OPE Evaluated the Optum Medicaid Behavioral Health Contract, but Not the Outcomes for People with Mental Illness

Idaho’s Office of Performance Evaluation (OPE) just released its report on the Idaho Medicaid managed care contract with Optum Idaho, the Idaho Behavioral Health Plan. (to view full report click here). The report examines some important issues and makes some worthwhile points, but it completely fails to answer the questions that are most important to Idahoans with mental illness and their families. We were hoping that the report would focus on access to treatment and impact on the lives of Idahoans with mental illness, but these outcomes were not addressed. However, if you read carefully, the report contains some serious findings which deserve everyone’s attention.

Optum Radically Reduced Psychiatric Rehabilitation

The most salient finding of the report is the reduction in Psychiatric Rehabilitation (called Community Based Rehabilitation Services or CBRS by Optum, and very similar to Psycho-social Rehabilitation or PSR). For more information on Psychiatric Rehabilitation in Idaho, see previous articles on this site. (For 1st article click here. For 2nd article click here). The summary of the OPE report features a graph of expenditures on PSR/CBRS trending steeply upward until the Optum contract is implemented when the trend is abruptly reversed. Optum has cut community mental health services overall by about $28,000,000 per year in spite of increases totaling about $1,000,000/year in family counseling and psychotherapy. Almost all of this reduction was in CBRS.

What Happens to the “Savings”?

Under the terms of the contract, Optum is allowed to keep the first 15% of total reductions in expenditures as an “administrative” fee. This creates a potent incentive for Optum to cut services without realizing any savings to the State of Idaho or the taxpayers. If Optum cuts services beyond the 15%, federal rules require them to reinvest the savings in additional Medicaid services. So far, there has been very little reinvestment of the annualized $28,000,000 in savings. At this point, no one has benefitted from the CBRS reductions except Optum. There has been no savings for the state, few service improvements for Medicaid recipients, big losses for providers, and a lot of mental health crises for people with mental illness. To be fair, some improvements are in the works. Peer Supports and Family Supports (evidence based practices using people in recovery and parents of children with mental illness) are becoming available in some areas. They are still far from full implementation, and not able to fill the void created by the CBRS cuts. Other enhancements to the service array, like partial hospitalization, Medicaid covered Assertive Community Treatment (ACT teams), or intensive home based services for children, are not even on the horizon. From the participant’s perspective, the greatest failure of the contract is the intense emphasis on immediately reducing CBRS without even having a plan for replacing it with other community services. The report claims that “Investment of savings has proved more difficult than the department originally anticipated because of the restrictive nature of federal regulations.” It does not elaborate on what federal regulations have prevented the Department or Optum from developing Medicaid approved services like those mentioned above.

The Report Says Nothing About the Effect of the Plan on People with Mental Illness

OPE evaluators report at length on the effect of this reduction on providers (and the Department’s failures in communication and planning for this effect), but nothing is said about the outcomes for participants’ mental health. At page 15, the report says “We cannot comment on the appropriateness of Optum’s criteria for clinical review…” From our perspective, this is the biggest issue with the OPE report. Idaho Medicaid covers treatment for mental health and substance use disorders, in order to prevent the suffering and death they cause and the huge social costs associated with these illnesses. The point of “Managed Care” is to increase effective treatments and practices which improve health outcomes. The Idaho Behavioral Health Plan is sadly deficient in measuring the mental health outcomes for participants. Reducing payments for CBRS is only beneficial if the mental health needs of Idahoans are still met, and the devastating consequences of mental illness are avoided at least as much as they were before. There is a lot of piecemeal and anecdotal evidence suggesting that the reduction of CBRS, without introducing replacement services, has had terrible results for people with mental illness and their families and has created greater burdens on counties, hospitals, law enforcement, jails and juvenile justice systems. However, there is no comprehensive source of reliable data to measure the relationship between the Behavioral Health Plan and these outcomes.

What is the Goal of the Behavioral Health Plan?

It would appear from the report that the Department’s primary goal for the Optum contract was to reduce the amount of CBRS paid for by Medicaid. “Overreliance on or misuse of psychosocial rehabilitation (PSR) was a major concern of the department and a strong influence on the department’s decision to incorporate managed care into its behavioral health system.” (Report, p. 6). It was apparently more important to them than reducing hospitalization. “The department explained that the primary reason it excluded inpatient services was because it worried that managed care contractors might choose the standard approach of focusing on the hospital [inpatient services] rather than on the issues with PSR.” This single minded focus on cutting CBRS led to a contract that did not emphasize good mental health outcomes, or effective preventive and community based services, or even prevention of hospitalization. In fact, the report suggests that two years into the three year contract, neither the Department nor the contractor knows how to incorporate more effective services to replace the lost CBRS. “The Governor’s work group envisioned 20 services that would comprise the core of its continuum of care—to be available to anyone who needs it regardless of their geographic location or enrollment in Medicaid. Only 9 of the 20 services were part of the state’s Medicaid plan.” (Report, p. 33) But they are only now developing a plan to achieve this. “The Department and Optum are working together to create a plan to spend savings within the limitations of federal regulations,” (Report p. 37).

Meanwhile the Department Has Not Measured The Effect on Participants’ Mental Health.

The Department acknowledges that one reason that PSR/CBRS was heavily used was that it was often the only tool in the tool box. With only nine of twenty recommended services covered by Medicaid, people used PSR as a substitute for unavailable services. A person who needed ACT, or Partial Hospitalization, intensive in-home services, or even community supports, often had to make do with PSR/CBRS. It is no surprise that, cutting off PSR/CBRS before more appropriate services are available, is causing increased mental health crises and all of the suffering and expense that entails. However, it seems that neither the Department nor Optum is tasked with monitoring the actual mental well being of the participants. No one is keeping track of the actual results of the plan in terms of mental health outcomes for people. The tools for tracking mental health outcomes have been available all along. This is not even a new idea. In 1998 the American Academy of Child and Adolescent Psychiatry (AACAP) published a Guide for tracking outcomes in Medicaid managed care contracts (to view the full guide click here) Here is one of several sets of measurable indicators recommended by AACAP:

Performance Category EFFECTIVENESS

Domain Functional Status — Quality Indicator
* Percentage of children per year placed outside the home due to emotional or behavioral problems.
• Number of days per year spent in hospital or residential settings as a ratio over days in all services.
• Number of arrests/legal referrals per year in population compared with community rates.
• Number of children in restrictive school settings (including in-home tutoring) due to emotional or behavioral problems.
• Improvement of impairment scores for a sample of patients in the program population (See Appendix B for examples of currently available instruments).
• Number of days of school attended per year.
• Rates of graduation from middle and high school.
• Number of suicides and attempts per year compared with national and regional prevalence rates.
• Number of days in detention/incarceration per year.
• Number of child abuse reports and infanticides.
• Number of youth homicides.
• Number of teen pregnancies.

Clinical Symptoms
• Decrease in symptom level for a sample of patients in the population.

It isn’t hard to come up with an equivalent list of outcomes for adults such as substituting evictions and homelessness for “out of home” placements, and adding employment or job loss instead of school outcomes. You can’t manage what you don’t measure.

Currently, Optum is required to measure very little other than money spent on claims, number of grievances and appeals, and some provider satisfaction surveys. The Department relies almost entirely on Medicaid claims data to evaluate the system. The OPE report acknowledges that they did not have adequate data to measure whether costs were shifted to agencies other than the Department. “We did not complete a comprehensive investigation of every place a member could go if they were denied services under the Idaho Behavioral Health Plan and subsequently experienced a mental health crisis. However, we examined data provided by the Division of Medicaid and the Division of Behavioral Health which did not show unexplained increases above historical trends” (p. 32). In other words they did not look at arrests, jails, juvenile detentions, runaways, suicides, expulsions, evictions, job loss, out of home placements, symptom increases, etc. Optum does not collect this information, and neither does the Department.

Psychiatric Rehabilitation is an Important Component of a Mental Health Program

The report does not question the department’s assumption that PSR/CBRS is overused. Although it has sometimes been used as a substitute for other more appropriate services which are not available in Idaho, it is also often the right service for the person in question. Optum has reduced CBRS for children so drastically that is well on its way to eliminating the service. This policy ignores the treatment authority on which Optum relies for its clinical decisions, the AACAP. Since 1996 the AACAP has had standards for developing managed care contracts. For children with high level needs they conclude: “Criteria for access to the “high utilizer” track should be well-defined and based at least on functional impairment as influenced by support systems and risk factors. Such criteria should be independent of assigned diagnosis… Rehabilitative services are an integral component of this track, maximizing utilization of available educational and vocational services offered through public agencies, as well as other supplements dictated by the child’s and family’s needs. Such services should address practical daily living, employment, and social skills” (emphasis added). (To see the AACAP Managed Care Principles click here). Rather than trying to eliminate CBRS for children, the AACAP, evidence based guidelines suggest that all children with more severe conditions should have access to rehabilitative services. CBRS for adults is also included in American Psychiatric Association Guidelines.


The OPE Report has valuable information, and it highlights serious mistakes in planning, and preparation. However, the report does not even consider whether the contract served people with serious mental illness well, or whether it has started an ongoing crisis in mental health. When it is read carefully, the report reveals that the department was so focused on cutting PSR/CBRS that they failed to plan for the services needed to replace it. So now we are sitting on money for services but we are not providing the services, and we are paying for it with people’s mental health and possibly with their lives.

2 thoughts on “OPE Evaluated the Optum Medicaid Behavioral Health Contract, but Not the Outcomes for People with Mental Illness

  1. Linda,
    As a CBRS specialist, I can attest to your spot-on depiction of the reality that Optum measures success of their program through family satisfaction surveys. These surveys are often overused and my clients do not see the value in taking time to submit but when they do, 99% of my clients report all 5’s-the highest level of satisfaction on each question in order to do them quickly and get on with the real support and guidance that which they need. In other words, virtually none of my clients take these surveys seriously. So, in addition to this program sitting on “savings” and sacrificing Idaho’s quality of mental health care, the program will likely not advance or make corrections if this is how they choose to measure quality.
    Thank you, Linda for knowing your research well, and reporting it in a honest way!

  2. I was a CBRS provider in Kootenai County. I have seen the damage this has caused for the individuals that suffer from mental illness. The people that suffer from mental illness do not have the skills, resources, or finances to stand up for their rights. I am pleased to say that I have started a group called the “Empowerment Group”, this is a group that supports self advocacy and helps to give this population the tools and the education on how to voice their opinion and how to exercise their rights. We had 21 clients write letters stating how they have been impacted by the cuts that were made to their CBRS services. Some have written letters as a way to prevent their CBRS services from being stopped. This is very disheartening, and I believe that their rights to services have been violated. Some of the clients have had the courage to stand up for what they believe in and I am proud of them. There are still more people needed in order to make a difference.The group is open to the public and is located at the Recovery Center on Ironwood Drive in Coeur d’ Alene, Idaho. I am hoping to get more people to join the group so these cut backs are taken seriously.

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