News Release
August 14, 1996

Mental Health Managed Care Report Documents
Quality Care, Coordination, Efficiency

Managed care in Michigan's Medicaid-funded mental health services produces quality care, coordination of services, and economic efficiency, according to a report released today. The document is the first quarterly report from the program, covering October through December of 1995. Managed care for Medicaid-funded mental health care began last August. It uses Michigan's statewide network of Community Mental Health (CMH) programs as gatekeepers for Medicaid-funded inpatient psychiatric care for approximately 850,000 Medicaid recipients. Previously, CMH oversaw admissions to state-operated hospitals only.

"This expanded managed care for mental health has worked better than our expectations," said James K. Haveman, Jr., Director of the Michigan Department of Community Health (DCH). "I am particularly pleased to see that consumer and family satisfaction with CMH services was 88%. This means that quality services are responsive to their needs, which is one of the most important measurements we can have."

Care coordination made a significant impact in providing appropriate services while reducing the use of inpatient hospitalization in local psychiatric hospitals and units. Under managed care, community inpatient admissions dropped to a rate of 1.51 per month per thousand Medicaid recipients. The rate is 30% lower than the benchmark rate of 2.17 in fiscal year 1994-95. The rate of inpatient days used per month per thousand recipients also declined, dropping to 14.3 from the baseline of 24.7.

Expenditures were lower than expected as a result of the increased coordination, which includes referring people to more appropriate care settings that are also more economically efficient. Actual expenditures were $19.5 million, 31% below the $28.4 million target. "We will use the dollars saved through managed care to provide more appropriate community-based services to more Michigan residents who need mental health care," Haveman said.

An estimated 188,000 Michigan residents will receive public mental health services this year. Mental health care is provided by CMH programs statewide under contract with DCH.