The Business Case for Behavioral Health

// By Howard Gershon, LFACHE //

With the shift toward value-based care and the assumption of risk, many health care organizations are beginning to understand that they must address behavioral health in conjunction with physical care for patients.

Behavioral health issues are in the news every day, whether it’s a national sports figure who has committed suicide, a new mother who has harmed her child as a result of postpartum depression, or a schizophrenic young adult who has gone off his meds and committed a crime. The following statistics from the National Council for Behavioral Health provide a look at how many people face a mental health or substance use challenge, whether we choose to see it or not:

• In the U.S., almost half of adults (46.4 percent) will experience a mental illness during their lifetime.
• Five percent of adults 18 or older experience a mental illness in any one year, equivalent to 43.8 million people.
• Of adults in the U.S. with any mental disorder in a one-year period, 14.4 percent have one disorder, 5.8 percent have two disorders, and 6 percent have three or more.
• Half of all mental disorders begin by age 14 and three-quarters by age 24.
• In the U.S., only 41 percent of the people who had a mental disorder in the past year received professional health care or other services.

It’s the last statistic that should raise a red flag for hospitals and health systems. The fact that there is such a significant unmet need is driven home in most communities when not-for-profit providers do their tri-annual Community Health Needs Assessment required by the Internal Revenue Service, which inevitably results in behavioral health issues being one of the top-three critical needs in almost every community in the United States.

So why is it that our nation’s hospitals and health systems have not solved this problem? Historically, many organizations have avoided addressing behavioral issues for reasons that include safety and security concerns, physician coverage challenges, poor financial performance, and more.

But with the shift toward value-based care and the assumption of risk, many organizations are beginning to understand that they can no longer avoid addressing this need.

Strained Resources

The lack of behavioral health services has simply exacerbated safety and security concerns as providers with employees lacking adequate behavioral health training attempt to deal with patients who wind up in emergency departments or as primary medical or surgical inpatients.

Various studies indicate that 12 to 15 percent of all emergency department patients have a primary behavioral health issue and 30 to 40 percent of all medical/surgical admissions have a primary or secondary behavioral health issue, regardless of whether the organization offers any dedicated behavioral health services.

While physician coverage issues remain a significant challenge — with several physician search firms reporting psychiatrist searches as one of their most frequent assignments — the spread of tele-psychiatry has helped take some of the pressure off coverage issues. An increase in the number of psychiatric nurse practitioners and physician assistants has also helped to address this issue.

Behavioral Health Services Reduce Utilization, Produce Savings

But the biggest breakthrough relates to the financial contribution of behavioral health services. No, it’s not that reimbursement for these services has suddenly become attractive — it’s the savings that can accrue to providers that are operating under risk-based or value-based arrangements.

These savings are commonly referred to as medical cost offset. The medical cost offset effect occurs because, when medical/surgical patients with behavioral health comorbidities receive therapy, they tend to reduce their utilization of all forms of medical care, and despite the cost of specialized behavioral health staff, money is saved overall.

Proactive Approaches

So instead of boarding mental health patients in the emergency department while waiting for disposition, why not invest in developing alternative treatment settings such as a behavioral health observation unit or a crisis center? That way, patients actually get treatment initiated earlier, you get reimbursed for the service provided, and you decompress the emergency department so that other patients can be seen more efficiently. (By the way, it’s a pretty well-known fact that as emergency departments struggle to accommodate boarded patients, the percentage of patients who leave without being seen goes up.)

Similarly, given that 30 to 40 percent of medical/surgical inpatients have behavioral health comorbidities, why not implement a program that screens patients and provides behavioral health consultations on a proactive basis? Reimbursement for the consultations may not cover the program’s cost, but studies show that such programs can reduce length of stay and also have a positive impact on readmission rates.

Think about embedding behavioral health providers in primary care practices since so many of these patients also have behavioral health issues. Patients are better served, services are often reimbursable, and primary care provider productivity and job satisfaction are both enhanced.

These ideas are not new and have long been embraced by integrated health care delivery and financing systems like Intermountain Healthcare and Kaiser Permanente. Just think, as more and more systems engage in risk arrangements where investments in behavioral health services can yield measurable returns, they can also begin to improve the health status of the communities they serve.

Summary of Recommendations

• Invest in developing alternative treatment settings such as a behavioral health observation unit or a crisis center.
• Implement a program that screens patients and provides behavioral health consultations on a proactive basis.
• Embed behavioral health providers in primary care practices since so many of these patients also have behavioral health issues.

Howard Gershon is a founding principal of New Heights Group in Santa Fe, New Mexico, a management consultancy. He has spent more than 35 years working with boards and senior managers on strategic planning, market research, organization, facility, and program/service development initiatives. He serves on the Editorial Advisory Board of Strategic Health Care Marketing.