SAMHSA Reauthorization, Medicaid, Medicare Present Challenges, Opportunities for Advocates

SAMHSA Reauthorization, Medicaid, Medicare Present Challenges, Opportunities for Advocates

by Colleen Fitzpatrick

Mental Health Weekly's Executive Forecast: Strategic Analysis of 2005 Trends January 3, 2005

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The new year is always a time for thinking in broad strokes; with this month's seating of the 109th Congress and the second inauguration of President George W. Bush, the sight range of mental health and addiction advocates extends well beyond the coming year.

Advocates acknowledge that with Republicans in control of the government's legislative and executive branches, they have their work cut out for them in the next four years. High on the mental health agenda is implementing the 18-month-old recommendations of the President's New Freedom Commission on Mental Health to transform the nation's mental health system from a fragmented, outdated effort to a comprehensive, recovery-oriented system of care that emphasizes prevention and early intervention. Some advocates say it makes sense to try to link aspects of this transformation to the reauthorization of the federal Substance Abuse and Mental Health Services Administration (SAMHSA).

Advocates also are keenly alert to likely changes to the Medicaid program, though the vehicle for and timing of those changes are unclear. They also will rigorously monitor, and challenge, where necessary, the implementation of Medicare reforms that were the centerpiece of Bush's domestic agenda during his first term. Funding, of course, remains

an issue with mental health and addiction advocates as the war in Iraq and national defense concerns continue to claim center stage and as the federal deficit climbs.

Transforming the mental health system

To help translate into action the mental health commission's six goals for transforming the system and to define what the new system will look like, 16 mental health advocacy, policy and professional organizations came together in 2003 as the Campaign for Mental Health Reform.

Bill Emmet, campaign coordinator, says the group expects to issue a 'call to action' before Bush's inauguration January 20. The document was to be prepared regardless of who prevailed in last fall's elections. But given the Republican victories, 'we definitely want to put down recommendations in terms that will resonate with federal lawmakers' need to promote self-sufficiency,' he says.

The report, not completed as of press time, will 'identify a clear federal role in the transformation process,' he continues.

While state legislatures and mental health providers will be at the vanguard of the changes, federal leadership is essential. 'It's not going to happen the way it should happen if there is not strong federal leadership,' says Emmet, who serves as project director with the National Association of State Mental Health Program Directors (NASMHPD).

Overall, the call to action will represent the consensus of the campaign, and will target several audiences, including members of Congress and their staffs, and grassroots advocates, Emmet says.

One component surely will be the federal-state Medicaid program. 'Medicaid is the most important funding program for mental health services, yet it's not administered with sensitivity to that fact,' Emmet says. The call to action may urge that the federal Centers for Medicare & Medicaid (CMS) and the state Medicaid agencies better integrate planning and informationsharing.

More program flexibility is needed, as are pay reimbursement policies that are based on a realistic appraisal of need provided by mental health agencies so they are not left 'begging for bits and pieces from Medicaid,' Emmet says.

The extent to which the document would address stand-alone legislation, such as mental health parity, the Family Opportunity Act (FOA), the Keeping Families Together Act and reauthorization of Temporary Assistance to Needy Families (TANF), was uncertain.

Also uncertain is the extent to which the Bush administration will back the campaign's agenda. But advocates were thrilled last year when Bush and the Senate Appropriations Committee both requested $44 million for the new State Incentive Grants for Transformation (SIG) program. The money is to be awarded through competitive grants to 14 states to work across agencies and systems as they develop new mental health systems according to the New Freedom commission's goals.

'The blueprint (for action) is the White House mental health commission report,' says Andrew Sperling, director of federal legislation with the National Alliance for the Mentally Ill (NAMI). 'We believe the administration is committed to the report. They say they are and we look forward to working with them on it.'

While most folks consider a 'top-down approach' to transformation, one group also will argue strongly for a 'bottom-up approach.' Linda Rosenberg, chief executive officer of the National Council for Community Behavioral Healthcare (NCCBH), says, 'In order to really transform the system, you have to energize the people on the ground,' while also supporting the field's more centralized goals.

This means enabling individual providers to use their own measures and data when looking at treatment outcomes and to change their practices to get better outcomes, Rosenberg says. Much of the data collection is being done at the state level, and while that may be good for policy-making, it does not translate quickly into practice, she says.

She cites the flexibility and progress made in this area, especially in primary care, with assistance from the Health Resources and Services Administration (HRSA). The federal agency has encouraged policies that enable federally funded health clinics to also offer mental health services under the same roof. It's time to extend a similarly flexible approach to mental health, she says, so that in some mental health settings, physical health services also are provided.

Medicaid

Bush has identified social security and tax reform as priorities for his second term. But with Medicaid, the 'Pac-Man' of government budgets chomping through increasingly tight federal and state resources, advocates well know that the federal-state health insurance program that serves 50 million poor and disabled people won't escape scrutiny.

'With Congress facing a huge budget deficit, the most formidable of the challenges will very likely be an effort to target Medicaid for major budget savings very early this year,' declares Ralph Ibson, J.D., vice president of government affairs with the National Mental Health Association (NMHA). 'Enactment of some kind of Medicaid restructuring, such as block-granting, is a very real threat that would have profound, devastating implications for people with mental illness who depend on that vital safety-net program. Defeating such an effort will be a top NMHA priority,' Ibson says.

As Michael F. Hogan, Ph.D., director of the Ohio Department of Mental Health who also served as chairman of the New Freedom Commission, explains: 'Medicaid is the single biggest payor for mental health care in the U.S., if you include the state component.' It generally pays for core, fundamental services for people with mental illnesses, including community-based treatment, rehabilitation care, case management and medications, depending on a state's program design. Yet 'as important as Medicaid is for mental health care, mental health is small potatoes in Medicaid,' Hogan says.

'The danger is the Medicaid elephant rolling over and squashing mental health.' Laurel Stine, director of federal relations with the Judge David L. Bazelon Center for Mental Health Law, notes that the Bush administration initiated Medicaid-reform overtures during his first term, but was unable to reach a compromise with the powerful National Governors Association.

Meanwhile, states like Tennessee, Mississippi and Oregon have been dropping the least needy from their rolls, enacting more stringent eligibility requirements or scaling back services, or are considering such actions. Utah, under the direction of Gov. Mike Leavitt three years ago, extended Medicaid coverage to 25,000 uninsured residents at no extra cost to taxpayers by cutting dental, vision and mental health benefits. Leavitt is Bush's second-term nominee to replace Tommy Thompson as the secretary of the U.S. Department of Health and Human Services (HHS).

Stine and Sperling say it's possible that Congress will take up Medicaid in the coming four years.

'It's something to be mindful of, especially given the budget climate and state pressures,' Stine says.

Even in the absence of a freestanding Medicaid bill, Sperling says, the administration has the tools to effect major system reform. It can control Medicaid's growth by getting states to impose spending caps in exchange for federal government permission for more flexibility in determining how programs are designed and money spent. The federal government can do this through auditing or waiver processes, or simply through political leverage, Sperling observes.

The implications of imposing cost-controls are enormous, he says, 'because in a capped program the states naturally will gravitate toward [cutting] optional services. And what's the crux of mental health services? The optional ones.'

Advocacy chapters in the states are gearing up for taking firm stances with lawmakers and regulators on Medicaid, Sperling adds.

In light of the budget problems, Hogan is bracing for a fundamental Medicaid reform effort that 'will introduce some elements of cost control for the federal government and the states.' He stressed that he has no inside knowledge that this will happen.

Although sweeping Medicaid reform could pose 'very serious threats for mental health care,' it could offer opportunities, as well, Hogan says. Some core aspects of Medicaid's design are problematic for mental health care. One is arbitrary income-eligibility requirements 'that don't relate to the need for mental health care,' he says. And Medicaid's various payment methods, whether fee for service or through managed care 'are hard to reconcile with a community-based approach' to service delivery.

'Flexibility and eligibility are just two places where there could be wins for mental health care,' Hogan says.

He urges mental health advocates and officials to begin preparations on the Medicaid front. 'It's not yet a very high profile activity,' Hogan says, but 'I would not be surprised to see a proposal by the administration within the next two years.'

Medicare

For NAMI's Sperling, the implementation of Bush's signature health care act in his first term, the Medicare Modernization Act, overshadows all other issues. The regulations governing private insurers' roles in the $400 billion prescription drug benefit to seniors and some disabled people are to take effect in January, 2006. 'It's got to go well and if it doesn't go well,' it will be a disaster, Sperling says. 'We've waited 40 years for the drug benefit. It's got to work.'

Mainly at issue is the treatment of people who qualify for both Medicare and Medicaid. Called 'dual eligibles,' these beneficiaries are estimated to number about 6.4 million and include mostly people with mental health conditions and other disabilities. Currently, only Medicaid carries a prescription drug benefit for them.

Dually eligible beneficiaries will see their drug coverage shift over 10 years from Medicaid to Medicare. This shift has prompted a host of concerns on the part of mental health advocates, who will be closely watching the regulations as they are implemented. Among their concerns: Will prescription drug plans and the private-sector delivery model actually work? Will the models be truly competitive, with sufficient depth? Will drug formularies be unrestricted, with people with mental disorders able access a wide array of drug categories and classes? Will health coverage be affordable and accessible? Can people enroll in a plan of their choosing?

Progress on the Medicare front also holds deep implications for state finances, as the federal government takes back the savings that would accrue to state Medicaid savings as a result of the shift. This 'Medicaid clawback' starts at the end of 2006, after the new Medicare law has been in effect for about a year.

NAMI, NMHA and other groups have voiced concerns over some of the implementation plans and their effect on people

with mental illness. The NMHA's Ibson lists some of the concerns:

o 'The most vulnerable beneficiaries are those dually eligible for Medicare and Medicaid based on disability and low income, face reduced coverage since an inferior Medicare benefit replaces the drug coverage they now receive under Medicaid;

o 'Rather than ensuring that health plans will provide patients the drugs they and their physicians decide are best for them, cost-considerations will override physician judgment;

o 'Patients who choose to fight an insurer's refusal to cover needed medications will confront an overwhelmingly complex, lengthy appeals process;

o 'Any misstep during the appeals process could leave a frustrated beneficiary without further drug coverage if the insurer perceives his or her behavior as 'uncooperative'.'

Hogan says he suspects it's possible that CMS may push back the implementation date for dually eligible beneficiaries until the ramifications are more thoroughly considered.

This 'Mental Health E-News' posting is a service of the New York Ass'n of Psychiatric Rehabilitation Services, a statewide coalition of people who use and/or provide community mental health services dedicated to improving services and social conditions for people with psychiatric disabilities by promoting their recovery, rehabilitation and rights. To join our list, please click on the E-News Subscription button.

Last Updated on 01/03/05 webmaster@namiscc.org

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