manager both to assess treatment successes and failures and to work with the patient’s

family. The authors conclude that better funding and utilization of outpatient services may be

cost-effective and also lead to improved outcomes.

Keywords: costs, outcomes

Annotated Bibliography 27
74. Wise, R. A. (1992). Managed care of the acutely ill psychiatric patient:

Development of a new delivery system. In J. Feldman & R. J. Fitzpatrick

(Eds.), Managed mental health care: Administrative and clinical issues (1st

ed., pp. 375–384). Washington, DC: American Psychiatric Press.

This chapter focuses on the challenging problems of caring for the acutely psychiatrically ill

patient who often consumes a disproportionate percentage of treatment time and resources.

The author reviews some current methods for managing the inpatient benefit for these patients.

He suggests a new system that can improve efficiency by more closely matching resources to

patient needs through alternative-to-hospital programs in conjunction with hospital care.

He describes the specific goals and some effective strategies that were developed at a staff

model HMO. He argues that managed care settings are best suited to explore alternative-tohospital programs, and that as the success of these programs is better documented, other

payors will be more willing to reimburse for this type of care.

Keywords: serious mental illness

75. Wolfe, H. L., Astrachan, B. M., & Scherl, D. J. (1988). Psychiatric

practice in organized health and proprietary care systems. In D. J. Scherl,

J. T. English, & S. S. Sharfstein (Eds.), Prospective payment and psychiatric

care. Washington, DC: American Psychiatric Association.

This chapter summarizes organized systems of care approaches to controlling mental health

costs. The authors describe the development, strengths and weaknesses of HMOs, preferred

provider organizations, employee assistance programs, and “multis”(multi-institutional corporations). The authors describe the practical and ethical implications of these payment systems

for psychiatrists, patients, and society at large. They conclude that the American Psychiatric

Association must focus attention on the issues of practice in organized settings and on the

nature and ethics of organizational practice.

Keywords: costs, EAPs, ethics, HMOs, PPOs

28 Special Report
III.

Annotated Bibliography 29

Capitation

76. Babigian, H. M., & Reed, S. K. (1992). Capitation and management of

mental health in the public sector. In J. Feldman & R. J. Fitzpatrick (Eds.),

Managed mental health care: Administrative and clinical issues (1st ed.,

pp. 111–124). Washington, DC: American Psychiatric Press.

The authors of this chapter describe a 5-year demonstration project to address inadequacies

in caring for seriously and persistently mentally ill people in Monroe and Livingston Counties

in New York. As part of this demonstration project, both counties and the State delegated

many of their responsibilities for the chronically mentally ill to a corporation that assumed

both management of the publicly funded mental health system and coordination of the

involved parties. The chapter discusses the evolution of the capitation payment system (CPS),

the problems it addressed, and the main features of the system. The chapter describes an

experimental evaluation of the CPS program, with preliminary findings indicating that the

experimental group is using fewer hospitalization resources than the control group. On the

basis of this project, the authors conclude that capitation shows promise in providing costeffective quality care for persons who are chronically mentally ill.

Keywords: capitation, New York, public sector, serious mental illness

77. Babigian, H. M., Cole, R. E., Reed, S. K., Brown, S. W., & Lehman, A. F.

(1991). Methodology for evaluating the Monroe-Livingston capitation

system. Hospital and Community Psychiatry, 42, 913–919.

The Monroe-Livingston demonstration project was initiated in 1987 to coordinate the quality

and cost of mental health services to chronically mentally ill patients. This paper presents the

methodology for evaluating the Monroe-Livingston demonstration project’s capitation payment system. The authors note that because random assignment produced equivalent groups,

attrition was kept to a minimum and excellent interrater reliability was achieved. The evaluation design appears sound. This study should increase our understanding of the impact of

capitation on families and patients.

Keywords: capitation, evaluation, New York, public sector, serious mental illness

78. Babigian, H. M., & Marshall, P. E. (1989). Rochester: A comprehensive

capitation experiment. New Directions for Mental Health Services, 43,

43–54. 

This chapter describes a demonstration project that examines whether persons who are

chronically mentally ill can be served effectively in a capitated-financing model. The authors

Annotated Bibliography
discuss the project design, which includes a central coordinating agency, prospective payment,

capitation, and management information systems. Examples are given to illustrate how clients

are deemed eligible. The article describes the issues and challenges that arose in implementation, such as determining capitation rates and ensuring that state hospital employees received

job security assurances. An evaluation has been undertaken to study the project’s effect on

mental health outcomes and costs.

Keywords: capitation, New York, public sector, serious mental illness

79. Brach, C. (1998). Designing substance abuse and mental health

capitation projects: Vol. 3. Managed care technical assistance series.

Rockville, MD: Substance Abuse and Mental Health Services

Administration.

This guide is meant as a reference tool for public officials in State and county substance abuse

and mental health agencies as they design capitation projects. With its overview of capitation

and answers to questions about capitation features, the guide also provides a useful foundation

to anyone interested in mental health or substance abuse capitation. The researchers identify

four relevant goals of substance abuse and mental health capitation and a 10-step plan to

becoming a purchaser of capitated substance abuse and mental health services. Each step represents a separate task for designers of capitation projects, who in considering each step review

the merits and drawbacks of different options. Steps include identifying goals, defining eligible

populations, determining the scope of services, assigning responsibilities, contracting, managing

risk, setting rates, enrolling clients, ensuring quality, and implementing the project. The guide

also includes a decision checklist as a separate appendix.

Keywords: capitation, contracting, public sector, substance abuse, technical assistance

80. Burns, B. J., Smith, J., Goldman, H. H., Barth, L. E., & Coulam, R. F.

(1989). The CHAMPUS Tidewater Demonstration Project. New Directions

for Mental Health Services, 43, 77–86.

Concern about high costs and overutilization of mental health benefits led the Office of

Civilian Health and Medical Program of the Uniformed Services (OCHAMPUS) to design

and implement a demonstration project. This project places a contractor at risk for the cost

of care, while granting the contractor leeway to manage the care using less costly forms of

delivery. Under this contractor provider arrangement, CHAMPUS hired a contractor to provide all mental health benefits for its members. OCHAMPUS retains ultimate responsibility

and performs oversight to maintain quality control. The chapter describes the functions

performed by the contractor such as case management, processing claims, and establishing

a network of providers. The authors identify the problems that arose in implementing the

project and the questions to be answered in evaluating the project.

Keyword: capitation

30 Special Report
81. Chandler, D., Meisel, J., Hu, T., McGowen, M., & Madison, K. (1998).

A capitated model for a cross-section of severely mentally ill clients:

Hospitalization. Community Mental Health Journal, 34(1), 13–26.

This 3-year study of the severely mentally ill (SMI) population examines hospitalization

outcomes for two capitated integrated service agencies (ISAs), one urban and one rural, in

California. The study focuses on the effectiveness of capitation and assertive treatment teams

to limit hospital admissions, lengths of stay, mean mental health costs, and other factors for

the SMI population. Using the flexibility of capitated funding and assertive treatment teams,

both ISAs established crisis response and continuity of care procedures. According to the

authors, at neither site were clients’ outcomes on hospitalization uniformly superior to those

of clients in the “usual system.” However, the authors concluded that, in these two ISAs,

elements of the capitated model produced both some clinically appropriate and less costly

uses of inpatient services.

Keywords: California, capitation, evaluation, outcomes, public sector, serious mental

illness 

82. Christianson, J. B., & Gray, D. Z. (1994). What CMHCs can learn from

two States’ efforts to capitate Medicaid benefits. Hospital and Community

Psychiatry, 45, 777–781.

The authors compare the Minnesota (Hennepin County) mental health capitation project with

the Utah Prepaid Health Plan. In this study, Medicaid beneficiaries were enrolled in HMOs

and the Utah Prepaid Health Plan which contracted with community mental health centers to

provide care for Medicaid eligible clients. The authors discuss pros and cons of contracting

with medical vs. mental health HMOs. They also present preliminary findings from these

demonstration projects.

Keywords: capitation, HMOs, Medicaid, Minnesota, public sector, Utah

83. Christianson, J. B., Lurie, N., Finch, M., & Moscovice, I. S. (1989).

Mainstreaming the mentally ill in HMOs. New Directions for Mental Health

Services, 43, 19–28.

The Health Care Financing Administration (HCFA) undertook a demonstration project in

Hennepin County, Minnesota, in order to study the ability of HMOs to cost-effectively serve

seriously mentally ill clients. For this project, Medicaid beneficiaries were randomly assigned

to receive 1 year of treatment in a prepaid health plan. The issues identified by the project

included disruption of treatment; the ability of health plans, in spite of their lack of experience, to use community resources effectively; and adverse patient selection. Although the

authors conclude that these concerns can be addressed, they raise questions as to how States

can address the problem of adverse selection if they cannot make retrospective payments to

compensate health plans that experience financial difficulties.

Keywords: capitation, HMOs, Minnesota, public sector, serious mental illness

Annotated Bibliography 31
84. Cole, R. E., Reed, S. K., Babigian, H. M., Brown, S. W., & Fray, J. (1994).

A mental health capitation program: I. Patient outcomes. Hospital and

Community Psychiatry, 45(11), 1090–1096.

Proponents of capitation have suggested that capitating payment for mental health services

both restrains high mental health care costs and improves the flexibility and responsiveness

of care. In this study, the authors evaluate the Monroe-Livingston demonstration project’s capitation payment system (CPS). The experiment randomized patients into either the capitatedfunding program (experimental group) or the fee-for-service program (control group). The

authors conducted followup interviews with patients 1 and 2 years after enrollment to assess

changes in their symptoms and functioning. Additionally, the authors reviewed data files of

the membership corporation to measure patients’ utilization of inpatient care. The results

show that while patients in the experimental group utilized inpatient days less frequently than

the control group, the two groups did not differ significantly in respect to functioning or level

of symptoms. 

Keywords: capitation, evaluation, New York, outcomes, public sector, serious mental

illness

85. Cutler, D. L., Bentson, H., & Winthrop, K. (1998). Mental health in the

Oregon health plan: Fragmentation or integration? Administration and

Policy in Mental Health, 25(4), 361–386.

Between 1994 and 1998, Oregon experienced a rapid change in its health care system. Since

the implementation of the Oregon Health Plan, Medicaid enrollment has expanded 50 percent to include some of the working poor. In addition, since then over 75 percent of individuals receiving Medicaid have enrolled in HMOs, and demonstration projects have experimented with capitated behavioral health services. In this paper, the researchers examine the effects

of the transition to capitation as well as the integration of behavioral and physical health

care, using interviews with various stakeholders in the community. The paper discusses the

background of Medicaid expansion and capitation in Oregon, the development of mental

health payment rates and rate setting, the variations in both carved out and integrated mental

health models, and, using interviews with stakeholders, the successes and challenges of implementing the new health plan. These interviews have revealed that the greatest challenge has

been the attempted integration of public sector behavioral health services with private sector

health plans, while the expansion and transition to capitation have been more successful. 

Keywords: capitation, integration, Medicaid, Oregon, public sector 

86. Dobmeyer, T. W., McKee, P. A., Miller, R. D., & Westcott, J. S. (1990).

The effect of enrollment in a prepaid health plan on utilization of a

community crisis intervention center by chronically mentally ill individuals.

Community Mental Health Journal, 26(2), 129–137.

The advent of a Medicaid Demonstration Project to enroll Medicaid beneficiaries in a prepaid

plan raised concerns among county mental health agencies in Hennepin County, Minnesota,

that the new system might lead to underprovision of mental health services by prepaid plans,

32 Special Report
and might therefore create an extra burden on county-funded mental health agencies. The

authors randomized a sample of eligible recipients into a prepaid or fee-for-service group

and examined how the effect of enrollment in a prepaid plan affected use of an emergency

crisis center by chronically mentally ill Medicaid recipients. This center had not contracted

with the prepaid plan as a service provider. The study found that the use of the center by

those enrolled in the prepaid group was slightly (statistically insignificant) lower than for the

fee-for-service group. The authors conclude that this finding may be an indication of successful case management by prepaid health plans in serving chronically mentally ill patients.

Keywords: capitation, local governments, Medicaid, Minnesota, public sector, serious

mental illness, utilization

87. Hadley, T. R., & Glover, R. (1989). Philadelphia: Using Medicaid as a

basis for capitation. New Directions for Mental Health Services, 43, 65–76. 

Philadelphia was one of nine cities selected by the Robert Wood Johnson Foundation and the

U.S. Department of Housing and Urban Development to develop innovative and improved

ways of providing mental health care to the chronically mentally ill population. As part of

this initiative, Philadelphia designed a Medicaid capitation demonstration project for financing and managing mental health services. This capitated arrangement includes all Medicaidreimbursed psychiatric services for Philadelphia residents. This article describes the project’s

design and early implementation, and also discusses early difficulties and future goals.

Keywords: capitation, local governments, Medicaid, Pennsylvania, public sector

88. Hargreaves, W. A. (1992). A capitation model for providing mental

health services in California. Hospital and Community Psychiatry, 43,

275–277.

In 1988, the California legislature adopted and funded an integrated services agency (ISA)

model of providing mental health services. State funds were appropriated for two sites, one in

rural Stanislaus County and the other in the city of Long Beach. Each site serves people who

are disabled because of their mental disorder, who show substantial functional impairment,

and who are considered public fiscal liabilities. This includes people who are being treated for

a first psychotic episode. The ISA model attempts to go beyond the strict capitation model by

providing incentives for providers to offer optimal services while maintaining cost-effectiveness.

A controlled, randomized comparison of ISAs and usual services is being conducted to evaluate

whether ISAs indeed control costs while enhancing outcomes for mentally disabled patients.

Keywords: California, capitation, public sector, serious mental illness

89. Lurie, N., Moscovice, I. S., Finch, M., Christianson, J. B., & Popkin,

M. K. (1992). Does capitation affect the health of the chronically mentally

ill? Results from a randomized trial. Journal of the American Medical

Association, 267, 3300–3304.

This study evaluated the effect on health outcomes of enrollment of chronically mentally ill

Medicaid recipients in prepaid plans and fee-for-service Medicaid. Seven hundred thirty-nine

Annotated Bibliography 33
chronically mentally ill Medicaid clients were randomly assigned into either one of four capitation plans or into a control group that continued to use fee-for-service care. Outcomes measured included general health status, physical and social functioning, and psychiatric symptoms.

Pre- and postdata were collected on both the client and control groups. The study found that

there was no consistent evidence of short-term adverse health effects in prepaid plan enrollees,

and it recommends conducting long-term outcome studies.

Keywords: capitation, Medicaid, outcomes, public sector, serious mental illness

90. Mauch, D. (1989). Rhode Island: An early effort at managed care.

New Directions for Mental Health Services, 43, 55–64. 

This chapter describes the Rhode Island Division of Mental Health’s use of partial capitation

to discharge long-term psychiatric patients from the State mental hospital to the community.

The Transfer I program provided $4,500 per patient per year to community agencies to serve

clients who had been hospitalized continuously for at least 1 year. The Transfer II program was

initiated 5 years after Transfer I started, following a review of the limitations and accomplishments of Transfer I. Transfer II clients must have been hospitalized continuously for 2 years or

longer. In both programs, providers were required to become their clients’ single, designated

manager of care. The capitated cost for Transfer II clients was set at $20,000 each. To guard

against inadequate service, community programs were required to provide core services over

and above those funded by capitation, to assign a care manager, and to track and evaluate

client functioning. The strategy resulted in the cost-effective transfer of a number of patients.

The author identifies a number of problems with this approach: lack of adequate community

care options; disincentives to serve clients with shorter lengths of stay; and inflexible capitation

rates, which lead to system instability. The author nonetheless argues that these programs have

been successful in helping individual clients live in the community and in bringing about system change.

Keywords: capitation, public sector, Rhode Island, serious mental illness

91. McGovern, M. P., Lyons, J. S., & Pomp, H. C. (1990). Capitation

payment systems and public mental health care: Implications for

psychotherapy with the seriously mentally ill. American Journal of

Orthopsychiatry, 60, 298–304.

Two types of prospective payment have been used to control mental health costs: case-mix

models (such as diagnosis-related groups) and capitation. According to this article’s authors,

capitation models offer the most promise for cost-effectively serving chronically mentally ill

persons. The article discusses the advantages of the capitation strategy, such as integrating

resources and service provision and providing a spectrum of services including medical care.

This approach has important implications for treatment. It can result in better linkage among

treatment modalities, greater emphasis on psychosocial versus medical care, the use of rehabilitation and social skills training, and an emphasis on involving the patient’s family and support

network. The authors also identify potential disadvantages to using capitation, such as inade34 Special Report
quate care, reliance on unskilled paraprofessionals, and an emphasis on maintenance rather

than rehabilitation.

Keywords: capitation, serious mental illness

92. Mechanic, D., & Aiken, L. H. (Eds.). (1989). New Directions for Mental

Health Services, 43.

This volume of New Directions for Mental Health Services presents a case study approach

to capitation programs of mental health services. This work represents the perspectives of

both theoreticians and implementors. The editors specifically include both capitation “success”

as well as “failure” stories because each offer the reader unique learning opportunities.

Keywords: capitation

93. Mechanic, D., & Aiken, L. H. (1989). Capitation in mental health:

Potentials and cautions. New Directions for Mental Health Services, 43,

5–18. 

Capitation is increasingly advocated as a means of solving cost and quality problems in mental

health care for chronically mentally ill persons. The authors provide examples and the history

of this strategy and discuss its limitations. Among the risks to a capitation strategy are underserving populations, or a lack of service entirely. There are also significant problems in “mainstreaming” chronically mentally ill persons in HMOs as well as in serving them using separate

mental health HMOs. Under capitation, certain subsets of this population are neglected and

poorly treated. There are obstacles to using capitation to consolidate financing, such as determining “fair” capitation rates; there is also reluctance by funding agencies to surrender control

of their budgets. The authors conclude that capitation holds promise as a strategy for consolidating major sources of funding and contributing toward a coherent system of managed care

for the most needy patients.

Keywords: capitation, serious mental illness

94. Reed, S. K., Hennessy, K. D., Brown, S. W., & Fray, J. (1992). Capitation

from a provider’s prospective. Hospital and Community Psychiatry, 43,

1173–1175.

This article explores providers’ experiences with the capitation payments system (CPS), a

component of a mental health demonstration project in Monroe and Livingston Counties,

New York. As part of the evaluation of the impact of CPS, interviews were conducted with

administrators, program managers, and direct-care staff from both CPS lead agencies and

the State hospital. Providers interviewed identified a number of ways in which CPS enhanced

care of seriously mentally ill persons. CPS, in which funding “follows” patients, facilitates

effective use of community mental health resources, and increases staff and client empowerment and collaboration among agencies. The authors also discuss provider recommendations

to improve CPS and providers’ efforts to advocate for this managed care strategy’s expanded

use.

Keywords: capitation, New York, public sector, serious mental illness

Annotated Bibliography 35
95. Reed, S. K., Hennessy, K. D., Mitchell, O. S., & Babigian, H. M. (1994).

A mental health capitation program: II. Cost-benefit analysis. Hospital and

Community Psychiatry, 45, 1097–1193.

In this study, the authors examined the costs and benefits associated with a capitation demonstration program. The authors analyzed total costs and benefits of care for individuals in the

Monroe-Livingston demonstration project’s capitated funding program, and compared them to

the costs and benefits in a traditional fee-for-service system of care. The study distinguished

between those patients enrolled in the comprehensive plan (continuous care) and those enrolled

in the partial plan. From the results, all groups showed improvements over the previous 2

years, but continuous patients in the capitated plan were hospitalized less frequently and experienced more case management and transportation services than continuous patients in the feefor-service plans. The patients continuously in the capitated plan were also more likely to live

in unsupervised settings and experienced higher levels of victimization. Subjects in the partial

plan for both the capitation and fee-for-service plans differed from each other on fewer measures, and both groups reported high levels of case management and social support services and

lower levels of supervised housing. The authors conclude that the capitation payments system

resulted in major improvements in the communities’ mental health services and in decreased

utilization in inpatient services.

Keywords: capitation, costs, evaluation, New York, outcomes, serious mental illness 

96. Reidy, W. J. (1993). Staff model HMOs and managed mental health

care: One plan’s experience. Psychiatric Quarterly, 64(1), 33–43.

The Community Health Plan (CHP) is a not-for-profit staff model HMO that has provided

inpatient and outpatient mental health benefits for its beneficiaries for the past 15 years. The

mental health program is organized into interdisciplinary teams of mental health professionals.

Wherever possible, the program provides outpatient over inpatient care, goal-limited rather

than long-term psychotherapy, group therapy, and psycho-educational programs. For members

with major psychiatric disorders, CHP staff provide ongoing maintenance care and case management. This article describes the structure and function of the CHP and the lessons learned

through the provision of this model of managed care.

Keywords: capitation, HMOs

97. Roth, D., Snapp, M. B., Lauber, B. G. & Clark, J. A. (1998). Consumer

turnover in service utilization patterns: Implications for capitated payment.

Administration and Policy in Mental Health, 25(3), 241–255.

The authors report the findings from a multiyear, National Institute for Mental Health

(NIMH)-funded study in Ohio, “Services in Systems: Impact on Client Outcomes,” that

explored the effect of the changing mental health system on services for the severely mentally

ill (SMI) population. The study uses past service utilization to classify people by level of risk,

and then uses these findings to hypothesize on the development of risk-adjusted capitation

rates for SMI individuals. This article describes the cluster statistical analysis technique which

36 Special Report
was used on a random sample of 4,346 consumers of mental health services over a 5-year

period. The findings of this study, according to the authors, suggest caution in the implementation of risk-adjusted capitated reimbursement plans for people with SMI, because retrospective assessment of service utilization is of limited value. 

Keywords: capitation, evaluation, Ohio, outcomes, public sector, serious mental illness

98. Rothbard, A. B., Hadley, T. R., Schinnar, A. P., Morgan, D., & Whitehill,

B. (1989). Philadelphia’s capitation plan for mental health services. Hospital

and Community Psychiatry, 40, 356–358.

This article describes a capitation demonstration project to deliver services cost-effectively

to Philadelphia’s chronically mentally ill Medicaid recipients. The project is overseen by a

central authority, a nonprofit corporation created by the city’s Office of Mental Health/

Mental Retardation. The authority uses strategies such as case management to control

costs. Capitation will be implemented in order to lower costs associated with high-user

clients. The authority will also use performance contracts for moderate user services.

Keywords: capitation, local governments, Medicaid, Pennsylvania, public sector,

serious mental illness

99. Santiago, J. M., & Berren, M. R. (1989). Arizona: Struggles and

resistance in implementing capitation. New Directions for Mental Health

Services, 43, 87–96.

In this chapter, the authors describe capitation pilot projects to reform Arizona’s public

mental health system. The Arizona experiment implemented four projects in Tucson and

Phoenix and one in rural Yuma. Each site received a fixed amount of money to provide

mental health services to randomly selected, indigent, mentally ill patients. The project

clinical team performed case management and delivered other services and was financially

at risk for the costs of inpatient and outpatient care. The authors discuss a number of

barriers to implementation, including insufficient capitation rates, provider resistance,

lack of market competition, and absence of safeguards against underserving populations.

Keyword: Arizona, capitation, public sector

100. Schinnar, A. P., & Rothbard, A. B. (1989). Evaluation questions for

Philadelphia’s capitation plan for mental health services. Hospital and

Community Psychiatry, 40, 681–683.

This report of the Philadelphia experiment to capitate psychiatric services for Medicaid

clients focuses on the anticipated impact of capitation on the cost, quality, and accessibility

of care to chronically mentally ill patients. The authors argue that the experience of this

large-scale demonstration in capitation financing should be watched closely by policymakers

across the country for the project’s potential impact on the substitution of outpatient for

inpatient services, on continuity of care, and on cost-shifting. Other project aspects to be

Annotated Bibliography 37
observed closely include its spillover effects as well as its impact on providers and client care.

The authors argue for timely evaluation of the impact of the experiment.

Keywords: capitation, local governments, Medicaid, Pennsylvania, serious mental

illness

101. Schinnar, A. P., Rothbard, A. B., & Hadley, T. R. (1989). Opportunities

and risks in Philadelphia’s capitation financing of public psychiatric

services. Community Mental Health Journal, 25, 255–266.

This article examines the risks and benefits inherent in the reorganization of Philadelphia’s

mental health service system under a capitation financing model. The authors focus on cost

and utilization patterns, providers and their staffing patterns, treatment outcomes, and the

impact of capitation on clients. Philadelphia plans to restructure its delivery and reimbursement system, creating a not-for-profit central authority to finance and manage service delivery.

Keywords: capitation, local governments, Medicaid, Pennsylvania, public sector, serious mental illness

102. Schlesinger, M. (1989). Striking a balance: Capitation, the mentally ill,

and public policy. New Directions for Mental Health Services, 43, 97–116. 

The author argues that in order to meet the needs of both publicly and privately insured

chronically mentally ill persons, capitation must balance several incentives and interests.

He describes two types of incentives to limit resource use: provider capitation related to

providers’ income and nonfinancial limits on treatment. These incentives to restrict use are

counterbalanced by pressures to intervene early through practice norms favoring excessive

utilization and consumer actions. Although these are each limited, together they may counterbalance incentives to cut costs. However, these countervailing pressures are less likely to protect chronic mentally ill persons, and this population may be subject to arbitrary denials of

care, lack of access, nonrandom distribution of risk, and inadequate monitoring. The author

suggests several remedies, including state-administered ombudsman programs and greater

risk-sharing by HMOs.

Keywords: capitation, serious mental illness

103. Substance Abuse and Mental Health Services Administration (1998).

Estimating and managing risks for the utilization and cost of mental health

and substance abuse services in a managed care environment: Vol. 4.

Managed care technical assistance series. Rockville, MD: Substance Abuse

and Mental Health Services Administration.

This manual is meant for mental health and substance abuse provider organizations to gain a

better understanding of the principles and development of risk-sharing provider payment systems used in a managed care system. SAMHSA means for this manual to be used as a training

tool, and thus, it emphasizes examples and exercises allowing the reader to understand the terminology of risk management. This manual is based on the premise that as the trend toward

capitation for mental health and substance abuse services continues, risk-sharing arrangements

38 Special Report
will become an increasingly prevalent form of provider reimbursement. The appendix includes

blank worksheets, contact information, bibliography, and examples of risk-sharing calculations

to guide the reader toward a clearer understanding of the issues.

Keywords: capitation, substance abuse, technical assistance

104. Warner, R., & Huxley, P. (1998). Outcomes for people with

schizophrenia before and after Medicaid capitation at a community

agency in Colorado. Psychiatric Services, 49(6), 802–807.

This article examines the psychiatric care of Medicaid recipients under a capitated funding

mechanism. Outcomes, satisfaction, and service utilization are compared between two random

samples of 100 clients, one a year before capitation was introduced and one a year after. The

authors’ results show that hospitalization rates were generally lower after capitation and that

clients reported improved quality of life. In this study, the findings suggest that Medicaid capitation led to an efficient use of treatment resources. 

Keywords: capitation, Colorado, community providers, Medicaid, outcomes, public

sector, schizophrenia, serious mental illness, utilization

105. Wyant, D., Christianson, J., & Coleman, B. (1999). The financial impact

on community mental health centers of capitated contracts with Medicaid:

The Utah Prepaid Mental Health Plan. Community Mental Health Journal,

35(2), 135–152.

Sparked by Medicaid’s movement toward managed care in many States, this study examines

the financial impact of contracting with a State Medicaid program on a community mental

health center (CMHC). In particular, the researchers compared the financial experience of

three CMHCs that entered into capitated contracts with the Utah Medicaid plan with a subset

of CMHCs in Utah that maintained the traditional method of reimbursement over a 6-year

period. The analysis compared the two types of CMHCs on profitability, liquidity, and patterns of investment and financing. From the results, there were relatively few differences

between the contracting and noncontracting CMHCs that did not exist prior to the change in

reimbursement options. At worst, the decision to contract had a neutral impact on financial

performance. 

Keywords: capitation, community providers, Medicaid, public sector, Utah

106. Zieman, G. L. (Ed.). (1995). The complete capitation handbook: How to

design and implement at-risk contracts for behavioral healthcare. Tiburon,

CA: Centralink Publications. 

This book is an installment of the National Behavioral Healthcare Library series and

describes behavioral health care financing and delivery systems of the short and intermediate

future. The first part of this book gives the history of capitation and risk, and the next part

describes business organization and management solutions that arose to deal with risk in the

managed behavioral health care delivery system. The third section includes specific instructions on how to provide health care under capitation and the fourth and fifth sections cover

Annotated Bibliography 39
40 Special Report

special topics and present case studies where capitation has been used for mental health service delivery. This book is intended to aid mental health professionals in the development,

negotiation, and management of at-risk contracts in managed behavioral health care delivery.

Keywords: capitation, contracting, providers, technical assistance
IV.

Annotated Bibliography 41

Community

Mental Health

Services

107. Christianson, J. B., Lurie, N., Finch, M., Moscovice, I. S., & Hartley, D.

(1992). Use of community-based mental health programs by HMOs:

Evidence from a Medicaid demonstration. American Journal of Public

Health, 82, 790–796.

This article tests the hypothesis that Medicaid beneficiaries in HMOs reduce their use of

mental health treatment programs in their communities, thereby jeopardizing the financial

viability of these programs. A randomized trial of two groups of severely mentally ill

Medicaid beneficiaries (one with traditional Medicaid benefits and one with HMO benefits)

showed no significant short-term difference in the use of community-based programs. The

authors suggest that Medicaid program administrators can minimize the disruption of ongoing treatment for beneficiaries who join prepaid groups by offering beneficiaries a choice

among prepaid plans and encouraging community treatment programs to contract with

plans to serve beneficiaries.

Keywords: community providers, evaluation, HMOs, Medicaid, serious mental illness

108. Cypres, A., Landsberg, G., & Spellman, M. (1997). The impact of

managed care on community mental health outpatient services in New

York State. Administration and Policy in Mental Health, 24(6), 509–521.

This article explores the impact of managed care on community mental health centers. It

reports the results of a survey that was administered to the directors of all licensed outpatient

mental health facilities (clinics, day treatment, and intensive outpatient psychiatric rehabilitation) in New York State. Indeed, these facilities reported extensive changes in the past as well

as predicted changes in the future as a result of the impact of managed care. These changes

occurred in a variety of areas — staffing patterns, rate at which various services are offered,

revenue sources, joining managed care panels, advertising, and training — and differed

depending upon size, region, and type of facility. The survey also inquired into respondents’

experiences with and attitudes toward managed care. The study reports that directors predict

declines in the number of staff other than psychiatrists (psychologists in particular), that they

document a shift away from open-ended treatment and toward more acute and short-term

care, and that they have a variety of concerns and frustrations arising from their experiences

with managed care.

Keywords: community providers, New York

Annotated Bibliography
42 Special Report

109. Feldman, S. (1994). Managed mental health — Community mental

health revisited? Managed Care Quarterly, 2(2), 13–18.

The author argues that despite the superficial differences between the community mental

health movement of the 1960s and the current managed care movement, there may be a

greater commonality in processes, values, and objectives between them than is readily apparent. Both focus on alternatives to hospitalization; both appear to have in common a belief in

the value of continuity of care, the responsibility for a defined population, and recognition of

the importance of easy access and early intervention. Because of these similarities, lessons from

community mental health may be applicable to managed care, and, in particular, the importance of an academic base for training and research and the potentially negative impact of

oversell and inflated expectations.

Keywords: community providers

110. Ray, C., & Oss, M. (1993). Community mental health and managed

care. New Directions for Mental Health Services, 59, 89–98. 

Community mental health centers (CMHCs) face a number of challenges if they are to function effectively in an era of managed care. The authors argue that CMHCs must balance their

social mission to provide mental health care to high-risk populations with a new sophistication

about finance, marketing, and operating in a managed environment. Using examples from the

experiences of Massachusetts CMHCs, the authors lay out options for CMHCs in their

attempt to survive in this new environment. The article concludes with a discussion of the

opportunities for CMHCs to be major participants in the movement toward managed mental

health care.

Keywords: community providers

111. Young, A. S., Sullivan, G., Murata, D., Sturm, R., & Koegel, P. (1998).

Implementing publicly funded risk contracts with community mental health

organizations. Psychiatric Services, 49(12), 1579–1584.

This article presents a case study of the Los Angeles County Partners Program, a contractual

arrangement for services for severely mentally ill individuals between Los Angeles County

Department of Mental Health and community mental health organizations. By providing a

fixed annual rate per enrolled patient, the program shifted the financial risk for treatment to

community organizations. From both qualitative and quantitative data, the researchers found

that the new approach geared toward the most expensive patients enhanced programs’ flexibility and accountability and increased their emphasis on principles of psychosocial rehabilitation.

The article discusses challenges in implementation including disenrollment, limitations with

existing information systems, and changes necessitated by risk contracting in general. They

conclude that although mental health authorities planning to institute risk contracts need to

balance fiscal incentives with performance guarantees, risk contracting offers great opportunity

to improve service delivery.

Keywords: California, capitation, community providers, local governments, public sector,

serious mental illness
V.

Annotated Bibliography 43

Diagnosis-Related

Groups (DRGs)

112. Ashcraft, M. L. F., Fries, B. E., Nerenz, D. R., et al. (1989). A psychiatric

patient classification system: An alternative to diagnostic-related groups.

Medical Care, 27, 543–555.

This article reports on a project to construct a diagnostic classification system more appropriate for alcohol, drug, and mental disorders than the DRG system. The authors used data from

the Veterans Administration (VA) to construct 12 psychiatric diagnostic groupings from which

a psychiatric patient classification (PCC) system was derived. They found that this new classification system accounts for significantly more of the variation in length of stay than the DRGs.

Moreover, they conclude that this system is more useful for hospital payment purposes because

PCCs are clinically useful. They argue that PCCs appear to be valuable candidates for inclusion into the VA’s resource allocation system, and warrant exploration of its applicability to

female and non-VA populations.

Keyword: DRGs

113. Dorwart, R. A., & Chartock, L. R.(1988). Psychiatry and the resourcebased relative value scale. American Journal of Psychiatry, 145, 1237–1242.

Recent attempts to control medical costs for inpatient psychiatric services focus on regulating

hospital reimbursement through the use of DRGs. This article focuses attention on other methods to control mental health inpatient costs through regulating reimbursements received by

physicians. The authors review the resource-based relative value scale (RBRVS) as an alternative to other proposed reimbursement methods, such as physician DRGs. The RBRVS uses the

setting, time spent, difficulty in treating the patient, training, and psychiatrist’s role to determine reimbursement rates for psychiatrists. The authors suggest that the RBRVS has several

advantages over both the DRG approach and capitation and may be useful in a variety of

health care settings such as in HMOs and in the public sector.

Keyword: DRGs

Annotated Bibliography
114. English, J. T., Sharfstein, S. S., Scherl, D. J., Astrachan, B. M., &

Muszynski, I. L. (1988). Diagnosis-related groups and general hospital

psychiatry: The American Psychiatric Association Study. In D. J. Scherl,

J. T. English, & S. S. Sharfstein (Eds.), Prospective payment and

psychiatric care (1st ed., pp. 19–40). Washington, DC: American

Psychiatric Association.

This chapter reviews the context in which psychiatric diagnoses were exempt from the original

DRG system and reports on the findings of the Task Force on Prospective Payment, established

by the American Psychiatric Association (APA) to examine the implications of the DRG system

for psychiatry. The authors report the findings of this study which concluded that the DRG

system is not accurate or fair for psychiatric diagnoses. Based on 1.67 million Medicare cases,

the study found that there is substantial variation between hospital type in resource use by

patients within a given psychiatric DRG. For example, the mean length of stay in hospitals

with psychiatric units was 38 percent higher than that in general hospitals. The authors urge

that any system be introduced incrementally, as part of a mixed retrospective and prospective

payment approach and that levels of payment should consider the facility’s historical costs and

the diversity of treatment models.

Keyword: DRGs

115. Essock, S., & Norquist, G. S. (1988). Toward a fairer prospective

payment system. Archives of General Psychiatry, 45, 1041–1044.

An underlying assumption of the Medicare prospective payment system (PPS) is that characteristics of patients such as diagnosis and of hospitals can be used to predict costs. The authors

challenge the assumption that the current system based on DRGs is an adequate predictor of

cost for psychiatric care. They claim that the psychiatric payment categories are poor predictors of cost, accounting for between 2 percent and 15 percent of the variability in the length of

stay. They examine variables that might be added to the equations to make for a more equitable and effective reimbursement system for inpatient psychiatric care including additional

facility and patient characteristics. Finally, they explore incentives that can be built into a

payment system to counteract the impetus to minimize care provided.

Keyword: DRGs.

116. Freiman, M. P., Mitchell, J. B., Taube, C. A., & Harrow, B. S. (1988).

The 1985 National Institute of Mental Health/Health Care Financing

Administration study of payment for psychiatric admissions under

Medicare: Overview and a look ahead. In D. J. Scherl, J. T. English, &

S. S. Sharfstein (Eds.), Prospective payment and psychiatric care

(1st ed., pp. 91–106). Washington, DC: American Psychiatric Association.

This chapter describes a study conducted by the National Institute of Mental Health (NIMH)

and the Health Care Financing Administration to examine issues relating to the classification

of alcohol, drug abuse, and mental health (ADM) admissions under prospective payment, and

the impact of modifications to this system on both exempt and nonexempt facilities. Medicare

44 Special Report
claims in four states were used to develop “clinically related groups” (CRGs), an alternative

classification system. This system was found to perform better than the DRG system in

explaining variation in hospital costs and length of stay, but 90 percent of the variation was

still unexplained by CRGs. The use of disease staging did not help to improve predictive

power. The study also simulated DRG-related payments for ADM admissions to general hospitals with and without exempt units, and found that the average simulated payment to hospitals

with exempt units was several hundred dollars higher than the average payment for an admission to a nonexempt unit. Substantial inter-state variation was found, as well as between

exempt and nonexempt hospital outlier rates. A follow-up study by the NIMH is described.

Keyword: DRGs

117. Goldman, H. H. (1988). Overview of studies on psychiatric hospital

care under a prospective payment system. In D. J. Scherl, J. T. English,

& S. S. Sharfstein (Eds.), Prospective payment and psychiatric care

(1st ed., pp. 172). Washington, DC: American Psychiatric Association.

This chapter reviews several studies examining the usefulness of case mix measures in

prospective payment. The author argues that there is no viable classification system whose

impact has been tested on the heavily differentiated mental health system. Given this, and

the fact that alternative systems may be worse than a prospective payment system (PPS), the

author urges psychiatry to play a key role in implementing an effective PPS. He argues that

psychiatry should not overemphasize the differences between health and mental health care,

as similarities are the basis for its claims for reimbursement under health insurance. An

equitable and efficient reimbursement system for mental health care can be viewed as an

opportunity for psychiatry rather than a necessary evil.

Keyword: DRGs

118. Namerow, M. J., & Gibson, R. W. (1988). Prospective payment for

private psychiatric specialty hospitals: The National Association of Private

Psychiatric Hospitals prospective payment study. In D. J. Scherl, J. T.

English, & S. S. Sharfstein (Eds.), Prospective payment and psychiatric

care, (1st ed., pp. 41–54). Washington, DC: American Psychiatric

Association.

This chapter describes a study conducted by the National Association of Private Psychiatric

Hospitals to test the adequacy of the psychiatric DRGs and alternative systems to pay hospitals, and to assess the financial impact of these systems on private psychiatric specialty hospitals. Thirty hospitals were randomly selected for the study, which included retrospective chart

review for patient-specific data, a questionnaire survey for hospital organization and financial

information, and site visits. Data were analyzed in order to determine the variables correlated

with length of stay and cost of care. The study found that both the original 15 DRGs and its

modified version allow for inadequate grouping for setting payment rates for private psychiatric hospital stays. This chapter discusses the implications of this and other findings.

Keyword: DRGs

Annotated Bibliography 45
119. Rosenheck, R., Massari, L., & Astrachan, B. M. (1990). The impact of

DRG-based budgeting on inpatient psychiatric care in Veterans

Administration medical centers. Medical Care, 28(2), 124–132.

This study examines the impact of a DRG-based resource allocation methodology (RAM) on

inpatient psychiatric care in the Veterans Administration (VA) hospitals. The authors reviewed

data on discharge for psychiatric and substance abuse disorders before and after the implementation of DRG-based budgeting in the VA system. They found a significant decline in lengths

of stay, total annual bed days per patient, and total expenditures after DRGs were instituted.

The authors conclude that RAM is a potent management tool and discuss the reasons why

these changes are attributable to this payment method and not other factors.

Keyword: DRGs

120. Ruggie, M. (1990). Retrenchment or realignment? U.S. mental health

policy and DRGs. Journal of Health Politics, Policy and Law, 15(1), 145–167.

This article examines the rise of DRGs as part of a major reorganization of the delivery of

health services in the United States. The author argues that there have been two major institutional shifts in the state’s provision of mental health services; from main provider to retrospective buyer, and from retrospective payer to prospective buyer. The impact of this shift on

providers and organizations is discussed.

Keyword: DRGs

121. Sargent, S. C., Scherl, D. J., & Muszynski, I. L.(1988). The New Jersey

experience with diagnostic-related groups. In D. J. Scherl, J. T. English,

& S. S. Sharfstein (Eds.), Prospective payment and psychiatric care

(1st ed., pp. 172). Washington, DC: American Psychiatric Association.

New Jersey has long been an important laboratory for experiments with prospective reimbursement of hospital services. This chapter reports on a study conducted by the American

Psychiatric Association to explore the effect of the state’s DRG-based system on its psychiatric

hospitals. Interviews and focus groups with State government officials, hospital administrators, and provider associations identified a number of problems with this system. Participants

were concerned that the DRG system would lead to reduction or closure of psychiatric units,

admissions based on anticipated reimbursement rather than on need, frequent utilization

review, and downgrading of staff. The authors conclude that the DRG system favors private

psychiatric hospitals which are exempt from such payment and that psychiatric DRGs

should reflect severity of illness, complications, and the costs of indigent care.

Keywords: DRGs, New Jersey

46 Special Report
Annotated Bibliography 47

122. Schinnar, A. P., Rothbard, A. B., & Hadley, T. R. (1992). A

prospective management approach to the delivery of public health

services. Administration and Policy in Mental Health, 19, 291–308.

The authors describe a prospective payment model for use in managing mental health in

the public sector. The model consists of three components: a single-stream funded prepayment system, psychiatric and needs assessment data to gauge demand for services, and

targeting of care to reduce unnecessary hospitalization and lengthy stays. Taken together,

these components address both supply and demand and achieve an equilibrium between

them. The article identifies the challenges inherent in implementing each component, and

describes a study in which the authors were able to predict the patients’ risk of becoming

high users. Since mental health crises appear to be highly predictable events, prospective

payment holds promise for controlling costs. Relevant literature on prospective payment

and major studies are also briefly discussed.

Keyword: DRGs

123. Zwanziger, J., Davis, L., Bamezai, A., & Hosek, S. D. (1991). Using

DRGs to pay for inpatient substance abuse services: An assessment of

the CHAMPUS reimbursement system. Medical Care, 29, 565–577.

Studies have shown that DRGs and similar classification systems poorly predict inpatient

resource use, especially mental health services. Previous studies have also demonstrated

that certain types of providers are systematically under- (or over-) reimbursed. This study

assessed how well the CHAMPUS (Civilian Health and Medical Program of the

Uniformed Services) DRG system explains variation in costs at the individual level and

predicts resource use across hospitals. The study found that substance abuse DRGs are

only partially successful in classifying CHAMPUS patients according to their resource

use, explaining only 4.2 percent of the total variance. The source of this variation might

be lack of consensus on treatment, or differences among mental health providers regarding delivery of services. The study also found substantial variation in the impact of the

DRG system on hospital revenue. General hospitals were reimbursed at a higher level

than substance abuse specialty hospitals. This may reflect differences in coding practices,

or severity of patients in the two settings.

Keywords: DRGs, substance abuse
VI.

Annotated Bibliography 49

Economics,

Forecasting,

and Pricing

124. Cummings, N. A. (1994). The successful application of medical offset

in program planning and in clinical delivery. Managed Care Quarterly,

2(2), 1–6.

Medical offset research comprises some of the earliest outcome studies in mental health. In this

article the author, one of the originators of medical offset studies, describes the evolution of

such studies, reflects on 30 years of research, and summarizes some of the early literature on

this subject. He demonstrates that evidence in favor of the offsetting of medical costs by providing psychological services has been replicated widely over the years in varied health care

systems. The absence of a psychotherapy benefit leads to increased medical and hospital costs

to the health care plan. Evidence that patients translate stress, anxiety, and other psychological

symptoms into physical ones is so strong that the author argues that no comprehensive health

plan can afford to be without an effective psychotherapy benefit.

Keyword: costs

125. DuVal, M. K. (1988). Changing reimbursement patterns and

the realities of health care finance. In D. J. Scherl, J. T. English, &

S. S. Sharfstein (Eds.), Prospective payment and psychiatric care

(1st ed., pp. 1–8). Washington, DC: American Psychiatric Association.

The author provides a historic overview of changing health care reimbursement patterns over

the past 50 years. He focuses on the past five years and describes the impact of these changes

on the practice of medicine, on academic medical research, and on health care coverage for the

uninsured. With practitioners at increasing economic risk, he is concerned that incentives to

undertreat may prevail. He describes the movement toward prospective pricing as the biggest

contemporary challenges to psychiatry.

Keywords: economics, trends

126. Frank, R. G., Huskamp, H. A., McGuire, T. G., & Newhouse, J. P. (1996).

Some economics of mental health ‘carve-outs’. Archives of General

Psychiatry, 53(10), 933–937.

This article discusses the economic rationale of carve-out contracts in general and for mental

health and substance abuse (MH/SA) in particular. The authors focus on the control of a plan’s

adverse selection of the insured population as the primary factor for the conception of behavioral health carve-outs as well as the moral hazard phenomenon, where utilization of mental

health services is twice as responsive to cost-sharing provisions as is utilization of general

Annotated Bibliography
health services. The authors first present the economic theory of carve-outs as determined by

the problems of moral hazard and adverse selection; second, they present evidence of these

economic explanations; and third, they analyze the incentives of the buyers and the vendors of

mental health services. The conclusion finds that adverse selection has long undermined the

insurance market for MH/SA coverage, and that, according to the authors, carve-outs are a

suitable economic solution to the failures of this insurance market. 

Keywords: carve-outs, economics, substance abuse

127. Frank, R. G., & Lave, J. R. (1992). Economics of managed mental

health. In S. Feldman (Ed.), Managed mental health services (1st ed., pp.

83–100). Springfield, IL: Charles C. Thomas.

This chapter discusses the promises and pitfalls of using managed care to control costs and

utilization in a private insurance setting. The authors explain the traditional demand-side

approaches (such as limits on coverage and cost-sharing) and supply-side approaches (such

as prospective payment), and identify several undesirable consequences of these approaches.

The promises of managed care include the potential to reduce inappropriate care while constraining utilization to appropriate levels. Potential problems include lack of clarity regarding

respective responsibilities of employer, provider, and managed care firm; lack of standards for

care; little research on effectiveness of managed care; and inefficient use of the tort system to

address accountability problems. The authors conclude that while managed mental health

care offers some promise for controlling utilization and cost of mental health services, it

should be only one of the tools in the cost-containment toolbox.

Keywords: costs, economics

128. Frank, R. G., & McGuire, T. G. (1998). The economic functions of

carve outs in managed care. The American Journal of Managed Care, 4,

SP31–SP39.

This paper examines the economic tenets of carve-outs. The authors discuss four broad forms

of carve-outs: (1) payer specialty carve-outs from all health plans, (2) payer specialty carveouts from only indemnity and preferred provider organization arrangements, (3) individual

health plan carve-outs to specialty vendors, and (4) group practice carve-outs to specialty

organizations. The efficiency, adverse selection, and costs of these different carve-out options

are considered without many specific qualitative examples being given. In the conclusion the

authors argue that the decision to carve out services must be made based on the individual

services being provided and the population being served. However, for some payers, it may be

more efficient to obtain the necessary expertise from a carve-out which specializes in management of one of these services and has a sufficient volume of cases in order to have a strong

bargaining position in the market. 

Keywords: carve-outs, economics

50 Special Report
129. Goldman, H. H., & Taube, C. A. (1988). High users of outpatient mental

health services, II: Implications for practice and policy. American Journal of

Psychiatry, 145, 24–28.

This article examines four stereotypes of outpatient mental health use: (1) all use is alike,

(2) any use leads to high use, (3) all high use is discretionary, and (4) insurance encourages

excessive use. The authors provide data to refute the first three assumptions and argue that

these stereotypes ignore the diversity of outpatient mental health services and the individuals

who use them. They favor a combination of pricing strategies that would not impede initial

treatment but would limit excessive use of mental health services. The authors argue that the

same principles of insurance and public health apply to the financing of mental health care

as to general health care.

Keywords: economics, utilization

130. Ma, C. A., & McGuire, T. G. (1998). Costs and incentives in a

behavioral health carve-out. Health Affairs 17(2), 53–69.

Implementing managed care arrangements has proven to be a highly effective cost-saving

strategy for the behavioral health arena, and many States have chosen to take advantage of

this fact for both their employee benefit programs and for beneficiaries of their public programs. At the same time, there is evidence that some managed care systems achieve these costsavings at the expense of quality. These authors examine the behavioral health managed care

carve-out established by the Massachusetts GIC (Group Insurance Commission), which supplies insurance to State employees, as a model from which to determine the nature of costsavings in this type of arrangement. The authors present a detailed analysis of changes in

cost, incentives contained in the carve-out contract, and eligibility and claims data to determine the source and nature of cost savings. The data they examine show significant costsavings (30–40 percent) after the implementation of the carve-out, even beyond that of their

pre-set cost targets/contract incentives. As a result they speculate further that there may be a

“reputation effect,” or desire on the part of contractors to show especially good results in

the interest of attracting future business in the rapidly expanding managed care market.

Keywords: carve-outs, costs, economics, Massachusetts, public sector

131. National Advisory Mental Health Council (1998). Parity financing

mental health services: Managed care effects on cost, access, and quality.

An Interim Report to Congress. Rockville, MD: National Institute of Mental

Health.

This National Advisory Mental Health Council workgroup paper discusses the cost implications of parity, and in response to more recent charges from the Senate, has amplified its

domain to include how managed care affects both access to mental health services and the

quality of those services. The summary findings show that as the overall managed care population increases, the projected cost of parity declines, and that the introduction of parity

laws would accelerate the trend toward increased management of mental health services.

Annotated Bibliography 51
Also, parity alone does not guarantee improved access to mental health care because of the

counteracting effects of managed care. Measurement of the quality of care with the advent of

management shows considerable variability in the results, and further research is needed in

this area.

Keywords: costs, parity

132. Olfson, M., Sing, M., & Schlesinger, H. J. (1999). Mental health/

medical care cost offsets: Opportunities for managed care. Health Affairs,

18(2), 79–90.

This paper examines the potential for managed care companies to take advantage of the “costoffset effect,” the phenomenon where the provision of mental health services can lead to a

decrease in utilization of general medical services. The authors introduce the debate, reviewing

possible pathways to achieve cost offsets, how cost offsets arise, and the relationship between

mental health status and use of medical services. They identify three patient groups with high

potentials to yield cost offsets, including distressed elderly medical inpatients, primary care outpatients with multiple unexplained somatic complaints, and nonelderly adults with alcoholism.

The paper discusses previous research in the subject and implications for delivery and financing. Three possible structures for achieving cost offsets are to integrate medical and mental

health financing and management, to train utilization managers to identify target populations

and facilitate their access to mental health care, and to combine pricing policies with utilization

management to increase access within managed care plans.

Keywords: costs, utilization

133. Pallak, M. S., Cummings, N. A., Dörken, H., & Henke, C. J. (1993).

Managed mental health, Medicaid, and medical cost offset. New Directions

for Mental Health Services, 59, 27–40.

Studies have demonstrated that mental health treatment may reduce the use and cost of medical services (the “cost-offset” effect). This study uses a quasi-experimental design to test the

cost-offset hypothesis on a Medicaid population in Hawaii. Results showed that managed

mental health services consistently resulted in declines in both inpatient and outpatient medical

costs for Medicaid enrollees. In contrast, traditional unmanaged mental health services had little effect on overall medical costs. The authors conclude that managed mental health care can

lead to a cost-effective provision of total medical services.

Keywords: costs, Hawaii, Medicaid, public sector

134. Pallak, M. S., Cummings, N. A., Dörken, H., & Henke, C. J. (1994).

Medical costs, Medicaid, and managed mental health treatment: The

Hawaii study. Managed Care Quarterly, 2(2), 64–70.

This article reports on a randomized, prospective study to examine the impacts of mental

health care on medical utilization and costs. The study found that medical costs of a Medicaid

population in Hawaii were reduced by 23 percent to 40 percent compared to control groups.

52 Special Report
The study analyzed the impact of managed mental health services separately for people with

and without chronic health conditions. The authors demonstrate that the costs of managed

mental health care are recovered in 6 to 24 months. They conclude that managed mental

health treatment is associated with declines in medical costs.

Keywords: costs, Hawaii, evaluation, Medicaid, public sector, utilization

135. Sharfstein, S. S. (1991). Prospective cost allocations for the chronic

schizophrenic patient. Schizophrenia Bulletin, 17, 395–400.

The author presents a life-course longitudinal model for financing care of patients with schizophrenia. The model, which is being tested in a demonstration project in Rochester, New York,

is based on a prospective cost allocation method using capitation payments that are “risk

adjusted” to reflect patient’s past use of services, current health status, and level of disability.

The purpose of this approach is to provide incentives to develop outpatient services, to encourage early intervention, and to integrate public and private funding streams. The author calls

for a new social policy to address the needs of this population. Such a policy would provide

comprehensive care, adequate funding, incentives for innovation, and patient choice. The

author outlines a proposal to integrate Federal and State funding for chronic mental illness.

Keyword: capitation, New York, public sector, schizophrenia, serious mental illness

136. Smith, M. E., & Loftus-Rueckheim, P. (1993). Service utilization

patterns as determinants of capitation rates. Hospital and Community

Psychiatry, 44, 49–53.

This study examined the service use of 55 clients of a psychosocial rehabilitation outpatient

program at a hospital-based community mental health center. The purpose of the study was

to identify different patterns of service use and associated patient characteristics. Treatment

cost and services provided were tracked for each patient for one year. Cluster analysis

revealed that service use may be determined by factors other than clinical need. The authors

argue that setting capitation rates based on previous use of services may inaccurately predict

the cost of services needed to serve patients with severe mental illness. Findings from this

study led the authors to develop an alternative strategy for estimating service need based on

comprehensive service planning models for subgroups of seriously mentally ill persons.

Keywords: capitation, serious mental illness

137. Sterman, P. (1997). The costs of behavioral health care coverage.

Employee Benefits Journal, 22(1), 2–10.

This article reports on the significant financial implications psychiatric and chemical dependency conditions can have on the plan sponsor and how to control the cost with managed

behavioral health care protocols and benefit designs. Conditions that contribute to the high

costs include absence of price regulation, shifting cost from patients with less coverage to

those with more coverage, a bias for inpatient reimbursement-in-full, destigmatization of

psychiatric and substance abuse treatment, and an increase in the number of psychiatric beds

Annotated Bibliography 53
54 Special Report

and the consequent increase in demand for patients. The author discusses several strategies to

contain behavioral health care costs such as modifying benefit plans to restrict services covered, imposing benefit limitations, refining and developing provider networks, implementing

managed care approaches, early identification and prevention of behavioral health conditions,

and improving treatment outcomes. 

Keywords: costs, substance abuse
VII.

Annotated Bibliography 55

Employee

Assistance

Programs (EAPs)

138. Kent, J. (1990). The role of employee assistance programs in managed

mental health care. Medical Interface, 14, 25–28.

Mental health problems of employees can be extremely costly to employers in terms of lost

productivity, low morale, and worker’s compensation. Employee Assistance Programs (EAPs)

were developed as a way for employers to provide cost-effective mental health services to their

employees. This article provides criteria for evaluating EAPs and describes a typical EAP service package and an effective psychiatric review process.

Keywords: EAPs

139. Major, C. (1993). EAPs as customers of managed mental health.

Administration and Policy in Mental Health, 21, 35–39.

This article describes AT&T’s internal employee assistance program and its efforts to promote

quality care by monitoring the managed care provider network and using clinical practice

guidelines to evaluate client needs and treatment outcomes. The author suggests ways of

obtaining and maintaining a high-quality panel of providers and describes the benefits of clinical practice guidelines. In addition to providing a flexible method for consistent but individualized clinical decision-making, guidelines also are the basis for clinical outcome studies to measure effectiveness and appropriateness of treatment decisions and become the foundation for

continuous quality improvement.

Keywords: EAPs

140. Masi, D. A., & Caplan, R. (1992). Employee assistance programs.

In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental health care:

Administrative and clinical issues (1st ed., pp. 321–333). Washington, DC:

American Psychiatric Press.

This chapter describes the evolution of employee assistance programs (EAPs) from the 1940s

when they were designed in response to alcoholism among employees. The authors describe

several models of employee assistance programs and ingredients of effective EAPs. They

describe the differences and similarities between EAPs and HMOs and show why the interface

between the two is sometimes conflictual. The three major problems between HMOs and EAPs

arise over clashes in the gatekeeping role, in choice of preferred provider, and through general

lack of communication. The authors describe current trends that have implications for the

future of EAPs. They argue that the four factors that will have direct impact on the future of

EAPs are (1) the role of EAPs in managed mental health; (2) the focus on drug abuse in the

Annotated Bibliography
56 Special Report

workplace; (3) the increasing number of persons affected by AIDS; and (4) the growing need

for quality management and clinical evaluation by third parties.

Keywords: EAPs, overviews, trends

141. Miller, N. A. (1992). An evaluation of substance misuse treatment

providers used by an employee assistance program. The International

Journal of the Addictions, 27, 533–559.

Thirty fee-for-service (FFS) facilities and nine HMOs were analyzed to determine the provider characteristics that are most likely to increase access and improve outcomes for people

referred for substance abuse problems. This article evaluates measures of access to care, continuity, and quality of treatment programs to which 243 employees of one public sector program were referred by their employee assistance program (EAP). The study recommends that

EAPs develop a mechanism to evaluate providers on an ongoing basis. One mechanism suggested is a precontract request for proposals in which treatment providers document that they

provide those characteristics shown to increase access and improve treatment outcomes. Some

of these characteristics include use of a multidisciplinary treatment team, provision of coordinated treatment services, and provision of a treatment program that enables an employee to

directly contact and enter a treatment program.

Keywords: EAPs, evaluation, substance abuse
VIII.

Annotated Bibliography 57

Health Maintenance

Organizations

(HMOs)

142. Altman, L., & Goldstein, J. M. (1988). Impact of HMO model type on

mental health service delivery: Variation in treatment and approaches.

Administration in Mental Health, 15, 246–261.

This paper reports on a descriptive and exploratory study that compares mental health services

availability and actual clinical practice across different HMO models. The authors hypothesize

that differences in the financial and institutional feature of HMOs influence treatment and

practice. Clinicians, managers, and chiefs in six HMOs in a Northeastern State were interviewed. HMOs were stratified and randomly selected to represent three model types: staff,

group (including network model), and independent practice association. There were no significant differences between HMO model types in mental health benefits, except in number of

days for outpatient substance abuse treatment. There were differences, however, in organizational characteristics, provider characteristics, and benefit design. Findings from this research

are consistent with other studies that show that in comparison to fee-for-service models, the

organizational and financial structure of HMOs influences provider response and utilization

patterns.

Keyword: HMOs

143. Barglow, P., Chandler, S., Molitor, N., & Offer, D. (1992). Managed

psychiatric care for adolescents: Problems and possibilities. In J. Feldman

& R. J. Fitzpatrick (Eds.), Managed mental health care: Administrative and

clinical issues (1st ed., pp. 261–271). Washington, DC: American

Psychiatric Press.

The authors of this chapter describe the philosophy and psychiatric benefits for adolescents

in the Humana Michael Reese HMO. They argue that with carefully managed inpatient

and 57outpatient treatment plans, the vast majority of adolescents who need psychiatric

care can benefit from short-term interventions. They describe the characteristics of the

psychiatric acute care unit and the adolescent intensive treatment program that comprise

the core of treatment options for this client population. The results of a client (adult care

providers) satisfaction survey are presented as are several components that the authors feel

are responsible for good client outcomes.

Keywords: children, HMOs

Annotated Bibliography
144. Bennett, M. J. (1988). The greening of the HMO: Implications for

prepaid psychiatry. American Journal of Psychiatry, 145, 1544–1549.

This article discusses the history of the HMO, focusing on its evolution from a social to an

economic movement. In particular, the author describes the role of psychiatry within a prepaid

structure. He anticipates the ways in which psychiatry may change in the future and suggests

that psychiatrists be trained in order to adapt to the growing emphasis on cost control, outcomes, and the economics of health care.

Keywords: HMOs, overviews, trends

145. Bennett, M. J. (1992). Managed mental health in health maintenance

organizations. In S. Feldman (Ed.), Managed mental health services

(1st ed., pp. 61–82). Springfield, IL: Charles C. Thomas.

Current trends in managed mental health are discussed in the context of the history of the

HMO concept and movement. Prepayment and group practice developed in the late nineteenth

century to deliver service to workers in rural areas and union laborers. HMOs became legitimate with the passage of the 1973 HMO Act. Mental health benefits and services gradually

expanded because of legislative mandates and research demonstrating its effectiveness. The

closed-panel HMO became a distinct form of mental health practice, emphasizing brief treatment and collaboration. The chapter describes trends in HMO structure, such as the proliferation of “open systems” (Independent Physicians Associations and preferred provider organizations) and the implications of managed care and subcontracting. HMOs are increasingly profit

driven and professionalized. The current patterns of mental health care provision and use are

discussed. The author anticipates that there will be increasing emphasis on population-based

care and consumer education, and states that the goals of accessibility and affordability have

yet to be realized.

Keywords: HMOs, overviews, trends

146. Bennett, M. J. (1993). View from the bridge: Reflections of a

recovering staff model HMO psychiatrist. Psychiatric Quarterly, 64(1),

45–75.

This article reviews the origin and development of managed mental health care, from the

“pure” prepaid practice paradigm to the current focus on utilization review, case management, discounted fees, and network development and management. The second part of the

article describes the current emphasis in health care that reflects a shift from containing costs

to assessing and monitoring outcomes. In response, managed care companies are shifting

from quality assurance to quality enhancement. The article concludes by anticipating seven

future trends and describing the pitfalls that we must overcome in order to create a mental

health system that is equitable, efficient, and effective.

Keywords: HMOs, trends

58 Special Report
147. Bloom, B. L. (1990). Managing mental health services: Some

comments for the overdue debate in psychology. Community Mental

Health Journal, 26, 107–124.

This article describes the similarities and differences between the three most prominent models

of mental health services: the preferred provider organization (PPO), the comprehensive HMO,

and the managed mental health care organization (MMHCO) in terms of organization, services provided, and degree of choice provided to the patient. The author suggests that of the

three, the HMO model, because of its integration of physical and mental health services and

focus on a managed model of service delivery, may have the greatest potential for survival as a

model of health care delivery. He concludes with a discussion of the types of training and skills

that psychologists must have in order to survive in this era of managed mental health care.

Keywords: HMOs, managed behavioral health care organization, training

148. Bonstedt, T. (1992). Managing psychiatric exclusions. In J. Feldman

& R. J. Fitzpatrick (Eds.), Managed mental health care: Administrative

and clinical issues (1st ed., pp. 69–82). Washington, DC: American

Psychiatric Press.

This chapter examines the types of psychiatric exclusions that exist in HMOs. These include

exclusions based on diagnosis, duration of illness, number/duration of hospitalizations, recent

utilization of psychiatric benefits in the plan, degree of disability, substance abuse, and others.

The author reviews the ideological premises and the impact of exclusions. He argues that in

the current managed care climate, psychiatric exclusions are likely to proliferate unless

research demonstrates that providing psychiatric care for specific clinical conditions produces

a significant offset effect. The author concludes that psychiatric exclusions are a necessary

but unfortunate “cap” on clinical care in a managed system.

Keyword: HMOs

149. Carson, D. (1992). Setting up provider networks and PPOs.

In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental health care:

Administrative and clinical issues (1st ed., pp. 99–109). Washington, DC:

American Psychiatric Press.

This chapter describes the features of preferred provider organizations (PPOs) that distinguish

them from health maintenance organizations (HMOs). The two most basic ways in which PPOs

differ from HMOs is that they reimburse providers on a fee-for-service basis and they offer subscribers the opportunity to select a designated or nonparticipating provider. Some components

of PPOs are the financial incentives to influence provider choice, discount pricing for hospital

rates, utilization review, and emphasis on reducing inpatient treatment through comprehensive

and accessible outpatient services. The author explores some of the unanswered questions

regarding the effectiveness of PPOs and addresses some of the inherent problems of PPOs.

Keywords: HMOs, PPOs

Annotated Bibliography 59
150. Christianson, J. B., & Osher, F. C. (1994). Health maintenance

organizations, health care reform, and persons with serious mental illness.

Hospital and Community Psychiatry, 45(9), 898–905.

Under the Clinton Administration’s 1994 Health Security Act, Medicaid-eligible individuals

who did not receive cash assistance would be represented by regional alliances that would

contract with health plans. Because this population has a relatively high incidence of serious

mental illness and HMOs would be the lowest cost alternative, it seemed the Health Security

Act could result in an increase of HMO enrollment for the seriously mentally ill. In this

paper, the authors examine studies of the mental health status and outcomes of seriously

mentally ill individuals treated by HMOs, focusing on the limitations in the available research

for predicting the likely effects of health care reform. They also describe the specific components of the Health Security Act that would influence individuals with serious mental illness

who were treated within an HMO. In order to gain a more complete understanding of the

impact of health care reform on mental health care for individuals with serious mental illness,

the authors argue for additional research in the areas of current service capacity of HMOs,

treatment approaches and outcomes in different HMO models, whether seriously mentally ill

individuals would choose to enroll in an HMO, and whether HMO enrollees with higher

incomes would seek care outside the networks.

Keywords: HMOs, outcomes, serious mental illness

151. Christianson, J. B., Wholey, D., & Peterson, M. S. (1997). Strategies for

managing service delivery in HMOs: An application to mental health care.

Medical Care Research and Review, 54(2), 200–222.

In this article, the researchers examine the problems facing HMO managers as they develop

strategies that combine financial incentives for providers with other mechanisms to influence

service delivery. Through two empirical analyses, they identify strategies used by HMOs in

managing service delivery, as well as explain the relationship of HMO strategies with market

characteristics. In the first part of the analysis, the authors highlight market strategies including payment methods, supervision of service delivery, limitations in coverage, and restrictions

on access. The authors conclude that HMOs do not rely on one mechanism to manage care,

but instead choose clusters of tactics that form one set of organizational strategies. From the

second part of the analysis, the authors find that strategies used by HMOs to manage mental

health care are related to the interaction of HMO-type and various market characteristics,

including competition and utilization of care.

Keywords: HMOs, overviews

60 Special Report
152. DeLeon, P. H, Bulatao, E. Q., & VandenBos, G. R. (1994). Federal

government initiatives in managed health care. In S. A. Shueman,

W. G. Troy, & S. L. Mayhugh (Eds.), Managed behavioral health care:

An industry perspective (pp. 97–112). Springfield, IL: Charles C. Thomas.

See DeLeon, VandenBos, and Bulatao, 1991 (reference number 154) for annotation.

153. DeLeon, P. H., & VandenBos, G. R. (1991). Psychotherapy in managed

health care: Integrating federal policy with clinical practice. In C. S. Austad

& W. H. Berman (Eds.), Psychotherapy in managed health care: The

optimal use of time and resources (1st ed., pp. 251–263). Washington, DC:

American Psychological Association.

This chapter is a version of the article “Managed mental health care: A history of the federal

policy initiative” by Patrick H. DeLeon, Gary VandenBos, and Elizabeth Q. Bulatao, which

was published in 1991. The section on clinical practice in HMOs is expanded in this chapter.

See DeLeon, VandenBos, and Bulatao, 1991 (reference number 154) for the annotation.

154. DeLeon, P. H., VandenBos, G. R., & Bulatao, E. Q. (1991). Managed

mental health care: A history of the federal policy initiative. Professional

Psychology Research and Practice, 22, 15–25.

This article traces the history of HMOs, focusing on key Federal legislative efforts to promote

and shape HMOs. The HMO Act of 1973 provided funding for the development of new

HMOs, and subsequent amendments of the Act addressed the need to ensure quality and to

help HMOs be competitive in the marketplace. The article also describes the CHAMPUS

Reform Initiative of 1986, in which the Department of Defense successfully reduced its mental health costs. Studies of the trends in HMOs are reviewed, such as the growth of for-profit

HMOs, and the shift from local to multistate HMO networks. The authors discuss the provision of mental health in HMOs and the concerns of psychologists such as limits on number

of sessions, poor utilization review, and lack of educational efforts to help members use the

system. They also review several major studies demonstrating that mental health care in

HMOs is equally or more effective than mental health care in other settings, and may help

reduce medical costs.

Keywords: HMOs, overviews

Annotated Bibliography 61
155. DeLeon, P. H., VandenBos, G. R., & Bulatao, E. Q. (1994). Managed

mental health care: A history of the federal policy initiative. In R. L.

Lowman & R. J. Resnick (Eds.), The mental health professional’s guide

to managed care (pp. 19–40). Washington, DC: American Psychological

Association.

See DeLeon, VandenBos, and Bulatao, 1991 (reference number 154) for annotation.

156. Dial, T. H., Bergsten, C., Kantor, A., Buck, J. A., & Chalk, M. E. (1996).

Behavioral health care in HMOs. In R. W. Manderscheid & M. A.

Sonnenschein, (Eds.), Mental Health, United States, 1996 (pp. 45–57).

Rockville, MD: Center for Mental Health Services.

This chapter describes the delivery system of HMOs and specifically explores two topics

related to HMOs’ provision of behavioral health care. The first concerns clinical staffing

levels of physicians and nonphysician mental health providers in HMOs. The authors report

on a study conducted by the Group Health Association of America on clinical staffing ratios

in a representative sample of staff- and group-model HMOs, and present data on the ratio

of full-time-equivalent (FTE) psychiatrists per 100,000 HMO members, of FTE nonphysician

mental health providers per 100,000 HMO members, and of nonphysician mental health

providers to psychiatrists in those HMOs. In the second part of the chapter, the authors

provide information on HMO benefits for mental health care and on the utilization of such

services for 1989 and 1993.

Keywords: HMOs, staffing, trends

157. Dorwart, R. A., & Epstein, S. S. (1992). Economics and managed

mental health care: The HMO as a crucible for cost-effective care.

In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental health care:

Administrative and clinical issues (1st ed., pp. 11–27). Washington, DC:

American Psychiatric Press.

This chapter provides an overview of the economics of mental health care with special

attention to the dynamics of the HMO model of service provision. The authors describe

several economic concepts, distinguish between need and demand for medical services, and

discuss the more recent methods to control supply of services. They discuss several major

trends in mental health care such as deinstitutionalization and community mental health care,

privatization and growth of private psychiatric hospitals, and investor-owned companies.

The authors argue for more and better studies of HMO psychiatry that include measures of

quality of care in order to assess whether HMO psychiatry is a healthy trend that will

improve services, or an unhealthy one that reduces utilization rates but has little beneficial

impact on clients’ well-being.

Keywords: economics, HMOs, trends

62 Special Report
158. Durham, M. L. (1995). Commentary: Can HMOs manage the mental

health benefit? Health Affairs. 14(3), 116–123.

This author raises concerns about the impact of managed care on the treatment of mental illness based on the following factors: these services present a high degree of financial risk to

HMOs, more responsibility is shifted to primary care providers (PCPs) to diagnose and treat

mental illness in HMOs, and there is evidence that PCPs in HMOs are less likely to detect

mental illness in their patients. The author goes on to discuss lessons that have been learned

thus far in the shift to managed mental health care. Managed care’s potential for populationbased management is described as a potential advantage for effective screening for conditions

and planning of staffing levels, treatment resources, etc. With regard to financing, the author

sees systems that link payment to outcomes data as being advantageous, while raising concerns

about financial barriers created by HMOs. As HMOs take in more and more members of

high-risk populations, the author argues that the system will need to adapt itself to one that

can provide the specialized services needed by these individuals.

Keyword: HMOs

159. Fink, P. J., & Dubin, W. R. (1991). No free lunch: Limitations on

psychiatric care in HMOs. Hospital and Community Psychiatry, 42, 363–365.

This article is a case study of the experiences of a private psychiatric hospital that subcontracted with a psychology group for hospital care for HMO patients. Severe problems arose as the

number of admissions to the hospital from contracted outpatient therapists was twice as much

as the number of admissions that was expected. This unexpected number of admissions was in

part due to the lack of a hospital-based evaluation unit for triage, expectations by patients and

their families that their HMO benefits guaranteed 30 days of hospital care, and the inability of

the hospital to exert control over referrals from the community-based therapists. These factors

contributed to a breakdown in communications between the hospital and HMO. The article

describes the authors’ understanding of the pitfalls of capitation arrangements for psychiatric

hospitals and for beneficiaries with severe mental illness.

Keywords: capitation, HMOs, serious mental illness

160. Goldman, W. (1988). Mental health and substance abuse services in

HMOs. Administration in Mental Health, 15, 189–200.

This article collates and presents current information about how mental health and substance

abuse care is being designed and provided in HMOs. The author provides an overview of

HMOs including type of benefits generally offered, locus of care, staff and staff mix, treatment

type, patterns of utilization, and cost. The chapter concludes that HMOs have the potential for

providing high-quality and comprehensive mental health and substance abuse services that are

also cost-effective.

Keywords: HMOs, overviews, substance abuse

Annotated Bibliography 63
161. Hodgkin, D., Horgan, C. M., & Garnick, D. W. (1997). Make or buy:

HMOs’ contracting arrangements for mental health care. Administration

and Policy in Mental Health, 24(4), 359–376.

This article explores HMO contracts with external vendors for mental health care versus an

internal mental health care department. The first part of the article covers the content of

external contracts and the current reasons for external contracting of mental health services.

Then the authors develop factors that will influence the HMO’s decisions about internal

or external mental health care. The factors, which are based on economic theory, include

operating costs, administration costs, monitoring costs, the shift of risk onto vendors, how

contracting choices affect value to purchaser, and competitive pressure from emerging managed behavioral health firms. Lastly, factors are used to create a new hypothesis and evidence

to explain HMO contracting choices and their implications in cost and quality of care.

Keywords: carve-outs, contracting, HMOs, integration 

162. Hornbrook, M. C. (1988). Mental health services in HMOs:

An oxymoron? Administration in Mental Health, 15, 236–245.

The author describes the significant difference in the level of HMO coverage of alcoholism,

drug abuse, and mental illness (ADM) and medical care. He argues that the “medical-mental

schism” may prevent development of integrated biopsychosocial treatments; thus HMOs may

be more like fee-for-service arrangements. The author identifies four approaches to rationing

ADM services including omitting coverage of mental illness; pricing copayments so as to

discourage use; using queues to encourage drop-outs; and using professional criteria ration

services on the basis of expected therapeutic benefit. He concludes that HMOs should work

toward the goal of parity in coverage of mental and medical conditions, and argues that the

costs of this relative expansion can be met through the offset effect and increases in charges

for medical services.

Keyword: HMOs

163. Hyde, P. (1996). Creating incentives for the delivery of services.

New Directions for Mental Health Services, 27, 25–33.

This article discusses four measures that are being explored to provide incentives to HMOs

to take responsibility for providing care to populations with the most difficult and costly

disorders: adults with serious and persistent mental illness, children and adolescents who

are seriously emotionally disturbed, and addicted individuals. These measures are eligibility

standards, structural approaches to system organization, financial incentives, and advocacy.

The authors discuss a number of techniques for implementing eligibility standards and several

different approaches to system organization that provide positive incentives to care for these

high-need individuals. The authors go on to provide examples of eight financial arrangements

which, when used in combination with eligibility standards and structural approaches, can

encourage providers to provide services to those most in need. Lastly, mechanisms must be

in place that allow consumers and their families to advocate for appropriate and adequate

64 Special Report
services, such as representation on governing boards and advisory groups, education, and

grievance and appeal processes.

Keywords: economics, HMOs, serious mental illness

164. Johnson, R. E., & McFarland, B. H. (1994). Treated prevalence rates of

severe mental illness among HMO members. Hospital and Community

Psychiatry, 45(9), 919–924.

The debate concerning the ability of HMOs to adequately provide for mental health services

for individuals with severe and chronic mental illness exists throughout the health care system.

Are HMOs skimming off healthy individuals for membership and excluding those with chronic

conditions like serious mental illness (SMI)? In this study, the researchers examine the treated

prevalence rates of two serious mental illnesses—schizophrenia and bipolar disorder—among

members of a large, group practice HMO and compare these rates with national rates from

the Epidemiologic Catchment Area (ECA) survey. Results indicate that there is a significantly

lower treated prevalence rate of schizophrenia among HMO members than in the ECA survey.

The treated prevalence rate of bipolar disorder is also lower among HMO members, but the

difference is not significant. The researchers conclude that the differences in treatment prevalence rates result from both different study methodologies and different factors influencing

HMO membership. They argue for additional research of the course of SMI among HMO

members.

Keywords: HMOs, serious mental illness

165. Langman-Dorwart, N., & Peebles, T. (1988). A comprehensive

approach to managed care for mental health. Administration in Mental

Health, 15, 226–235.

This paper discusses the key components of a comprehensive mental health management

approach. The authors argue that maintaining quality of care while containing costs is a

challenge; however, it is one that can be met with a comprehensive approach that includes

these three components: prescreening of admissions; maintaining a network of preferred

provider contracts; and concurrent utilization review and individual case management.

The article uses a case study approach to describe the ways in which one group network

model HMO improved access for clients, maintained consistent criteria of care, reduced

costs, and improved treatment outcomes. The HMO created a separate mental health and

substance abuse department, which established a preferred provider network and offered

case management to patients in contracted facilities. They report that savings to the plan

for the first year of operation was approximately $300,000 in saved admissions alone.

Keywords: case management, HMOs, PPOs, utilization management

Annotated Bibliography 65
166. Lazarus, A. (1994). Disputes over payment for hospitalization under

mental health “carve-out” programs. Hospital and Community Psychiatry,

45, 115–116.

Five cases are employed to demonstrate the potential problems with the carve-out approach

to mental health care. In three of these cases, a patient was admitted to a general hospital for

medical problems. Psychiatric problems either were present at hospitalization or developed

subsequently while the patient was still in the hospital. In each of these cases, the HMO felt

that the managed mental health care company was responsible for some or all of the cost of

treatment, arguing that the patient’s condition did not warrant acute medical attention. The

author concludes that these vignettes demonstrate the downside of carve-outs, that HMOs

and their managed care vendors must strive to overcome the barriers to integration, and that

more empiric research is needed to determine the nature and frequency of such problems and

mechanisms for resolving these disputes.

Keywords: carve-outs, HMOs, managed behavioral health care organizations

167. Levin, B. L., & Glasser, J. H. (1992). Comparing mental health benefits,

utilization patterns, and costs. In J. Feldman & R. J. Fitzpatrick (Eds.),

Managed mental health care: Administrative and clinical issues (1st ed.,

pp. 29–52). Washington, DC: American Psychiatric Press.

The authors report recent findings from a national study that examined the organizational

structure, benefits coverage, costs, and utilization of mental health services within HMOs.

This study examined levels of participation by HMOs in providing mental health benefits,

reviewed the kinds of organizational models used by HMOs that provide mental health

services, and identified factors associated with the level of coverage, costs, and utilization

of these services. Out of 424, 324 HMO administrators responded to a 36-question mail

questionnaire that asked about HMO characteristics, mental health service coverage and

benefits, organizational structure, costs, and utilization of services. The authors found that

while most HMOs provide a minimum level of mental health coverage, the fiscal, organizational, and service delivery arrangements for providing coverage reflect a great deal of

diversity among organizations.

Keywords: costs, HMOs, utilization

168. Marshall, P. E. (1992). The mental health HMO: Capitation funding for

the chronically mentally ill. Why an HMO? Community Mental Health

Journal, 28, 111–120.

This article describes an HMO capitation project for chronically mentally ill persons currently

being tested in Monroe and Livingston Counties in New York State. The author reports that

the project can remain financially solvent because the projected expenses are based on known

costs of services needed by seriously mentally ill patients, with the capitation rate based on a

“sickest person” scenario rather than insurance industry actuarial data. This approach uses

both case management in addition to a financial system with funding that follows patients into

66 Special Report
the community. The project has shown to improve patient functioning and reduce the cost of

community care for chronically mentally ill persons.

Keywords: capitation, HMOs, New York, public sector, serious mental illness

169. McFarland, B. H. (1994). Health maintenance organizations and

persons with severe mental illness. Community Mental Health Journal,

30(3), 221–242.

In an era of health care reform, one of the only apparent certainties is the continuation of

the rapid growth of HMOs. Although HMOs currently focus on treatment for physical

health services, the mental health industry is facing the same rapid increase in costs. This

paper examines the impact that HMOs could have on the mental health industry and, in

particular, how HMO penetration could affect treatment for the seriously mentally ill (SMI)

population. The author reviews the basic components of an HMO, the current structure for

provision of mental health services, and the results of studies concerning the impact of capitated rates on mental health care for SMI. He concludes that while integrating mental health

services for persons with serious and persistent mental disorders can be challenging to an

HMO, it is possible if the public and private components are well coordinated and adequately

funded. He argues for further research concerning the level of consumption of care by the

SMI when enrolled in HMOs, the likelihood of HMOs “dumping” the SMI population into

the public stream, and the method for developing capitated rates for such treatment.

Keywords: capitation, HMOs, serious mental illness

170. McFarland, B. H., Johnson, R. E., & Hornbrook, M. C. (1996).

Enrollment duration, service use, and costs of care for severely mentally ill

members of a health maintenance organization. Archives of General

Psychiatry, 53, 938–944.

This study attempts to address increasing concerns about the adequacy of capitated health

plans in providing services to the seriously mentally ill (SMI). The researchers compare

HMO enrollment duration, private and public service utilization, and HMO costs of care

for a target group of 250 adults enrolled in Kaiser Permanente in 1986 or 1987 with control

HMO members with and without diabetes mellitus over a 4-year follow-up period. The

results suggest that SMI individuals within an HMO have longer enrollment duration than

controls without diabetes mellitus and only slightly shorter duration than members with

diabetes mellitus. Additionally, those SMI individuals with longer enrollment durations

utilize community mental health service at a greater level without leading to higher HMO

costs of care. The researchers find no evidence of early termination of HMO members

because of chronic and severe mental illness.

Keywords: capitation, costs, HMOs, serious mental illness 

Annotated Bibliography 67
171. Norquist, G. S., & Wells, K. B. (1991). How do HMOs reduce outpatient

mental health care costs? American Journal of Psychiatry, 148, 96–101.

Previous studies have demonstrated that HMOs reduce expenditures for mental health services.

It has been hypothesized that HMOs may achieve these savings by excluding individuals with

psychiatric disorders. To test this hypothesis, this study examines differences in the prevalence

of psychiatric disorders and the use of outpatient mental health services for adults enrolled in

HMOs and fee-for-service plans. The data used are from the National Institute of Mental

Health Epidemiological Catchment Area survey (or study). The study found that there are

no significant differences between the HMO clients and those in private groups in prevalence

or use of services and that the most likely explanation for lower mental health costs in HMOs

is a less intensive style of care for a comparable population.

Keywords: HMOs, utilization

172. Rosenberg, S. (1996). Health maintenance organization penetration

and general hospital psychiatric services: Expenditure and utilization

trends. Professional Psychology, 27(4), 345–348.

This study examines the relationship between mental health and substance abuse treatment

utilization and HMO penetration on a State-by-State level, as well as the relationship between

expenditures for inpatient and outpatient psychiatric services provided through general hospitals. Findings suggest considerable variability in HMO penetration across the United States

between 1983 and 1990, with high levels of HMO penetration associated with lower rates

of expenditure growth. Outpatient use for general hospitals increased substantially for States

with high HMO penetration but decreased for States with low HMO penetration. Such findings imply that HMOs encourage outpatient alternatives to inpatient treatment while at the

same time restraining the growth of general hospital expenditures. 

Keywords: costs, HMOs, substance abuse, trends, utilization

173. Scheffler, R., Grogan, C., Cuffel, B., & Penner, S. (1993). A specialized

mental health plan for persons with severe mental illness under managed

competition. Hospital and Community Psychiatry, 44, 937–942.

The authors summarize the major characteristics of managed competition proposals and recommend the development of special mental health maintenance organizations (MHMOs) to

serve only persons with severe mental illness. In this model, the MHMO would provide case

management in the community and a fixed point of responsibility for clinical care of these

patients. Two methods of reimbursement are proposed as are specific plan characteristics that

should be part of MHMOs. The authors also discuss possible systematic reforms that would

be necessary to facilitate the integration of MHMOs into a managed health care system.

Keywords: HMOs, serious mental illness

68 Special Report
174. Schneider-Braus, K. (1992). Managing a mental health department in a

staff model HMO. In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental

health care: Administrative and clinical issues (1st ed., pp. 125–141).

Washington, DC: American Psychiatric Press.

In this chapter, the author discusses the philosophical and practical issues relevant to the

management of a staff model mental health department. In particular, she addresses importance of purpose and mission, role of the director, designing a spectrum of services, staffing

patterns, utilization and gatekeeping, centralization versus decentralization, medical records,

and patient service. The author concludes that mental health professionals should educate

themselves in these areas so they can have an impact on providing cost-effective, high-quality

mental health services.

Keywords: HMOs, overviews

175. Shadle, M., & Christianson, J. B. (1988). The organization of mental

health care delivery in HMOs. Administration in Mental Health, 15,

201–225.

This article presents an overview of the status of the HMO industry and focuses on how

HMOs structure and deliver mental health care. The authors describe a nationwide study in

which directors of 286 HMOs (representing staff, group, network, and Independent Physicians

Association [IPA] models) were surveyed. The study found that mental health services were

delivered internally by 70 percent of the HMOs. Over half of the HMOs had designated

coordinators of mental health services other than the medical director, and the presence of

a designated mental health coordinator was significantly related to the age, size, and model

type. Older and larger not-for-profit HMOs were most likely to have designated directors.

The study also reported on types of providers used, the percentage of time different types

of providers spent in service delivery, and staffing ratios for various categories of providers.

Finally, the study reports on use of external alcoholism, drug abuse, and mental illness

providers by HMO type, referral patterns, and access to services. The article concludes

with a comparison of IPAs with other types of HMO models.

Keywords: HMOs, overviews

176. Shadle, M., & Christianson, J. B. (1989). The impact of HMO

development on mental health and chemical dependency services.

Hospital and Community Psychiatry, 40, 1145–1151.

In this article the authors examine the ways in which the five major HMOs in the Minnesota–

St. Paul area have reduced their members’ use of inpatient mental health and chemical

dependency services. They are particularly interested in the impact of these HMOs on the

way that other providers in the community organize and deliver services. Data were collected

through structured interviews with 19 HMO representatives and individuals associated with

Annotated Bibliography 69
government, community-based organizations, and provider groups. The authors also analyzed

data provided by the HMOs to the State of Minnesota and hospital utilization data.

Keywords: HMOs, utilization

177. Simon, G. E., Grothaus, L., Durham, M. L., VonKorff, M., & Pabiniak, C.

(1996). Impact of visit copayments on outpatient mental health utilization

by members of a health maintenance organization. American Journal of

Psychiatry, 153(3), 331–338. 

With the need for mental health services exceeding available resources at a time when pressures

for cost containment are high, many researchers are attempting to identify a way to decrease

costs without preventing the most needy people from accessing care. Several mechanisms for

limiting outpatient mental health services exist, including cost-sharing, restrictions on the number of visits, restrictions by diagnosis, and restrictions by type of treatment. In this study, the

authors examine the effect of two stepwise increases in visit copayments on outpatient mental

health utilization within an HMO. From their results, they conclude that implementing copayments significantly reduces initial access to mental health services and has a smaller impact on

treatment intensity. Cost-sharing restricts access to care regardless of the level of clinical need.

Keywords: economics, HMOs, utilization

178. Stelovich, S. (1996). Evolution of services for the chronically mentally

ill in a managed care setting: A case study. Managed Care Quarterly, 4(3),

78–84.

The author uses the experience of Harvard Pilgrim Health Care, a Boston HMO, to illustrate

key factors in the evolution of mental health and substance abuse care in HMOs and managed

care environments. These factors include the development of a broad spectrum of services, the

use of algorithms to guide patient treatment decisions, and the implementation of outcome

measurement. The author also discusses other factors, less directly related to clinical practice,

which have had a significant impact on program development: dollars allocated to mental

health services, the influence of different service delivery models, and the use of diverse payment models. 

Keywords: HMOs, overviews, serious mental illness

179. Stoil, M. J., & Hill, G. A. (1998). Survey results on behavioral health

promotion in managed primary health care. Journal of Public Health

Management Practice, 4(1), 101–109.

This article reports on a 1995–1996 survey of HMOs that gathered information about the

nature of their health promotion services related to lifestyle and behavioral health. Using

the survey results, the authors describe eight distinct models for the delivery of preventive

services. The distinguishing features of the models are based on how services are provided:

for example, whether they are directly purchased by the buyer from the HMO, provided

by in-network primary care providers versus through a subcontractor, provided by way of

70 Special Report
Annotated Bibliography 71

referral to an external source, provided through long-term community investment, or provided

by way of philanthropic commitment of either the managed care provider or its contractors.

Keywords: HMOs, models, prevention

180. Unutzer, J., Simon, G., Pabiniak, C., Bond, K., & Katon, W. (1998).

The treated prevalence of bipolar disorder in a large staff-model HMO.

Psychiatric Services, 49(8), 1072–1078.

This article examines the treated prevalence of bipolar disorder in a large staff-model HMO

in western Washington State. The HMO’s patient database was used to determine the number

and identity of patients treated for bipolar disorder. The patient records showed a somewhat

higher treatment prevalence for women, younger enrollees, and enrollees in the State’s Basic

Health Plan program for low-income residents. Of the patients treated for bipolar disorder,

only a small percentage received treatment with an antidepressant, antipsychotic, or a benzodiazepine without having a mood stabilizer prescribed. Overall, this study finds the treatedprevalence rate found in this HMO population to be somewhat higher than previously reported rates for prepaid health plans.

Keywords: HMOs, serious mental illness

181. Wainstock, E. J. (1993). How HMOs can effectively manage mental

health services in the 1990s. Administration and Policy in Mental Health,

21, 15–26.

This article describes the ways in which HMOs have responded to increased demand for costeffective and quality mental health and chemical dependency (MH/CD) services. The author

argues that HMOs should not contract or carve out mental health service to managed mental

health care companies but should restructure internally to provide these services. In this way,

HMOs can ensure comprehensive, integrated, and continuous services to their clients. The

author suggests how and why HMOs should restructure. Some goals of restructuring include

the establishment of a separate MH/CD department or unit, redesign of the benefit plan to

allow for flexible benefits, the use of case management and improved access to services

through decreased waiting times, 24-hour/7-day-a-week telephone service, and maintenance

of a multidisciplinary staff.

Keywords: HMOs, integration

182. Wholey, D., Christianson, J., & Peterson, M. (1996). Organization of

mental health care in HMOs. Administration and Policy in Mental Health,

23(4), 307–328.

The internal organization of an HMO can greatly affect the integration of service delivery.

This article examines the relationship between the structure of an HMO’s delivery system

and the way in which it provides for mental health services. On the basis of a survey of 405

HMOs in 1990, the authors conclude that certain variables internal to an HMO’s structure

significantly impact that HMO’s level of integration of mental health services. In particular,
group-based HMOs are more likely than Independent Physicians Associations to contract

for mental health care provision, and both are more likely to contract as overall enrollment

increases. Competition within a market area also influences the likelihood that an HMO will

contract for mental health services, with HMOs in a more competitive market being more

likely to contract than those in a less competitive market.

Keywords: carve-outs, HMOs

72 Special Report
IX.

Annotated Bibliography 73

Law and Ethics

183. Appelbaum, P. S. (1993). Legal liability and managed care. American

Psychologist, 48, 251–257.

Clinicians and managed care companies will incur new legal duties as a result of their activities in a managed care environment. This article discusses potential legal responsibilities of

clinicians. These include the duty to appeal adverse decisions of a managed care company;

to discuss the potential economic consequences of treatment decisions; and to continue treatment without payment or at a reduced rate. The article describes several legal cases involving

managed care. The author concludes that clinicians may be reassured by the tendency of

courts to recognize the legal responsibilities of both clinicians and care reviewers for their

activities in managed mental health care.

Keyword: liability

184. Becker, J., Tiano, L., & Marshall, S. (1992). Legal issues in managed

mental health. In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental

health care: Administrative and clinical issues (1st ed., pp. 159–184).

Washington, DC: American Psychiatric Press.

This chapter discusses some of the legal and ethical issues that arise in connection with managed mental health care programs (MMHPs). The authors confine the scope of the chapter to

five major issues: State laws relating to managed mental health organizations; confidentiality

issues; risk management; selection of providers; and the impact of rules relating to affiliated

service groups. The chapter uses legal cases to demonstrate the areas in which a managed care

organization may be held liable and makes some suggestions regarding ways that MMHPs

can be structured and operated to maximize compliance with State laws.

Keywords: ethics, liability

185. Blum, S. R. (1992). Ethical issues in managed mental health.

In S. Feldman (Ed.), Managed mental health services (1st ed., pp. 245–266).

Springfield, IL: Charles C. Thomas.

The author argues that the crux of the ethical debate in managed mental health care is the

perceived trade-off between the goals of cost containment through management versus quality

of care. This chapter uses the discipline of applied health care ethics to examine the implications of managed care for both provider as well as consumer on issues such as patient and

provider autonomy, informed consent, and the “double agent” problem (the divided loyalty

clinicians feel to both patient and care manager/payor). He concludes that the success of

Annotated Bibliography
managed mental health must be judged both on its quality and cost-effectiveness as well as

on the extent to which the ethical issues are addressed and resolved satisfactorily.

Keyword: ethics

186. Boyle, P. J., & Callahan, D. (1995). Managed care in mental health:

The ethical issues. Health Affairs, 14(3), 7–22.

This article examines the ethical issues involved with managed care penetration in the mental

health care market. The authors discuss the ethical arguments behind six of the major criticisms of managed care. These criticisms concern managed care’s supposed adverse effects on

quality, limitations on access, a loss of the provider/patient relationship, insufficient promotion

of informed patient choice, heightened secrecy of policy and benefit design, and the transfer of

decision-making responsibility from physicians to managers under utilization review processes.

The report concludes that, from an ethical viewpoint, the problems that confront managed

mental health care diverge very little from those of managed care. The authors contend that

ultimately the managed mental health care system, if it continues to attempt to curb abuses

and rectify ethical problems, should prove superior on the whole to fee-for-service medicine. 

Keyword: ethics 

187. Dörken, H., & Pallak, M. S. (1994). Using law, research, professional

training, and multi-disciplinary collaboration to optimize managed care.

Managed Care Quarterly, 2(2), 53–59.

Poor collaboration among health professionals leads to negative outcomes for patients.

In this article, the authors outline the potential for revisions of law, application of research,

professional collaboration, and focused training to maximize collaboration between mental

health care professionals and the effectiveness of managed care. They argue that when a

multidisciplinary perspective is brought to bear on a situation requiring mental health care,

the strengths of these resources far outweigh those of any single professional approach to

the same situation.

Keyword: providers

188. Elpers, J. R., & Abbott, B. K. (1992). Public policy, ethical issues, and

mental health administration. Administration and Policy in Mental Health,

19, 437–447.

Today’s mental health clinician-administrators in both the public and private sector face a

number of ethical dilemmas. The authors describe a variety of conflicts and issues, such as

patient rights, resource allocation, and problems posed by privatization and managed care.

They suggest that a professional organization develop ethical guidelines to assist administrators in monitoring and making difficult choices.

Keyword: ethics

74 Special Report
189. Geraty, R. D., Hendren, R. L., & Flaa, C. J. (1992). Ethical perspectives

on managed care as it relates to child and adolescent psychiatry. Journal

of the American Academy of Child and Adolescent Psychiatry, 31, 398–401.

The increased influence of managed care on the way child and adolescent psychiatry is practiced has created new ethical and legal dilemmas for the clinician and administrator. This

article reviews the history of managed care and medical ethics and discusses the role of social

values in medical decision making. Salient ethical issues are discussed, as are current legal

decisions addressing clinician responsibility within a managed care system. The authors recommend that child and adolescent psychiatrists anticipate ethical dilemmas before they occur

and work with hospital administrators to develop guidelines that address contradictory fiscal

and clinical decisions.

Keywords: children, ethics, overviews

190. Hall, R. C. W. (1994). Legal precedents affecting managed care:

The physician’s responsibilities to patients. Psychosomatics, 35, 105–117.

This article reviews some of the most significant legal cases related to managed care and

physician responsibility for patient care. The author focuses on the implications of these cases

for how psychiatrists should practice in a managed care environment. Suggestions are made

for how physicians might manage care when they feel they are caught in an ethical dilemma

by managed care companies or their third-party reviewers.

Keywords: ethics, liability

191. Higuchi, S. A. (1994). Recent managed-care legislative and legal

issues. In R. L. Lowman & R. J. Resnick (Eds.), The mental health

professional’s guide to managed care (pp. 83–118). Washington, DC:

American Psychological Association.

This article is an extension of Newman and Bricklin’s review (Chapter 4; reference numbers

193 and 194) of legal issues relevant to managed mental health care. The author describes in

detail the content of State statutes regarding utilization review, preferred provider organizations, and HMOs. Recent court cases are discussed in light of expanding liability for managed

care systems and providers. The author discusses typical legal dilemmas faced by psychologists,

particularly those involving utilization review and access to mental health care services. The

chapter concludes with a number of legal strategies that can be used by practitioners who are

experiencing problems in managed care systems. 

Keywords: liability, overviews

Annotated Bibliography 75
192. Lazarus, J., & Pollack, D. (1997). Ethical aspects of public sector

managed care. In K. Minkoff & D. Pollack (Eds.), Managed mental health

care in the public sector: A survival manual. Amsterdam: Harwood

Academic Publishers.

When the public sector enters into managed care arrangements for the provision of services,

certain ethical dilemmas can arise. This article discusses the roles of the following ethical concerns in public sector managed care (PSMC) systems: confidentiality, informed consent, full

disclosure, double-agentry and conflicts of interest, honesty, financial incentives and disincentives, outcomes, interference in the clinical relationship, relationships among mental health

professionals, consumers as providers, telemedicine, formulary restrictions, leverage, inadequate experience of PSMC systems, and organizational issues. In addition to discussing ethical

concerns that may arise, this article also suggests ways to maintain ethically sound practices.

Keywords: ethics, public sector

193. Newman, R., & Bricklin, P. M. (1991). Parameters of managed mental

health care: Legal, ethical, and professional guidelines. Professional

Psychology Research and Practice, 22, 26–35.

The authors express concern about the potentially adverse consequences of cost containment

on quality of care in managed care settings. They argue that managed care legislation has

failed to establish parameters for ensuring the quality of mental health services. More effective

laws and regulations are needed to ensure that cost-containment efforts do not compromise

quality mental health care. State statutes and regulations to ensure quality are outlined, such as

those aimed at licensing and prohibiting false advertising. Also described are recent lawsuits to

hold managed care companies accountable for the care they provide. The authors discuss the

major legal, ethical, and professional parameters available to guide clinicians and managed

care companies. Finally, they propose methods of ensuring that a focus on providing quality

care is not compromised by strategies for cost containment.

Keywords: liability, overviews

194. Newman, R., & Bricklin, P. M. (1994). Parameters of managed mental

health care: Legal, ethical, and professional guidelines. In R. L. Lowman &

R. J. Resnick (Eds.), The mental health professional’s guide to managed

care (pp. 63–82). Washington, DC: American Psychological Association.

See Newman and Bricklin, 1991 (reference number 193) for annotation.

195. Olsen, D. P. (1994). The ethical considerations of managed care in

mental health treatment. Journal of Psychosocial Nursing, 32(3), 25–28.

This article, written from a nursing perspective, addresses ethical issues in managed mental

health care. The author suggests that the three areas most significantly impacted by managed

care are restrictions on patient autonomy of choice of treatment and treatment site; relationship between the nurse as a managed care agent and the patient; and patient responsibility in

76 Special Report
treatment decisions made through managed care with concomitant denial or alteration

of access to treatment based on compliance. The author argues that while managed care

is neither inherently good nor bad, the medical profession must examine managed care in

light of these potential ethical dilemmas.

Keyword: ethics

196. Olsen, D. P. (1995). Ethical cautions in the use of outcomes for

resource allocation in the managed care environment of mental health.

Archives of Psychiatric Nursing, 9(4), 173–178.

With the rise in competitive contracting for health care resources, outcome data is becoming

a common deciding factor in the allocation of contracts and financial rewards. In this article,

the author discusses the ethical concern about using outcome data in the field of mental

health. In particular, the paper focuses on the ethical concerns with six specific types of outcome measurements: utilization data, patient reports, clinician reports, objective measures

of diagnostic entities, objective measures of functioning, and multifactor research. The author

suggests guidelines for addressing ethical concerns and presents the difficulty in defining

good outcomes.

Keywords: ethics, outcomes, performance measurement

197. Packer, I. K. (1998). Privatized managed care and forensic mental

health services. Journal of the American Academy of Psychiatry and the

Law, 26(1), 123–129.

This article describes the introduction of managed care for mental health services into the public sector, and the special challenges unique to serving the forensic population, such as pretrial

evaluation services, pretrial treatment services, and post-adjudication services. Throughout the

report, the author describes examples where States have been managing forensic services and

highlights the successes and challenges they have faced in serving this population. According to

the author, five primary elements are required for any State to properly monitor the delivery of

forensic services by the private sector: a specialized utilization review process, a quality assurance tool, a standard to properly train and assess the performance of professionals, the release

of a risk assessment concurrent with the release of forensic patients, and a tool to monitor the

prevalence of severely mentally ill forensic patients. 

Keywords: public sector

198. Patterson, R. F. (1998). Managed behavioral healthcare in correctional

settings. Journal of American Academic Psychiatry Law, 26(3), 467–473.

This article focuses on issues of concern in negotiating managed care contracts for the provision of behavioral health care services in correctional settings. The author summarizes the

factors that contribute to the complexity of providing services in correctional settings. He

discusses key decision points in negotiating behavioral health care services with managed care

organizations and argues for the involvement of mental health professionals in these areas.

Annotated Bibliography 77
These key considerations include staffing levels, drug formulary, level of service requirements,

and other costs related to health care which, although typically borne by the State, influence

the provision of care and should be taken into account during contract negotiations. 

Keywords: contracting, public sector

199. Petrila, J. (1995). Who will pay for involuntary civil commitment under

capitated managed care? An emerging dilemma. Psychiatric Services,

46(10), 1045–1048.

With mental health reimbursement increasingly relying on capitation and managed care

principles, there are incentives to limit hospital bed use for the civilly committed. Yet these

individuals must often remain hospitalized for even longer periods because of their civil profile and the perceived risk involved in releasing them into general society. In this paper, the

author explores this conflict as well as the relationship between civil commitment and costshifting in a capitated payment system. The author suggests six strategies for providers dealing with these issues: avoiding negotiations concerning payment questions after evaluation

and treatment have begun by including conditions for civil commitment in their contracts;

creating services and social supports to reduce the need for commitment; implementing

consistent risk assessment standards for all patients; conducting research on the use of civil

commitment in managed care settings; ensuring that States with managed Medicaid programs

do not create incentives to shift costs through commitment; and engaging in discussions with

treatment staff about the dilemma.

Keywords: capitation, involuntary commitment

200. Petrila, J. (1998). Courts as gatekeepers in managed care settings.

Health Affairs, 17(2), 109–117.

This article describes instances where the judicial system orders behavioral health treatment

for offenders and questions the responsibility of managed care providers to pay for services

that might not be “medically necessary.” The author examines the often conflicting goals of

the courts and the managed care organization (MCO), the plan structure of the MCO, and

the enforcement and liability of the MCO that chooses to limit reimbursement of services

for court-ordered behavioral health treatment. The author provides solutions reached by

different States through legislative means that help to designate financial responsibility, risk,

and provision of services between judges acting as “gatekeepers” and the MCO as the payer

or provider of services.

Keywords: involuntary commitment

201. Rich, J. P. (1992). Managed mental health: Key legal issues.

In S. Feldman (Ed.), Managed mental health services (1st ed., pp. 267–290).

Springfield, IL: Charles C. Thomas.

This chapter provides an overview of the trends in the managed health care field, concentrating

on legal issues affecting managed mental health care. These include significant court cases and

78 Special Report
federal and state regulatory actions. The federal and state regulatory environment in which

the managed care industry and mental health professionals work is described, as are current

legal issues confronting provider-controlled managed care entities. Several managed mental

health liability issues are discussed. These include provider credentialing and peer review

liability, utilization review decisions, risk sharing and restrictive referrals, refusal to consent to

psychotropic drugs, and liability for failing to protect mental health patients or their victims

from harm.

Keywords: liability, overviews, trends

202. Simon, N. P. (1994). Practitioner ethics and managed care. Managed

Care Quarterly, 2(2), 43–45.

Providers of managed mental health services often argue that the profit motive base of managed care companies generates dilemmas for providers that may have serious legal and ethical

implications for them. These dilemmas are briefly discussed. The author argues that in the best

interests of patients, both managed care companies and care providers should strive for a more

cooperative working relationship, open discussion, and resolution of the ethical issues at stake.

Keyword: ethics

203. Stone, A. A. (1999). Managed care, liability, and ERISA. Forensic

Psychiatry, 22(1), 17–29.

In 1974, Congress passed the federal Employee Retirement Income Security Act (ERISA) to

secure health benefits negotiated between management and labor without providing either side

an edge over the other. This article provides an overview of the crucial issues that have had an

impact on the nature and quality of care that patients receive from physicians, psychiatrists,

and other mental health practitioners. These include ERISA’s restrictions on health care, identified by examples from specific court cases; liability for suicide; and ERISA restrictions that

cause harm to patients in the era of managed care. With ERISA’s effects of lowering professional standards of care and protecting insurance carriers from liability, perhaps malpractice liability will become the primary vehicle for mitigating the injustices sparked by this regulation. 

Keywords: legislation, liability

204. Substance Abuse and Mental Health Services Administration. (1998).

Ethical issues for behavioral health care practitioners and organizations in

a managed care environment: Vol. 5. Managed care technical assistance

series. Rockville, MD: Author.

This monograph of five sections presents discussions and case studies to illustrate a number

of core ethical issues in managed behavioral health care. The first section discusses the ethical

principles relevant to overall allocation of behavioral health care resources, the second discusses those ethical principles informing the treatment relationship, and the third and fourth

sections discusses the impact of managed behavioral health care on these ethical principles.

The monograph concludes with a discussion of how behavioral health care individual

Annotated Bibliography 79
80 Special Report

providers and organizations might respond to these ethical dilemmas. According to the

monograph, ethical issues are especially relevant to the managed care system because it

poses particularly difficult ethical issues due to the tension between cost containment and

obtaining services for people with mental disorders. 

Keywords: ethics, technical assistance

205. Wineburgh, M. (1998). Ethics, managed care, and outpatient

psychotherapy. Clinical Social Work Journal, 26(4), 433–443.

The author discusses ethical issues that managed care organizations and mental health care

providers should consider in the environment of managed mental health care. These include

respect for the patient and patient autonomy, informed consent regarding procedures and

treatment, confidentiality, issues of divided loyalty among practitioners who also work for

managed care organizations, placing a priority on the promise to do no harm to the patient,

resisting the impulse to treat all patients with short spans of care, and taking on the duty to

appeal the patient’s case to the managed care organization where applicable. 

Keywords: ethics, providers
X.

81

Provider Issues

206. Armenti, N. P. (1991). The provider network in managed care.

The Behavior Therapist, 123–128.

This article describes the characteristics of providers who might be most successful in a

managed care system. These include having substance abuse training and experience; the

ability to provide emergency and crisis intervention; behavioral training; a demonstrated

ability to use community resources; and a community mental health or agency background.

The author describes some of the varying styles of managed care for providers and suggests

that providers also need to be selective when choosing a managed care arrangement to join.

Keyword: providers

207. Austad, C. S., & Berman, W. S. (1991). Managed health care and

the evolution of psychotherapy. In C. S. Austad & W. H. Berman (Eds.),

Psychotherapy in managed health care: The optimal use of time and

resources (1st ed., pp. 3–18). Washington, DC: American Psychological

Association.

This chapter, written by the book’s editors, describes how the changing health care system

has impacted the field of psychotherapy. They examine the evolution of short-term therapy,

and describe the commonalities in all of the therapies practiced in managed care settings.

Psychotherapy as it is practiced in the HMO setting is discussed, as are controversies in and

about managed health care.

Keywords: providers, psychotherapy

208. Austad, C. S., Sherman, W. O., Morgan, T., & Holstein, L. (1992).

The psychotherapist and the managed care setting. Professional

Psychology Research and Practice, 23, 329–332.

This study explores the practice patterns and attitudes of 43 mental health professionals working

in staff-model HMOs in the Northeast. Participants were asked to respond to semi-structured

and open-ended questions about their work setting, burnout, graduate training, and the evolution

of their practice style. Therapists were found to “happen” into the HMO setting and to possess

little information about HMOs prior to their employment. Participants reported that their work

involves a high level of direct client contact, that they use mostly brief therapy methods, and that

they use a variety of strategies to prevent burnout. The study also discusses the ways in which

psychologists differ from other mental health professionals in their practice styles.

Keywords: providers

Annotated Bibliography
209. Backlar, P. (1996). Managed mental health care: Conflicts of interest in

the provider/client relationship. Community Mental Health Journal, 32(2),

101–106.

This article is a theoretical analysis of the conflicts of interest confronting health care providers

with special attention paid to mental health providers and the implicit economic conflicts of

interest brought about by managed care. According to the author, there are three primary positions where conflicts of interest arise in health care: when providers promote their clients’

interests over all other interests; when providers promote the general social good by acting as

rational resource allocators; and when providers promote their own financial well-being at the

expense of all other interests. The author argues that conflicts of interest in managed mental

health care are distinct from those that arise in traditional health care services because the

mentally ill population oftentimes has a limited ability to care for itself or to make informed

choices. Therefore, the author sees a potential loss of confidentiality in patient care for people

with mentally illness, as well as a potential conflict between the provider’s personal financial

loyalties and the patient’s interests.

Keywords: ethics, providers

210. Baker, N. J., & Giese, A. A. (1992). Reorganization of a private

psychiatric unit to promote collaboration with managed care. Hospital

and Community Psychiatry, 43, 1126–1129.

Over the past five years, an increased number of managed care organizations in the Denver,

Colorado, area have challenged psychiatric hospitals to reduce costs and length of stay. This

article describes the experience of one private psychiatric hospital unit that reorganized a

locked unit into three progressively less restrictive ones through which patients could progress

at their own rate. In the first year after reorganization, length of stay and staffing costs were

significantly reduced. This article describes these and other impacts of this hospital-based

alternative model.

Keywords: models, providers

211. Barnes, P. D. (1991). Managed mental health care: A balancing act.

Administration and Policy in Mental Health, 19, 51–55.

Managed mental health care is characterized by tensions between countervailing interests,

goals, and approaches. In this opinion piece, the author identifies some of the areas in which

mental health professionals are working to strike a balance, and the implications of the choices

that they make. Managed care companies’ desire to use a selected panel of providers must be

balanced against consumer freedom of choice; quality control must be balanced against the

need to control costs; utilization review must serve providers, consumers, and payors alike; and

mental health goals must be balanced with health care goals. After describing these tensions,

the author outlines methods to reduce adversarial relationships, arguing that the behavior of

managed health care and practitioners will eventually become more similar and collaborative.

Keyword: providers

82 Special Report
212. Bennett, M. J. (1992). The managed care setting as a framework for

clinical practice. In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental

health care: Administrative and clinical issues (1st ed., pp. 203–217).

Washington, DC: American Psychiatric Press.

The author describes a treatment model for psychotherapy in a managed setting that was

developed with over 20 years of experience in an HMO environment. The treatment model,

referred to as focal psychotherapy, consists of five phases that can be characterized along six

axes. This treatment model is described, as are the implications of this model for assessment

and monitoring client progress. The author argues that this model is responsive to patient

needs as well as cost-effective. He asserts that although the focal psychotherapy originated in

a closed setting, the model is compatible with a wide variety of clinical settings with similar

missions.

Keywords: models, providers, psychotherapy

213. Berkman, A. S., Bassos, C. A., & Post, L. (1988). Managed mental

health care and independent practice: A challenge to psychology.

Psychotherapy, 25, 434–440.

This article addresses ways in which high quality of care can be delivered within a framework

that emphasizes cost-containment. The authors outline the key strategies of the Synton Group,

a mental health management firm. These strategies include diagnostic consultation; utilization

management committee; and use of patient satisfaction surveys. The article describes critical

issues that managed care systems should consider: using experienced providers; meeting both

clinical and financial goals; establishing effective mechanisms to ensure access to care; and

matching patients with providers and treatment. The authors also discuss the various arrangements between managed care firms and providers, and their advantages and disadvantages.

Finally, the article reviews questions regarding what constitutes effective mental health treatment, and the role of diagnosis in such treatment.

Keywords: managed behavioral health care organizations, providers

214. Berman, W. H., & Austad, C. S. (1991). Managed mental health care:

Current status and future directions. In C. S. Austad & W. H. Berman (Eds.),

Psychotherapy in managed health care: The optimal use of time and

resources (1st ed., pp. 264–278). Washington, DC: American Psychological

Association.

This chapter, written by the book’s editors, provides an overview of the book. The authors write

that the purpose of the book has been to “describe optimal mental health care as it is practiced

by clinicians in managed health care systems.” The collection of chapters demonstrates the various ways that psychotherapists have adjusted their practices to accommodate changes in financing and organization of the mental health care system. This chapter summarizes some of the

innovations in theory, assessment, and treatment and explores current developments in program

development, treatment of chronic patients, and training and staff development.

Keyword: providers

Annotated Bibliography 83
215. Bittker, T. E. (1992). The emergence of prepaid psychiatry.

In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental health care:

Administrative and clinical issues (1st ed., pp. 3–10). Washington, DC:

American Psychiatric Press.

This chapter briefly describes the emergence of prepaid psychiatry over the past 25 years,

from its beginnings in the HMO movement of the 1960’s to its recent forms of managed care.

The author argues that physician surpluses and escalating medical care costs have promoted

an alliance between government, corporate America, and health insurers that has led to an

industrialization of medicine. He describes the impact of this industrialization on mental

health professionals and discusses the ways in which changes in the financing and organization of psychiatric services will continue to impact psychiatry in the next century.

Keywords: overviews, providers, trends

216. Carson, D. (1993). Managed care: A provider perspective.

New Directions for Mental Health Services, 59, 81–87. 

This chapter uses the experience of a private psychiatric hospital to describe the impact

on both the hospital and its staff of moving towards a managed care model. As in other

psychiatric hospitals, managed care led to a shift in focus from inpatient to outpatient care.

In addition to the impact on locus of care, there was a concomitant impact on length of

treatment, type of treatment, and range of services offered to clients by the hospital.

Moreover, managed care had a profound impact on clinicians. A detailed case example

describes the initial problems experienced by the hospital and staff, changes in staff

attitudes, administrative issues, financial issues, and the vision for the future.

Keyword: providers

217. Dewan, M. (1999). Are psychiatrists cost-effective? An analysis of

integrated versus split treatment. American Journal of Psychiatry, 156,

324–326.

Recent models of health care have emphasized the need to treat the patient holistically, integrating behavioral health services and physical health services under one managed care organization. Yet within the realm of mental health, many health maintenance organizations (HMOs)

favor split treatment between psychiatrists and psychotherapists over integrated care by a single provider because they assume split treatment will be less costly. In this study using 1998 fee

schedules from seven large managed care organizations and Medicare, the author models clinical scenarios of psychotherapy alone, medication alone, and the combined treatment provided

by a psychiatrist or split with a psychologist or social worker. From the results, short-term

psychotherapy alone by a social worker is the least expensive modality. For patients who require

more intensive treatment, integrated care is less expensive than split treatment for almost all

treatment length scenarios. The author argues for further research to differentiate patients who

will respond better to brief psychotherapy alone compared with combined treatment. 

Keywords: costs, integration, models, providers, psychotherapy 

84 Special Report
218. Dial, T. H., Bergsten, C., Haviland, M. G., & Pincus, H. A. (1998).

Psychiatrist and nonphysician mental health provider staffing levels in

health maintenance organizations. American Journal of Psychiatry, 155,

405–408.

Based on research from the Group Health Association of America (now the American

Association of Health Plans) concerning clinical staffing patterns in a sample of staff and

group model health maintenance organizations (HMOs), this study examines the ratios of fulltime psychiatrists to members and nonphysician mental health professionals to psychiatrists.

From the results, the overall mean number of psychiatrists per 100,000 HMO members is 6.8,

and there are 4.5 nonphysician mental health professionals on average for every licensed psychiatrist in the plan. Compared to previous estimates of the required psychiatrist-to-population

ratios in fee-for-service and managed care environments, the overall number of psychiatrists

per 100,000 members is less than half the requirement for a fee-for-service environment estimated in 1980 and about 40–80 percent greater than that for a managed care environment

estimated by later studies. The authors argue for the need of adequate projections of the future

demand for psychiatrists and suggest potential mechanisms to aid in this analysis. 

Keyword: HMOs, providers, staffing

219. Dörken, H. (1994). Managed care intervenes where state

regulation fails. In S. A. Shueman, W. G. Troy, & S. L. Mayhugh (Eds.),

Managed behavioral health care: An industry perspective (pp. 113–126).

Springfield, IL: Charles C. Thomas.

In this chapter the author argues that managed care has brought the issue of clinical standards,

quality of care, and accountability to the fore. He discusses the inadequacies of regulatory entities to ensure competency among mental health providers and to maintain reasonable practice

standards through peer review. He reviews licensing and other legislation in the state of

California to demonstrate the inability of such legislation to regulate professional behavior.

Keywords: California, legislation, providers

220. Dorwart, R. A. (1990). Managed mental health care: Myths and

realities in the 1990s. Hospital and Community Psychiatry, 41, 1087–1091.

As managed mental health care is becoming the norm for people who are insured, concerns

about the effects of managed care are increasingly being raised by both clients and providers.

These concerns have focused around whether managed care really reduces costs, whether it

adversely affects the quality of care, and the ways in which it affects access to care. The author

calls for more and better research to answer some of these questions and debunk some of the

myths about managed health care. This research would ideally lead to better communication

between mental health professionals and managed care organizations.

Keyword: providers

Annotated Bibliography 85
221. Feldman, J. L. (1992). The managed care setting and the

patient-therapist relationship. In J. Feldman & R. J. Fitzpatrick (Eds.),

Managed mental health care: Administrative and clinical issues

(1st ed., pp. 219–229). Washington, DC: American Psychiatric Press.

This chapter delineates five major aspects of managed care practice that influence the patienttherapist relationship. These are payment, systems issues, regulatory issues, internal management issues, and organizational values. The author discusses each of these issues in a managed

care setting. She argues that the overall values and philosophy of an organization will significantly impact the therapeutic relationship. She presents a model of the therapeutic relationship

as a “family triad” of patient, therapist, and organization, and asserts that alliances between

any two of the parties will impact the quality of the relationship between the patient and the

clinician and inevitably affect the outcome of therapy.

Keywords: overviews, providers

222. Feldman, J. L., & Fitzpatrick, R. (Eds.), (1992). Managed mental health

care: Administrative and clinical issues (1st ed.). Washington, DC:

American Psychiatric Press.

This book includes articles about managed mental health care from administrative as well as

clinical points of view. The book is divided into three sections: administrative issues (covering

the historical, economic, and managerial approaches to managed care); clinical issues (often

using a case study approach to discuss treatment approaches developed by the authors); and a

special issues section. Two chapters in the clinical issues section focus specifically on managed

care services for drug and alcohol abuse. In the final section on “special topics” are articles

discussing new delivery system approaches, including one that describes a computer-assisted

therapy method for short-term therapy.

Keyword: providers

223. Fowls, D. J. (1994). From managed care to cooperative care.

Managed Care Quarterly, 2(2), 46–50.

The tensions between managed care companies and providers of care have led to what this

author calls “organizational schizophrenia.” This article addresses some of the reasons for the

lack of communication and cooperation between many providers of mental health care and the

managed care companies they work for. Two case studies are presented in which providers and

managed care companies have moved beyond a conflictual relationship to form a collaborative

one. The author argues that this can only happen with leadership from both camps and a

shared vision of quality and cost-effective care that puts the consumer and provider first.

Keyword: providers

86 Special Report
224. Goldstein, L. S. (1989). Genuine managed care in psychiatry.

General Hospital Psychiatry, 11, 271–277.

In this article, the author describes a genuine managed mental health care system and the role

of psychiatrists in such a system. Genuine managed care is defined as a practice pattern that

mental health practitioners can use to deliver quality care cost-effectively. Practice pattern is

a structure for care, and includes provision of multiple services by a multidisciplinary staff.

It is also a process characterized by collaboration, utilization review, and quality assurance.

The author concludes by presenting an evaluation study analyzing the use of such a practice

pattern by a group practice.

Keyword: providers

225. Goodman, M., Brown, J., & Deitz, P. (1992). Managing managed care:

A mental health practitioner’s survival guide. Washington, DC: American

Psychiatric Press.

This book is written specifically for mental health practitioners who may need help understanding their evolving role in a managed mental health care system. It is intended to guide

the clinician through the review processes inherent in managed care services and to help them

develop appropriate treatment plans. The authors use clinical vignettes to illustrate how to

write patient impairment profiles and outcome objectives. In lengthy appendices, they provide

specific psychotherapeutic interventions for many common mental disorders. 

Keywords: providers, technical assistance 

226. Gould, R. L. (1992). Adult development and brief computer-assisted

therapy in mental health and managed care. In J. Feldman & R. J.

Fitzpatrick (Eds.), Managed mental health care: Administrative and clinical

issues (1st ed., pp. 347–358). Washington, DC: American Psychiatric Press.

This chapter presents a model of adult development based on Erickson’s theory that development, developmental blocks, and repair of previous developmental blocks occur at all ages.

This paradigm of adult development lends itself well to short-term therapy, i.e., the goal being

to find and resolve the current developmental block that is interfering with healthy functioning. The author proposes the therapeutic learning program, which is a computer-assisted brief

therapy program written for patients to work through themselves. The program consists of 10

interactive, sequential computer sessions. The patient also works with a therapist at the end of

each session. This chapter describes each of the goals and objectives of the 10 steps, describes

the advantages of such a program, and reviews an outcome study of the first 2,000 patients

using this method.

Keywords: models, providers, psychotherapy

Annotated Bibliography 87
227. Hoyt, M. F., & Austad, C. S. (1992). Psychotherapy in a staff model

health maintenance organization: Providing and assuring quality care in

the future. Psychotherapy, 29, 119–129.

This article describes “good” therapy in an HMO setting. The essential characteristics of such

therapy include crisis intervention; clear definition of patient and therapist roles; flexible and

creative use of time; interdisciplinary collaboration; use of multiple treatment models; intermittent rather than long-term care; and utilization review. The authors recommend the use of

groups and family systems approaches, as well as growth-oriented rather than cure-oriented

approaches. They also review research evidence demonstrating the effectiveness of short-term

therapy and outline strategies to ensure that quality of care and accountability are maintained.

Keywords: HMOs, providers, psychotherapy

228. Jellinek, M. S., & Nurcombe, B. (1993). Two wrongs don’t make a

right: Managed care, mental health, and the marketplace. Journal of the

American Medical Association, 270, 1737–1739.

In this commentary, the authors describe the evolution of the mental health delivery system

from primarily “unleashed market forces” to “unopposed incentives to cut services.” The

authors argue that just as there were few countervailing forces against overutilization and

misuse of mental health services in the 1980’s, there is currently little to check systematic

profiteering from underutilization of services. They discuss the implications of the decreasing

professional autonomy for psychiatrists and suggest what individuals and organizations can

do to pursue specific political objectives. The article describes implications for primary care

clinicians and why managed care represents both a threat and an opportunity.

Keyword: providers

229. Lane, N. E. (1994). Managed care and providers: You’re in business!

In S. A. Shueman, W. G. Troy, & S. L. Mayhugh (Eds.), Managed behavioral

health care: An industry perspective (pp. 65–75). Springfield, IL: Charles C.

Thomas.

This chapter explores issues in managed behavioral health care from the perspective of the

providers. The author directs her discussion to the mental health provider who may be feeling

disillusioned with the changes in the field during the past decade. She describes concrete ways

that providers can cope with these changes, such as how to view behavioral health services as

a commodity to be bought, sold, marketed, and negotiated. Finally, she suggests ways that

providers can approach managed care organizations about participation in their programs,

and how to negotiate with these companies.

Keyword: providers

88 Special Report
230. Olsen, D. P., Rickles, J., & Travlik, K. (1995). A treatment-team model of

managed mental health care. Psychiatric Services, 46(3), 252–256.

This article examines the treatment-team model of managed care for mental health patients.

This model includes an in-person assessment by a clinician who acts as the managed care

agent, immediate accessibility of this clinician, referral services with a broad range of intensity,

and participation of the managed care clinician on the treatment team. The advantages of

this approach include an increased ability to provide patients with individualized services,

and a more organized system of care management. Limitations of the model include difficulty

in decision-making due to the presence of team decisions, and the potential for overuse of

emergency care by primary care physicians.

Keywords: models, providers

231. Patterson, D. Y., & Sharfstein, S. S. (1992). The future of mental health

care. In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental health care:

Administrative and clinical issues (1st ed., pp. 335–346). Washington, DC:

American Psychiatric Press.

In this chapter, the authors speculate on what the future of mental health care will hold as we

move towards the 21st century. They review some of the critical historical turning points in

mental health policy and briefly discuss current trends. These include the growing role of

employers, perceived inadequacy of HMOs, widespread concern with the rapid rise of mental

health and substance abuse costs, and concurrent decline in Federal and State direct oversight

for public mental health care. They speculate that managed care will continue to grow in

importance, that there will be a clearer definition of private versus public responsibility for

health care, a clearer delineation of responsibilities between medical and nonmedical mental

health care professionals, growing involvement of employers in health care, and increasing

number of training programs to prepare clinicians for the 21st century.

Keywords: providers, trends

232. Resnick, R. J., Bottinelli, R. W., Puder-York, M., Harris, B., & O’Keefe,

B. E. (1994). Basic issues in managed mental health services. In R. L.

Lowman & R. J. Resnick (Eds.), The mental health professional’s guide to

managed care (pp. 41–62). Washington, DC: American Psychological

Association.

The chapter compares and contrasts the four most prevalent managed care systems: health

maintenance organizations, preferred provider organizations, employee assistance programs,

and competitive medical plans. The authors delineate the ways in which psychologists participate in these systems—as owners, shareholders, independent providers, and employees.

Finally, the article examines the various professional relationship and practice issues that affect

providers who work in managed care settings. The authors conclude that mental health professionals in today’s practice environment need to be aware of the clinical and financial implications of managed care systems so that they participate effectively and influence their design.

Keywords: overviews, providers

Annotated Bibliography 89
233. Richardson, L. M., & Austad, C. S. (1991). Realities of mental health

practice in managed-care settings. Professional Psychology Research and

Practice, 22, 52–59.

This article describes aspects of the managed care system that are of concern to psychologists.

Topics discussed include mental health benefits under HMOs, the advantages and disadvantages of employment as staff or contractors, financial considerations in providing services in

fee-for-service arenas, prospective payment and capitation plans, and potential barriers to

treatment. The authors also review practice issues. Psychologists working in HMOs continue

to prefer long-term psychodynamic approaches; however, efforts are underway to help these

practitioners develop skills in providing short-term therapy. The authors argue that psychologists in HMOs must address challenges such as reducing inpatient use, providing care for

chronically ill and noncompliant clients, and interacting effectively in an interdisciplinary

team. The pros and cons of providing service in a managed care system are outlined, as well

as criteria clinicians can use in working in such systems.

Keywords: overviews, providers

234. Richardson, L. M., & Austad, C. S. (1994). Realities of mental health

practice in managed-care settings. In R. L. Lowman & R. J. Resnick (Eds.),

The mental health professional’s guide to managed care (pp. 151–168).

Washington, DC: American Psychological Association. 

See Richardson and Austad, 1991 (reference number 233) for annotation.

235. Root, L. S. (1991). Cost controls on mental health services: Context

and the role of the professional. Employee Assistance Quarterly, 7(2), 1–13.

Cost control is a key concern for employers; employee benefits represent 37.6 percent of U.S.

payroll costs. To address rising costs, employers offer health insurance through HMOs and

preferred provider organizations that is less expensive than fee-for-service plans. The author

describes three cost-containment strategies: exclusions and limits on coverage, managed care

carve-outs, and employee assistance programs as case managers, and explains how these

strategies are aimed at controlling behavior, use, and price. The author examines the context

of cost-control efforts in both mental health and substance abuse services. He argues that

mental health practitioners must be proactive and take initiative in creating an approach that

manages the care of clients, not simply limits the cost of the care.

Keywords: costs, providers

236. Sabin, J. E. (1991). Clinical skills for the 1990s: Six lessons from HMO

practice. Hospital and Community Psychiatry, 42, 605–608.

HMO clinical practice currently embodies many of the features that are being required of

managed mental health care providers. These include attention to cost containment, identification of outcomes, practice audits and treatment guidelines. This author argues that identifying the skills required for clinical effectiveness and professional satisfaction in the HMO can

90 Special Report
be extremely valuable for all clinicians working in a managed care environment. He identifies

six crucial skills that can help clinicians become more effective, and uses brief case examples

to illustrate how these skills may be useful in managed-care settings.

Keywords: HMOs, providers

237. Sabin, J. E., & Borus, J. F. (1992). Mental health teaching and research

in managed care. In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental

health care: Administrative and clinical issues (1st ed., pp. 185–199).

Washington, DC: American Psychiatric Press.

In this chapter, the authors argue that the accelerating shift from fee-for-service to managed

care has created a need for a new set of training skills for clinicians to practice effectively.

This chapter delineates six new skills that managed care clinicians should possess. Several

examples of teaching programs designed to train mental health practitioners in skills appropriate for practicing in a managed care environment are presented. In a separate section, the

benefits and problems of conducting research in HMOs are discussed. The authors conclude

that both academic medical centers and HMOs will gain substantially by fostering meaningful

collaboration in training and research.

Keywords: providers, training

238. Sargent, S. C. (1992). Contracting and managed care payment options.

In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental health care:

Administrative and clinical issues (1st ed., pp. 53–67). Washington, DC:

American Psychiatric Press.

The author of this chapter argues that mental health providers in the 1990’s must be able to

design payment options that will work for them rather than respond to potentially inappropriate managed care offers. This chapter offers a template for mental health providers to use

when approaching and evaluating managed care opportunities. Six steps for managed care

contracting are discussed in detail: preparation, proposal, negotiation, contract, implementation, and evaluation/renegotiation. The author recommends that a provider have a template

such as this one to help assess whether any given managed care plan will meet the needs of

patients and their families.

Keywords: contracting, providers, technical assistance

239. Scheffler, R., & Ivey, S. L. (1998). Mental health staffing in managed

care organizations: A case study. Psychiatric Services, 49, 1303–1308.

Temporal changes in staffing numbers and ratios within health maintenance organizations

(HMOs) offer us a valuable tool for estimating the future composition of the health care workforce as the trend toward managed care organizations continues. This article examines such

staffing configurations of mental health providers through case studies of two staff-model

HMOs. In an effort to address the move of many HMOs to contracting out mental health

services to specialized behavioral health organizations, the authors compare staffing ratios of

these HMOs with a 1-year average from a managed behavioral health carve-out organization

Annotated Bibliography 91
in the same State. Results indicate a decline in total number of patient care physicians regardless of enrollment changes, similar ratios of general psychiatrists per 100,000 members

between the two HMOs that were about half the State’s average, and a higher percentage of

doctoral-level psychologists in the carve-out plan. The results highlight a need for future

research focused on outcome measurement, the possibility of improvements in service delivery

and quality through collaboration among provider types, and the effects of substituting nonspecialist physicians for behavioral health services.

Keywords: carve-outs, HMOs, managed behavioral health care organizations, providers,

staffing

240. Schreter, R. K. (1993). Ten trends in managed care and their impact

on the biopsychosocial model. Hospital and Community Psychiatry, 44,

325–327.

In this article, the author expresses concerns about the impact of managed care on the biopsychosocial model of diagnosis and treatment. He identifies 10 trends in managed care

and examines their impact on clinicians and their clients. He argues that managed care in its

present form is being transformed as mental health services are increasingly being carved out,

and provider networks are becoming the norm.

Keywords: providers, trends

241. Schreter, R. K., Sharfstein, S. S., & Schreter, C. A. (Eds.). (1994).

Allies and adversaries: The impact of managed care on mental health

services (1st ed.). Washington, DC: American Psychiatric Press.

This edited volume is a collection of essays written by clinicians and mental health executives.

The book revolves around paired essays (one representing the managed care view, the other

the clinical view). In a section on clinical services, inpatient services, intermediate level of

care, outpatient care, child and adolescent services, and drugs and alcohol are addressed. The

same format is used to show the two perspectives regarding the role of providers, including

the psychiatrist, psychologist, and social worker. Ethical issues under managed care, qualityof-care guidelines, and practice guidelines are also addressed. Essayists were asked to respond

to two questions: What do you believe are the major problems with managed mental health

care? What would you do to improve the situation? Many of the chapters are written in an

informal, personal style with liberal use of anecdotes and case studies. The editors wrote the

final chapter, entitled “How Adversaries Can Become Allies,” in which they outline the areas

of both conflict and agreement between managed care executives and clinicians and reiterate

the need for dialogue between the two groups.

Keyword: providers

92 Special Report
242. Schuster, J. (1991). Ensuring highest-quality care for the cost: Coping

strategies for mental health providers. Hospital and Community Psychiatry,

42, 774–776.

Frustrated with mixed reviews regarding the ability of methods such as utilization review,

diagnosis-related groups (DRGs), and HMOs to control health care costs, the Federal

Government is now exploring other avenues to achieve cost control. These include increased

attention to outcome studies, renewed interest in a national health care system, and the enactment of the Medicare Volume Performance Standard. Psychiatry has followed a different path

with regard to cost control; for example, most psychiatric services have not been subject to

DRG limitations. This author describes current cost-containment methods in mental health

care and concludes that mental health providers be proactive in exploring cost-containment

methods that provide the highest quality for the cost.

Keywords: costs, providers

243. Sederer, L. I., & St. Clair, R. L. (1989). Managed health care and the

Massachusetts experience. American Journal of Psychiatry, 146,

1142–1148.

Managed behavioral health care represents both danger and opportunity for psychiatry. The

authors describe some of the reasons for the rapid growth of managed care and the clinical,

economic, ethical, and practical implications. They then discuss the ways in which psychiatrists have organized to counterbalance the trend. The authors describe the efforts of the Task

Force on Managed Care of the Massachusetts Psychiatric Society to ensure that psychiatrists

continue to play a major role in determining the destiny of psychiatric care. The task force

chose to focus on three areas: developing criteria for minimal standards of care; certification

and monitoring of utilization review organizations; and maintaining a second opinion service

as a back-up for when a psychiatrist or patient disagrees with a managed care organization.

Keywords: providers, standards of care, utilization management

244. Sederer, L. I. (1994). Managed mental health care and professional

compensation. Behavioral Sciences and the Law, 12, 367–378.

In this article, the author examines physicians’ organizational relationship to new managed

systems of care as well as physician compensation within these systems. The paper presents

three models of professional compensation: profit maximization, target income, and patient

agency. The author then describes five different types of physician organizations, entities

integrating physicians with health care systems. From these foundations, the author discusses

the impact of managed mental health care on physician compensation and incentives, concluding that fully integrated, physician-hospital organizations with target income compensation arrangements are the most successful for both physicians and organized systems of care.

The paper includes a discussion of the dilemmas and challenges in bringing together managed

care, organized networks of care, and professional compensation. 

Keywords: economics, models, providers

Annotated Bibliography 93
245. Snibbe, J. R., Radcliffe, T., Weisberger, C., Richards, M, & Kelly, J.

(1989). Burnout among primary care physicians and mental health

professionals in a managed health care setting. Psychological Reports, 65,

775–780.

The authors administered the Maslach Burnout Inventory to primary care physicians and psychiatric staff (psychiatrists, psychologists and social workers) of a large health maintenance

organization (HMO). They found that for all providers except psychologists, their HMO

sample scored significantly higher on all subscales than the Maslach normative population of

physicians and mental health professionals. Several interprofessional differences also emerged.

For example, internists scored significantly lower on emotional exhaustion than did psychiatrists; however, psychiatrists scored higher on depersonalization than either family practitioners or internists. The authors discuss implications of these findings for HMOs that include job

rotation, mentoring systems, and workshops to help health care professionals recognize and

cope with burnout.

Keywords: HMOs, providers

246. Sturm, R., Meredith, L. S., & Wells, K. B. (1996). Provider choice and

continuity for the treatment of depression. Medical Care, 34(7), 723–734.

This article examines the effects that the changing payment system in mental health care has

had on characteristics of the patient-provider relationship such as a choice of specialist versus

generalist, and the duration of the relationship. The authors compare provider selection among

depressed patients in prepaid and traditional fee-for-service (FFS) plans. Data from the Medical

Outcomes Study are analyzed among three competing systems of care in urban areas across the

country. The results of the patient survey administered by the authors finds that FFS patients

were more likely than those in prepaid health plans to consider a psychiatrist to be their main

source of care. FFS individuals were also found to have a higher probability of provider continuity over time than those in prepaid health plans. This study may be useful in future policy

analysis on issues of patient-provider relationships as well as the quality of care being offered

in the managed behavioral health care market.

Keywords: depression, evaluation, providers

247. Thompson, J. W., Smith, J., Burns, B. J., & Berg, R. (1991). How

mental health providers see managed care. Journal of Mental Health

Administration, 18, 284–291.

This paper reports the findings from a 1989 study using focus groups to explore mental health

practitioners’ attitudes regarding managed care. The 23 participants (psychologists and psychiatrists) were ether contractors with managed care firms or on an “approved” list of providers.

Although there were differences of opinion on a number of points, the general consensus of

the groups was that managed care has adversely affected quality of care as well as their own

practice. Participants believed that limits on the number of sessions and inpatient stays interfered with effective treatment. They identified barriers to engaging clients such as inappropriate intake assessments by untrained case managers and the subjective use of “standardized”

94 Special Report
criteria. The participants called for peer review, greater collaboration between providers

and managed care firms, more stability in benefits and standards, and more autonomy in

decision-making.

Keyword: providers

248. Van Gelder, D. W. (1992). Surviving in an era of managed care:

Lessons from Colorado. Hospital and Community Psychiatry, 43,

1145–1147.

This paper discusses how managed care has affected nonprofit psychiatric facilities in

Colorado, where more than half of the State’s population is covered by managed care plans.

The author describes the strategies one facility has used to function effectively in an era of

cost containment. Because of a decrease in length of stay, the facility needs more patients to

maintain a full census. To achieve this, the facility has trained staff in brief treatment and

implemented a marketing campaign to generate referrals. The author suggests a number of

approaches to prevent declines in employee morale should layoffs become necessary. These

include making the facility mission clear to employees and giving them a say in decisions

about cutbacks.

Keyword: providers

249. Wagman, J. B., & Schiff, J. (1990). Managed mental health care for

employees: Roles for social workers. Occupational Social Work Today,

53–65.

Case management is a major strategy for controlling skyrocketing mental health costs. The

authors identify the causes of the problem of high costs, how case management is being used

to address this problem, and the role of social workers in case management and employee

assistance programs. Social workers possess skills that are useful in assessment and referral,

as well as in review and monitoring of treatment. Managed mental health care has provided

many opportunities for clinicians who are competent in both direct practice and administrative

skills. The authors argue that as the field of managed mental health care grows, social work

education will need to address the emerging roles that it presents for social workers.

Keywords: case management, providers

250. Whittington, H. G. (1992). Managed mental health: Clinical myths

and imperatives. In S. Feldman (Ed.), Managed mental health services

(1st ed., pp. 223–244). Springfield, IL: Charles C. Thomas.

This chapter argues that the clinical, social, and economic imperatives in favor of a managed

mental health approach are compelling. The author identifies and refutes a number of myths

about managed mental health care. These include beliefs such as that controlling physician

behavior is amenable to simple economic incentives; that mental health care is unmanageable;

that adverse selection will occur if good mental health benefits are offered; that patients as

a rule overutilize psychotherapy, and that managed care results in poorer service outcomes.

Annotated Bibliography 95
The author argues that the skepticism with which managed mental health and substance

abuse services are viewed by the general public and payors is largely due to ignorance about

the clinical and economic realities of such services; and that managed mental health represents an opportunity to improve both clinical outcomes and economic efficiency.

Keywords: economics, providers

251. Zakheim, M. H., Leifer, J. C., & Schwartz, R. A. (1998). A guide for

providers of mental health and addictive disorder services in managed

care contracting: Vol. 9. Managed care technical assistance series.

Rockville, MD: Substance Abuse and Mental Health Services

Administration.

As more and more health care providers are contracting with managed care organizations,

it has become increasingly important for providers to understand the structure and organization of these contracts before they begin to negotiate. The purpose of this guide is to assist

providers of publicly funded substance abuse and mental health services as they enter into

contracts with managed care organizations. In particular, the discussion centers around the

wording of these contracts, with a focus on identifying commonly found weaknesses in the

provisions and recommending alternatives. The guide is composed of five sections: Fundamentals of Managed Care Contracting, Scope of Services, Financial Issues, Eligibility and

Enrollment, and Dispute Resolution and Conditions of Termination. Each chapter presents

a discussion of a specific type of contract provision as exemplified by relevant excerpts from

actual contracts followed by critiques and recommendations.

Keywords: contracting, providers, public sector, substance abuse, technical assistance

252. Zimet, C. N. (1989). The mental health care revolution:

Will psychology survive? American Psychologist, 44, 703–708.

The author argues that psychologists should help shape the managed care system. The key

tasks for psychologists are to provide high-quality care and to assert their role in providing

that care. The article provides an overview of managed care as a cost-containment approach.

Although psychiatric hospitals have been exempted from cost containment, it is only a matter

of time before these facilities are reimbursed prospectively and treatments are paid at a fixed

rate. Reimbursement limits will have important implications for psychologists. The article also

describes the ways in which psychologists can play a role in assuring quality assurance, developing reimbursement guidelines, and in advocating for the use of mental health services as a

way of reducing medical costs.

Keyword: providers

96 Special Report
XI.

Annotated Bibliography 97

Public 

Sector

253. Austin, M. J., Blum, S. R., & Murtaza, N. (1995). Local-state

government relations and the development of public sector managed

mental health care systems. Administration and Policy in Mental Health

22(3), 203–215.

This article begins by establishing the existence of a trend over the past three decades of

devolution of authority for the raising of funds and provision of services in the mental

health arena from the Federal government to States and from States to county and city governments. Resources are extremely scarce in the realm of mental health services, and therefore

policy makers have adopted the theory that they can best be managed and fairly distributed

by local authorities. This article describes how county governments handle the burden of

responsibility for mental health services and problems that emerge. Some of the problems

raised are the difficulties in raising adequate funds, the failure to move dollars from inpatient

to community care, the burden of costly reporting and accountability requirements, and the

expanding of responsibility without simultaneous increase in funding or autonomy. The

advent of managed mental health care is beginning to once again alter the dynamic of responsibility between State and county governments. The authors identify potential implications

for county mental health services.

Keywords: local governments, public sector

254. Beinecke, R. H., & Lockhart, A. (1998). A provider assessment of the

Massachusetts Medicaid managed behavioral health program: Year four.

Administration and Policy in Mental Health 25(4), 411–426.

This article reports the results of the third annual assessment of the Massachusetts Medicaid

Managed Mental Health/Substance Abuse Program. A random sample of 80 providers, stratified by service type and region, were interviewed by phone for their views on the program in

year four as compared with year three. Providers were questioned about access, utilization,

and quality of care; severity of the clients seen by providers; length of stay; readmission;

emergency room admissions aftercare; effect on clients in the program; integration of care in

the program; clinical review process; medication use; hospital discharge; and administration

of the program. The results indicated that access and quality of care were better or the same;

client severity continued to increase; length of stay decreased; and readmission, aftercare, and

emergency room admissions were the same. The providers reported difficulties with integration of services, linkages with support services, and the administration of the program.

Keywords: carve-outs, evaluation, Massachusetts, Medicaid, public sector 

Annotated Bibliography
255. Beinecke, R. H., & Perlman, S. B. (1997). The impact of the

Massachusetts managed mental health/substance abuse program on

outpatient mental health clinics. Community Mental Health Journal 33 (5),

377–385. 

This article discusses how mental health clinics in Massachusetts have responded to the

Medicaid Mental Health/Substance Abuse Program (MH/SAP). Data were used from a telephone survey of a random sample of providers in the Mental Health Management of America

(MHMA) network, and from MHMA claims payment data for fiscal years 1993 and 1994.

The authors found that total expenditures decreased while utilization increased over the previous year, and that service indicators such as access, utilization, and quality of care were

similar or better. The article also discussed providers’ problems with program management,

and changes outpatient providers have made in their services and their organization in

response to the MH/SAP. 

Keywords: carve-outs, community providers, evaluation, Massachusetts, Medicaid,

public sector

256. Beinecke, R. H., Shepard, D. S., Goodman, M., & Rivera, M. (1997).

Assessment of the Massachusetts Medicaid managed behavioral health

program: Year three. Administration and Policy in Mental Health 24(3),

205–220.

This article reports the results of the second annual assessment of the Massachusetts

Medicaid Managed Mental Health/Substance Abuse Program. Information was collected

from claims data in fiscal years 1993 and 1994 and a random sample of 88 providers, stratified by service type and region, who were interviewed by phone for their views on the program in year two. The authors interviewed providers, professionals, consumer organizations,

and public officials from the Division of Medical Assistance and Mental Health Management

of America. Providers were questioned about access, utilization, quality of care, severity of

the clients seen by providers, length of stay, readmission, aftercare, integration of care in the

program, and the clinical review process. The results indicated that access and quality of care

were the same or better in year three, client severity was higher, and aftercare planning and

integration of care had improved. However, providers reported continuing problems with

program administration.

Keywords: carve-outs, evaluation, Massachusetts, Medicaid, public sector

257. Callahan, J. J., & Merrick, E. L. (1997). Designing public sector

managed care systems. In K. Minkoff and D. Pollack (Eds.), Managed

mental health care in the public sector: A survival manual (pp. 45–58).

Amsterdam: Harwood Academic Publishers.

This chapter discusses system-level considerations and decisions involved in the design of

public sector managed care arrangements. The authors address the implications of a variety

of decisions for the organization of health care delivery and for consumers, mental health

practitioners, third-party payers, and managed care companies. The following issues are

98 Special Report
discussed: the “make” versus “buy” decision, for-profit managed care organizations (MCOs)

versus nonprofit agencies, total population versus subpopulation coverage, statewide versus

sub-State coverage, carve-out versus integration with general health care services, selection of

strategies for limiting utilization (demand- versus supply-side controls, capitation versus noncapitated payment mechanisms, managed care networks versus HMOs, and the selection of

methodologies for accountability and quality control.

Keywords: overviews, public sector

258. Callahan, J. J., Shepard, D. S., Beinecke, R. H., Larson, M. J., &

Cavanaugh, D. (1995). Mental health/substance abuse treatment in

managed care: The Massachusetts Medicaid experience. Health Affairs.

14(3), 173–184.

This study assesses the impact of Massachusetts Medicaid’s specialty mental health managed

care carve-out on expenditures, access, and quality of care in the first year of operation. The

report is based on information from the program’s “independent review” submitted to the

Health Care Financing Administration. Access was evaluated based on the percentage of

enrollees who used services. Quality was based on the percentage of discharges followed by

readmissions. The findings show that a 22 percent reduction in expenditures below levels predicted without managed care was accomplished; that access and quality were not diminished

on the whole; and that cost savings resulted from reduced numbers of admissions, shorter

lengths of stay, use of alternative nonhospital 24-hour care facilities, and lower prices. One

possible area of concern within the findings is in the treatment of children and adolescents,

whose readmission rates increased slightly and whose providers reported lower levels of satisfaction. On the whole, the authors find results that confirm the potential benefits of managed

mental health and substance abuse treatment.

Keywords: carve-outs, children, costs, evaluation, Massachusetts, Medicaid, outcomes,

public sector, substance abuse, utilization

259. Chalk, M. (1997). Privatizing public mental health and substance abuse

services: Issues, opportunities, and challenges. Quality Management in

Health Care, 5(2), 55–64.

This article provides a discussion of the concerns faced by States as they move into contracting

with private companies for the provision of public mental health and substance abuse treatment services. The author notes that States are making a large number of critical decisions,

such as whether to “carve out” certain services or populations, and complicated calculations,

such as determining reasonable capitation rates for vulnerable groups, without adequate information or experience in the practice of health care management. States may not recognize the

particular complexities and challenges of managing substance abuse and mental health services.

The management of these services is a newer field in which there is less experience on which

to base policies. The author discusses the chronicity, stigmatization, and social costs of mental

illness and substance abuse problems as examples of the unique complexities of mental health

and substance abuse treatment. The author addresses resulting implications for policy making

Annotated Bibliography 99
in the course of privatization initiatives. Topics discussed include organizational structure,

coordination and integration of agencies and private companies, organizational mission and

values, establishing methods of performance assessment, and ensuring consumer participation

and control. 

Keywords: contracting, public sector, substance abuse

260. Cuffel, B. J., Snowden, L., Masland, M., & Piccagli, G. (1996).

Managed care in the public mental health system. Community Mental

Health Journal, 32(2), 109–124.

This article describes managed care’s organizational arrangements using “principal-agent theory,” wherein the managed care organization (MCO) has as its primary functions the role of

agent for the payer and the responsibility of managing the relationships between payers,

providers, and consumers. These players enter into contractual relationships with one another,

thereby creating an “agency relationship.” In this relationship, however, there is the potential

for the provider party to act in its own interest, rather than that of the other parties, because

of the fact that the other parties have imperfect knowledge of provider behaviors and consumer outcomes. According to this theory, the MCO presents a potential solution to this

problem in that it is able to oversee these behaviors and outcomes. This role becomes more

complex in the public mental health system when MCOs are responsible for managing the

relationships between citizen/taxpayer and government, consumer and provider, and government and mental health authority. In addition, there may be multiple agency or program

payers at multiple levels of government. These authors argue that MCOs must recognize the

intricacies of their responsibility to each of these parties, and that public agencies must recognize the value of oversight and information-gathering made possible by MCOs in order for

this partnership to be successful.

Keywords: contracting, managed behavioral health care organizations, public sector

261. Dangerfield, D., & Betit, R. L. (1993). Managed mental health care in

the public sector. New Directions for Mental Health Services, 59, 67–80. 

In 1991, the Utah Medicaid Prepaid Mental Health Plan was implemented in three regions

of the State. This chapter describes the implementation of this plan at one site, Valley Mental

Health (VMH), a private, not-for-profit corporation that provides mental health services

under contract with the State. Prominent features of the Medicaid demonstration project

include capitation, placing the provider at financial risk, providing incentives for providers

to manage care wisely, and tying payments to a specific risk pool. VMH developed a number

of principles to ensure that clients receive appropriate and timely services. These principles

include enhanced services to severely and persistently mentally ill persons, individualized

treatment planning, broad array of services, attention to location of services, and single

clinical authority. A case example illustrates the VMH approach.

Keywords: capitation, public sector, Utah

100 Special Report
262. Egnew, R. C., & Baler, S. G. (1998). Developing principles, goals, and

models for public/private partnerships. Administration and Policy in Mental

Health, 25(6), 571–579.

At a time when behavioral health authorities are becoming the major administrative entity

responsible for the provision of behavioral health care services, many have begun to explore

the option of developing a public/private partnership with a for-profit managed care organization for specific administrative or technologically based services. This article examines the

necessary philosophy, common set of principles, and objectives for this type of partnership

to be successful. The authors identify principles on governance, administration, participation,

and services and demonstrate four potential models for collaboration. Finally, they consider

potential benefits as well as obstacles to collaboration and present suggestions for public

sector behavioral health authorities considering such a partnership. 

Keywords: models, public sector

263. Essock, S. M., & Goldman, H. H. (1995). States’ embrace of managed

mental health care. Health Affairs, 14(3), 34–44.

It is important for State Mental Health Authorities (SMHAs) to take advantage of specialized

health care management expertise that has been developed in the private sector. At the same

time, the authors are concerned with the need for SMHAs to continue to make use of their

own expertise in serving vulnerable populations. This article discusses present issues and trends

in the development of public sector managed behavioral health care: how States can fit together their own management goals with those of managed care contractors; how managed care

techniques such as contracting, utilization review, and monitoring can be put to use in public

sector programs; how States can navigate the transition from delivering services to monitoring

their delivery; and how they can effectively write incentives into contracts to promote better

management of care.

Keywords: contracting, public sector

264. Feldman, S., Baler, S., & Penner, S. (1997). The role of private-forprofit managed behavioral health in the public sector. Administration and

Policy in Mental Health, 24(5), 379–389.

This article discusses the rapid growth of public sector investment in the provision of behavioral health services through contracts with private managed care companies, the reasons for

this growth (political climate, need to contain costs and prove effectiveness), and its outcomes—both benefits and drawbacks. Among the topics discussed are the observation that

merging public and private sectors can lead to a clash of cultures with different sets of values,

priorities, and practice patterns; and concerns that the public sector has traditionally served

a very different population from those traditionally treated in the private sector. The article

also presents divergent models that are emerging, using Solano County, CA, and Kings

County, WA, as examples.

Keywords: California, local governments, models, public sector, Washington

Annotated Bibliography 101
265. Fisher, W. H., Lindrooth, R. C., Norton, E. C., & Dickey, B. (1999).

How managed care organizations develop selective contracting networks

for psychiatric inpatient care: A Massachusetts case study. Inquiry, 35(4),

417–431. 

This case study describes the formation of a public managed care network to service

Medicaid beneficiaries in Massachusetts. The study draws on the Massachusetts example

to answer questions applicable to the Medicaid managed mental health care market around

the Nation. It models how hospitals’ experience with Medicaid psychiatric patients, prior

reimbursement rates, and geographic location each affected the decision of a Massachusetts

hospital to bid for membership in a managed care organization (MCO). Also, the study

models which factors determined the MCO’s choice of hospitals with which to contract.

The data analysis shows that hospitals are more likely to bid if they have treated more psychiatric inpatients and more Medicaid Supplemental Security Income individuals, and MCOs

are more likely to choose hospitals for their network based on experience with Medicaid

patients and geographic dispersion rather than reimbursement rates.

Keywords: contracting, Massachusetts, Medicaid, public sector

266. Frank, R. G., & McGuire, T. G. (1997). Savings from a Medicaid carveout for mental health and substance abuse services in Massachusetts.

Psychiatric Services, 48(9), 1147–1152.

This article describes cost savings accomplished by the Massachusetts behavioral managed care

carve-out, as the first and one of the few such behavioral carve-outs to have employed a forprofit company to deliver services of this kind to this population. Using data from publicly

available documents, mainly those used in the contract rebidding process, these authors compare expenditures for the delivery of services by the managed care vendor to projected expenditures based on the year before the carve-out adjusted for inflation. Findings show savings of

25 percent below projected expenditures, and show that these savings were maintained in later

years. Furthermore, an examination of incentives built into the contract with the State indicates that the vendor had relatively weak incentives to reduce costs below target for the direct

services component of its budget, while having greater opportunity for profit through savings

in the contract’s budget for administrative functions. These authors conclude that other motivations existed for the vendor to practice “managing to the contract,” such as the interests of

recontracting and of pursuing other clients by pleasing Massachusetts Medicaid.

Keywords: carve-outs, contracting, costs, evaluation, Massachusetts, Medicaid,

public sector

267. Geller, J. L., Fisher, W. H., McDermeit, M., & Brown, J. M. (1998).

The effects of public managed care on patterns of intensive use of

inpatient psychiatric services. Psychiatric Services, 49(3), 327–332.

Public sector managed behavioral health care is intended to change utilization in ways that

lead to more cost-effective uses of mental health services. Some changes, however, may actually

affect certain populations of patients adversely, making their care less cost-effective. This article

102 Special Report
presents a study of patterns of inpatient mental health services utilization by frequent users,

in order to recommend ways for public sector managed care systems to serve these patients

more effectively. The authors draw their sample of patients from users of the Massachusetts

public sector managed care program who were identified by the Massachusetts Department

of Mental Health client tracking system as having five or more admissions in any year from

1992 to 1995. They compare such factors as patients’ demographics, levels of function and

personal distress, repeated use of the same facilities vs. new ones, frequency of admissions,

and length of inpatient stays. The authors conclude that some of the practices of managed

mental health care in Massachusetts have an adverse impact on patients in this particular

special needs population. For example, their results indicate that patients who made use of

multiple different facilities rather than the same one consistently tended to have longer stays.

They point out that constraints of managed care networks can lead to this kind of discontinuity, which ultimately results in less rather than more cost-effective care. On the basis of these

results, the authors make policy recommendations.

Keywords: Massachusetts, outcomes, public sector, serious mental illness, utilization

268. Hadley, T. R., Schinnar, A. P., & Rothbard, A. B. (1992). Managed

mental health in the public sector. In S. Feldman (Ed.), Managed mental

health services (1st ed., pp. 45–60). Springfield, IL: Charles C. Thomas.

Policymakers have introduced a number of proposals to apply capitation and managed care

to public sector mental health programs serving chronic mentally ill persons. These proposals

are based in part on cost containment models developed over the past 30 years. This chapter

describes capitation demonstration projects in five States. In general, these experiments are

designed to improve coordination of services and discourage inpatient care. This is achieved

through the use of incentives to provide more individualized treatment, and by centralized

management. The provision of mental health care through capitated financing requires the

development of a single funding stream administered by a central authority, such as a county

office. Resources and responsibilities are transferred either “downstream,” from Federal to

State to local authorities, or “upstream,” from local to higher level authorities. The authors

discuss the savings as well as the costs of downstream financing, and conclude that capitation

models should be adapted to meet the unique needs of their communities.

Keywords: capitation, public sector, serious mental illness

269. Hogan, M. F. (1996). Managing the whole system of care.

New Directions for Mental Health Services, 72, 13–24.

As managed care increases its penetration into the public mental health system, responsibility

for mental health care shifts from the public sector to the private sector, bringing about tensions over which populations should receive priority for care, along with the concurrent

changes in the financing and organization of services. This article analyzes the match between

managed care methods and public mental health services. The author examines several factors

in assessing the congruence between the two, including the ability of managed care to meet the

needs of the diverse and needy population served by the public system; the fit between public

Annotated Bibliography 103
and private system management strategies; the applicability of managed care to other aspects

of the public mental health system such as housing and rehabilitation; and the implications of

managed care for public mental health programs involving social or legal control. The article

also discusses the social and political implications of allying the private and public sectors to

manage public care.

Keywords: overviews, public sector 

270. Hoge, M. A., Davidson, L., Griffith, E. E. H., & Jacobs, S. (1998).

The crisis of managed care in the public sector. International Journal of

Mental Health, 27(2), 52–71.

This article discusses the current trends in public sector managed behavioral health care and

defines the potential opportunities and dangers of using managed care. The authors begin

with a brief overview of past public sector efforts in managed care and set forth an ideal

approach. They then discuss recent trends in public sector managed care, classifying public

sector managed care initiatives into three general categories (managed Medicaid, initiatives

focused on populations with severe and prolonged mental illness, and programs that mainstream the severely ill into health maintenance organizations [HMOs]), and summarize findings about the outcome of managed behavioral health care in the public sector. The authors

discuss the potential opportunities created by public sector managed care (greater accountability, access, and coordination of care for specific individuals and for the system of services

as a whole; less restrictive treatments of care; greater cost control and flexibility in spending;

enhanced quality control; and expanding coverage for the uninsured), and the potential

dangers (using managed care as a ploy for decreased funding; fragmentation of funding and

services with little pooling of funds; cost-shifting; erosion of local systems of care; and an

erosion of a skilled workforce). They offer several conclusions on the current state of public

sector managed behavioral health care.

Keywords: Medicaid, public sector, serious mental illness, trends

271. Hoge, M. A., Davidson, L., Griffith, E. E. H., Sledge, W. H., &

Howenstine, R. A. (1994). Defining managed care in public-sector

psychiatry. Hospital and Community Psychiatry, 45, 1085–1089.

This paper attempts to draw a connection from managed care in the private sector to the

adoption of managed care policies by the public sector. The authors offer a conceptual framework and a working definition of public sector managed care. The argument first analyzes

the four major service delivery strategies used by the public sector: case management,

assertive community treatment, local mental health authorities, and financing strategies.

On the basis of these core functions, the authors posit a definition of managed care in the

public sector, and use this definition to evaluate the existing public-sector managed care

delivery system as well as the Clinton administration’s proposed changes to the health care

system. 

Keywords: overviews, public sector 

104 Special Report
272. Hoge, M. A., Jacobs, S., Thakur, N. M., & Griffith, E. E. H. (1999).

Ten dimensions of public-sector managed care. Psychiatric Services,

50, 51–55.

Recent literature on managed care organizations in the public sector has demonstrated that

each managed care initiative is shaped by local structures, history, geography, and politics. In

this paper, the authors examine existing initiatives in the public sector to extend the knowledge

from earlier reviews. They identify 10 dimensions on which a managed care initiative should

be assessed in order to understand its likely effect on existing systems of care. The dimensions

are objectives, scope, organizational structures and authority, enrollment, benefit package,

strategies for managing utilization, best practices, financing, quality management and outcomes measurement, and the impact of the initiative on the public mental health system. From

their review of existing initiatives, the authors conclude that most focus on one principal

dimension, giving less attention to other important dimensions. They argue for a set of common assessment criteria to enable a comprehensive approach to planning and implementing

managed care projects.

Keywords: overviews, public sector

273. Katz, S. E., & Trainor, P. E. (1988). Impact of cost containment

strategies on the state mental health delivery system. In D. J. Scherl, J. T.

English, and S. S. Sharfstein (Eds.), Prospective payment and psychiatric

care (1st ed., p. 172). Washington, DC: American Psychiatric Association.

This chapter discusses the role of State government in mental health, and mental health officials’ concerns about the impact of Medicare’s prospective payment system (PPS) and capitation on quality of care. The authors argue that PPS will have three major effects: increase the

inpatient caseload, shift costs from general to State psychiatric hospitals, and lead to the loss

of Federal funds to support inpatient care in psychiatric hospitals. Prompted by these concerns,

the National Association of State Mental Health Program Directors conducted a study of the

impact of PPS on the State mental health system in five States. The authors discuss concerns

about the DRG (diagnosis-related group)-based and capitation approaches to containing

Medicaid costs, and call for evaluation of these efforts. They raise questions about the standards used by professional review organizations to monitor hospital admissions. Finally, they

express concern that the private sector will forget its duty to share the responsibility to care

for mentally ill persons and inappropriately shift the burden to the State system.

Keywords: capitation, DRGs

274. Leadholm, B., & Kerzner, J. (1994). Public managed care: Developing

comprehensive community support systems in Massachusetts. Managed

Care Quarterly, 2, 25–30.

In 1991, the Massachusetts commissioner of mental health proposed to restructure the service

system through implementing public managed care. The reorganization has led to a shifting of

resources from inpatient hospital use to managed community-based services. This article

Annotated Bibliography 105
describes the organization of the program within the Massachusetts Department of Mental

Health and the ways that the new program’s concern with consumer choice and psychosocial

rehabilitation are promoted. Accountability and quality management are ensured through the

development of quality councils, a utilization management system, practice guidelines, and

performance standards. These features are discussed, as are methods of managed care financing and barriers to implementation.

Keywords: Massachusetts, public sector

275. McFarland, B. H., George, R. A., Pollack, D. A., & Angell, R. H. (1993).

Managed mental health in the Oregon health plan. New Directions for

Mental Health Services, 59, 41–54. 

This article outlines the development of the Oregon Health Plan, which is intended to provide

health coverage for uninsured Oregonians. In particular, it describes the efforts to demonstrate

the rationality of including mental health coverage in a comprehensive plan. The authors

describe the issues and challenges raised in determining which services would be provided and

in integrating the Oregon Health Plan with the ongoing public mental health system. The

delivery and financing systems are also described.

Keywords: Oregon, public sector

276. Mechanic, D. (1991). Strategies for integrating public mental health

services. Hospital and Community Psychiatry, 42, 797–801.

There are significant deficiencies in the delivery and financing of the public mental health

sector, particularly for chronically mentally ill persons. A major problem is not just the lack

of funds, but the lack of integrated and coherent efforts to provide services. The author presents four generic approaches to building a viable public mental health system: developing

assertive community treatment systems, capitating mental health care, building strong local

mental health authorities, and developing supportive reimbursement structures. The author

discusses the advantages and disadvantages of each model, and recommends that they be

implemented conjointly to reduce costs and improve quality of care.

Keywords: models, public sector, serious mental illness

277. Minkoff, K. (1994). Community mental health in the nineties: Public

sector managed care. Community Mental Health Journal, 30, 317–321.

The author discusses the recent shift toward managed care in public sector mental health

programs. Implications for community mental health professionals are reviewed, and principles

for evaluating public sector managed care programs are presented.

Keywords: community providers, public sector

106 Special Report
278. Moscovice, I. S., Finch, M., & Lurie, N. (1989). Minnesota: Plan choice

by the mentally ill in Medicaid prepaid health plans. Advances in Health

Economics and Health Services Research, 10, 265–278.

This study reports on a federally funded demonstration project to test the efficacy of providing

prepaid health care services to a Medicaid population. Minnesota was one of six States to

receive a Federal waiver for this project, and the only State with a true experimental design in

which enrollees are randomly assigned to either a prepaid health plan or fee-for-service system.

Thirty-five percent of all Medicaid beneficiaries in Hennepin County were randomly assigned

to prepaid plans. The State provided a broker to contact clients and educate them about their

choices of health care plans. Those who did not choose a health care plan within 90 days were

assigned to a plan. The study examined predictors of voluntarily choosing a plan rather than

being assigned to one. Eighty-two percent of clients chose a plan. The two main factors

responsible for likelihood of choosing a plan were presence of a usual source of care and

education.

Keywords: capitation, Medicaid, Minnesota, public sector

279. Norton, E. C., Lindrooth, R. C., & Dickey, B. (1997). Cost shifting in a

mental health carve-out for the AFDC population. Health Care Financing

Review, 18(3), 95–108.

Many States have opted to “carve out” mental health and/or substance abuse services from

their regular Medicaid programs and contract them to managed care vendors. This article

explores the potential that managed care vendors who administer a behavioral health carveout may have an incentive to promote services in the mainstream health care system to their

clientele so as to shift costs to the regular Medicaid program and reap the financial reward.

Certain medical and pharmaceutical services (all covered by regular Medicaid) can be substituted for some behavioral health services. These authors examine data for the Massachusetts

mental health carve-out serving the Aid to Families with Dependent Children (AFDC) population. Their analysis shows overall change in expenditures after implementation of the carveout, examines expenditures for two services covered by the Medicaid program and two

covered by the behavioral managed care vendor as a test for cost-shifting, and inquires into

whether cost-shifting was more pronounced for patients with severe mental illness. This last

inquiry is significant because patients who are more severely ill represent a greater financial

risk. Results indicate that total expenditures were reduced after implementation of the carveout, and that this reduction occurred most dramatically among those with more serious

mental illness. However, the authors find little or no evidence for cost-shifting among the

AFDC population, in contrast to previous indication of such an effect among the disability

population.

Keywords: carve-outs, costs, economics, evaluation, Massachusetts, Medicaid,

public sector, serious mental illness

Annotated Bibliography 107
280. Rohland, B. M. (1998). Implementation of Medicaid managed mental

health care in Iowa: Problems and solutions. The Journal of Behavioral

Health Services & Research, 25(3), 293–299.

Geared toward stakeholders who are developing Medicaid managed mental health care programs, this commentary examines the issues that Iowa encountered in developing such a program in 1995. The article summarizes Iowa’s strategy for developing the Medicaid managed

mental health contract, as well as the resulting problems and regulatory attempts to address

these problems. Concerns at the time included denial of hospitalization, premature discharge

from the hospital, qualifications of utilization managers, inconsistency among case reviewers,

slow payment of claims, and excessive paperwork requirements. The author addresses these

problems as well as the success of the regulatory attempts, and provides suggestions for other

States on the development, implementation, and oversight of managed care contracts to avoid

such issues. Suggestions include developing appropriate contract specifications, providing

mechanisms for oversight, and enforcing standards of care in Medicaid managed care contracts. 

Keywords: contracting, Iowa, Medicaid, public sector

281. Semke, J., Brown, L., Sutphen-Mroz, J., Cox, G. B., et al. (1994).

Impact of mental health reform on service use. Evaluation and Program

Planning, 17, 73–79.

This article is one of several in this journal issue discussing the recent reforms and reorganization of public sector mental health services in the State of Washington. The authors evaluate

the impact of the early stages of implementation of mental health system reform on client

utilization of community mental health services.

Keywords: public sector, utilization, Washington

282. Stein, L. I. (1989). Wisconsin’s system of mental health financing.

New Directions for Mental Health Services, 43, 29–42.

In 1971, Wisconsin passed legislation requiring its counties to plan for and provide (or purchase) services for mentally ill persons. Funding was provided on a formula basis, with each

county contributing at least 9 percent in matching funds. This chapter discusses this process

of mental health service decentralization and funding integration. The State provided counties

with “special needs” funds to facilitate the transition from hospital- to community-based

care. This chapter describes the results in the 15 years that Wisconsin has funded its public

mental health system via a consolidated mental health budget. A case example of Dane

County is used to illustrate how one community successfully implemented this law, which

posed a significant challenge to the traditional service delivery model.

Keywords: local governments, public sector, Wisconsin

108 Special Report
283. Stoner, T., Manning, W., Christianson, J., Gray, D., & Marriott, S.

(1997). Expenditures for mental health services in the Utah prepaid mental

health plan. Health Care Financing Review, 18(3), 73–93.

This article reports on an analysis of the effect of the Utah Prepaid Mental Health Plan

(UPMHP), a mental health carve-out, on utilization and expenditures for populations in the

catchment area of three community mental health centers (CMHCs). The study compares

these data for the periods before and after the implementation of the carve-out, and also

compares those enrolled in UPMHP to a control group in the same catchment area who were

not enrolled in the plan. Both Medicaid and UPMHP claims/encounter forms data were used.

Stated goals of the program included reducing expenditures and increasing use of the outpatient facilities while reducing inpatient care. The results indicate that the goal of reducing

expenditures on inpatient care was achieved, and that this was accomplished by reducing the

number of admissions. For outpatient care, however, there was no difference in utilization

between the capitated and noncapitated (enrolled and nonenrolled) populations. Thus, this

study does not provide evidence that outpatient care replaced inpatient care. The authors

also conclude that the carve-out made no overall impact on mental health expenditures.

Keywords: capitation, carve-outs, costs, evaluation, Medicaid, public sector, Utah,

utilization

284. Stroup, T. S., & Dorwart, R. A. (1995). Impact of a managed mental

health program on Medicaid recipients with severe mental illness.

Psychiatric Services, 46 (9), 885–889.

This article reports on research into the impact of the Massachusetts Medicaid managed behavioral health care program on Medicaid clients with severe mental illness. For the purposes of

this study, clients defined as severely mentally ill were those with psychotic disorders, certain

mood and anxiety disorders, and borderline personality disorder. Using retrospective data about

client demographics, diagnosis, and service utilization from the Department of Mental Health’s

client tracking system, the authors examined patterns of emergency room referrals and length of

stay for patients admitted to the hospital. They compare data on recipients of services through

the State’s managed behavioral health program with data on a comparison group of severely

mentally ill patients who are demographically and diagnostically similar, but who have another

payer. The study covers the 18-month period before, during, and after implementation. The

results indicated significant changes in care patterns for both groups, including a 16 percent

drop in the number of visits to the emergency room that led to admission, concurrent with an

increase in referral to alternative 24-hour care settings. There was also a 27 percent decline in

mean length of stay for acute hospitalizations. The authors find that the likelihood of referral or

transfer to lower intensity care settings is more common in the managed behavioral health program population, but they do not find higher rates of denial of care, nor do they find evidence

of cost-shifting on the part of the State’s behavioral health contractor. The impact of the program as well as the larger context of mental health systems change is discussed.

Keywords: carve-outs, evaluation, Massachusetts, Medicaid, public sector, 

serious mental illness

Annotated Bibliography 109
110 Special Report

285. Yank, G. R., Hargrove, D. S., & Davis, K. E. (1992). Toward the financial

integration of public mental health services. Community Mental Health

Journal, 28, 97–109.

Because of a lack of fiscal and administrative integration of State and community services, the

public mental health care system is not meeting the needs of seriously mentally ill persons.

Public mental health agencies are accountable to a plethora of funders, policies, and regulations. Further, public financing encourages the use of expensive hospitalization by not providing adequate incentives to develop alternative forms of treatment such as crisis intervention.

The author argues that capitation, performance contracts, utilization review, and regional mental health authorities can stimulate integration by encouraging providers to create coordinated

and cost-effective services. The article describes how a number of States have integrated services using these strategies, and how these have led to the expansion of alternative services.

Keywords: public sector, serious mental illness
XII.

Annotated Bibliography 111

Quality

Assurance and

Outcomes

286. Bartlett, J., & Cohen, J. (1993). Building an accountable, improvable

delivery system. Administration and Policy in Mental Health, 21, 51–58.

The authors describe the efforts of their organization, MCC Behavioral Care, Inc., to collect

outcome data for the purpose of improving managed mental health and substance abuse treatment. They say three conditions are necessary to drive improvement in overall system function:

that the process be ongoing, that data generated be sound and relevant, and that the process

become an integral part of an organization’s regular operations. MCC contracted with the

Institute for Health Services Research at the University of Minnesota to provide the scientific

rigor needed for providing an accountable, improvable delivery system. MCC hopes that this

investment in continuous data collection will drive forward the state of the art, both within

MCC and in the field in general, and that it holds great promise for the continual improvement in quality and cost-effectiveness of managed approaches in mental health and substance

abuse care.

Keywords: performance measurement, quality assurance

287. Berlant, J. L. (1992). Quality assurance in managed mental health.

In S. Feldman (Ed.), Managed mental health services (1st ed., pp. 201–222).

Springfield, IL: Charles C. Thomas.

This chapter discusses the wide range in the definition of quality assurance systems, from

“standard practice” to the “avoidance of adverse outcomes” to “optimal care.” The author

discusses constraints on developing and maintaining a good quality assurance system. A 10-

step monitoring and evaluation plan is outlined, as well as guidelines that many hospitals

have found useful in implementing internal evaluation. The author argues that despite claims

to the contrary, mental health services are amenable to quality assurance. Tools for quality

assurance are described. The author concludes with several directions for quality assurance

in managed mental health that appear promising, and suggests that a national data bank

should be established for the collection, analysis, and dissemination of quality assessment

findings in mental health.

Keywords: quality assurance, technical assistance

288. Borenstein, D. B. (1990). Managed care: A means of rationing

psychiatric treatment. Hospital and Community Psychiatry, 41, 1095–1098.

Employers are looking increasingly to managed care and utilization review to reduce their

medical expenses. This paper describes some of the problems experienced by patients and

Annotated Bibliography
psychiatrists as a result of these review processes. These problems include unqualified reviewers, lack of avenues for appeal of reviewers’ decisions, disruptions in the therapeutic relationship because of the frequency and intensity of reviews, and fears about loss of confidentiality.

The author emphasizes the need for setting standards for review organizations that will help

overcome these and other problems.

Keywords: utilization management

289. Breslow, R. E., Klinger, B. I., & Erickson, B. J. (1996). Characteristics

of managed care patients in psychiatric emergency service. Psychiatric

Services, 47, 1259–1261.

Because managed care organizations (MCOs) function as gatekeepers, they should reduce

patient reliance on psychiatric emergency services. Among individuals receiving emergency

services, those patients in MCOs should be more likely than patients who are not enrolled

in managed care to require hospitalization, should require a shorter contact time with the

service as a result of preauthorization of hospital care, and should be a more functional

group. To test these hypotheses, researchers examined records for 293 patients who visited a

psychiatric emergency service, 69 of whom were enrolled in managed care. Contrary to their

hypotheses, they found that almost half of the managed care patients visiting the emergency

service were not hospitalized, but were referred for outpatient behavioral health services after

receiving crisis services. Managed care patients also required more contact time with the service. Finally, the results showed significant differences between the two groups, with the nonmanaged-care group having more psychotic and substance abuse disorders, requiring more

emergency community interventions, and having more previous psychiatric hospitalizations.

Keywords: outcomes, utilization 

290. Burlingame, G. M., Lambert, M. J., Reisinger, C. W., Neff, W. M., &

Moiser, J. (1995). Pragmatics of tracking mental health outcomes in a

managed care setting. The Journal of Mental Health Administration, 22(3),

226–236.

The authors of this article are a mixture of academic researchers and health program

administrators. They discuss logistical and methodological considerations involved in applying outcome monitoring techniques to managed mental health programs for the purposes

of accountability and of verifying cost-effectiveness and Continuous Quality Improvement.

Topics addressed include selection of representative and meaningful outcome measures,

selection of instruments, obstacles to ongoing monitoring systems, the challenges of changing provider behavior toward incorporating outcomes assessment, and the implications for

delivery of mental health services.

Keywords: outcomes, performance measurement, quality assurance 

112 Special Report
291. Burton, W. N., Hoy, D. A., Bonin, R. L., & Gladstone, L. (1989).

Quality and cost-effective management of mental health care. Journal of

Occupational Medicine, 31, 363–367.

This article describes a corporation-based comprehensive mental health plan that combines

expanded outpatient mental health benefits, an emphasis on prevention and early detection,

and psychiatric hospital utilization review. Analysis found that the number of hospitalizations,

average length of stay, and costs have decreased significantly compared with figures 12 months

before the program was implemented. The authors argue that a managed mental health care

plan can simultaneously improve quality of services and be cost-effective.

Keywords: costs, quality assurance

292. Carpinello, S., Felton, C. J., Pease, E. A., DeMasi, M., & Donahue, S.

(1998). Designing a system for managing the performance of mental health

managed care: An example from New York State’s prepaid mental health

plan. The Journal of Behavioral Health Services & Research, 25(3),

269–278.

Across the United States, several States are implementing managed care principles as a way

both to contain costs and to improve service effectiveness within the publicly funded mental

health system. Research on the outcomes of individuals receiving these services and the impact

of managed care on the overall system has been sparse, because most mental health care information systems have been transaction- and not outcome-oriented. In this paper, the authors

provide an in-depth analysis of one example of a managed mental health plan with an outcome-oriented information system—the Prepaid Mental Health Program in New York State.

The paper examines the development, implementation, and early experiences with the plan’s

performance management system for public sector managed behavioral health. The authors

highlight policy, administrative, and financial implications of this basis for quality improvement activities and information-reporting products. 

Keywords: capitation, information systems, New York, performance measurement,

public sector, quality assurance

293. Center for Health Policy Studies (1996). Policy assessment study of

managed care and mental health/substance abuse services under health

care reform. Rockville, MD: Substance Abuse and Mental Health Services

Administration (SAMHSA).

This report, written for SAMHSA, is the synthesis of two expert advisory panels representing

the mental health/substance abuse (MH/SA) community, raw data collected from managed care

organizations, and a review of the available literature. The findings are presented in a question-and-answer format with substantial utilization and cost data analyzed by different patient

categories. The report finds that substantial premium savings are brought about by managed

care, but that the effects of managed care on MH/SA services are inconsistent as a result of

poor data collection and methodological problems. The authors ultimately recommend that

SAMHSA continue its role in promoting standardization of performance measures for MH/SA

Annotated Bibliography 113
delivery systems (Appendix E is a catalog of potential performance measures deemed suitable

by the authors) to better monitor the effects of managed care penetration on the quality of

MH/SA services.

Keywords: costs, outcomes, performance measurement, substance abuse, utilization

294. Dickey, B. (1997). Assessing cost and utilization in managed mental

health care in the United States. Health Policy, 41 (Suppl.), S163–S174.

This article examines the preliminary results of experiments with Medicaid managed care.

The author presents a brief background of the managed care system and describes some of

the early failures of Medicaid waivers and managed care at the State level. Preliminary data

on mental health and substance abuse expenditures and patterns of use from the successful

Medicaid managed care experience in Massachusetts show cost savings without a significant

reduction in quality. The author suggests that future experiments with managed care invest

in information systems to better track data, pay more attention to quality-of-care issues,

move away from externally imposed utilization review processes, and carve out mental

health management. 

Keywords: carve-outs, costs, evaluation, Massachusetts, Medicaid, public sector,

utilization

295. Essock, S., & Goldman, H. (1997). Outcomes and evaluation: System,

program, and clinician level measures. In K. Minkoff & D. Pollack (Eds.),

Managed mental health care in the public sector: A survival manual.

Amsterdam: Harwood Academic Publishers.

Because managed care systems are concerned with the cost-effectiveness of care, this chapter

seeks to address how to evaluate and monitor the “effectiveness” component of the equation,

with particular attention to the special obligations involved in services provided through the

public sector. The authors address relevant outcome measures at the individual client level,

treatment program level, and systems level. They discuss the need for outcome measures to be

based directly on changes in patients’ disabilities and areas of functional impairment rather

than on indirect measures of structures, processes, or indirect outcomes. Outcome measures

are hailed as an essential counterbalance to economic incentives to undertreat and as necessary

information for determining fair and reasonable distribution of resources. Methods for data

collection and factors involved in deciding which outcome measures to use are discussed as well.

Keywords: performance measurement, public sector 

296. Feldman, J. (1999). How will mental health outcomes data be used in

private systems? New Directions for Mental Health Services, 71, 103–109.

This article discusses how varied mental health outcomes data are used depending on the parties involved and their needs. Different stakeholders favor different variables and attempt to

influence payers and provider to produce data useful to them. Stakeholders include employers

and other payers, managed care organizations, mental health managers and provider groups,

114 Special Report
patients and families, and researchers and academics. The author summarizes the data needs

of each stakeholder and the ideal variables that each stakeholder desires. The author also contrasts the ideal data needs with data that are currently being used, addresses conflicts between

stakeholder needs, and offers an opinion on the types of studies and measures that would

affect quality of care.

Keywords: performance measurement 

297. Feldman, S. (1992). Managed mental health services: Ideas and issues.

In S. Feldman (Ed.), Managed mental health services (1st ed., pp. 3–26).

Springfield, IL: Charles C. Thomas.

This chapter discusses several controversial and unresolved issues in the managed mental

health care debate. The author describes the rhetoric of the debate and some of the underlying

concerns of critics of managed mental health care. For example, he discusses ways in which

concerns about loss of money and autonomy tend to be framed in terms that are more professionally and socially acceptable—such as on “quality of life,” “professional standards,” and

“patient needs.” The author identifies common misunderstandings about managed care and

argues that done well, managed mental health should be a method to better match the treatment to the problem. An effective managed care system should integrate managers, providers,

and payers into a system of care that can flexibly respond to the needs of the mental health

field. The author believes that a constructive tension between providers and case managers

should have a positive impact on the quality of care in the managed system. A case study of

U.S. Behavioral Health is used to illustrate his points.

Keywords: quality assurance

298. Garnick, D. W., Hendricks, A. M., & Comstock, C. (1996). Using health

insurance claims data to analyze substance abuse charges and utilization.

Medical Care Research and Review, 53(3), 350–368.

Over the past decade, many researchers have studied health insurance claims data in an

effort to answer questions ranging from the effects of managed care on substance abuse cost

to the effectiveness of programs to prevent readmissions. Health insurance claims data sets

have several advantages, including multiple years of data, very large databases, and information on a variety of treatment settings. In this article, the authors present several challenges

to utilizing insurance claims data by using illustrations from three large employers to answer

questions about costs to employers, utilization of services to treat abuse of specific drugs,

and the effects of managed care strategies. They conclude that insurance claims data sets are

more suitable for researching some questions (such as tracking changes in employers’ charges)

than others (such as studying the use of treatment for specific drugs). They suggest three

potential improvements to broaden the application of these data sets to substance abuse

research.

Keywords: performance measurement, substance abuse, utilization

Annotated Bibliography 115
299. Giles, T. R. (1991). Managed mental health care and effective

psychotherapy: A step in the right direction? Journal of Behavior Therapy

and Experimental Psychiatry, 22, 83–86.

The author argues that alternatives to fee-for-service models of care delivery, such as HMOs,

not only contain costs but better serve the mental health needs of consumers. Because of

capitation, practitioners must demonstrate that their methods result in successful outcomes.

The paper presents a brief history of managed mental health care and describes how managed

care companies are carefully reviewing the outcome literature to identify effective behavioral

and short-term treatment approaches.

Keyword: outcomes

300. Ginsberg, S. (1991). Managed care’s paradoxical effect. International

Journal of Partial Hospitalization, 7, 171–177.

The author cautions that managed care companies are paying disproportionate attention to

the dollar at the expense of appropriate patient care and argues that these companies should

be held accountable for decisions to deny payment for treatment. A particularly effective and

cost-efficient form of psychiatric care, the day hospital, is discussed at length. The author

concludes that utilization review should be undertaken by appropriately trained mental health

professionals and that payers must bear responsibility for the impact of the care that patients

receive.

Keywords: utilization management

301. Goldman, W., McCulloch, J., Cuffel, B., Zarin, D. A., Suarez, A., &

Burns, B. J. (1998). Outpatient utilization patterns of integrated and split

psychotherapy and pharmacotherapy for depression. Psychiatric Services,

49, 477–482.

In the era of HMOs, mental health service models that manage costs as well as services have

gained increasing popularity. One such model, hypothesized to reduce costs, is “split treatment,” where psychiatrists provide pharmacotherapy and less costly mental health specialists

provide psychotherapy. In order to study the benefits of split therapy over the model of integrated therapy, where a psychiatrist provides both pharmacotherapy and psychotherapy,

the researchers examined differences in the utilization patterns of depressed patients from a

national managed mental HMO in the two treatment models. The results show that patients

receiving integrated treatment not only used significantly fewer outpatient sessions, but also

had lower treatment costs than those patients in split treatment. The researchers conclude

that integrated treatment is not more costly than split treatment in a managed care network.

Keywords: costs, depression, HMOs, models, outcomes, psychotherapy, utilization

116 Special Report
302. Goldman, W., McCulloch, J., & Sturm, R. (1998). Costs and use of

mental health services before and after managed care. Health Affairs,

17(2), 40–52.

This paper highlights the successful implementation of a West Coast-based employer’s mental

health carve-out that achieved parity for mental health services without increasing costs. The

authors track the costs of mental health care for a private employer during a period in which

mental health benefits were carved out of the medical plan and managed care was introduced.

Before the change, mental health costs had been increasing 30 percent annually; in the first

year after the change, costs dropped by more than 40 percent while utilization of mental

health services actually increased. The authors attribute the successful mental health carve-out

experiment to increased efficiency resulting in reduced probability of an inpatient admission,

reduced inpatient length-of-stay, and substantially lower costs per unit of service.

Keywords: carve-outs, costs, performance measurement, utilization

303. Hamilton, J. M. (1988). The role of peer review and quality assurance

in changing reimbursement schemes. In D. J. Scherl, J. T. English, & S. S.

Sharfstein (Eds.), Prospective payment and psychiatric care (pp. 129–138).

Washington, DC: American Psychiatric Association.

This chapter describes the activities of the American Psychiatric Association (APA) in

quality assurance, utilization review, and peer review. Medical review has progressed from

retrospective to concurrent review. Together with the Civilian Health and Medical Program

of the Uniformed Services (CHAMPUS), the APA developed a national peer review system

for inpatient and outpatient psychiatric treatment. APA has also published several editions

of its manual providing models for standards and criteria in peer review. The author

provides an overview of the APA’s joint venture with the insurance company Intracorp to

provide quality assurance, utilization review, case management, and discharging.

Keywords: quality assurance, utilization management

304. Huskamp, H. A. (1998). How a managed behavioral health care carveout plan affected spending for episodes of treatment. Psychiatric Services,

49(12), 1559–1562.

Many employers and States are carving out behavioral health services from their health plans

in an effort to manage behavioral health costs. But are these efforts successful? This paper

provides an in-depth exploration of the impact of carving out behavioral health care on

spending for episodes of treatment. The researcher compared spending per episode before and

after implementation of the carve-out for episodes of care provided in an inpatient facility,

episodes involving both inpatient and outpatient care, and episodes involving only outpatient

care. From the results, the implementation of the carve-out resulted in a large decrease in

spending per episode across all three episode types, with inpatient care showing the greatest

Annotated Bibliography 117
reduction. Those episodes involving a diagnosis of either unipolar depression or substance

dependence resulted in particularly large reductions, regardless of treatment type.

Keywords: carve-outs, costs, depression, substance abuse

305. Ingram, B. L., & Chung, R. S. (1997). Client satisfaction data and

quality improvement planning in managed mental health care

organizations, Health Care Management Review, 22(3), 40–52.

This article examines the principles of total quality management (TQM) used by health care

administrators to increase the quality of care. The authors perform a Chi Square Automatic

Interaction Detection (CHAID) statistical analysis of client satisfaction survey data from a

large, national managed care organization to separate clients into two categories, the “maximally” and the “moderately” satisfied, and develop a predictive model of maximum satisfaction. The authors present a methodology for the analysis of client satisfaction surveys, and

ultimately, suggest ways in which such surveys can be constructed to improve future analyses.

Keywords: client satisfaction, quality assurance

306. Kane, R. L., Bartlett, J., & Potthoff, S. (1995). Building on empirically

based outcomes information system for managed mental health care.

Psychiatric Services, 46(5), 459–461.

This article describes how one national managed mental health care corporation, in cooperation with the University of Minnesota, has begun to create a clinical management information

system. The underlying principles of this system involved data collection at admission to create

a baseline, and outcome data collection by telephone after departure. The authors view this

system as reliable because it had continuous input from clinicians through its development.

The key to the success of the system is its use in clinical practice for the analysis of sound data

to support better and more effective clinical decision making. 

Keywords: information systems

307. Lazarus, A. (1994). Dumping psychiatric patients in the managed care

sector. Hospital and Community Psychiatry, 45, 529–530.

This article provides three examples of what the author describes as patient dumping from

the medical sector into the managed psychiatric sector. In each of the cases, the patient was

transferred to psychiatric facilities while he or she was still medically unstable; in two of the

three cases, the transfer had not been authorized by the managed care company. The author

cautions that such inappropriate transfers from medical to psychiatric settings may be a result

of fragmented treatment brought on by lack of coordination between medical and psychiatric

care, and that efforts to control costs through selective contracting, prospective payment, and

carve-outs may exacerbate this trend.

Keywords: quality assurance

118 Special Report
308. Leff, H. S., & Woocher, L. S. (1998). Trends in the evaluation of

managed mental health care. Harvard Review of Psychiatry, 5(6), 344–347.

This article describes work currently under way to develop a tracking system for evaluation

studies of public managed behavioral health care. The evaluation studies cited within the article fall into three broad categories: State-funded and initiated, federally funded and initiated,

and investigator-initiated studies funded by foundations or Federal agencies. The authors analyze five studies, the majority of which compare managed care with fee-for-service systems in

terms of service use and cost and consumer outcomes such as health status, symptoms, quality

of life, and patient satisfaction.

Keywords: client satisfaction, costs, evaluation, outcomes, public sector, utilization

309. Leon, S. C., Lyons, J. S., Christopher, N. J., & Miller, S. I. (1998).

Psychiatric hospital outcomes of dual diagnosis patients under managed

care. The American Journal on Addictions, 7(1), 81–86.

Many studies have found that utilization patterns of patients with both mental illness and

substance abuse diagnoses (the dually diagnosed) differ from non-substance-abusing patients.

This study examines the impact of managed care on the inpatient psychiatric utilization of

persons with dual diagnosis. Patients with coexisting substance abuse disorders spent fewer

days in the hospital, but experienced higher rates of recidivism, than patients with psychiatric

disorders only. Such results suggest that managed care has not had an impact on patterns of

psychiatric hospital use by patients with coexisting substance abuse disorders. The authors

discuss potential incentives for such utilization patterns for the dually diagnosed and stress

the importance of focusing solutions on preventative programs. 

Keywords: outcomes, utilization

310. McCarthy, P. R., Gelber, S., & Dugger, D. E. (1993). Outcome

measurement to outcome management: The critical step. Administration

and Policy in Mental Health, 21, 59–68.

Several strategies for measuring mental health outcomes have been developed, but few

mechanisms have been designed to assess the quality of care for use in case management.

The author describes a conceptual model to measure quality based on a model developed by

Donabedian (1980) that evaluates structure, process, and outcome. A quality/improvement

algorithm is described that can be used to assess quality in a single system or to compare

systems. These data aid in management functions, such as establishing network standards

against which individual providers can be compared in terms of both cost-effectiveness and

quality. The authors argue that while implementing a quality-focused outcome is clearly

more costly in the short term, it will lead to substantial benefits in the long run for the

patient, the managed health provider, and the payer.

Keywords: case management, outcomes, performance measurement

Annotated Bibliography 119
311. Milstein, A., Henderson, M., Berlant, J. L., & Anderson, D. (1994).

Evaluating psychiatric and substance abuse case management

organizations. In S. A. Shueman, W. G. Troy, & S. L. Mayhugh (Eds.),

Managed behavioral health care: An industry perspective (pp. 222–240).

Springfield, IL: Charles C. Thomas.

In this chapter, the authors discuss two methods of evaluating mental health and chemical

dependency case management organizations: (1) direct evaluation of case management

operations, including interviews, observations, and examination of staff work sheets; and

(2) evaluation of claims data. The authors offer specific steps that can be used to conduct

the evaluations and discuss the rationale for using external evaluators.

Keywords: case management, performance measurement

312. Pallak, M. S., & Cummings, N. A. (1994). Outcomes research in

managed behavioral health care: Issues, strategies, and trends. In

S. A. Shueman, W. G. Troy, & S. L. Mayhugh (Eds.), Managed behavioral

health care: An industry perspective (pp. 205–221). Springfield, IL: Charles

C. Thomas.

The authors argue that three factors have led to the interest in clinical outcome research in

the behavioral sciences. These are (1) the continuing rise in costs for alcohol/drug abuse and

mental health services; (2) the perception within the managed care industry that knowledge

about outcomes is valuable marketing information; and (3) the increasing availability of

research tools and strategies regarding outcomes. In this chapter, they examine the implications of these factors. They explore the problems that managed care companies face when

trying to develop procedures to address effectiveness and discuss new trends in treatment

outcome measures.

Keywords: outcomes, trends

313. Pandiani, J. A., Banks, S., & Gauvin, L. (1997). A global measure

of access to mental health services for a managed care environment.

The Journal of Mental Health Administration, 24(3), 268–277.

This article proposes a quantitative measure of access to mental health services in a managed

care environment. The measure, referred to as the access ratio, compares the number of people

receiving mental health services to the number of people in need of mental health services in a

population. The authors describe the methodology for deriving the measures of need and utilization, and then illustrate its use by measuring access to inpatient mental health care in the

State of Vermont. The results of this study produced objective quantitative measures of access

and identified pattern variations in access that can be used as comparative benchmarks for

future work in this area. The authors conclude with a discussion of the role of the appropriate

use of the access ratio, and other quantitative measures of system performance, in improving

systems of care.

Keywords: performance measurement, public sector, Vermont

120 Special Report
314. Pickett, S. A., Lyons, J. S., Polonus, T., Seymour, T., & Miller, S. I.

(1995). Factors predicting patients’ satisfaction with managed mental

health care. Psychiatric Services, 46(7), 722–723.

In response to concerns about quality of care in managed mental health plans, this study

examined patients’ satisfaction with a managed mental health care program using a mail survey. The survey included questions measuring two types of variables: patients’ perception of

each element in a service delivery model and patients functioning after treatment. From the

results, patients who reported better psychological functioning and who found the managed

care staff to be helpful and their therapist skillful and conveniently located were more likely

to be satisfied with their services. The authors conclude that managed mental health plans

should train mental health professionals in effective service delivery, select providers that are

convenient for the patient, and monitor the helpfulness of their staff.

Keywords: client satisfaction, performance measurement

315. Roberts, B. (1996). Quality as the driving force for cost-effective

psychiatric managed care. Journal for Healthcare Quality, 18(1), 4–8.

This paper outlines the author’s view of the “megatrends” of economics, politics, and technology influencing contemporary psychiatric treatment. The author compares psychiatric

treatment between the conventional fee-for-service paradigm and the “new” managed care

paradigm. According to the author, the “new” paradigm emphasizes identification and treatment of symptoms rather than the diagnosis of disease according to standard therapy. This

article compares the two treatment paradigms through a hypothetical clinical case summary

of a depressed individual. The author relates an account of the treatment schedule under

both the fee-for-service paradigm and the “new” managed care paradigm in an attempt to

show that the managed care paradigm provides more focused, cost-effective treatment for

psychiatric services.

Keywords: outcomes

316. Roberts, B. (1998). An evolving continuous quality improvement role

for managed care: A behavioral healthcare perspective. Journal for

Healthcare Quality, 20(5), 20–23.

The author describes the evolution of continuous quality improvement (CQI) in managed

behavioral health care. The author posits that the initial impact of managed care on health

care was a result of the sentinel, or Hawthorne, effect. The sentinel effect refers to the impact

on quality of knowing that outcomes will be monitored. The author proposes that the positive impact of the sentinel effect has ebbed and suggests new ways to continue the evolution.

The author suggests the Clinical Navigator Model, in which the clinician is the “navigator”

of each patient’s treatment and this navigation can be improved if the clinician follows a few

tasks: (1) Define the clinical destination via a clinical assessment with the patient, based on

the desired end-result. (2) Develop the best clinical approach to get the desired end-result.

(3) Decide on the most effective mode to get to the end result (i.e., the least restrictive, least

Annotated Bibliography 121
intrusive site of care). This model can be used to positively reinforce good outcomes and help

continue the evolution of managed behavioral health care.

Keywords: models, outcomes, providers, quality assurance

317. Rodriguez, A. R. (1989). Evolutions in utilization and quality

management: A crisis for psychiatric services? General Hospital Psychiatry,

11, 256–263.

Science, social policies, and government funding brought about high-quality mental health

services from 1948 to the early 1980s, when payers began implementing strategies to reduce

and control the costs of health care. These strategies include benefit redesign and structuring,

alternative reimbursement methods, utilization review, and alternative delivery systems. The

author contends that managed care programs must ensure quality as well as affordability.

He argues that this combination will be difficult to achieve because there is little consensus

as to what constitutes effective treatment.

Keywords: quality assurance

318. Rodriguez, A. R. (1992). Management of quality, utilization, and risk.

In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental health care:

Administrative and clinical issues (1st ed., pp. 83–97). Washington, DC:

American Psychiatric Press.

In this chapter, the author discusses critical issues in medical quality management. He

describes some of the epidemiological trends in the utilization of mental health services, and

the mechanisms that have been instituted to control utilization. The mechanisms discussed

include benefit redesign and structuring to provide economic disincentives to seek care, alternative reimbursement approaches such as prospective payment, alternative delivery systems,

and utilization review and management. Finally, the author describes some of the major components of an effective risk management system. He concludes that more effective management information systems for health services are needed to avoid arbitrary and/or discriminatory apportionment systems.

Keywords: overviews, quality assurance

319. Rohrer, J. E., & Rohland, B. M. (1998). Oversight of managed care for

behavioral health services. Journal of Public Health Management Practice,

4(1), 96–100.

This article is concerned with the need for payers to be able to set contract specifications for

behavioral health services to help ensure that services are delivered in a way that is accessible,

efficient, and effective. To that end, these authors propose staff-per-population ratios, service

utilization rates, and outcome data as useful performance measures for monitoring the performance of managed care providers and for selecting vendors when new contracts are being

planned. The authors review previous literature on quality and access indicators and then put

122 Special Report
forth their own measures as a more practical set of tools. Finally, they emphasize the importance of consistent monitoring and further comparative research to refine indicators.

Keywords: contracting, performance measurement

320. Savitz, S. A. (1992). Measuring quality of care and quality

maintenance. In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental

health care: Administrative and clinical issues (1st ed., pp. 143–158).

Washington, DC: American Psychiatric Press.

This chapter explores ways of defining, measuring, and improving the quality of care in a

managed mental health care environment. The author describes the issues of cost versus quality; discusses methods of assessing quality of medical care, including standards for treatment,

tracers, patient satisfaction, and claims review; and describes some problems associated with

each. He addresses ways in which organizations can improve quality through problem identification, establishing standards, collecting data, remedial action, and monitoring and followup. The author concludes that managed care organizations have structural advantages for

providing quality care compared with the independent nature of fee-for-service practice.

Keywords: overviews, quality assurance

321. Schoenbaum, M., Zhang, W., & Sturm, R. (1998). Costs and utilization

of substance abuse care in a privately insured population under managed

care. Psychiatric Services, 49(12), 1573–1578.

Even with the increasing trend toward carving out behavioral health services, there has been

little research on the actual cost and utilization of substance abuse and mental health services.

This paper examines 1995 cost and utilization patterns for substance abuse treatment for

members of private managed care carve-out behavioral health plans. From their review of

claims made in 1995 in 93 behavioral health care plans, the researchers found that approximately 5.2 percent of members used mental health services and 0.3 percent used substance

abuse services. Average costs for substance abuse patients were more than twice as high as

average costs for mental health patients. This disparity in costs reflected greater rates of use

of inpatient and intensive outpatient services for substance abuse treatment. The authors conclude that substance abuse coverage accounts for a small portion of behavioral health coverage payments and an even smaller fraction of insurance payments for overall health care.

Keywords: carve-outs, costs, substance abuse, utilization

322. Scholle, S. H., Peele, P. B., Kelleher, K. J., Frank, E., & Kupfer, D. (1999).

Satisfaction with managed care among persons with bipolar disorder.

Psychiatric Services, 50(6), 751.

In this study, researchers surveyed members of a national voluntary case register of persons

with bipolar disorder. To examine the impact of restrictions on care on patient satisfaction

with care, they categorized respondents into four groups: self-referral to any mental health

provider, self-referral to a restricted provider network, referral through another gatekeeper, and

referral through a toll-free number. From the results, those respondents with restricted access

Annotated Bibliography 123
to provider networks (85 percent of respondents) were less satisfied with their health plans

than those respondents with no restrictions (the first category). The authors conclude that systems of care need to track satisfaction over time, because dissatisfaction influences insurance

disenrollment, adherence, fragmentation in care, and treatment rates.

Keywords: client satisfaction, depression

323. Sederer, L. I., & St. Clair, R. L. (1990). Quality assurance and managed

mental health care. Psychiatric Clinics of North America, 13, 89–97.

This article discusses the ways in which quality of care for mental health services has traditionally been defined and is currently being modified. The authors describe a new direction

in quality assurance, called continuous improvement in care, that moves away from quality

“control,” with its reliance on surveillance, toward a vision of seeking defects as “treasures.”

The authors describe many of the forms of managed care and some of the potential problems

in reconciling quality, cost, access, and efficiency, and offer suggestions for what can be done.

Keywords: overviews, quality assurance

324. Shueman, S. A., & Troy, W. G. (1994). Quality assurance in managed

systems. In S. A. Shueman, W. G. Troy, & S. L. Mayhugh (Eds.), Managed

behavioral health care: An industry perspective (pp. 131–148). Springfield,

IL: Charles C. Thomas.

The main focus of this chapter is on the design of quality assurance (QA) strategies for managed behavioral health care systems. The authors describe the characteristics that an adequate

QA program should have. These include a system that reflects the perspectives of key stakeholders; that focuses on multiple aspects of clinical services, case management, and administration; and that uses subjective and objective data and multiple data sources to assess quality.

The authors profess to take a relatively traditional QA approach, but one that examines the

ways in which the applications of QA have been influenced by more recent approaches to

quality, such as total quality management and continuous quality improvement.

Keywords: overviews, quality assurance

325. Shueman, S. A., Troy, W. G., & Mayhugh, S. L. (1994). In Mayhugh,

S. L. (Ed.), Managed behavioral health care: An industry perspective.

Springfield, IL: Charles C. Thomas.

This book is about, for, and by those in the forefront of the managed behavioral health care

movement. Part I lays the groundwork by describing how the economic structure of health

care in the 1970s and early 1980s was fertile ground on which to sow a managed care

approach. Part II focuses on the roles and responsibilities of the provider in a managed care

program. In one particularly useful chapter, the essentials of case management are presented as

conducted by one specialized case management organization. Part III describes the history of

Federal and State initiatives in managed health care, and part IV concentrates on the important

topics of quality assurance and practice guidelines. Part V deals with educational issues. The

124 Special Report
remainder of the book focuses on issues of interest to researchers and program evaluators in

managed behavioral health with interesting chapters on the state of outcomes research, and

a basic “how to” on evaluating behavioral case management organizations.

Keyword: overviews

326. Shusterman, A. (1994). Expanding the “Q” word. Managed Care

Quarterly, 2, 19–21.

This article presents a broad, multidisciplinary definition of quality that moves beyond the

therapeutic relationship between a clinician and a provider. In this article, quality includes

accessibility, affordability, positive clinical outcomes, and patient satisfaction. The author

argues that only through such a systemic approach to quality can mental health care take

its rightful place in the sphere of necessary, affordable, universal health care.

Keywords: quality assurance

327. Smith, G. R. (1996). State of the science of mental health and

substance abuse patient outcomes assessment. New Directions for Mental

Health Services, 71, 59–67.

This article discusses three areas that summarize the current status of patient outcomes assessment. The first area concerns achievements in patient outcomes assessment. Providers, payers,

and mental health clinicians are becoming proficient in the science of outcomes assessment.

Recent advances in outcomes research have been concentrated in two areas: development of

a consensus on outcome domains and development of patient-based assessment scales and

indexes. The second area concerns issues of scientific debate. The author discusses five such

issues that have implications for the design of outcomes assessment: disorder-specific assessment versus generic assessment; sampling versus assessment of an entire population; assessment of a tracer condition versus assessment of all disorders; brief assessments versus precise,

multidimensional assessments; and assessment logistics: Which method is best? Finally, the

author discusses the challenges that must be addressed in order to advance the science of

outcomes assessment: understanding consumer preferences for a particular outcomes domain,

interpretation and management of assessment results, and development of new assessment

technology to enhance the feasibility of implementing outcomes assessment systems. 

Keywords: outcomes, performance measurement 

328. Smith, J., & Gaumer, G. L. (1992). Evaluation of managed mental

health programs. In S. Feldman (Ed.), Managed mental health services

(1st ed., pp. 165–200). Springfield, IL: Charles C. Thomas.

Evaluation can provide information that can ensure that managed care programs are

effective and are not driven purely by untested assumptions held by providers, consumers,

and employers. Assessing what happened, why, and the implications of these changes is difficult. The authors discuss some of the important issues in the evaluation of managed mental

health programs and provide guidelines for evaluating programs’ effects. To ensure that the

Annotated Bibliography 125
evaluation correctly attributes changes to the intervention, evaluators use methods such as

randomization, comparison, and control groups. The authors emphasize the importance of

descriptive and baseline data.

Keyword: evaluation

329. Stelovich, S. (1992). Managed care and major mental illness:

An overview. In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental

health care: Administrative and clinical issues (1st ed., pp. 249–260).

Washington, DC: American Psychiatric Press.

A brief historical overview of mental health service delivery is used to illustrate the challenges

in finding new ways to provide appropriate care. The author argues that the locus and potential treatment options for mental illness are extremely limited, and that to improve upon

historical failures to provide quality mental health care, we need to reassess both the focus

(biological, psychological, and social) and setting (spectrum of services) for mentally ill

persons. He argues that alliances between managed care systems and private mental health

care organizations may significantly increase the quality, number, and spectrum of services

as alternatives to the hospital.

Keywords: overviews, quality assurance

330. Sturm, R., Jackson, C. A., Meredith, L. S., Yip, W., Manning, W. G.,

Rogers, W. H., & Wells, K. B. (1995). Mental health care utilization in

prepaid and fee-for-service plans among depressed patients in medical

outcomes study. Health Services Research, 30(2), 320–340.

This study examines the difference in utilization patterns among depressed patients between

prepaid and fee-for-service health plans. In particular, the authors explore whether there is

adverse selection among patients switching between the two types of insurance plans, what

effect switching plans has on utilization of services, and whether utilization differences, switching, and provider specialty are related. From their longitudinal data on depressed patients

participating in the Medical Outcomes Study, the researchers found that depressed patients in

the prepaid system exhibited 35 to 40 percent fewer mental health visits than similar patients

in the fee-for-service system. There was some evidence of adverse selection, with patients

switching out of prepaid plans showing higher baseline utilization and patients switching out

of fee-for-service plans showing lower utilization. While all patients who switched plans

demonstrated a decline in utilization, there was no increase in utilization after the switch.

The authors conclude that there is an interruption in care for patients switching between plans. 

Keywords: depression, outcomes, utilization

331. Thompson, J. W., Burns, B. J., Goldman, H. H., & Smith, J. (1992).

Initial level of care and clinical status in a managed mental health program.

Hospital and Community Psychiatry, 43, 599–603.

This study uses indirect measures to examine the quality of care of a managed mental health

care demonstration project, using data from 9,055 adult psychiatric intakes. The relationship

126 Special Report
between clinical status and level of care was the indirect measure used to assess quality. The

study found a 50 percent decrease in the use of inpatient care in all clinical conditions (mild

to severe) under the managed care system. The study also found that the use of detoxification

and outpatient services doubled. The diversion of patients to outpatient care was not related

to condition but to a policy decision. The authors conclude that data must be case-oriented,

rating scales must be systematized, and measures of treatment outcome are needed in order to

better assess the quality of these programs.

Keywords: performance measurement, quality assurance, utilization

332. Wells, K. B., Astrachan, B. M., Tischler, G. L., & Unutzer, J. (1995).

Issues and approaches in evaluating managed mental health care.

The Milbank Quarterly, 73(1), 57–75.

The purpose of this article is to discuss methodological considerations involved in conducting

research into the performance of managed care organizations (MCOs) with respect to access,

quality, and outcomes. The article begins by defining and describing different types of MCOs

and explaining some of their methods for achieving cost savings. These methods include precertification, the use of gatekeepers and case management strategies, provider selection, and

clinical guidelines and protocols. With regard to the evaluation of mental health services delivered by MCOs, these authors discuss challenges and obstacles to research, such as issues of

confidentiality, problems with data sources, and feasibility of developing and implementing

more complex research protocols in the fast-paced and profit-driven environment of private

MCOs. In describing approaches to managed care research, these authors address differences

in priorities and obstacles for internal and external evaluation studies, and for studies that

facilitate industry purposes versus studies that are of interest from a societal perspective.

Sample data from a variety of evaluation studies are presented to illustrate the discussion.

Keywords: evaluation, performance measurement

333. Westermeyer, J. (1991). Problems with managed psychiatric care

without a psychiatrist-manager. Hospital and Community Psychiatry, 42,

1221–1224.

The author uses seven case studies to illustrate that managed psychiatric care in which a

nonpsychiatrist directs care can harm patients with severe psychiatric illness. In a review of

these cases, the author found indication of the following problems: infrequent and inconsistent

psychotherapy, failure to recommend standard therapies, poor recordkeeping, and inappropriate use and monitoring of hospitalization and medications. He suggests ways in which higher

quality mental health care can be administered within a managed context. These include more

consistent monitoring of quality of outpatient care, use of fourth-party audit organizations,

and increased use of peer review.

Keywords: quality assurance

Annotated Bibliography 127
XIII.

Annotated Bibliography 129

Special

Populations

A. CHILDREN

334. Eisen, S., Griffin, M., Sederer, L., Dickey, B., & Mirin, S. M. (1995).

The impact of preadmission approval and continued stay review on

hospital stay and outcome among children and adolescents. The Journal

of Mental Health Administration 22(3), 270–277.

This article reports on results of a study that used a multiple regression model to predict the

impact of utilization review on length of inpatient stay and clinical outcomes for children and

adolescents under 18 years of age. The independent variables used in the model included

demographic and clinical characteristics, hospital ownership type, and pre-admission approval

or continued stay review. Results of the study indicated that only two of the 10 predictor variables included in the model were statistically significant in predicting length of stay: previous

psychiatric hospitalization and for-profit hospital status. The model was unsuccessful in

accounting for a significant amount of the variance in hospital outcome. The authors conclude

with a discussion of limitations of the study, and the implications of the findings for health

care reform.

Keywords: children, outcomes, utilization management 

335. Gresenz, C. R., Liu, X., & Sturm, R. (1998). Managed behavioral health

services for children under carve-out contracts. Psychiatric Services, 49(8),

1054–1058.

Amidst the recent growth in managed care organizations that specialize in administering

behavioral health care benefits apart from general health services, few studies have focused

on the effects of these new carve-out plans on children. In this study, researchers investigated

children’s cost and utilization patterns in carve-out plans and compared them with the patterns of adults in these plans. From the results, adolescents in this plan were twice as likely

as adults and about seven times as likely as children ages 6 to 12 to use inpatient services.

Adolescents were also more likely than adults or other children to have higher inpatient

costs, while adults were the most likely to have higher outpatient costs. The authors conclude

that adolescents may benefit most from the elimination of caps on mental health care costs

covered by insurance.

Keywords: carve-outs, children, costs, utilization

Annotated Bibliography
336. Kaplan, D. W., Calonge, B. N., Guernsey, B. P., & Hanrahan, M. B.

(1998). Managed care and school-based health centers. Archives of

Pediatric and Adolescent Medicine 145, 25–33.

This article examines the use of physical and mental health services for adolescents who participate in managed care organizations, comparing those who have access to school-based

health centers (SBHCs) to those who do not. The study specifically looked at the use of primary and specialty medical, mental health, substance abuse, preventative health, and urgent

care services. Results showed that adolescents with access to SBHCs were 10 times more

likely to make a mental health or substance abuse visit than non-SBHC students. Students

with access to SBHCs made one more medical visit per year, had decreased rates of use of

emergency or urgent care, were more likely to have one comprehensive health supervision

visit, and were more likely to be screened for high-risk behaviors than students without

access to SBHCs. SBHCs were shown to be very successful in improving access to treatment

for mental health and substance abuse problems and to comprehensive health supervision.

Keywords: children, school-based health, substance abuse, utilization

337. Jellinek, M., & Little, M. (1998). Supporting child psychiatric services

using current managed care approaches. Archives of Pediatric and

Adolescent Medicine, 152(4), 321–326.

This report details specific business approaches used by for-profit behavioral health care

companies that have carved out mental health services for children. First, the authors discuss

the evolution of managed mental health services and the negative implications of managing

the care of children by limiting access and shifting costs to the public sector and pediatricians.

These factors are not sufficiently counterbalanced by some of the positive changes, such as

lower costs from the decreased utilization of inpatient services within managed care, and

political pressure by legislative means. Ultimately, the commentary recommends that child

and adolescent psychiatric services should be reintegrated into the overall medical care of

children and families, and that market-driven managed care allocations are not the optimal

path to achieve high-quality mental health services for the Nation’s most vulnerable children. 

Keywords: carve-outs, children

338. Lourie, I. S., Howe, S. W., & Roebuck, L. L. (1996). Systematic

approaches to mental health care in the private sector for children,

adolescents, and their families: Managed care organizations and service

providers. Washington, DC: Georgetown University Child Development

Center, National Technical Assistance Center for Child Mental Health.

In this study of private sector models for delivering mental health services to children, adolescents, and their families, researchers examined five provider sites—two managed care organizations and three service provider agencies—all of which offer their own managed care products.

Among the findings are the lack of a true system of care in the private sector including mechanisms for access to services, case management/coordination at the client level, coordination

across agencies, and mechanisms for financing services; the positive potential for managed

130 Special Report
care; and the growing private sector continuum of care. The book provides in-depth analysis

of managed care organizations, service providers, and public/private integration issues.

Appendices include site visit reports, values and principles for the System of Care outlined by

the Federal Child and Adolescent Service System Program, a list of advisers, a list of qualified

nominated organizations, and the private system of care questionnaire.

Keywords: children, evaluation, integration, models

339. Mason, M. J. (1998). School-based health clinics and the role of

mental health services: A review of the literature. Journal of Health and

Social Policy, 10(2), 1–13.

This article begins by establishing the heightening national concern about targeting mental

health and substance abuse problems in children, and points to goals cited in the Healthy

People 2000 initiative. It describes the origins and growth of the school-based health center

(SBHC) as a model of service delivery that effectively broadens access to health services in

general for children and adolescents. According to the author, SBHCs play an important role

in delivering counseling, assessment, and referral services for mental health and substance

abuse problems. A variety of issues affecting the proliferation of SBHCs are discussed, including the need to build in systematic research protocols that would aid in accounting for the

cost-effectiveness of services delivered in these facilities. Some other issues addressed are

current and potential future sources of funding for SBHCs, the need for attention to public

relations concerns, and the impact of managed care on SBHCs. Managed care organizations

(MCOs) have traditionally been reluctant to contract with SBHCs because of the difficulty they

have in meeting practice guidelines of the MCOs. The article calls for research initiatives to

prove the importance and effectiveness of SBHCs in delivering mental health services to youth.

Keywords: children, overviews, school-based health, substance abuse

340. Nicholson, J., Young, S. D., Simon, L., Bateman, A., & Fisher, W. H.

(1996). Impact of Medicaid managed care on child and adolescent

emergency mental health screening in Massachusetts. Psychiatric Services,

47(12), 1344–1350.

This article reports on an initial evaluation of the impact of the Massachusetts Medicaid

managed mental health reform on service use and dispositions for children and youth

through an examination of the emergency mental health screening process. The study compared client attributes and system characteristics (payer, referral source, and disposition) for

emergency mental health screenings for the year before and the first year after implementation of Medicaid managed care. The study found that after the implementation of managed

Medicaid mental health and substance abuse benefits, the volume of emergency mental

health screening for children and adolescence significantly increased, while the percentage of

inpatient admissions decreased. The authors further discuss these findings and the necessity

to address issues of quality of care and longer term savings. 

Keywords: carve-outs, children, evaluation, Massachusetts, Medicaid, public sector

Annotated Bibliography 131
341. Nicholson, J., Young, S. D., Simon, L. J., Fisher, W. H., & Bateman, A.

(1998). Privatized Medicaid managed care in Massachusetts: Disposition

in child and adolescent mental health emergencies. The Journal of

Behavioral Health Services and Research, 25(3), 279–292.

Against the backdrop of Massachusetts’s transition to Medicaid managed care, this study

investigates two questions: the impact of privatized Medicaid managed care on the level of

care provided to children and adolescents with the greatest clinical need, and the relationship

between payer source and disposition. To answer these questions, the researchers examined

data from child and adolescent emergency mental health screening episodes before and after

privatized Medicaid managed care. They found that the transition to Medicaid managed care

decreases the likelihood of hospitalization by more than 60 percent for individuals covered by

Medicaid compared with those covered by HMOs. Additionally, privatized Medicaid managed

care does not seem to compromise quality of care, as measured by matching clinical need with

level of care. The authors describe the multiple forces shaping professional standards, decision

making, and quality of care as well as implications for behavioral health policymakers.

Keywords: carve-outs, children, evaluation, Massachusetts, Medicaid, utilization

342. Pumariega, A. J., Nace, D., England, M. J., Diamond, J., Fallong, T.,

Hanson, G., Lourie, I., Marx, L., Solnit, A., Grimes, C., Thurber, D., &

Graham, M. (1997). Community-based systems approach to children’s

managed mental health services. Journal of Child and Family Studies, 6(2),

149–164.

As managed care principles infiltrate into the children’s mental health service delivery system,

there is concern that they could deprive children of necessary intervention and prevention services. In this paper, the authors review guidelines developed by the American Academy of Child

and Adolescent Psychiatry for the implementation of managed Medicaid contracts through

community-based systems of care principles. The authors describe the development and principles of the community-based systems approach as a means to ensure that the needs of seriously

emotionally disturbed children are met within the health system. The key principles of the system of care approach include access to a comprehensive array of services, individualized treatment, treatment in the least restrictive environment possible, full participation of families,

interagency coordination, early identification and intervention, care management, advocacy

efforts, effective transition into the adult system, and culturally sensitive services. The authors

also examine the community-based systems approach to managed care, including guidelines

on governance, benefit design, access to care, assessment, care plan development, treatment

services, care management, quality, provider supports, and information management.

Keywords: children, contracting, Medicaid, overviews

132 Special Report
343. Scholle, S. H., Kelleher, K. J., Childs, G., Mendeloff, J., & Gardner,

W. P. (1997). Changes in Medicaid managed care enrollment among

children. Health Affairs, 16(2), 164–170.

This study looks at voluntary enrollment and disenrollment data for Medicaid managed care

in Allegheny County, PA, paying particular attention to patterns among children with mental

illness. Self-selection patterns for managed care versus fee-for-service are significant because

patients who voluntarily choose managed care are generally in better health and have lower

utilization of health care services. This phenomenon can distort data about managed care performance, consumer satisfaction, cost savings, and other factors, and may benefit plans financially if capitation payments are not risk-adjusted. These authors are particularly concerned

with patients with mental illness, because managed care plans have traditionally provided a

low level of mental health services. Results of this study indicate that markers for more severe

mental illness were associated with lower levels of enrollment in managed care. In addition,

disabled children and those receiving cash assistance were less likely to enroll. Disenrollments

were higher for children with psychiatric conditions than for children with other conditions.

The authors discuss causes of these trends and make policy recommendations.

Keywords: children, Medicaid, Pennsylvania, public sector

344. Semlitz, L. (1996). Adolescent substance abuse treatment and

managed care. Child and Adolescent Psychiatric Clinics of North America,

5(1), 221–241.

This paper examines the impact of managed care on adolescent substance abuse treatment

planning and care delivery. The author describes the emergence of the managed care era from

the traditional fee-for-service system, including the types of managed care plans; the impact

on the doctor-patient relationship; responses of insurance companies/HMOs, hospitals, and

physicians to managed care; the idea of managed competition; and the trend toward capitation. Other components of managed care reviewed include patient placement criteria, patient

treatment matching, outcome as a factor in treatment planning, treatment plan documentation, successful treatment plans, and utilization review. The author examines the impact of

managed care on substance abuse services and discusses ethical issues of managed care on

the doctor-patient relationship, such as the importance of patient confidentiality, standards

of review, and the prohibition of incentives to withhold care. 

Keywords: children, substance abuse

345. Stroul, B. A., Pires, S. A., & Armstrong, M. I. (1998). Health care

reform tracking project: Tracking state managed care reforms as they

affect children and adolescents with behavioral health disorders and their

families. Tampa, FL: University of South Florida Research and Training

Center for Children’s Mental Health.

This is a report on calendar year 1997 of a 5-year project designed to track and analyze public

sector managed care reform targeting children and adolescents with emotional and substance

abuse problems and their families. The authors outline the specific goals of this report as

Annotated Bibliography 133
describing the managed care reforms that affect behavioral health care for children and

adolescents, analyzing the effects of these changes, and identifying both problem areas and

effective strategies to help refine managed care systems for this vulnerable population. This

report surveys all of the States on a broad range of managed care topics, and then analyzes

the impact through examples from in-depth site visits to a select sample of States. The tracking project finds that there is a wide variation in the extent to which States assume an active

role in designing and overseeing managed care systems for this population. 

Keywords: children, overviews, public sector, substance abuse

B. ELDERLY

346. Colenda, C. C., Banazak, D., & Mickus, M. (1998). Mental health

services in managed care: Quality questions remain. Geriatrics, 53(8),

49–63.

This article is intended to be useful to primary care health professionals who may be called

upon to counsel their patients about decisions on whether to enroll in a Medicare managed

care plan. The authors are particularly concerned that patients be well informed about the

nature of mental health services delivered by these plans. In this article the authors profile

Medicare risk contract plans, identify pros and cons, define and explain the difference between

“carve-outs” and “carve-ins,” and explain what patients should expect from a plan’s staffing

model with regard to adequate numbers of mental health providers. Finally, the article discusses potential advantages and disadvantages of managed care plans specific to the prevention

and treatment of Alzheimer’s disease.

Keywords: elderly, HMOs, overviews

347. Robinson, G. K., Crow, S. E., & Scallet, L. J. (1998). Managed care

policy: Meeting the mental health needs of the aged? Generations, 22(2),

58–62.

With many States moving to managed care in an effort to control public health care costs,

the question arises of how managed care will affect mental health care for the elderly. This

paper explores the approaches States are taking to manage public mental health services.

In particular, the researchers focus on the advantages and disadvantages of integrated and

carved-out mental health services as well as the different types of reimbursement. They

describe one example of a program enrolling people eligible for both Medicaid and Medicare

as a potential model for other programs for mental health care for the elderly. Finally, the

authors present some policy questions concerning the methods and feasibility of managed

mental health plans for the elderly. 

Keywords: elderly, overviews, public sector

134 Special Report
C. ETHNIC GROUPS

348. Dana, R. H. (1998). Problems with managed mental health care for

multicultural populations, Psychological Reports, 83, 283–294.

This article suggests that current psychological treatment is inadequate in its consideration and

treatment of multicultural populations. It explains that historically, interventions in the United

States were designed primarily for Americans of European descent, and thus were oriented

toward Caucasian patients. The author argues that managed care has reduced the availability

and quality of these interventions for all patients and further limited the evolution and diversification of treatment toward nonwhite patients. Culturally competent mental health services

are described and related to the quality of care. An agenda for the implementation of culturally

sensitive services is suggested.

Keywords: ethnic groups

349. Snowden, L. R. (1998). Managed care and ethnic minority populations.

Administration and Policy in Mental Health, 25(6), 581–592.

This article addresses the impact on minority populations of changes in mental health practice

patterns and utilization resulting from managed care. Differences in utilization of the mental

health system across racial/ethnic groups and problems with the cultural appropriateness or

accessibility of mental health services preceded the advent of managed care growth. Nonetheless, these problems take a new form within the context of managed care. While oversight,

coordination, and accountability may be beneficial aspects of managed care for minorities,

other aspects can be detrimental. The inflexibility of when and where services can be accessed

and the potentially intimidating and confusing nature of the bureaucracy are potential problem areas. Additionally, the average cost of care per patient differs across ethnic groups,

meaning that a reimbursement strategy based on capitation may create incentives to undertreat these clients or avoid covering them altogether. Further areas of concern are addressed,

and some policy solutions are proposed.

Keywords: capitation, ethnic groups, overviews

D. WOMEN

350. Glied, S. (1997). The treatment of women with mental health

disorders under HMO and fee-for-service insurance. Women & Health,

26(2), 1–16.

This report analyzes data on office visits by women with mental health problems from 1990

to 1994 to examine characteristics of office visits by payment type. The study finds that the

expansion of managed care practices may harm the treatment of women with mental health

problems. Specifically, women enrolled in HMOs are more likely to see a primary care physician rather than a specialist, and of the women in specialty care, those in HMOs are more

Annotated Bibliography 135
136 Special Report

likely to have medications substituted for psychotherapy than are those with fee-for-service

payments. The author suggests that a possible solution might be to allow self-referral for

women to lower cost specialty care.

Keywords: HMOs, women

351. Huskamp, H. A., Azzone, V., & Frank, R. G. (1998). Carve-outs,

women, and the treatment of depression. Women’s Health Issues,

8(5), 267–282.

This article examines the impact of “carving out” mental health services on the treatment

of depression in women. The first part of the article provides background information on

behavioral health care carve-outs, describing the market functions of the two general forms

of carve-outs, the health plan subcontract, and the payer carve-out. The authors provide an

overview of women and depression and suggest some possible effects of carve-outs on the

treatment of depression in women. The authors then report on their analyses of three separate

employer-based data sets, which allowed them to examine the impact of behavioral health

carve-outs on service utilization and spending for women with a diagnosis of depression.

The first data set was used to examine a cross section of health plans. The other data sets

were used to look at pre-/post-comparison of a health plan subcontract model and an

employer carve-out model. 

Keywords: carve-outs, costs, depression, utilization, women

352. Newell, A. R., & Saltzman, G. M. (1997). The impact of managed

mental health care on women. Journal of the American Medical Women’s

Association, 52(2), 69–74.

Based upon differences in epidemiological patterns of mental illness in men and women,

aspects of psychodynamic theory, and evidence from outcome and cost studies, these authors

suggest that managed behavioral health care will have a differential impact on the receipt of

mental health care by women. Women are more likely to seek mental health services, to be

diagnosed with conditions that require care exclusively through the health care system, and to

have conditions such as eating disorders or trauma from abuse that require long-term treatment. Various restrictions and cost-saving strategies involved in managed care strategies will

therefore disproportionately affect women. This article argues that certain managed care costsaving strategies do not make sense in light of evidence from cost-benefit studies of mental

health services. Instead, the authors argue for more focused and appropriate managed care

interventions, innovation in treatment methods, and legislation for minimum standards.

Keywords: overviews, women 
XIV.

Annotated Bibliography 137

Substance

Abuse

353. Alexander, J. A., & Lemak, C. H. (1997). The effects of managed care

on administrative burden in outpatient substance abuse treatment

facilities. Medical Care, 35(10), 1060–1068.

This article describes a study of the burden (in hours per week and per client) of administrative functions related to managed care on outpatient substance abuse treatment facilities. The

authors focus in particular on the effects of four dimensions: managed care oversight procedures, organizational experience with managed care (length of time), managed care penetration, and complexity of managed care arrangements. The sample was drawn from the 1994

to 1995 National Frame of Substance Abuse Treatment Programs and prior waves of the

National Drug Abuse Treatment System Survey. A telephone survey was conducted of the

facilities’ administrative and clinical directors. The authors’ findings support their hypothesis

that administrative requirements imposed by managed care create a significantly increased

burden on these facilities. They find that managed care penetration and managed care oversight procedures are most strongly associated with this increased burden.

Keywords: community providers, substance abuse

354. Alexander, J. A., & Lemak, C. H. (1997). Managed care penetration in

outpatient substance abuse treatment units. Medical Care Research and

Review, 54(4), 490–507.

This article reports the first national data on the impact of managed care at the provider

level. The study used data from a 1995 national survey of 618 outpatient substance abuse

treatment (OSAT) units. The sample was categorized by treatment modality, ownership status,

and organizational affiliation. The study investigated the level of managed care penetration

into OSAT units and found that they were not affected by managed care. However, for-profit

OSAT units were more involved in managed care than public and private not-for-profit units.

OSAT units involved with managed care utilized multiple arrangements and on average are

involved with eight separate managed care arrangements that conform to a series of different

and even competing requirements. Hospital-affiliated OSAT units are more likely to have

multiple managed care arrangements. The study indicates that OSAT units are participating

in very few public managed care arrangements, whereas private managed care arrangements

occur at a greater frequency and with a constant distribution across types of arrangements.

Keywords: community providers, substance abuse

Annotated Bibliography
355. Caplan, R. (1992). Treatment of drug abuse in the managed care

setting. In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental health

care: Administrative and clinical issues (1st ed., pp. 305–320). Washington,

DC: American Psychiatric Press.

In this chapter, the author demonstrates how the philosophy of managed care can be well

integrated with a clinically sound approach to drug treatment. He outlines the specific elements that make managed care different from other settings, and describes a treatment

model developed for a staff model HMO. In this model, major clinical decisions are made

using a clinical algorithm. He explains how a managed care system can handle the four

major phases of drug treatment—evaluation, stabilization, relapse prevention, and maintenance—and addresses additional issues of contracting for services, staffing, the role of the

case manager, and employer groups. Alternative approaches to dealing with the small but

difficult group who experience chronic relapse are presented.

Keywords: models, substance abuse

356. French, M. T., Dunlap, L. J., Galinis, D. N., Rachai, J. V., & Zarkin, G. A.

(1996) Health care reforms and managed care for substance abuse

services: Findings from eleven case studies. Journal of Public Health

Policy, 17(2), 181–203.

This paper presents data from case studies of 11 drug treatment programs, on their current

funding and level of cost, as well as their perceptions about the current or forthcoming impact

of behavioral managed care on their delivery of services. The programs included in the study

cover a broad geographic, programmatic, and organizational range. They include public and

private facilities, inpatient and outpatient models, and a variety of modalities of care. The

authors used two instruments developed by the Research Triangle Institute—the Drug Abuse

Treatment Cost Analysis Program (DATCAP) and the Drug Abuse Treatment Financing

Analysis Program (DATFin)—to gather data on cost and financing of the facilities. Perceptions

of the impact of managed care varied among the programs depending on the type of site. For

example, many of the residential treatment facilities expressed concern that case management

strategies would result in more patients being referred to outpatient modalities, even though

they may not be the ideal treatment type for some patients, simply because they offer lower

intensity and lower cost care. 

Keywords: costs, evaluation, substance abuse

357. Gondolf, E., Coleman, K., & Roman, S. (1996). Clinical-based vs.

insurance-based recommendations for substance abuse treatment level.

Substance Use & Misuse, 31(9), 1101–1116.

This article reports on an exploratory study created to determine the extent of the disagreement between clinical-based and insurance-based recommendations for level of care in substance abuse treatment. The study included 250 patients from three treatment facilities in the

Western Pennsylvania region, and compared treatment recommendations based on criteria

developed by the American Society of Addiction Medicine (ASAM) to those based on criteria

138 Special Report
developed by managed care organizations. The study showed that 85 percent of the insurancebased and clinical-based recommendations for treatment level were in agreement and that 93

percent of the cases coincided with ASAM recommendations for care. These findings suggested

that even when there was disagreement in treatment, clinical-based recommendations were

most likely to be followed.

Keywords: standards of care, substance abuse

358. Gragg, D. M. (1991). Managed health care systems: Chemical

dependency treatment. In C. S. Austad & W. H. Berman (Eds.),

Psychotherapy in managed health care: The optimal use of time and

resources (1st ed., pp. 202–219). Washington, DC: American Psychological

Association.

This chapter describes the Chemical Dependency Recovery program at Kaiser Permanente

Medical Center in Los Angeles. The author discusses treatment philosophy, guidelines, program design and development, general principles of addictions treatment, psychotherapeutic

goals and issues, and specific influences of managed health care on treatment programs such

as this one. He describes key elements in an evaluation of this and similar programs to ensure

quality of care, and a philosophy of critical “self-study” among staff of an addictions treatment program.

Keywords: substance abuse

359. Kushner, J. N., & Moss, S. (1995). Purchasing managed care services

for alcohol and other drug treatment: Essential elements and policy issues:

Vol. 16. Technical assistance publication series. Rockville, MD: Center for

Substance Abuse Treatment.

As States consider or move forward with the decision to redirect public funds for the treatment

of substance abuse to private managed care organizations (MCOs), they face certain opportunities and challenges. This document serves as a brief technical assistance manual for State

AOD (alcohol and other drug) agencies. Chapter 1 provides an overview of current State managed care arrangements and urges States to use their contracts with MCOs as a means of

enforcing standards of treatment. Chapter 2 discusses access issues that emerge under managed

care, ranging from geographic accessibility of services to the cultural, ethnic, and gender sensitivities of providers. Chapter 3 discusses the importance of ensuring the provision of wraparound services, targeted outreach to special populations, and inclusion of publicly funded programs/essential community providers, especially because private managed care companies may

be inexperienced in the treatment of populations receiving publicly funded AOD treatment

services. Chapter 4 discusses financial considerations that should be taken into account—risk

management strategies, potential benefits restrictions, the elimination of opportunities for costshifting the burden of uncompensated care, and the importance of understanding and being

able to challenge actuarial analysis. Chapter 5 addresses key consumer protections such as outof-plan services, disenrollment processes, “consumer-friendly” materials, and appeals. This

document also provides examples of model contract language for the establishment of stanAnnotated Bibliography 139
dards, as well as a Managed Healthcare Organizational Readiness Checklist—a resource

designed to help States take into account the broad spectrum of policy issues that enter into

effectively contracting for services through the private managed care market.

Keywords: contracting, public sector, substance abuse, technical assistance

360. McNeese-Smith, D. K. (1998). Program directors’ views of the effect

of managed care on substance abuse programs in Los Angeles County.

Psychiatric Services, 49(10), 1323–1329.

Fifty program directors, representing 134 substance abuse treatment centers in Los Angeles

County, responded to a survey in early 1997 soliciting their views about the impact of managed care on their facilities. The primary topics of the survey were changes in the programs

since 1994 resulting from managed care, major concerns about the influence of managed care

on substance abuse programs, advantages and disadvantages of managed care, and anticipated

future changes to promote success in the managed care environment. Responses indicated that

outreach and marketing had increased while length of treatment and staffing levels had

decreased. There were concerns that incentives to provide the least costly service posed a threat

to quality. Advantages described were an increasing focus on outcomes, the opportunity to

contract with managed care providers, and the establishment of consistent program standards.

Disadvantages named were contractual restrictions on services, increasing paperwork, restrictions on length of treatment, and decreasing quality. Directors described a wide array of anticipated future changes including changes in structure, type of program, sources of referral, staff

composition, revenue generation, and increased focus on prevention.

Keywords: community providers, substance abuse

361. Rawson, R. A., Obert, J. L., McCann, M. J., Marinelli-Casey, P., & Suti,

E. (1991). Outpatient chemical dependency treatment and the managed

care system: An unrealized symbiosis. Journal of Ambulatory Care

Management, 14, 48–59.

This paper traces the rise of outpatient treatment models for chemical dependency as it relates

to the managed care movement. The authors draw on their own clinical experience to argue

that there are serious problems in the coordination of outpatient drug and alcohol abuse programs by the managed care industry. They point to poor communication with providers, technical “sloppiness,” and idiosyncratic, unscientific treatment programs as just some of the pitfalls of managed chemical dependency services. Suggestions are offered for how managed care

organizations and chemical dependency treatment providers can work together.

Keywords: models, substance abuse

362. Renz, E. A., Chung, R., Fillman, O., Mee-Lee, D., & Sayama, M. (1995).

The effect of managed care on the treatment outcome of substance use

disorders. General Hospital Psychiatry, 17, 287–292.

This article examines the effect of managed care and other reimbursement mechanisms on the

outcome of substance abuse treatment at a single treatment facility. Data were collected from

140 Special Report
1,594 patient records at the Castle Medical Center of Hawaii. Patients in the study were adults

admitted for treatment of substance use disorders. The study looked at the incidence of recidivism in each patient over a 2-year period. The sample was divided into four groups: intensive

managed care, traditional managed care, private pay, and State-funded. The study concluded

that managed care patients are not more likely to return to treatment because of truncated

treatment episodes. Also, no difference was found between managed and nonmanaged patient

populations on relapse rates. The authors discuss the need for future research to include other

outcome measures besides recidivism rate.

Keywords: outcomes, performance measurement, substance abuse

363. Schneider, R. J., & Herbert, M. (1992). Substance abuse day treatment

and managed health care. Journal of Mental Health Administration, 19,

119–124.

For a variety of reasons, not the least being availability of reimbursement, inpatient care

has been viewed as the treatment of choice for substance abuse over the past three decades.

However, with the rise of managed health care, prospects for greater acceptance of day

treatment programs have improved. This article describes the day treatment program at

the Harvard Community Health Plan, a 2-week program that uses a variety of approaches

including group work, family meetings, and individual treatment sessions. The authors discuss ways of marketing day treatment and overcoming patient resistance to day treatment.

Keywords: substance abuse

364. Shwartz, M., Mulvey, K. P., Woods, D., Brannigan, P., & Plough, A.

(1997). Length of stay as an outcome in an era of managed care.

Journal of Substance Abuse Treatment, 14(1), 11–18.

With their emphasis on cost reduction, managed care systems reimburse only for “appropriate” lengths of stay. Yet there is no research base for determining what is an appropriate length

of stay for a client in substance abuse treatment, and previous studies have found lengths of

stay to be important predictors of client outcomes. In this paper, the authors identify length of

stay categories within four treatment modalities such that program completion rates are consistent within category and differ among categories. The four treatment modalities are short-term

residential, long-term residential, outpatient, and detox. The authors demonstrate that future

utilization over a 2-year period differs between categories, with those clients in short-length-ofstay categories being admitted more frequently and spending more days in treatment over the

followup period than the long-length-of-stay clients. The researchers conclude that length of

stay is an easily measured proxy for treatment success and should be considered by managed

care companies in constructing length-of-stay cutoffs.

Keywords: outcomes, performance measurement, substance abuse

Annotated Bibliography 141
365. Sturm, R., Zhang, W., & Schoenbaum, M. (1999). How expensive are

unlimited substance abuse benefits under managed care? The Journal of

Behavioral Health Services and Research, 26(2), 203–210.

With the Federal Mental Health Parity of 1996, legislators prohibited dollar limits on mental

health benefits, but not on substance abuse benefits because of the high cost associated with

substance abuse treatment. In response, many employers have begun to decouple the two types

of services in their behavioral health contracts, which could lead to less efficient care and difficulties in coordinating treatment. In this paper, the researchers examine how many patients are

affected by substance abuse coverage limits and the implications of limits on insurance payments. They find that removing an annual limit of $10,000 per year on substance abuse treatment would increase insurance payments by only 6 cents per member per year while affecting

a large percentage of patients needing the care. The authors conclude that “parity” for substance abuse in employer-sponsored health plans is not very costly.

Keywords: parity, substance abuse 

366. Wilson, C. V. (1993). Substance abuse and managed care.

New Directions for Mental Health Services, 59, 99–105. 

This chapter discusses the problems that exist in the coverage of substance abuse. Dissatisfied

with high costs and ineffective treatment for substance abuse, employers are turning to managed care. A case example illustrates the benefits of this approach. The author suggests that

case managers and payers use a standardized intake, assessment, and outcome method developed by the American Society of Addiction Management in order to address concerns about

cost and quality.

Keywords: substance abuse

367. Woodward, A. (1992). Managed care and case management of

substance abuse treatment. In R. S. Ashery (Ed.), Progress and issues in

case management (DHHS Publication number ADM 92-1946). Rockville,

MD: National Institute on Drug Abuse.

This monograph discusses the relevance of managed care to case management of substance

abuse programs. The author argues that the goals of the two are contradictory; whereas the

focus of case management is on providing comprehensive, coordinated care, managed care is

concerned primarily with cost-effectiveness. Yet despite the differences in their goals, both case

management and managed care have similar shortcomings. Among these are lack of criteria in

assessment, referral, intervention activities, and followup as well as lack of documented costeffectiveness.

Keywords: case management, substance abuse

142 Special Report
Annotated Bibliography 143

368. Zwick, W. R., & Bermon, M. (1992). Spectrum of services for

the alcohol abusing patient. In J. Feldman & R. J. Fitzpatrick (Eds.),

Managed mental health care: Administrative and clinical issues

(1st ed., pp. 273–304). Washington, DC: American Psychiatric Press.

This chapter discusses the elements of a successful program for alcohol-abusing patients

in a managed care environment. The authors outline four assumptions that they believe

should guide the design of a cost-effective managed program for the treatment of alcohol

abuse and dependence. They discuss cost, staffing issues (type of staff and staffing ratios),

and marketing of alcohol treatment services (to primary care providers, mental health

providers, and the corporate community). They also describe integration of substance

abuse in general mental health through education and suggest ways of overcoming some

of the traditional conflicts between alcohol specialists and other mental health providers.

Finally, they outline priorities and program qualities of an exemplary alcohol abuse program and describe the ideal spectrum of services that should be offered. Issues regarding

referral to appropriate level of care are also described in detail.

Keywords: models, staffing, substance abuse
XV.

Annotated Bibliography 145

Training and

Education 

369. Austad, C. S., & Berman, W. H. (Eds.). (1991). Psychotherapy in

managed health care: The optimal use of time and resources (1st ed.).

Washington, DC: American Psychological Association.

This edited text brings together many prominent contributors who attempt to outline specific

models for the provision of mental health services in a managed care setting. Both practitioners

and administrators should find this book useful. Part I reviews the evolution of psychotherapy

in managed health care and gives the reader a broad overview of the historical and economic

context of managed mental health. Part II presents several theoretical models for the practice

of mental health in the managed care setting. Part III provides guidelines for working with

specific populations and disorders, with an emphasis on how a managed care approach can

enhance care for many patients. The final section addresses future trends in practice, training,

and research in managed mental health.

Keywords: models, psychotherapy, training, trends

370. Austad, C. S., & Hoyt, M. F. (1992). The managed care movement and

the future of psychotherapy. Psychotherapy, 29, 109–118.

This article describes the ways that the practice of psychotherapy is being changed by the economic climate of managed health care. The authors describe several models of psychotherapy

that have emerged from a managed care approach that require providers to be clinically effective as well as cost-effective. These include a goal-directed, problem-solving orientation, with

a focus on efficient use of time, and crisis-oriented intermittent psychotherapy through the life

cycle and single-session approaches. The authors argue that while the trend toward requiring

accountability in the provision of mental health care is understandably controversial, placing

the burden of proof on providers will potentially lead to higher quality mental health care.

Keyword: models, psychotherapy

371. Blackwell, B., & Schmidt, G. L. (1992). The educational implications of

managed mental health care. Hospital and Community Psychiatry, 43,

962–964.

This article discusses the clinical, professional, ethical, and organizational aspects of training

mental health practitioners in an HMO setting. The authors also describe the educational

opportunities unique to such a setting. They argue that mental health trainees should develop

Annotated Bibliography
skills such as providing short-term treatment, collaborating with other professionals, and

ensuring that treatment is “medically necessary” and ethical. To support such learning, HMOs

are urged to develop curricula and provide financial support for educational activities for

faculty and trainees. Such support can result in increased recruitment and retention of qualified

mental health staff.

Keywords: HMOs, training

372. Browning, C. H., & Browning, B. J. (1993). How to partner with

managed care: A “do-it-yourself-kit” for building working relationships and

getting steady referrals. (1st ed.). Los Alamitos: Duncliff’s International.

This book is directed toward clinicians who need assistance in overcoming the frustration and

confusion commonly associated with managed care systems. Writing from the perspective that

many mental health practitioners perceive managed care as a “nightmare,” the authors offer

detailed, practical advice on how to use managed care to build practices and provide solutionoriented, cost-effective services. The book covers four basic areas: (1) a comprehensive definition of managed care, including managed care trends and current perspectives; (2) how to

market one’s practice in a competitive, managed care environment; (3) how to increase referrals through managed care systems, particularly preferred provider networks and case managers; and (4) how to provide effective brief therapy within a managed care context. The

book’s detailed table of contents reflects the user-friendly approach employed by the authors.

The final chapter covers questions commonly asked by therapists as they consider the impact

of managed care on their practices. Additionally, the appendix includes advice for clinicians

from managed care insiders, assistance for office support staff in managing administrative

details, and a list of definitions of key terms.

Keywords: providers, technical assistance

373. Budman, S. H. (1992). Models of brief individual and group

psychotherapy. In J. Feldman & R. J. Fitzpatrick (Eds.), Managed mental

health care: Administrative and clinical issues (pp. 231–248). Washington,

DC: American Psychiatric Press.

The author of this chapter discusses definitional confusion over what constitutes brief therapy

and distinguishes between the therapeutic assumptions, perspectives, and expectations of the

long- and short-term therapists. He discusses several basic principles of brief individual and

group therapy and describes models of brief individual and group psychotherapy that take into

account the realities of working in a prepaid health care environment. He concludes that in

order for brief therapy in managed settings to be provided in a high-quality, competent manner, therapists need special training programs in HMOs.

Keywords: models, psychotherapy

146 Special Report
374. Budman, S. H., & Armstrong, E. (1994). Brief therapy for

managed mental health companies: Becoming a learning organization.

Managed Care Quarterly, 2, 31–35.

The authors argue that neither contracted mental health providers nor case managers at

managed mental health companies are sufficiently trained in time-efficient therapy. A successful provider is often defined by managed care companies by the brevity of treatment and the

lack of recidivism of clients. The authors put forward a model that focuses not so much on

the brevity of treatment as on the time-effectiveness of treatment. This article describes some

of the ways that providers can learn to use this mode of treatment effectively, but focuses on

the challenges to managed care companies to provide training programs for their network

providers. The authors contend that the survivors in this competitive industry will be those

companies that are able to learn about the services they are offering, which in essence become

“learning organizations.”

Keyword: training

375. Goldman, W., & Feldman, S. (Eds.). (1993). New Directions for Mental

Health Services, 59.

In this special volume of New Directions for Mental Health Services on managed mental

health care, the editors bring together a wide range of expertise on the subject. Authors present

alternative models of managed mental health care. Among the nine chapters are ones describing models of managed mental health care from various perspectives, including providers and

employers. Other chapters discuss how managed care can focus on special client groups such

as children and adolescents or persons with substance abuse problems. Two model programs

for managed services in the public sector are described; other chapters explore the impact of

managed care, and historical and policy links with the community mental health movement. 

Keywords: children, models, substance abuse

376. Haas, L. J., & Cummings, N. A. (1991). Managed outpatient mental

health plans: Clinical, ethical, and practical guidelines for participation.

Professional Psychology: Research and Practice, 22, 45–51.

This article addresses the ways psychologists can make informed decisions about whether to

participate in managed mental health care plans. It describes some of the options and relevant

ethical concerns and common features of plans that psychologists should be aware of before

signing up with a particular plan. The article also addresses the question of whether there are

certain prospective patients for whom time-limited treatment would be contraindicated and

certain clinicians who are not capable of conducting such therapy. The authors note that

time-limited treatment is not simply the abbreviated form of long-term therapy and argue

that this type of therapy requires its own set of skills. They advocate that only by carefully

selecting their training, the plans they associate with, and the interventions they attempt will

psychologists be prepared for a satisfactory professional life under managed care.

Keywords: ethics, psychotherapy

Annotated Bibliography 147
377. Haas, L. J., & Cummings, N. A. (1994). Managed outpatient mental

health plans: Clinical, ethical, and practical guidelines for participation.

In R. L. Lowman & R. J. Resnick (Eds.), The mental health professional’s

guide to managed care (pp. 137–150). Washington, DC: American

Psychological Association.

See Haas and Cummings, 1991 (reference number 376) for annotation.

378. Lowman, R. L., & Resnick, R. J. (Eds.). (1994). The mental health

professional’s guide to managed care. Washington, DC: American

Psychological Association.

This book is directed toward mental health practitioners and researchers who are looking

for a general overview of what managed care is and how to operate effectively within it. For

example, chapter 1 reviews the economic shifts that underpin the rise of managed health care.

Chapter 3 outlines the basic issues in managed mental health services, especially how mental

health professionals must adapt to a changing environment. Chapter 4 summarizes some of

the legal and ethical issues inherent in practicing in a managed care setting, and chapter 6

reviews mental health benefit claims analysis and its implications. The final chapter discusses

future directions in managed mental health care.

Keywords: ethics, overviews

379. Meyer, R. E., & Sotsky, S. M. (1995). Managed care and the role and

training of psychiatrists. Health Affairs, 14(3), 65–77.

This article discusses the future challenges that psychiatry faces as a result of the changing

economic environment produced by managed care. The new managed care environment must

define the psychiatrist’s role and determine new training strategies. The authors discuss the

challenges and opportunities psychiatrists will encounter in managed care, such as a surplus of

psychiatrists; academic training to fit the needs of a managed care system; structural problems

created by the new roles of academic psychiatry departments; getting funding for clinical training in hospitals; and adapting clinical training to fit the changing environment. The authors

conclude with a discussion on funding challenges faced by academic psychiatry departments.

Keywords: providers, training

380. Moffic, H. S., Krieg, K., & Prosen, H. (1993). Managed care and

academic psychiatry. Journal of Mental Health Administration, 20, 172–177.

This article discusses the impact of managed care on the training of psychiatric residents.

Surveys of chairs of psychiatry in 125 medical schools were conducted in 1989–1990 and

again in 1991–1992. In 1989, only about one-third of respondents reported that their departments were involved in some aspect of managed care. By 1991, more than half were involved.

In 1989, 19 percent of psychiatric residency programs had provided training in some aspect of

clinical managed care to their residents; by 1991, the figure had doubled to 38 percent of programs. Despite academic psychiatry’s growing involvement in managed care, academic leaders

148 Special Report
in the field continue to view managed care with skepticism, and feel that the main beneficiaries

may not be the patients.

Keyword: training

381. Pomerantz, J. M., Liptzin, B., Carter, A. H., & Perlman, M. S. (1994).

The professional affiliation group: A new model for managed mental

health care. Hospital and Community Psychiatry, 45, 308–310.

This article suggests that a professional affiliation group might be an ideal model for the delivery and financing of mental health services. The 30 Independent Physicians Association psychiatrists associated with an HMO in Massachusetts chose to design their own model rather than

use a national managed mental health care company to carve out their mental health benefits.

The model that they selected included a 1-year fee freeze, risk-sharing, and other controls. The

article describes the process, outcomes, limitations, and benefits of developing a professional

affiliation group.

Keywords: models, providers

382. Quaytman, M., & Sharfstein, S. S. (1990). Managed patient care.

Hospital and Community Psychiatry, 41, 1296–1298.

Managed care in a psychiatric setting may intensify conflicts between members of the treatment team as to how to best address patients’ defenses to treatment. This dynamic is explored

in three case examples, which illustrate how managed care can arouse patients’ ambivalence

about treatment. The authors argue that inadequate treatment can result unless clinicians work

collaboratively. They base their assessments on reliable outcome data as well as on the views of

the patients and their families.

Keyword: providers

383. Shueman, S. A., Troy, W G., & Mayhugh, S. L. (1994). The way ahead:

The promise and challenges of managed behavioral health care. In S. A.

Shueman, W. G. Troy, & S. L. Mayhugh (Eds.), Managed behavioral health

care: An industry perspective (pp. 243–256). Springfield, IL: Charles C.

Thomas.

In this final chapter of the book, the authors discuss their vision of the promises and challenges

that lie ahead for managed behavioral health care. The two major types of challenges are (1)

“developmental” ones, such as quality of care issues, that arise from rapidly developing programs; and (2) structural ones, like those between two or more agencies, such as managed care

companies and governments or providers. They describe some specific promises and challenges. They conclude with a discussion of the ways in which financing and service delivery

systems are substantially changing the evolution and identity of mental health professionals.

Keyword: trends

Annotated Bibliography 149
150 Special Report

384. Staton, D. (1991). Psychiatry’s future: Facing reality. Psychiatric

Quarterly, 62, 165–176.

Public and private mental health care costs have risen markedly in recent years. To address this

problem, public programs such as Medicaid will soon severely limit or cut psychiatric coverage. Proposals to contain mental health care costs in Oregon and California have established

reimbursement priority. In several States, priority is given to seriously psychiatrically ill children and employable individuals with substance abuse disorders. The author argues that psychiatric treatment must now be short-term, be crisis-oriented, and permit transfer of patients

to alternative settings such as in-home crisis management. Further, psychiatrists must develop

cost-effective, high-quality performance indicators and an ethic in which they see themselves as

responsible for meeting society’s mental health priorities. The author believes that psychiatrists

should be trained to make rapid assessments and to provide short-term treatment in nonhospital settings.

Keyword: providers

385. Troy, W. G. (1994). Developing and improving professional

competencies. In S. A. Shueman, W. G. Troy, & S. L. Mayhugh (Eds.),

Managed behavioral health care: An industry perspective (pp. 168–188).

Springfield, IL: Charles C. Thomas.

A major thesis of this chapter is that most training programs do not have among their faculties

the expertise needed to treat the critical issues of managed care. Moreover, the author argues

that their allegiance to a core set of knowledge and skills curtails their interest in expanding

the curriculum to include issues of managed care. He asserts that managed care companies

need to take a proactive, leadership role with regard to post-graduate training and describes

some approaches to curricular reform.

Keyword: training

386. Winegar, N. (1992). The clinician’s guide to managed mental health

care (1st ed.). New York: Haworth Press.

This book provides mental health clinicians with a thorough overview of the essential components of the emerging managed care system. Chapters cover topics such as the role of preferred

provider organizations and employee assistance programs, and how to manage the utilization

review process. Several chapters offer concrete suggestions for clinicians on how to survive in

the era of managed care, including lengthy appendices with sample contracts, and examples of

how to maintain treatment records. Overall, this book gives clinicians the basic knowledge

they need to respond effectively to the rise of managed mental health care.

Keywords: overviews, technical assistance
Annotated Bibliography 151

XVI. Utilization

Management

387. Baker, F., & Vischi, T. (1989). Continuity of care and the control of

costs: Can case management assure both? Journal of Public Health Policy,

10, 204–213.

Traditionally, case-managed services have focused on individual needs through providing comprehensive, flexible, and continuous services to mentally ill persons. The more recent emphasis

on managed care belies an increasing concern with cost control. This article explores the

potential conflict between the goals of continuity of care and of cost control, and describes a

number of steps to reduce the potentially negative effects of these competing policies.

Keywords: utilization management

388. Belcher, J. R. (1993). The trade-offs of developing a case management

model for chronically mentally ill people. Health and Social Work, 18,

20–31.

This article describes the role of case management in caring for chronic mentally ill people.

While case management appears to be an ideal method to improve the quality of care and control mental health costs, the author cautions about the difficulty of accomplishing both goals

simultaneously. The article reviews different case management and brokering models and

argues that social work professionals need to play a key role in proposing and implementing

case management models that match client needs with appropriate services and that accurately

reflect the costs of providing these services.

Keywords: case management, models, serious mental illness, utilization management

389. Clark, R. E., & Fox, T. S. (1993). A framework for evaluating the

economic impact of case management. Hospital and Community

Psychiatry, 44, 469–73.

Confusion about the efficacy and cost-effectiveness of alternative models of case management

for mental health care stems in part from poorly defined assumptions about outcomes and

unclear theories of the effect of case management on costs. This article identifies and discusses

some of the determinants of cost-effective case management such as characteristics of the case

management model, characteristics of clients served, and the administrative and financial context in which a program is implemented. Several models of case management are described,

focusing on the ways in which these models differ with regard to resource management. A critical distinction between models with implications for both costs and outcome is the extent to

which each is client-directed or case-manager-directed. The authors conclude that case management has the potential to reduce costs, and to improve the lives of people with mental illness,

Annotated Bibliography
but that it is not likely to do so unless unambiguous goals are set and the mechanisms for

achieving them are clearly defined.

Keywords: case management, models, utilization management

390. Frank, R. G., & Brookmeyer, R. (1995). Managed mental health care

and patterns of inpatient utilization for treatment of affective disorders.

Social Psychiatry and Psychiatric Epidemiology, 30(5), 220–223.

This analysis estimates the impact of managed care on the provision of hospital care for

depression, using a database of individuals insured by large American corporations. The

authors assessed the effects of managed care on the cost per episode and the likelihood of rehospitalization. Results of the analysis suggest that the managed care strategies of utilization

review and case management have clear short-run impacts. Pre-admission certification programs also resulted in both long- and short-term savings through a reduction of both episode

duration and re-hospitalization. 

Keywords: costs, depression, utilization management

391. Gabbard, G. O., Takahashi, T., Davidson, J., Bauman-Bork, M., &

Ensroth, K. (1991). A psychodynamic perspective on the clinical impact of

insurance review. American Journal of Psychiatry, 148, 318–323.

This article explores the impact of managed care and utilization review on clinicians, their

clients, and families. According to the authors, utilization review creates uncertainty about the

length of stay for psychiatric inpatient care, and chaotic treatment planning. The authors argue

that managed psychiatric care has led to adverse outcomes for many patients through premature discharge and a reluctance to hospitalize. Five case studies are presented to illustrate the

authors’ points about the negative impact of utilization review on inpatient psychiatric care.

The authors conclude with a call for better outcome studies on the cost-effectiveness of extended hospital treatment and for increased collaboration between payer and provider.

Keywords: utilization management

392. Glazer, W., & Morgenstern, H. (1993). The impact of utilization

management on hospital length of stay and illness outcome.

Administration and Policy in Mental Health, 21, 41–49.

This article presents an experimental model to determine the effect of utilization management

on the cost and outcome of inpatient psychiatric treatment. Two hypotheses would be tested:

that utilization management feedback results in a reduction in the average length of stay, and

that utilization management does not adversely affect illness outcome after hospitalization.

The design and methodological factors that must be considered to implement such a study are

also discussed.

Keywords: utilization management

152 Special Report
393. Goldstein, J. M., Bassuk, E. L., Holland, S. K., & Zimmer, D. (1988).

Identifying catastrophic psychiatric cases: Targeting managed-care

strategies. Medical Care, 26, 790–799.

Many utilization review programs have developed standardized criteria (generally diagnosisbased) to identify and monitor potentially catastrophic and high-cost cases. These criteria,

however, do not consider several factors that might predict catastrophic illness, such as age,

gender, and treatment setting and location. The study, based on claims data from more than

3,000 psychiatric inpatient admissions, demonstrates that these factors together and alone may

contribute to long stays and high costs. High costs and long stays were more likely to be associated with adolescent admissions and admissions involving major affective, organic, and eating disorders. Catastrophic admissions were also more likely to occur in free-standing psychiatric hospitals. Long stays were more likely in the Northeast, and high-cost cases in the West.

These findings suggest that case managers take patient and setting characteristics—not just

diagnosis—into account when determining which cases should receive special attention.

Keywords: utilization management

394. Goldstein, L. S. (1990). Linking utilization management with quality

improvement. Psychiatric Clinics of North America, 13, 157–169.

This article compares and contrasts utilization management and quality improvement and

describes how utilization management can lead to quality improvement. The goal of utilization management is efficiency. Preadmission authorization, admission review, case management, and drug use evaluation are examples of utilization management. The goal of quality

improvement is to ensure that the structure and process of care is effective. Quality improvement activities include the development of normative and empirical criteria, and outcome

studies. Despite their different goals, utilization management data, such as patterns of

resource utilization, can be used to ensure quality. The article describes a drug utilization

evaluation that identified potentially problematic prescribing practices at a psychiatric unit.

The findings catalyzed efforts to educate psychiatrists to ensure quality.

Keyword: quality assurance, utilization management

395. Gotowka, T. D., & Smith, R. B. (1991). Focused psychiatric review:

Impacts on expense and utilization. Benefits Quarterly, 7(4), 73–81.

This article reports the results of an evaluation to determine whether Focused Psychiatric

Review (FPR), Aetna’s utilization review program, reduces the use and costs of psychiatric

hospitalization. Hospital utilization was compared using claims data for approximately 16,000

beneficiaries who were subject to FPR, and 11,000 non-FPR controls. The study found that

FPR resulted in lower admission rates and lengths of stay, and that initiating case management

before admission led to shorter lengths of stay and lower hospital costs. The study also found

that length of stay is affected by day of admission, because Tuesday through Friday admissions

are often carried over an additional weekend. FPR has a greater impact on psychiatric disorders than on substance abuse disorders and on nonpsychoses than on psychoses. These reducAnnotated Bibliography 153
tions were found in every age group except young adults ages 19 to 34. These findings

suggest the need to do case management before admission and to plan care for substance use,

psychoses, and depression.

Keywords: substance abuse, utilization, utilization management

396. Hennessy, K. D., & Green-Hennessy, S. (1997). An economic and

clinical rationale for changing utilization review practices for outpatient

psychotherapy. The Journal of Mental Health Administration, 24(3),

340–349.

Given the trend toward managed mental health organizations, there has been increased costconsciousness in the financing and delivery of mental health and substance abuse services.

In this paper, the authors examine how management strategies that result from these pressures

have affected mental health and substance abuse services. After reviewing the evolution and

application of managed care to behavioral health, they argue that pressures to reduce costs

have led to the over-application of utilization review (UR) in a way that may be economically

and clinically counterproductive. They provide several rationales for changing UR for outpatient psychotherapy as well as some alternatives to micromanaging outpatient psychotherapy

benefits in an effort to promote a balance between economic and clinical goals.

Keywords: economics, psychotherapy, substance abuse, utilization management

397. Hersch, R. G. (1994). Mental health’s contribution to the financial

performance of a utilization management program. Managed Care

Quarterly, 2(2), 71–78.

This study uses data from a national utilization management program, covering approximately 3.4 million individuals from 1989 through June 1993, to analyze the costs and benefits of

mental health utilization review compared with medical, surgical, and maternity management.

Analysis revealed that while the costs of performing mental health utilization management

are significantly greater than for the medical areas, so are the returns on investment. Indeed,

in 1993, the management of the mental health hospitalizations provided seven times as much

in absolute dollar savings as a surgical case, and 20 times as much as the management of a

maternity case. The article also discusses the implication of full mental health benefits for

health care reform.

Keywords: costs, utilization management

398. Langman-Dorwart, N., Wahl, R., Singer, C. J., & Dorwart, R. A. (1992).

Managed mental health: From cost containment to quality assurance.

Administration and Policy in Mental Health, 19, 345–353.

This article describes the managed care approach of one national managed health care company over the past 5 years, with an emphasis on the integration of quality assurance into utilization review. Through a case-study approach of this company, the authors explore the ways in

which an emphasis on quality may, in the long run, lead to increased cost-effectiveness and

efficiency. The authors conclude that clinically oriented utilization review can control mental

154 Special Report
health costs while monitoring and improving quality of care. They anticipate future changes

in mental health cost containment efforts such as increasing reliance on utilization and quality

data, improved match between clients and approved clinicians based on acuity and appropriateness of service, and continued redirection of patients to outpatient settings.

Keywords: quality assurance, utilization management

399. Lewin, R., & Sharfstein, S. S. (1990). Managed care and the discharge

dilemma. Psychiatry, 53, 116–121.

This article describes the ways in which efforts by “fourth party” case managers to contain

costs may lead to premature hospital discharge for severely mentally ill patients. A case study

of a borderline patient exemplifies the potentially deleterious effects of early discharge on

patients such as the “sicker and quicker” phenomenon leading to repeated short-term hospitalizations, pressure to inappropriately use high doses of medicines or electroconvulsive

therapy in order to produce a rapid clinical response, and compromise of treatment goals.

The authors argue that there is an urgent need for outcome studies that justify the costly

treatment in inpatient care for a subset of patients and that document the negative impacts of

premature discharge. Further, they advocate increased reimbursement for community-based

residential care for chronically mentally ill persons.

Keywords: serious mental illness, utilization management

400. Oehm, M. J. (1992). Information systems. In S. Feldman (Ed.),

Managed mental health services (1st ed., pp. 143–164). Springfield, IL:

Charles C. Thomas.

An efficient, reliable, and flexible computer information system can enhance the quality of

utilization management. Despite its advantages, few utilization management companies have

implemented such a system because they prefer “tangible” recordkeeping and fear high costs

and frequent downtime. The author describes the key features of an information system and

how it can address these concerns. The system should be fast and reliable and include data

about patients, providers, benefits, and clinical criteria. Among other features, it should

perform coding and “flag” certain cases, assign case numbers, and automatically transfer

information to the claims system. Although the most effective systems are internally

developed, the author concludes that packaged systems can be successfully adapted for use.

Keywords: information systems, utilization management

401. Panzarino, P. J., & Wetherbee, D. G. (1990). Advanced case

management in mental health: Quality and efficiency combined.

QRB Quality Review Bulletin, November, 386–390.

The case manager in a managed mental health care system can serve as the patient’s

ombudsman to provide high quality care. Treatment effectiveness data, outcome studies,

and utilization patterns, rather than simply availability and cost of treatment, guide case

Annotated Bibliography 155
managers’ decision making. There are four steps to the decisionmaking process: preadmission certification, triage, concurrent review, and individual case management or creative

benefit reallocation. A case example illustrates how these steps can be employed to ensure

a continuum of care in appropriate, cost-effective outpatient programs.

Keywords: case management, utilization management

402. Reinhardt, B., & Shepherd, G. L. (1994). Behavioral health case review:

Utilization review or case management? One company’s view. In S. A.

Shueman, W. G. Troy, & S. L. Mayhugh (Eds.), Managed behavioral health

care: An industry perspective (pp. 76–91). Springfield, IL: Charles C.

Thomas.

This chapter describes the process of managed behavioral health care as it is conducted by

one case management company. The authors focus on (1) the role of the case manager; and

(2) what the case management company can do legally and practically to affect patient treatment. They present some of their own experiences with case management.

Keywords: case management, utilization management

403. Sturm, R., McGlynn, E. A., Meredith, L. S., Wells, K. B., Manning,

W. G., & Rogers, W. H. (1994). Switches between prepaid and fee-forservice health systems among depressed outpatients: Results for the

medical outcomes study. Medical Care, 32, 917–929.

The authors found that the lowest rate of plan switching was among patients of mental health

specialists in fee-for-service plans, compared to general medical patients in fee-for-service

plans and both types of patients in prepaid plans. Additional findings of this longitudinal

study are presented and discussed.

Keywords: capitation, utilization management

404. Tischler, G. L. (1990). Utilization management of mental health

services by private third parties. American Journal of Psychiatry, 147,

967–973.

In utilization management a third party—rather than the physician—is the final arbiter of

treatment. This article describes three utilization management approaches: preadmission certification, concurrent review, and case management. Utilization management raises a number

of issues, such as professional bias in treatment, what constitutes an effective community

substitute for inpatient care, the role of utilization management in shifting costs from Federal

to State agencies, the lack of privacy safeguards, quality control, and practitioner liability.

The author concludes that there is a need for further study of the implications and efficacy

of utilization management.

Keywords: utilization management

156 Special Report
405. Tischler, G. L. (1990). Utilization management and the quality of care.

Hospital and Community Psychiatry, 41, 1099–1102.

Utilization management has implications for the availability, appropriateness, and effectiveness

of mental health care. This article discusses the history of utilization management in both the

public and private sectors, and the development of peer review approaches to care decision

making. The author identifies clinical and economic factors that influence care decisions, and

suggests ways to determine whether systematic biases exist in reviewer decision making. He

concludes that more research is needed on the impact of cost-containment initiatives on access

and outcome.

Keywords: utilization management

406. Trabin, T. (1994). How will computerization revolutionize managed

care? Managed Care Quarterly, 2(2), 22–24.

This brief article presents an imaginary scenario of how computerization will help clinicians

and case managers access and communicate patient data for behavioral health services in the

near future. The author uses this scenario to demonstrate how computerization of behavioral

health information is revolutionizing the way payers, managed care companies, and providers

use and exchange information. He describes some of the benefits of this advanced technology

and obstacles to attaining these gains.

Keywords: information systems, utilization management

407. Wanerman, L. (1993). Managed mental health for children and

adolescents. New Directions for Mental Health Services, 59, 13–26. 

In this chapter, the author uses a series of cases to illustrate the ways in which managed care

can provide comprehensive and cost-effective mental health and substance abuse treatment

for children and adolescents. The author briefly describes the Focused Adolescent and Child

Treatment team at U.S. Behavioral Health (USBH), a national managed care company. The

team includes mental health professionals from a variety of disciplines who work with

providers to coordinate care from intake to referral and continual case monitoring. The

author argues that this approach can protect generally limited and restrictive mental health

benefits so they are available when truly needed. USBH’s guidelines for level-of-care decisions

in mental health for children and adolescents are included in an appendix.

Keywords: children, managed behavioral health care organizations, utilization

management

408. Wickizer, T. M., & Lessler, D. (1998). Do treatment restrictions imposed

by utilization management increase the likelihood of readmission for

psychiatric patients? Medical Care, 36(6), 844–850.

This article describes a 5-year study on more than 2,000 privately insured psychiatric patients

and uses logistical regression analysis to determine how utilization management programs

affected restrictions on length of stay and the likelihood of readmission. The findings indicated

Annotated Bibliography 157
158 Special Report

that those patients whose length of stay was restricted by utilization management (UM) were

more likely to be readmitted. The authors view readmissions as a sign of poor quality service

and believe UM programs might best serve patient populations by improving clinical outcomes

as well as containing costs.

Keywords: utilization management

409. Wickizer, T. M., & Lessler, D. (1998). Effects of utilization management

on patterns of hospital care among privately insured adult patients.

Medical Care, 36(11), 1545–1554.

Although utilization management (UM) is one of the primary tools of an HMO in cost containment, there has been little research on the effects of this practice on patterns of care. In this

study, researchers examined pre-admission review and concurrent (continued stay) review of

49,654 privately insured adult patients undergoing utilization review between January 1989

and December 1993. The focus of the study was to examine how often UM denied care at

time of admission, to what extent UM restricted hospital length of stay, which diagnoses and

procedures were most affected by UM, and whether UM became more restrictive with time.

The study found that fewer than 1 percent of patients were denied care at time of admission.

Restricting length of stay through concurrent review accounted for 83 percent of the total

reduction in inpatient care. Utilization management was the most restrictive for mental health

patients, who represented 5.7 percent of the study population but accounted for 54.7 percent

of the total reduction in requested days. 

Keywords: utilization management 

410. Wickizer, T. M., Lessler, D., & Travis, K. M. (1996). Controlling inpatient

psychiatric utilization through managed care. American Journal of

Psychiatry 153(3), 339–345.

This article reports the results of a study of the effect of utilization management on psychiatric hospital inpatient care. The authors analyzed data on utilization management review

activities conducted by a single large commercial insurance carrier during 1989–1992.

Measures included percentage of admission requests approved, number of days requested and

approved, and number of additional treatment days granted. In addition, the authors examined how the number of days approved by utilization management compared with lengths of

stay of patients with similar diagnoses in the general population as reported by the National

Hospital Discharge Survey. The authors discuss the limitations of the study, and stress the

need for studies on the effects of managed care on patient outcomes and the quality of care.

Keywords: utilization management
XVII.

Annotated Bibliography 159

Author

Index

Abstract Number

Abbott, B. K. . . . . . . . . . . . . . . . .188

Abrams, H. S. . . . . . . . . . . . . . . . . . .1

Adler, D. A. . . . . . . . . . . . . . . . . . .24

Afield, W. E. . . . . . . . . . . . . . . . . . . .2

Aiken, L. H. . . . . . . . . . . . . . . .92, 93

Alexander, J. A. . . . . . . . . . .353, 354

Altman, L. . . . . . . . . . . . . . . . .3, 142

Anderson, D. . . . . . . . . . . . . . . . .311

Angell, R. H. . . . . . . . . . . . . . . . .275

Appelbaum, P. S. . . . . . . . . . . . . . .183

Armenti, N. P. . . . . . . . . . . . . . . .206

Armstrong, E. . . . . . . . . . . . . . . . .374

Armstrong, M. I. . . . . . . . . . . . . .345

Arons, B. S. . . . . . . . . . . . . . . . . . . .4

Ashcraft, M. L. F. . . . . . . . . . . . . .112

Astrachan, B. M. . . .75, 114, 119, 332

Austad, C. S. . . . .207, 208, 214, 227,

233, 234, 369, 370

Austin, M. J. . . . . . . . . . . . . . . . .253

Avery, D. . . . . . . . . . . . . . . . . . . . .58

Azeni, H. . . . . . . . . . . . . . . . . . . . .10

Azzone, V. . . . . . . . . . . . . . . . . . .351

Babigian, H. M. . . .76, 77, 78, 84, 95

Backlar, P. . . . . . . . . . . . . . . . . . . .209

Bae, J. P. . . . . . . . . . . . . . . . . . . . . .21

Baker, F. . . . . . . . . . . . . . . . . . . . .387

Baker, N. J. . . . . . . . . . . . . . . . . . .210

Baler, S. . . . . . . . . . . . . . . . .262, 264

Bamezai, A. . . . . . . . . . . . . . . . . .123

Banazak, D. . . . . . . . . . . . . . . . . .346

Annotated Bibliography

Banks, S. M. . . . . . . . . . . . . . . . . .313

Barglow, P. . . . . . . . . . . . . . . . . . .143

Barnes, P. D. . . . . . . . . . . . . . . . . .211

Barth, L. E. . . . . . . . . . . . . . . . . . .80

Bartlett, J. . . . . . . . . . . . . . . .286, 306

Bassos, C. A. . . . . . . . . . . . . . . . .213

Bassuk, E. L. . . . . . . . . . . . . . . . .393

Bateman, A. . . . . . . . . . . . . .340, 341

Bauman-Bork, M. . . . . . . . . . . . . .391

Bazelon Center for Mental 

Health Law . . . . . . . . . . . . . . . .29

Becker, J. . . . . . . . . . . . . . . . . . . .184

Beinecke, R. H. . . .254, 255, 256, 258

Belcher, J. R. . . . . . . . . . . . . . . . . .388

Bemak, F. . . . . . . . . . . . . . . . . . . . .17

Bennett, M. J. . . . . . .5, 61, 144, 145,

146, 212

Bentson, H. . . . . . . . . . . . . . . . . . .85

Berg, R. . . . . . . . . . . . . . . . . . . . .247

Bergsten, C. . . . . . . . . . . . . .156, 218

Berkman, A. S. . . . . . . . . . . . . . . .213

Berland, J. . . . . . . . . . . . . . . . . . . .24

Berlant, J. L. . . . . . . . . . . . . .287, 311

Berman, W. H. . . . . . . . .50, 214, 369

Berman, W. S. . . . . . . . . . . . . . . . .207

Bermon, M. . . . . . . . . . . . . . . . . .368

Berren, M. R. . . . . . . . . . . . . . . . . .99

Betit, R. L. . . . . . . . . . . . . . . . . . .261

Bittker, T. E. . . . . . . . . . . . . . . . . .215

Blackwell, B. . . . . . . . . . . . . . . . . .371

Bloom, B. L. . . . . . . . . . . . . . . . . .147
160 Special Report

Blum, S. R. . . . . . . . . . . . . . .185, 253

Bond, K. . . . . . . . . . . . . . . . . . . . .180

Bonin, R. L. . . . . . . . . . . . . . . . . .291

Bonstedt, T. . . . . . . . . . . . . . . . . .148

Borenstein, D. B. . . . . . . . . . . . . .288

Borus, J. F. . . . . . . . . . . . . . . . . . .237

Bottinelli, R. W. . . . . . . . . . . . . . .232

Boyle, P. J. . . . . . . . . . . . . . . . . . .186

Brach, C. . . . . . . . . . . . . . . . . . . . .79

Brannigan, P. . . . . . . . . . . . . . . . .364

Breslow, R. E. . . . . . . . . . . . . . . . .289

Bricklin, P. M. . . . . . . . . . . . .193, 194

Brookmeyer, R. . . . . . . . . . . . . . . .390

Broskowski, A. . . . . . . . . . . . . . . .6, 7

Brown, G. S. . . . . . . . . . . . . . . . . . .59

Brown, J. . . . . . . . . . . . . . . . . . . .225

Brown, J. M. . . . . . . . . . . . . . . . .267

Brown, L. . . . . . . . . . . . . . . . . . . .281

Brown, S. W. . . . . . . . . . . .77, 84, 94

Browning, B. J. . . . . . . . . . . . . . . .372

Browning, C. H. . . . . . . . . . . . . . .372

Buck, J. A . . . . . . . . . . . . . . . . . . .156

Budman, S. H. . . . . . . . . . . .373, 374

Bulatao, E. Q. . . . . . . . .152, 154, 155

Burlingame, G. M. . . . . . . . . . . . .290

Burns, B. J. . . . .47, 80, 247, 301, 331

Burton, W. N. . . . . . . . . . . . . . .8, 291

Busch, S. . . . . . . . . . . . . . . . . . . . . .9

Callahan, D. . . . . . . . . . . . . . . . . .186

Callahan, J. J. . . . . . . . . . . . .257, 258

Calonge, B. N. . . . . . . . . . . . . . . .336

Caplan, R. . . . . . . . . . . . . . .140, 355

Carpinello, S. . . . . . . . . . . . . . . . .292

Carson, D. . . . . . . . . . . . . . .149, 216

Carter, A. H. . . . . . . . . . . . . . . . .381

Cavanaugh, D. . . . . . . . . . . . . . . .258

Center for Health Policy Studies . .293

Chalk, M. . . . . . . . . . . . . . . .156, 259

Chandler, D. . . . . . . . . . . . . . . . . . .81

Chandler, S. . . . . . . . . . . . . . . . . .143

Chartock, L. R. . . . . . . . . . . . . . .113

Childs, G. . . . . . . . . . . . . . . . . . . .343

Christianson, J. . . . . . . .105, 182, 283

Christianson, J. B. . . .82, 83, 89, 107, 

150, 151, 175, 176

Christopher, N. J. . . . . . . . . . . . . .309

Chung, R. . . . . . . . . . . . . . . .305, 362

Clark, J. A. . . . . . . . . . . . . . . . . . . .97

Clark, R. E. . . . . . . . . . . . . . . . . .389

Cohen, J. . . . . . . . . . . . . . . . .47, 286

Cole, R. E. . . . . . . . . . . . . . . . .77, 84

Coleman, B. . . . . . . . . . . . . . . . . .105

Coleman, K. . . . . . . . . . . . . . . . . .357

Colenda, C. C. . . . . . . . . . . . . . . .346

Comstock, C. . . . . . . . . . . . . . . . .298

Conti, D. J. . . . . . . . . . . . . . . . . . . .8

Coulam, R. F. . . . . . . . . . . . . . . . . .80

Cox, G. B. . . . . . . . . . . . . . . . . . .281

Crow, S. E. . . . . . . . . . . . . . . . . . .347

Cuffel, B. . . . . . . . . . . .173, 260, 301

Cummings, N. A. . . . . .124, 133, 134,

312, 376, 377

Cutler, D. L. . . . . . . . . . . . . . . . . . .85

Cypres, A. . . . . . . . . . . . . . . . . . .108

Dagadakis, C. . . . . . . . . . . . . . . . . .58

Dana, R. H. . . . . . . . . . . . . . . . . .348

Dangerfield, D. . . . . . . . . . . . . . . .261

Davidson, J. . . . . . . . . . . . . . . . . .391

Davidson, L. . . . . . . . . . . . . .270, 271

Davis, K. E. . . . . . . . . . . . . . . . . .285

Davis, L. . . . . . . . . . . . . . . . . . . .123

Deitz, P. . . . . . . . . . . . . . . . . . . . .225

DeLeon, P. H. . . . .152, 153, 154, 155

DeMasi, M. . . . . . . . . . . . . . . . . .292
Annotated Bibliography 161

Dewan, M. . . . . . . . . . . . . . . . . . .217

Dial, T. H. . . . . . . . . . . . . . .156, 218

Diamond, J. . . . . . . . . . . . . . . . . .342

Dickey, B. . . . .10, 265, 279, 294, 334

Dobmeyer, T. W. . . . . . . . . . . . . . . .86

Docherty, J. . . . . . . . . . . . . . . . . . .24

Donahue, S. . . . . . . . . . . . . . . . . .292

Dörken, H. . . . . . .133, 134, 187, 219

Dorwart, R. A. 24, 113, 157, 284, 398

Dubin, W. R. . . . . . . . . . . . . . . . .159

Dugger, D. E. . . . . . . . . . . . . . . . .310

Duhl, L. J. . . . . . . . . . . . . . . . . . . .11

Dunlap, l. J. . . . . . . . . . . . . . . . . .356

Durham, M. L. . . . . . . . .12, 158, 177

DuVal, M. K. . . . . . . . . . . . . . . . .125

Egnew, R. C. . . . . . . . . . . . . . . . .262

Eisen, S. V. . . . . . . . . . . . . . . . . . .334

Ellison, J. M. . . . . . . . . . . . . . . . . .24

Elpers, J. R. . . . . . . . . . . . . . . . . .188

England, M. J. . . . . . . . . .13, 14, 342

English, J. T. . . . . . . . . . . . . . . . . .114

Ensroth, K. . . . . . . . . . . . . . . . . . .391

Epstein, S. S. . . . . . . . . . . . . . . . . .157

Erickson, B. J. . . . . . . . . . . . . . . . .289

Eselius, L. L. . . . . . . . . . . . . . . . . . .27

Essock, S. . . . . . . . . . . .115, 263, 295

Fairbank, A. . . . . . . . . . . . . . . . . . .38

Fallong, T. . . . . . . . . . . . . . . . . . .342

Feldman, J. . . . . . . . . . . . . . . . . . .296

Feldman, J. L. . . . . . . . . . . . .221, 222

Feldman, S. 15, 16, 109, 264, 297, 375

Felton, C. J. . . . . . . . . . . . . . . . . .292

Fillman, O. . . . . . . . . . . . . . . . . . .362

Finch, M. . . . . . . . . .83, 89, 107, 278

Fink, P. J. . . . . . . . . . . . . . . . . . . .159

Fishel, L. . . . . . . . . . . . . . . . . . . . .17

Fisher, L. . . . . . . . . . . . . . . . . . . . .18

Fisher, W. H. . . . . .265, 267, 340, 341

Fitzpatrick, R. . . . . . . . . . . . . .19, 222

Flaa, C. J. . . . . . . . . . . . . . . . . . . .189

Fowls, D. J. . . . . . . . . . . . . . . . . .223

Fox, T. S. . . . . . . . . . . . . . . . . . . .389

Frank, E. . . . . . . . . . . . . . . . . . . .322

Frank, R. G. . . . . . .4, 20, 21, 22, 23,

126, 127, 128, 266, 351, 390

Fray, J. . . . . . . . . . . . . . . . . . . .84, 94

Freiman, M. P. . . . . . . . . . . . . . . .116

French, M. T. . . . . . . . . . . . . . . . .356

Fries, B. E. . . . . . . . . . . . . . . . . . .112

Fuller, K. . . . . . . . . . . . . . . . . . . . .58

Gabbard, G. O. . . . . . . . . . . . . . .391

Galinis, D. N. . . . . . . . . . . . . . . . .356

Gardner, W. P. . . . . . . . . . . . . . . .343

Garnick, D. W. . . . . . . . . . . .161, 298

Gaumer, G. L. . . . . . . . . . . . . . . .328

Gauvin, L. . . . . . . . . . . . . . . . . . .313

Gelber, S. . . . . . . . . . . . . . . . . . . .310

Geller, J. L. . . . . . . . . . . . . . . . . . .267

George, R. A. . . . . . . . . . . . . . . . .275

Geraty, R. D. . . . . . . . . . . . . . . . .189

Gibson, R. W. . . . . . . . . . . . . . . . .118

Giese, A. A. . . . . . . . . . . . . . . . . .210

Giles, T. R. . . . . . . . . . . . . . . . . . .299

Gillespie, D. K . . . . . . . . . . . . . . . .46

Ginsberg, S. . . . . . . . . . . . . . . . . .300

Gladstone, L. . . . . . . . . . . . . . . . .291

Glasser, J. H. . . . . . . . . . . . . .33, 167

Glazer, W. . . . . . . . . . . . . . . . . . . .392

Glied, S. . . . . . . . . . . . . . . . . . . . .350

Glover, R. . . . . . . . . . . . . . . . . . . . .87

Goff, V. V. . . . . . . . . . . . . . . . . . . .13

Goldman, H. . . . . . . . . . . . . . . . .295

Goldman, H. H. . . . . . . .4, 20, 24, 80,

117, 129, 263, 331
162 Special Report

Goldman, W. . .25, 160, 301, 302, 375

Goldstein, J. M. . . . . . . . . . .142, 393

Goldstein, L. . . . . . . . . . . . . . . . . .34

Goldstein, L. S. . . . . . . . . . . .224, 394

Gondolf, E. . . . . . . . . . . . . . . . . .357

Goodman, M. . . . . . . . . . . . .225, 256

Goran, M. J. . . . . . . . . . . . . . . . . . .26

Gotowka, T. D. . . . . . . . . . . . . . .395

Gould, R. L. . . . . . . . . . . . . . . . . .226

Grace, J. D. . . . . . . . . . . . . . . . . . .59

Gragg, D. M. . . . . . . . . . . . . . . . .358

Graham, M. . . . . . . . . . . . . . . . . .342

Gray, D. . . . . . . . . . . . . . . . . . . . .283

Gray, D. Z. . . . . . . . . . . . . . . . . . . .82

Grazier, K. L. . . . . . . . . . . . . . . . . .27

Green-Hennessy, S. . . . . . . . . . . . .396

Gresenz, C. R. . . . . . . . . . . . . . . .335

Griffin, M. . . . . . . . . . . . . . . . . . .334

Griffith, E. E. H. . . . . . .270, 271, 272

Grimes, C. . . . . . . . . . . . . . . . . . .342

Grogan, C. . . . . . . . . . . . . . . . . . .173

Grothaus, L. . . . . . . . . . . . . . . . . .177

Guernsey, B. P. . . . . . . . . . . . . . . .336

Haas, L. J. . . . . . . . . . . . . . .376, 377

Hadley, T. R. . . .87, 98, 101, 122, 268

Hall, R. C. W. . . . . . . . . . . . . . . .190

Hamilton, J. M. . . . . . . . . . . . . . .303

Hanrahan, M. B. . . . . . . . . . . . . .336

Hanson, G. . . . . . . . . . . . . . . . . . .342

Hargreaves, W. A. . . . . . . . . . . . . . .88

Hargrove, D. S. . . . . . . . . . . . . . .285

Harris, B. . . . . . . . . . . . . . . . . . . .232

Harrow, B. S. . . . . . . . . . . . . . . . .116

Hartley, D. . . . . . . . . . . . . . . . . . .107

Haviland, M. G. . . . . . . . . . . . . . .218

Henderson, M. . . . . . . . . . . . . . . .311

Hendren, R. L. . . . . . . . . . . . . . . .189

Hendricks, A. M. . . . . . . . . . . . . .298

Henke, C. J. . . . . . . . . . . . . .133, 134

Hennessy, K. D. . . . . . . . .94, 95, 396

Herbert, M. . . . . . . . . . . . . . . . . .363

Hersch, R. G. . . . . . . . . . . . . . . . .397

Higuchi, S. A. . . . . . . . . . . . . . . . .191

Hill, G. A. . . . . . . . . . . . . . . . . . .179

Hodgkin, D. . . . . . . . . . . . . . . . . .161

Hogan, M. F. . . . . . . . . . . . . . . . .269

Hoge, M. A. . . . . . . . . .270, 271, 272

Holland, S. K. . . . . . . . . . . . . . . .393

Holstein, L. . . . . . . . . . . . . . . . . .208

Horgan, C. M. . . . . . . . . . . . . . . .161

Hornbrook, M. C. . . . . . . . .162, 170

Hosek, S. D. . . . . . . . . . . .70, 72, 123

Howe, S. W. . . . . . . . . . . . . . . . . .337

Howenstine, R. A. . . . . . . . . . . . .271

Hoy, D. A. . . . . . . . . . . . . . . . . . .291

Hoyt, M. F. . . . . . . . . . . . . . .227, 370

Hu, T. . . . . . . . . . . . . . . . . . . . . . .81

Huskamp, H. A. . . . . . .126, 304, 351

Huxley, P. . . . . . . . . . . . . . . . . . . .104

Hyde, P. . . . . . . . . . . . . . . . . . . . .163

Iglehart, J. K. . . . . . . . . . . . . . . . . .28

Ingram, B. L. . . . . . . . . . . . . . . . .305

Ivey, S. L. . . . . . . . . . . . . . . . . . . .239

Jackson, C. A. . . . . . . . . . . . . . . .330

Jacobs, S. . . . . . . . . . . . . . . .270, 272

Jaffe, C. . . . . . . . . . . . . . . . . . . . . .58

Jaffee, C. L. . . . . . . . . . . . . . . . . . .33

Janzen, C. . . . . . . . . . . . . . . . . . . .17

Jellinek, M. . . . . . . . . . . . . . . . . .337

Jellinek, M. S. . . . . . . . . . . . . . . . .228

Johnson, R. E. . . . . . . . . . . .164, 170

Kane, R. L. . . . . . . . . . . . . . . . . . .306

Kantor, A. . . . . . . . . . . . . . . . . . .156

Kaplan, D. W. . . . . . . . . . . . . . . . .336
Annotated Bibliography 163

Kapur, S. . . . . . . . . . . . . . . . . . . . .24

Katon, W. . . . . . . . . . . . . . . . . . . .180

Katz, S. E. . . . . . . . . . . . . . . . . . .273

Kelleher, K. J. . . . . . . . . . . . .322, 343

Kelly, J. . . . . . . . . . . . . . . . . . . . .245

Kent, J. . . . . . . . . . . . . . . . . . . . . .138

Kerzner, J. . . . . . . . . . . . . . . . . . .274

Kihlstrom, L. C. . . . . . . . . . . . . . . .30

Klinger, B. I. . . . . . . . . . . . . . . . . .289

Koegel, P. . . . . . . . . . . . . . . . . . . .111

Krieg, K. . . . . . . . . . . . . . . . . . . .380

Kunnes, R. . . . . . . . . . . . . . . . . . . .31

Kupfer, D. . . . . . . . . . . . . . . . . . .322

Kushner, J. N. . . . . . . . . . . . . . . . .359

Lambert, M. J. . . . . . . . . . . . . . . .290

Landsberg, G. . . . . . . . . . . . . . . . .108

Lane, N. E. . . . . . . . . . . . . . . . . . .229

Langman-Dorwart, N. . . . . .165, 398

Larson, M. J. . . . . . . . . . . . . . . . .258

Lauber, B. G. . . . . . . . . . . . . . . . . .97

Lave, J. R. . . . . . . . . . . . . . . . . . .127

Lazarus, A. . . . . . . . . . . . . . .166, 307

Lazarus, J. . . . . . . . . . . . . . . . . . .192

Leadholm, B. . . . . . . . . . . . . . . . .274

Lee, F. C. . . . . . . . . . . . . . . . . . . . .32

Leff, H. S. . . . . . . . . . . . . . . . . . .308

Legal Action Center . . . . . . . . . . . .29

Lehman, A. F. . . . . . . . . . . . . . . . . .77

Leifer, J. C. . . . . . . . . . . . . . . . . . .251

Lemak, C. H. . . . . . . . . . . . .353, 354

Leon, S. C. . . . . . . . . . . . . . . . . . .309

Lessler, D. . . . . . . . . . . .408, 409, 410

Levin, B. L. . . . . . . . . . . . . . . .33, 167

Lewin, R. . . . . . . . . . . . . . . . . . . .399

Lindrooth, R. C. . . . . . . . . . .265, 279

Liptzin, B. . . . . . . . . . . . . . . . . . .381

Little, M. . . . . . . . . . . . . . . . . . . .337

Liu, X. . . . . . . . . . . . . . . . . . . . . .335

Lizanich-Aro, S. . . . . . . . . . . . . . . .34

Lockhart, A. . . . . . . . . . . . . . . . . .254

Loftus-Rueckheim, P. . . . . . . . . . .136

Lourie, I. . . . . . . . . . . . .337, 338, 342

Lowman, R. L. . . . . . . . . . . . .35, 378

Lurie, N. . . . . . . . . . .83, 89, 107, 278

Lyons, J. S. . . . . . . . . . . .91, 309, 314

Ma, C. A. . . . . . . . . . . . . . . . . . . .130

Madison, K. . . . . . . . . . . . . . . . . . .81

Mahoney, J. J. . . . . . . . . . . . . . . . .36

Major, C. . . . . . . . . . . . . . . . . . . .139

Manning, W. . . . . . . . . . . . . . . . .283

Manning, W. G. . . . . . . .71, 330, 403

Marinelli-Casey, P. . . . . . . . . . . . .361

Marquis, M. S. . . . . . . . . . . . . .70, 72

Marriott, S. . . . . . . . . . . . . . . . . .283

Marshall, P. E. . . . . . . . . . . . .78, 168

Marshall, S. . . . . . . . . . . . . . . . . .184

Marx, L. . . . . . . . . . . . . . . . . . . .342

Masi, D. A. . . . . . . . . . . . . . . . . .140

Masland, M. . . . . . . . . . . . . . . . .260

Mason, M. J. . . . . . . . . . . . . . . . .339

Massari, L. . . . . . . . . . . . . . . . . . .119

Mauch, D. . . . . . . . . . . . . . . . . . . .90

Mayhugh, S. L. . . . . .37, 64, 325, 383

McAlpine, D. D. . . . . . . . . . . . . . . .42

McCann, M. J. . . . . . . . . . . . . . . .361

McCarthy, P. R. . . . . . . . . . . . . . .310

McCulloch, J. . . . . . . . . . . . .301, 302

McDermeit, M. . . . . . . . . . . . . . .267

McFarland, B. H. .164, 169, 170, 275

McGlynn, E. A. . . . . . . . . . . . . . .403

McGovern, M. P. . . . . . . . . . . . . . .91

McGowen, M. . . . . . . . . . . . . . . . .81

McGuire, T. G. . . . . . . .4, 20, 21, 22, 

23, 38, 126, 128, 130, 266
164 Special Report

McIntyre, F. . . . . . . . . . . . . . . . . . .17

McKee, P. A . . . . . . . . . . . . . . . . . .86

McNeese-Smith, D. K. . . . . . . . . .360

Mechanic, D. . . . . . . . .39, 40, 41, 42,

92, 93, 276

Mee-Lee, D. . . . . . . . . . . . . . . . . .362

Meisel, J. . . . . . . . . . . . . . . . . . . . .81

Mendeloff, J. . . . . . . . . . . . . . . . .343

Meredith, L. S. . . . . . . .246, 330, 403

Merrick, E. L. . . . . . . . . . . . . . . . .257

Meyer, R. E. . . . . . . . . . . . . . . . . .379

Mickus, M. . . . . . . . . . . . . . . . . .346

Milhalik, G. . . . . . . . . . . . . . . . . . .43

Miller, N. A. . . . . . . . . . . . . . . . . .141

Miller, R. D. . . . . . . . . . . . . . . . . . .86

Miller, S. I. . . . . . . . . . . . . . .309, 314

Milstein, A. . . . . . . . . . . . . . . . . .311

Minkoff, K. . . . . . . . . . . . . . . . . .277

Mirin, S. M. . . . . . . . . . . . . . . . . .334

Mitchell, J. B. . . . . . . . . . . . . . . . .116

Mitchell, O. S. . . . . . . . . . . . . . . . .95

Moffic, H. S. . . . . . . . . . . . . . . . .380

Moiser, J. . . . . . . . . . . . . . . . . . . .290

Molitor, N. . . . . . . . . . . . . . . . . . .143

Morgan, D. . . . . . . . . . . . . . . . . . .98

Morgan, T. . . . . . . . . . . . . . . . . . .208

Morgenstern, H. . . . . . . . . . . . . . .392

Moscovice, I. S. . . . . .83, 89, 107, 278

Moss, S. . . . . . . . . . . . . . . . . .44, 359

Mulvey, K. P. . . . . . . . . . . . . . . . .364

Murata, D. . . . . . . . . . . . . . . . . . .111

Murtaza, N. . . . . . . . . . . . . . . . . .253

Muszynski, I. L. . . . . . . . . . .114, 121

Nace, D. . . . . . . . . . . . . . . . . . . . .342

Namerow, M. J. . . . . . . . . . . . . . .118

National Advisory Mental Health

Council . . . . . . . . . . . . . . . . . . . .131

Nauert, R. C. . . . . . . . . . . . . . . . . .45

Neff, W. M. . . . . . . . . . . . . . . . . .290

Nerenz, D. R. . . . . . . . . . . . . . . . .112

Newell, A. R. . . . . . . . . . . . . . . . .352

Newhouse, J. P. . . . . . . . . . . . .22, 126

Newman, R. . . . . . . . . . . . . .193, 194

Nicholson, J. . . . . . . . . . . . . .340, 341

Norquist, G. S. . . . . . . . . . . .115, 171

Norton, E. C. . . . . . . . . . . . .265, 279

Nurcombe, B. . . . . . . . . . . . . . . . .228

Obert, J. L. . . . . . . . . . . . . . . . . . .361

Oehm, M. J. . . . . . . . . . . . . . . . . .400

Offer, D. . . . . . . . . . . . . . . . . . . . .143

Ogles, B. M. . . . . . . . . . . . . . . . . . .46

O’Keefe, B. E . . . . . . . . . . . . . . . .232

Olfson, M. . . . . . . . . . . . . . . . . . .132

Olsen, D. P. . . . . . . . . . .195, 196, 230

Osher, F. C. . . . . . . . . . . . . . . . . .150

Oss, M. . . . . . . . . . . . . . . . . . . . .110

Pabiniak, C. . . . . . . . . . . . . .177, 180

Packer, I. K. . . . . . . . . . . . . . . . . .197

Padgett, D. K. . . . . . . . . . . . . . . . . .47

Pajer, K. . . . . . . . . . . . . . . . . . . . . .24

Pallak, M. S. . . . . .133, 134, 187, 312

Pandiani, J. A. . . . . . . . . . . . . . . .313

Panzarino, P. J. . . . . . . . . . . . . . . .401

Patrick, C. . . . . . . . . . . . . . . . . . . .47

Patterson, D. Y. . . . . . .48, 49, 50, 231

Patterson, R. F. . . . . . . . . . . . . . . .198

Pearson, J. . . . . . . . . . . . . . . . . . . .51

Pease, E. A. . . . . . . . . . . . . . . . . .292

Peebles, T. . . . . . . . . . . . . . . . . . .165

Peele, P. B. . . . . . . . . . . . . . . . . . .322

Penkert, K. S. . . . . . . . . . . . . . . . . .46

Penner, N. R. . . . . . . . . . . . . . . . . .52

Penner, S. . . . . . . . . . . . . . . .173, 264

Perlman, M. S. . . . . . . . . . . .380, 381
Annotated Bibliography 165

Perlman, S. B. . . . . . . . . . . . . . . . .255

Peterson, M. . . . . . . . . . . . . . . . . .182

Peterson, M. S. . . . . . . . . . . . . . . .151

Petrila, J. . . . . . . . . . . . . . . .199, 200

Pfaum, B. B. . . . . . . . . . . . . . . . . . .53

Piccagli, G. . . . . . . . . . . . . . . . . . .260

Pickett, S. A. . . . . . . . . . . . . . . . . .314

Pincus, H. A. . . . . . . . . . . . . . . . .218

Pires, S. A. . . . . . . . . . . . . . . . . . .345

Plough, A. . . . . . . . . . . . . . . . . . .364

Pollack, D. . . . . . . . . . . . . . . . . . .192

Pollack, D. A. . . . . . . . . . . . . . . . .275

Polonus, T. . . . . . . . . . . . . . . . . . .314

Pomerantz, J. M. . . . . . . . . . . . . .381

Pomp, H. C. . . . . . . . . . . . . . . . . . .91

Popkin, M. K. . . . . . . . . . . . . . . . .89

Post, L. . . . . . . . . . . . . . . . . . . . . .213

Potthoff, S. . . . . . . . . . . . . . . . . . .306

Price, W. . . . . . . . . . . . . . . . . . . . . . .3

Prosen, H. . . . . . . . . . . . . . . . . . .380

Puder-York, M. . . . . . . . . . . . . . . .232

Pumariega, A. J. . . . . . . . . . . . . . .342

Quaytman, M. . . . . . . . . . . . . . . .382

Rabin, L. . . . . . . . . . . . . . . . . . . . .58

Rachai, J. V. . . . . . . . . . . . . . . . . .356

Radcliffe, T. . . . . . . . . . . . . . . . . .245

Ransom, D. C. . . . . . . . . . . . . . . .18

Rawson, R. A. . . . . . . . . . . . . . . .361

Ray, C. . . . . . . . . . . . . . . . . . . . . .110

Reed, S. K. . . . . . . .76, 77, 84, 94, 95

Reidy, W. J. . . . . . . . . . . . . . . . . . .96

Reinhardt, B. . . . . . . . . . . . . . . . .402

Reisinger, C. W. . . . . . . . . . . . . . .290

Renz, E. A. . . . . . . . . . . . . . . . . . .362

Resnick, R. J. . . . . . . . . . . . .232, 378

Rich, J. P. . . . . . . . . . . . . . . . . . . .201

Richards, M. . . . . . . . . . . . . . . . .245

Richardson, L. M. . . . . . . . . .233, 234

Rickles, J. . . . . . . . . . . . . . . . . . . .230

Ries, R. . . . . . . . . . . . . . . . . . . . . .58

Rivera, M. . . . . . . . . . . . . . . . . . .256

Roberts, B. . . . . . . . . . . . . . .315, 316

Robinson, G. K. . . . . . . . . . . . . . .347

Rodriguez, A. R. . . . . . . .54, 317, 318

Roebuck, L. L. . . . . . . . . . . .337, 338

Rogers, W. H. . . . . . . . . . . . .330, 403

Rogerson, C. L. . . . . . . . . . . . . . . .55

Rohland, B. M. . . . . . . . . . . .280, 319

Rohrer, J. E. . . . . . . . . . . . . . . . . .319

Roman, S. . . . . . . . . . . . . . . . . . .357

Root, L. S. . . . . . . . . . . . . . . . . . .235

Rosenbaum, S. . . . . . . . . . . . . .56, 57

Rosenberg, S. . . . . . . . . . . . . . . . .172

Rosenheck, R. . . . . . . . . . . . . . . .119

Roth, D. . . . . . . . . . . . . . . . . . . . . .97

Rothbard, A. B. . . . . . . . . . . .98, 100,

101, 122, 268

Roy-Byrne, P. . . . . . . . . . . . . . . . . .58

Ruggie, M. . . . . . . . . . . . . . . . . . .120

Rupp, A. . . . . . . . . . . . . . . . . . . . .21

Russo, J. . . . . . . . . . . . . . . . . . . . . .58

Ryan, M. . . . . . . . . . . . . . . . . . . . .17

Sabin, J. E. . . . . . . . . . . . . . .236, 237

Salkever, D. S. . . . . . . . . . . . . . . . .23

Saltzman, G. M. . . . . . . . . . . . . . .352

Santiago, J. M. . . . . . . . . . . . . . . . .99

Sargent, S. C. . . . . . . . . . . . .121, 238

Savitz, S. A. . . . . . . . . . . . . . .59, 320

Sayama, M. . . . . . . . . . . . . . . . . .362

Scallet, L. J. . . . . . . . . . . . . . . . . .347

Scheffler, R. . . . . . . . . . . . . .173, 239

Scherer, M. . . . . . . . . . . . . . . . . . . .43

Scherl, D. J. . . . . . . . . . .75, 114, 121

Schiff, J. . . . . . . . . . . . . . . . . . . . .249
166 Special Report

Schinnar, A. P. .98, 100, 101, 122, 268

Schlesinger, H. J. . . . . . . . . . . .47, 132

Schlesinger, M. . . . . . . . . . . . .42, 102

Schmidt, G. L. . . . . . . . . . . . . . . .371

Schneider, R. J. . . . . . . . . . . . . . . .363

Schneider-Braus, K. . . . . . . . . . . . .174

Schoenbaum, M. . . . . . . . . . .321, 365

Scholle, S. H. . . . . . . . . . . . .322, 343

Schreter, C. A. . . . . . . . . . . . . . . .241

Schreter, R. K. . . . . . . . . . . . .240, 241

Schuster, J. . . . . . . . . . . . . . . . . . .242

Schwartz, B. J. . . . . . . . . . . . . . . . .60

Schwartz, R. A. . . . . . . . . . . . . . .251

Sederer, L. . . . . . . . . . . . . . . . . . .334

Sederer, L. I. . . . . . .61, 243, 244, 323

Semke, J. . . . . . . . . . . . . . . . . . . .281

Semlitz, L. . . . . . . . . . . . . . . . . . .344

Seymour, T. . . . . . . . . . . . . . . . . .314

Shadle, M. . . . . . . . . . . . . . .175, 176

Sharfstein, S. S. . . . . . . .62, 114, 135, 

231, 241, 382, 399

Shaw, K. . . . . . . . . . . . . . . . . . . . . .56

Shepard, D. S. . . . . . . . . . . . .256, 258

Shepherd, G. L. . . . . . . . . . . . . . .402

Sherman, P. S. . . . . . . . . . . . . . . . . .65

Sherman, W. O. . . . . . . . . . . . . . .208

Shields, J. . . . . . . . . . . . . . . . . . . . .73

Shin, P. . . . . . . . . . . . . . . . . . . . . . .56

Shueman, S. A. . . . . . .37, 63, 64, 324, 

325, 383

Shusterman, A. . . . . . . . . . . . . . . .326

Shwartz, M. . . . . . . . . . . . . . . . . .364

Siegel, D. . . . . . . . . . . . . . . . . . . . .69

Silver, K. . . . . . . . . . . . . . . . . . . . . .57

Simon, G. . . . . . . . . . . . . . . . . . . .180

Simon, G. E. . . . . . . . . . . . . . . . . .177

Simon, L. . . . . . . . . . . . . . . . . . . .340

Simon, L. J. . . . . . . . . . . . . . . . . .341

Simon, N. P. . . . . . . . . . . . . . . . . .202

Sing, M . . . . . . . . . . . . . . . . . . . .132

Singer, C. J. . . . . . . . . . . . . . . . . .398

Siris, S. . . . . . . . . . . . . . . . . . . . . . .24

Sledge, W. H. . . . . . . . . . . . . . . . .271

Smith, G. R. . . . . . . . . . . . . . . . . .327

Smith, J. . . . . . . . . .80, 247, 328, 331

Smith, M. E. . . . . . . . . . . . . . . . . .136

Smith, R. B. . . . . . . . . . . . . . . . . .395

Smukler, M. . . . . . . . . . . . . . . . . . .65

Snapp, M. B. . . . . . . . . . . . . . . . . .97

Snibbe, J. R. . . . . . . . . . . . . . . . . .245

Snowden, L. . . . . . . . . . . . . . . . . .260

Snowden, L. R. . . . . . . . . . . . . . . .349

Solnit, A. . . . . . . . . . . . . . . . . . . .342

Sotsky, S. M. . . . . . . . . . . . . . . . .379

Spellman, M. . . . . . . . . . . . . . . . .108

Spiro, A. H. . . . . . . . . . . . . . . . . . .66

Srebnik, D. S. . . . . . . . . . . . . . . . . .65

Sayama, M. . . . . . . . . . . . . . . . . .362

St. Clair, R. L. . . . . . . . . . . . .243, 323

Staton, D. . . . . . . . . . . . . . . . . . . .384

Stein, L. I. . . . . . . . . . . . . . . . . . .282

Stelovich, S. . . . . . . . . . . . . .178, 329

Stephens, S. . . . . . . . . . . . . . . . . . . .4

Sterman, P. . . . . . . . . . . . . . . . . . .137

Stoil, M. J. . . . . . . . . . . . . . . . . . .179

Stokes, L. Q. . . . . . . . . . . . . . . . . .66

Stone, A. A. . . . . . . . . . . . . . . . . .203

Stoner, T. . . . . . . . . . . . . . . . . . . .283

Stroul, B. A. . . . . . . . . . . . . . . . . .345

Stroup, T. S. . . . . . . . . . . . . . . . . .284

Sturm, R. . . . . . . . .67, 111, 246, 302,

321, 330, 335, 365, 403

Suarez, A. . . . . . . . . . . . . . . . . . . .301

Substance Abuse and 

Mental Health Services 

Administration . . . . . . .168, 103, 204
Annotated Bibliography 167

Sullivan, G. . . . . . . . . . . . . . . . . .111

Suti, E. . . . . . . . . . . . . . . . . . . . . .361

Sutphen-Mroz, J. . . . . . . . . . . . . .281

Takahashi, T. . . . . . . . . . . . . . . . .391

Taube, C. A. . . . . . . . . . . . . .116, 129

Teitelbaum, J. B. . . . . . . . . . . . . . . .56

Thakur, N. M. . . . . . . . . . . . . . . .272

Thompson, J. W. . . . . . . . . . .247, 331

Thurber, D. . . . . . . . . . . . . . . . . .342

Tiano, L. . . . . . . . . . . . . . . . . . . .184

Tischler, G. L. . . . . . . . .332, 404, 405

Trabin, T. . . . . . . . . . . . . . . . . . . .406

Trainor, P. E. . . . . . . . . . . . . . . . . .273

Travis, K. M. . . . . . . . . . . . . . . . .410

Travlik, K. . . . . . . . . . . . . . . . . . .230

Trout, S. C. . . . . . . . . . . . . . . . . . .46

Troy, W. G. . . . . . . .63, 64, 324, 325, 

383, 385

Uehara, E. S. . . . . . . . . . . . . . . . . .65

Unutzer, J. . . . . . . . . . . . . . .180, 332

Vaccaro, V. A. . . . . . . . . . . . . . . . .14

Valdez, R. B. . . . . . . . . . . . . . . . . .71

Van Gelder, D. W. . . . . . . . . . . . . .248

VandenBos, G. R. . . . . . . . .152, 153, 

154, 155

Vischi, T. . . . . . . . . . . . . . . . . . . .387

VonKorff, M. . . . . . . . . . . . . . . . .177

Wagman, J. B. . . . . . . . . . . . . . . .249

Wahl, R. . . . . . . . . . . . . . . . . . . . .398

Wainstock, E. J. . . . . . . . . . . . . . .181

Wanerman, L. . . . . . . . . . . . . . . . .407

Warner, R. . . . . . . . . . . . . . . . . . .104

Wehr, E . . . . . . . . . . . . . . . . . . . . .57

Weiner, R. B. . . . . . . . . . . . . . . . . .69

Weisberger, C. . . . . . . . . . . . . . . .245

Wells, K. B. . . . . . . . .70, 71, 72, 171, 

246, 330, 332, 403

Westcott, J. S. . . . . . . . . . . . . . . . . .86

Westermeyer, J. . . . . . . . . . . . . . . .333

Wetherbee, D. G. . . . . . . . . . . . . .401

Wetzler, S. . . . . . . . . . . . . . . . . . . .60

White, K. . . . . . . . . . . . . . . . . . . . .73

Whitehill, B. . . . . . . . . . . . . . . . . . .98

Whittington, H. G. . . . . . . . . . . . .250

Wholey, D. . . . . . . . . . . . . . .151, 182

Wickizer, T. M. . . . . . . .408, 409, 410

Wilson, C. V. . . . . . . . . . . . . . . . .366

Wineburgh, M. . . . . . . . . . . . . . . .205

Winegar, N. . . . . . . . . . . . . . . . . .386

Winthrop, K. . . . . . . . . . . . . . . . . .85

Wise, R. A. . . . . . . . . . . . . . . . . . . .74

Wolfe, H. L. . . . . . . . . . . . . . . . . . .75

Woocher, L. S. . . . . . . . . . . . . . . .308

Woods, D . . . . . . . . . . . . . . . . . . .364

Woodward, A. . . . . . . . . . . . . . . .367

Wyant, D. . . . . . . . . . . . . . . . . . .105

Yank, G. R. . . . . . . . . . . . . . . . . .285

Yip, W. . . . . . . . . . . . . . . . . . . . . .330

Young, A. S . . . . . . . . . . . . . . . . .111

Young, S. D. . . . . . . . . . . . . .340, 341

Zakheim, M. H. . . . . . . . . . . .56, 251

Zarin, D. A. . . . . . . . . . . . . . . . . .301

Zarkin, G. A. . . . . . . . . . . . . . . . .356

Zhang, W. . . . . . . . . . . . . . .321, 365

Zieman, G. L. . . . . . . . . . . . . . . . .106

Zimet, C. N. . . . . . . . . . . . . . . . . .252

Zimmer, D. . . . . . . . . . . . . . . . . . .393

Zwanziger, J. . . . . . . . . . . . . . . . .123

Zwick, W. R. . . . . . . . . . . . . . . . .368
XVIII.

Annotated Bibliography 169

Keyword

Index

Arizona...99

California...81, 88, 111, 219, 264

capitation...21, 76–106, 111, 135, 136, 159, 168–170, 199, 261, 268, 273, 278, 283,

292, 349, 403

carve-outs...3, 9, 16, 21, 26, 27, 41, 43, 67, 68, 126, 128, 130, 161, 166, 169, 182,

239, 254–256, 258, 266, 279, 283, 284, 294, 302, 304, 321, 335, 337, 340, 341,

351

case management...34, 66, 165, 249, 310, 311, 367, 388, 389, 401, 402

children...29, 46, 47, 143, 189, 258, 334–345, 375, 407

client satisfaction...305, 308, 314, 322

Colorado...41, 104

community providers...57, 104, 105, 107–111, 255, 277, 353, 354, 360

contracting...22, 29, 41, 43, 44, 56, 57, 68, 79, 106, 161, 198, 238, 251, 259, 260,

263, 265, 266, 280, 319, 342, 359

costs...2, 6, 35, 53, 67, 69, 73, 75, 95, 124, 127, 130–134, 137, 167, 170, 172, 217,

235, 242, 258, 266, 279, 283, 291, 293, 294, 301, 302, 304, 308, 321, 335, 351,

356, 390, 397

depression...30, 246, 301, 304, 322, 330, 351, 390

DRGs...112–123, 273

EAPs...3, 8, 75, 138–141

economics...21, 22, 28, 35, 67, 125–130, 157, 163, 177, 244, 250, 279, 396

elderly...346, 347

ethics...15, 61, 75, 184–186, 188–190, 192, 195, 196, 202, 204, 205, 209, 376, 378

ethnic groups...348–349

evaluation...8, 10, 77, 81, 84, 95, 97, 107, 134, 141, 246, 254–256, 258, 266, 279,

283, 284, 294, 308, 328, 332, 338, 340, 341, 356

Hawaii...133, 134

health care reform...20, 24, 25, 54, 150, 345

HMOs...17, 26, 33, 71, 75, 82, 83, 96, 107, 142–151, 154, 156–182, 218, 227, 236,

239, 245, 301, 346, 350, 371

information systems...55, 292, 306, 400, 406
integration...4, 13, 18, 39, 40, 45, 46, 85, 161, 181, 217, 338

involuntary commitment...199, 200

Iowa...280

liability...61, 183, 184, 190, 191, 193, 201, 203

legislation...4, 67, 203, 219

local governments...86, 87, 98, 100, 101, 111, 253, 264, 282

managed behavioral health care organizations...15, 16, 32, 43, 44, 57, 147, 166, 213,

239, 260, 407

Massachusetts...9, 41, 130, 254–256, 258, 265–267, 274, 279, 284, 294, 340, 341

Medicaid...9, 41, 56, 68, 82, 85–87, 89, 98, 100, 101, 104, 105, 107, 133, 134,

254–256, 258, 265, 266, 270, 278–280, 283, 284, 294,340–343

medical necessity...58

Minnesota...82, 83, 86, 278

models...20, 31, 39, 48–50, 60, 179, 210, 212, 217, 226, 230, 244, 262, 264, 276,

301, 316, 338, 355, 361, 368–370, 373, 375, 381, 388, 389

New Jersey...121

New York...76–78, 84, 94, 95, 108, 135, 168, 292

Ohio...46, 97

Oregon...85, 275

outcomes...42, 71, 73, 81, 84, 89, 95, 97, 104, 150, 196, 258, 267, 289, 290, 293,

299, 301, 308–310, 312, 315, 316, 327, 330, 334, 362, 364

overviews...5, 6, 15, 25, 26, 28, 35, 36, 40, 45, 51–53, 61, 64, 140, 144, 145, 151,

154, 160, 174, 175, 178, 189, 191, 193, 201, 215, 221, 232, 233, 257, 269, 271,

272, 318, 320, 323–325, 329, 339, 342, 345–347, 349, 352, 378, 386

parity...4, 24, 40, 59, 67, 131, 365

Pennsylvania...87, 98, 100, 101, 343

performance measurement...15, 17, 19, 196, 286, 290, 292, 293, 295, 296, 298, 302,

310, 311, 313, 314, 319, 327, 331, 332, 362, 364

PPOs...26, 70, 72, 75, 149, 165

prevention...11, 179

primary care...18, 39

private sector programs...1, 3, 8, 14, 19, 20, 23, 26, 32, 36, 51, 53

providers...5, 37, 48, 60, 72, 106, 187, 205, 206–252, 316, 372, 376, 379,381, 382,

384

psychotherapy...207, 212, 217, 226, 227, 301, 369, 373, 374, 376, 396

public sector...9, 29, 41, 44, 56, 68, 76–79, 81, 82–90, 94, 97, 98, 99, 101, 104, 105,

111, 130, 133–135, 168, 192, 197, 198, 251, 253–272, 274–285, 292, 294, 295,

308, 313, 340,3 43, 345, 347, 359

170 Special Report
quality assurance...2, 15, 34, 63, 286, 287, 290–292, 297, 303, 305, 307, 316–318,

320, 323, 324, 326, 329, 331, 333, 394, 398

Rhode Island...90

schizophrenia...104, 135

school-based health...336, 339

serious mental illness...12, 30, 40, 74, 76–78, 81, 83, 84, 86, 88–91, 93–95, 97, 98,

100–102, 104, 107, 111, 135, 136, 150, 159, 163, 164, 168–170, 173,178, 180,

267, 268, 270, 276, 279, 284, 285, 388, 399

staffing...50, 156, 218, 239, 368

standards of care...63, 65, 243, 357

substance abuse...4, 22, 29, 33, 44, 53, 56–57, 68, 79, 103, 123, 126, 137, 141, 160,

172, 251, 258, 259, 293, 298, 304, 321,336, 339, 344, 345, 353–368, 395, 396

technical assistance...29, 44, 57, 68, 79, 103, 106, 204, 225, 238, 251, 287, 359, 372,

386

training...5, 147, 237, 369, 371, 374, 379, 380, 385

trends...5, 6, 32, 33, 35, 36, 40, 62, 125, 140, 144–146, 156, 157, 172, 201, 215,

231, 240, 270, 312, 369, 383

Utah...9, 41, 82, 105, 261, 283

Vermont...313

Virginia...23

utilization...38, 70, 86, 104, 129, 132, 134, 167, 171, 172, 176, 177, 258, 267, 281,

283, 289, 293, 294, 298, 301, 302, 308, 309, 321, 330, 331, 335, 336, 341, 351,

395

utilization management...10, 34, 41, 61, 66, 165, 243, 288, 300, 303, 334, 387–410

Washington...264, 281

Wisconsin...282

women...350–352

Annotated Bibliography 171