Although states that have developed or are developing programs of Medicaid managed mental health care often claim to be targeting severely and persistently mentally ill patients, in fact they have disrupted several significant elements of effective care. Since its beginnings, community psychiatry has demonstrated the necessity and efficacy of applying certain principles to meet the needs of this population. They include continuity of care, integration of treatment elements, integration of treatment with social and economic interventions, and provision of effective case management to facilitate continuity and integration of services.

Has managed care found a way to follow these principles to meet the needs of seriously and persistently mentally ill patients? In the main, no. Capitated rates are too low to cover these needs. Continuity is impossible if, for instance, companies seek less expensive outpatient services for a patient and then, when hospitalization is required, refer the patient to a less expensive hospital unrelated to the outpatient program. Cost overrides continuity. Case management to bridge such gaps is alien to most companies bidding on Medicaid mental health contracts. Long-term rehabilitation, even if a benefit under the contract, is rarely approved. Companies consider it a nonmedical or unproven intervention. If rehabilitation is approved, the time allowed is rarely consonant with the literature, which shows that up to 18 months may be required to achieve results.

Managed care companies also do not appreciate the need to incorporate economic and social interventions, such as access to entitlement programs and housing, with psychiatric care. They consider such needs nonmedical, no matter what they agreed to in order to win a contract. Some states have tried to retain control over elements of care targeted to seriously mentally ill people, such as rehabilitation and case management, but this split responsibility only further disrupts continuity of care.

While private practitioners have vented their outrage at managed mental health care, we community psychiatrists have been relatively silent. One reason is that we are a small group compared with private-practicing psychiatrists. Another is that we are being hit so fast and so hard by managed care that we are simply reeling. Although we could not provide systematic community-based care to all seriously and persistently mentally ill persons, we did have proven models of efficacy, some of which stand as state models. Our limitations were largely political and economic, not therapeutic or intellectual. We need to stand up for the principles of community psychiatry to avoid the demise of the hope of adequate care for the seriously ill patients we serve.—