Thousands received addiction treatment once Medicaid paid for it. Could that happen for mental health?

When James Murdoch Sr., was living in Maryland, his family didn’t have trouble accessing care for their young son, who was diagnosed with autism when he was two.

“Say you open one door, six more open after that,” Murdoch, now a Tappahannock resident, said of Maryland. “Whereas, in Virginia, it was the total opposite. Nobody would tell us anything.”

In Virginia, it took two years to secure a Medicaid waiver for his son, who was later diagnosed with schizoaffective disorder, which the National Alliance on Mental Illness describes as a mental illness “characterized primarily by symptoms of schizophrenia, such as hallucinations or delusions, and symptoms of a mood disorder, such as mania and depression.”

“In order to get the services, my son had to be hospitalized,” said Murdoch, who is a member of the state’s newly-created Medicaid Member Advisory Committee. “If I hadn’t gone that route, I wouldn’t be able to get what I needed for him, because they said I made too much, but there’s no way I could afford the services.”

Murdoch’s story isn’t unique. Advocates tell similar tales when appealing to lawmakers to change the state’s behavioral health system from one with a distinct focus on crisis care to a system in which people can get the treatment they need before the crisis ever occurs.

Right now, Virginia is in the midst of a massive transformation of the behavioral health system so it provides ample access to outpatient and preventative care.

The Department of Medical Assistance Services and the Department of Behavioral Health and Developmental Services are working on changing Virginia’s Medicaid program so it covers a continuum of behavioral health services.

The Medicaid changes will create a funding stream so clinicians can be reimbursed and patients can have more consistent access. The hope is that by making more services eligible for Medicaid coverage, more providers will emerge to meet the demand, a model that has proven successful in addiction treatment in Virginia.

“I like to think of it like this: You get what you pay for,” Dr. Hughes Melton, the state behavioral health commissioner, told a panel of lawmakers in early April. “And the reality is that Medicaid pays for … a behavioral delivery system that we wanted in the ’80s and the ’90s.”

The goal of the redesign effort is to pivot the system away from an over-reliance on intensive treatment services and to instead fund outpatient and community-based services, said Dr. Alyssa Ward, behavioral health clinical director with the Department of Medical Assistance Services.

The two departments have been working since October to come up with a plan to redesign the system and they hope to roll out the first phase of services by the summer of 2020. That will include functional family therapy, partial hospitalization and intensive outpatient programs, among others. After that, additional services will be phased in over time, like school-based behavioral health, family programs and case management.

Medicaid did something similar in 2017 for those with substance use disorders. Its Addiction and Recovery Treatment Services program expanded access to addiction treatment for thousands of Virginians. After its implementation, there was a 69 percent increase in Medicaid members receiving substance use disorder treatment, and a 25 percent decrease in total emergency department visits related to an opioid use disorder.

“The difference lies in the fact that behavioral health, which really is the global term around mental health and substance use, is a much larger picture than just substance use services,” Ward said. “What we’re really looking to do is make some really significant changes to the structure of the Medicaid-funded behavioral health system in order to drastically improve access to care.”

The need

It is an ambitious effort. As of 2017, an estimated 28 percent of Virginia’s Medicaid population had a behavioral health diagnosis, according to the state. That equates to more than 386,000 people with challenges ranging from anxiety and depression to bipolar disorder or schizophrenia.

There may be even more need within the Medicaid expansion population. Virginia anticipates that up to half of those enrollees will have a behavioral health or substance-use diagnosis, which could add as many as 200,000 people.

But for that roughly half a million people in need of treatment, access is far from consistent. Medicaid coverage is filled with gaps. For example, it will reimburse inpatient hospitalization, but not intensive outpatient or partial hospitalization, which allows someone to receive treatment during the day but not stay overnight.

Without access to consistent treatment — or a financial incentive for providers to offer it in the first place — the overall behavioral health system has similarly tilted toward a crisis-driven approach, in which state hospitals are dangerously crowded with patients and a patchwork array of community services are available in different parts of the state.

The Virginia Hospital and Healthcare Association recommended creating a Medicaid benefit to pay for partial hospitalization and intensive outpatient treatment, both of which will help reduce inpatient admissions.

As state hospitals have seen a huge increase in the number of involuntarily detained patients, private hospitals have also seen an increase in voluntary patients seeking care. Collectively, the hospitals are adding 159 new psychiatric beds across the state by 2022 to help address the need.

“Our system is overly focused on crisis care,” said Rhonda Thissen, executive director of the National Alliance on Mental Illness of Virginia. “If we can enhance community-based mental health services that reduce the need for crisis treatment, then this problem will ameliorate, and that’s the whole goal of behavioral health redesign.”

A statewide effort

The Department of Medical Assistance Services is not alone in trying to right-size Virginia’s behavioral health system and focus on prevention.

The state’s System Transformation Excellence and Performance, or STEP-VA, is currently working to ensure that people in every region in the state have access to the same services through their local community services board, or CSB.

In social services, the state is preparing to implement the Families First Prevention Services Act, which will, for the first time, allow local departments to be reimbursed for preventative, rather than reactive, services.

But providing a Medicaid benefit, Ward said, will bolster and help sustain all those efforts.

“There’s been quite significant development and progress over the past couple of years around strengthening and building out the behavioral health system,” said Mira Signer, chief deputy commissioner of the Department of Behavioral Health and Developmental Services.

“That’s sort of one reason why redesign is so essential: It supports the long-term sustainability of STEP-VA and is a key component of helping them move the system further along.”

Right now, the Department of Medical Assistance Services is working on a rate study to determine how much it will cost the state to expand Medicaid coverage.

“The rate study is this fiscal impact analysis that projects the path forward,” Ward said. “It’s why it’s a phased design, so we can do this incrementally and understand in the first wave the cost impact.”

But the ultimate hope is that the savings the state will see from fewer people using intensive services, like trips to the emergency room or psychiatric hospitalizations, will offset the cost.

DMAS is due to submit reports to the General Assembly outlining the projected costs by October and December.

But for people like Murdoch, the cost is less significant than what standardized access across the state will mean to people dealing with behavioral challenges.

“You shouldn’t have to go find it. You should be told where to get it,” he said. “People should not have to struggle.”