The administrative control system of substance abuse managed care.

In substance abuse managed care, authorities use rules, standards, procedures, and financial incentives to control the nature and length of treatment (Mechanic, Schlesinger, and McAlpine 1995). Presently, slightly under 30 percent of provider treatment episodes are thus controlled (Horgan et al. 2001). Managed care may also now cover a majority of the substance abuse services that are offered in private health care plans (Fox, Graves, and Garris 1999). Much of the research on substance abuse managed care concerns one popular type of behavioral health (mental health and substance abuse) arrangement, the “carve-out” plan (Frank and McGuire 1997; Ma and McGuire 1998; Stein, Elaine, and Sturm 1999; Steenrod et al. 2001). This research finds that carve-outs are more restrictive than traditional insurance in some ways. They tend to reduce cost, all but eliminate inpatient services, but to differentially affect access to care, and the intensity of outpatient treatment. Other works consider the general tendency of substance abuse managed care to limit provider autonomy (Mechanic, Schlesinger, and McAlpine 1995; Schlesinger, Dorward, and Epstein. 1996; Alexander and Lemak 1997a; Beinecke 1998; Schwartz and Wetzler 1998). However, works do not yet clarify if, and how, managed care affects the outcomes of the outpatient providers who now dominate service provision. So far, the literature at the provider level finds limited and complex relations (only some variable ranges are predictive) between the extent of reliance on managed care and average client lengths of stay, service breadth, and client access (Lemak 1998; Durkin, 2002; Alexander, Nahra, and Wheeler 2003). This may suggest that the implementation of managed care only mildly affects outpatient care. However, another possibility is that there is much variation (Wolff and Schlesinger 1998); the effects of managed care on service delivery may depend on the types of controls that are used. Indeed, it is known that, in varying managed care plans, providers are allowed client stays that vary from less than 10 days to many months (Lemak 1998; Liu, Sturm, and Cuffel 2000). One somewhat pertinent work suggests that a few individual managed care rules and policies affect (usually negatively) provider perceptions of managed care (Alexander and Lemak 1997b). Another finds that some financial sanctions affect provider efficiency (Alexander et al. 1998). The most relevant investigation finds that only one measure of the controls (managed care stringency) affects the number of outpatient sessions that clients obtain in treatment, and to a limited degree (Lemak and Alexander 2001). However, all of these findings are preliminary. They stem from studies that use aggregate data, where outpatient providers' overall perceptions or service delivery patterns are related to summary measures of the controls used by all of the providers' managed care suppliers. Virtually all of the studies also either sample few of the control mechanisms used in managed care, or index the control mechanisms on nonempirical bases. More advanced methods may help to locate stronger and more subtle relationships between service delivery patterns and the controls. Accordingly, the current work relies on a data set that contains information on the individual relations between agency-based outpatient substance abuse providers and managed care suppliers. It uses these data to empirically determine the patterns of control. It also relates measures of control to key service delivery outcomes. The results help to describe the controls that are commonly used in substance abuse managed care, and to consider how various patterns of control affect provider services, and thus service delivery goals.