Just like the pandemic accelerated the use of telemedicine in behavioral health, value-based care (VBC) models are pursuing the specialty like never before. While there are several considerable challenges facing the mental health field, there are disruptors who are successfully changing the way behavioral healthcare is delivered and paid for in the U.S. Every healthcare provider and payer organization that wishes to enter VBC arrangements for behavioral health services will either partner, purchase, or create new models.

Six challenges to value-based care success could address the current mental health crisis

The shift to healthcare that is outcomes-based and rewarded for performance has focused mostly on the physical health. However, the current mental health crisis in the U.S. requires new solutions and value-based care holds promise if these six challenges can be overcome.

Challenge #1: Behavioral health's separation from physical health

Mental health, in many ways, has evolved as a medical specialty and discipline separately from physical health. Clinically, operationally, financially, socially, and culturally the two have remained separate.

Elizabeth Netherton, MD, psychiatrist and regional medical director with Mindpath Health, shared in a Psychiatric Times article, “Psychiatry is a challenging profession that still suffers from stigma. It is often viewed negatively by other medical professionals and seen as remote from other forms of medicine—an unscientific specialty lacking in glamour or prestige." However, there is a “growing awareness that physical and mental health have a symbiotic relationship" and value-based care could help bridge the gap through integration.

Behavioral health integration (BHI) – through VBC contracting, enmeshing with primary care services, medical homes, ACOs, for examples – hold promise to address many mental healthcare challenges.

Behavioral health integration can improve care, lower cost, and increase equity

Regular outpatient mental healthcare can help reduce overall health costs by as much as $3,109 per person over a two-year period, reducing emergency department visits and inpatient hospitalizations.

Forty percent of all healthcare expenditures are tied to patients with behavioral health conditions or $752B annually. Integrating behavioral and medical services for patients with behavioral health conditions could save $68B annually according to research by Forge Health.

According to research by Milliman, medical costs for people living with serious behavioral disorders are 10 to 15 times higher than patients without psychiatric illnesses. Healthcare spending is two to three times greater for patients with a mental or behavioral health diagnosis than for those without. Integrating the two could bring additional efficiencies and savings.

Beyond better, whole-person care, lower cost and greater efficiencies, BHI could support health equity and lessening the stigma of behavioral health – in the general public as well as the medical community. Changing medical care from a two-track system to one that's integrated could also attract new professionals and help fill a current shortage of an estimated 7,500 psychiatrists.

Challenge #2: Behavioral health has been undervalued by payers

The relationship between health plans and behavioral health providers and organizations have been fraught with issues like fragmentation, imbalanced and unequal pay structures, and carve-outs that act as payment loopholes. In fact, estimates put the number of psychiatrists that operate cash-only private practices at 40% in 2017 and hadn't changed in 2022 according to the Kaiser Foundation. However, according to research reported by JAMA Psychiatry the “percentage of psychiatrists accepting Medicaid has dropped to 35%."

Health plans that want to partner and integrate mental health into value-based care will require a paradigm shift. This would include embracing the value of behavioral health professionals, seeing them as more than auxiliary specialists, and building trust through recognizing and paying for their value. Increasing reimbursement rates, increasing in-network access, achieving mental health parity, and greater transparency would go a long way to creating a new kind of care collaboration.

The disparity in reimbursement and in-network availability between medical and surgical providers versus behavioral health is striking. According to an updated report from Milliman -- 17.2% of behavioral health office visits were out of network compared to 3.2% for primary care and 4.3% for other medical specialties. Additionally, network reimbursement is ~23% higher for primary care compared to behavioral health, which is the segment to have the highest share of out-of-network spending.

And it behooves payers to ramp up behavioral health engagement. Nearly 75% of “members who have sought out mental healthcare services hold health insurers responsible for their access—or lack thereof—to mental healthcare providers."

Challenge #3: Behavioral health does not have outcomes measures or quality standards

Most health plans have yet to apply any outcome measures to their behavioral health providers. This is partially because mental conditions don't have clear outcomes measures.

For example, lab values for diabetes, like HbA1C, demonstrate clear improvement in a medical condition. It can be difficult to measure quality mental healthcare objectively. Standards of care have not been measured consistently over time. Instead, quality assessments tend to focus on process or structure metrics, which don't always indicate outcomes improvement. This could explain why only 22% of behavioral health reimbursement is outcomes-based arrangements.

Suffusing the behavioral health profession and practice with quality improvement capabilities will better align the discipline with modern medical healthcare and accelerate VBC inclusion. By adopting data-sharing models with objective measures, behavioral health can objectively and systematically measure care quality without degrading the subjective aspects of delivering effective care. Measurement-based care (MBC) should evolve toward evidence-based instruments like the PHQ-9, GAD-7, WHO- 5, USAUDIT, and SUS that more appropriately and objectively assess patient symptoms and track ongoing progress.

Moving towards quality measurement in behavioral health

It's worth the transformation from a care quality and patient satisfaction perspective, as well as financially. Research shows that when mental health providers track symptoms and therapeutic alliance data regularly, outcomes improve substantially. Yet, only 14% of mental health providers use standardized progress measures. Taking a MBC approach would also help bridge the separation between mental and physical healthcare.

Standard sets, like the one established by the International Consortium for Health Outcomes Measurement (ICHOM), offers outcome measure sets for 25 different conditions, including depression and anxiety. While mental healthcare has unique aspects that must be accounted for, it's a myth that it is too subjective to measure performance. For health plans, relevant behavioral health HEDIS measures can complement physical health.

Some payers have created value-based contracting models for behavioral health provider organizations that focus on patients with moderate-to-high risk. Reimbursements are tied to outcomes like time-to-initiate care, member-reported outcomes, avoiding inpatient or emergency department use, and timely follow-up. Providers receive bonuses based on performance related to engagement, assessment, and community tenure.

Challenge #4: Behavioral health has lacked incentives to adopt technology, data, and data exchange

Another effect of separation from physical health, behavioral health organizations and practices have not kept up with technology adoption nor been included in incentives like the HITECH act the same as other provider organizations. Because of $35B in subsidies to incentivize providers to use electronic medical records (EHR), by 2017 86% of office-based allopathic and osteopathic physicians had adopted an EHR.

New VBC programs, however, are addressing this gap. One example is the California Advanced Primary Care Initiative, which brings together five health plans and provider organizations to help primary care practices integrate behavioral health and while-person care, enter VBC contracts, and receive technical assistance. The technology is to support implementation of VBC clinical and business models, address mental health needs, and reduce health disparities.

A panel of behavioral health executives confirmed these needs, “We, as an industry, have not always done a good job adopting new technology. We certainly have not done a good job with data with outcomes tracking," said Tom Viscelli, Chief Development Officer at Vertava Health. Taking steps to improve both areas can solidify behavioral health's readiness for value-based care.

Challenge #5: Clinician readiness and hesitation

One recent article asked, "Are behavioral health providers ready for value-based care?" This question goes to the heart of whether VBC and integration is possible or could succeed. While not a standalone challenge, clinician acceptance and support relate to every other challenge in this list. Any VBC arrangement must respect and reward clinicians while preserving the aspects of their practice that have worked well alongside guiding them into new opportunities that benefit them and their patients.

Adding greater tracking and reporting, performance measures, and administrative duties need a counterbalance in reimbursement, a seat at the table for input, and incentives that align with their professional goals. The hurdle is causing clinicians to possibly leapfrog from a cash-only approach to a value- and outcomes-based model.

Any VBC or BHI initiative will require a phased approach with milestones and rewards. Payment models need to be simple and performance measures should start with process and progress towards outcomes. Again, education, inclusion, and transparency are key.

Challenge #6: Start-ups are driving VBC in behavioral health

The growing opportunity for value-based care and behavioral health, spurred on by the explosion of telemedicine adoption in the mental health space during the pandemic, has seen many start-ups enter the market. That's also because more capacity for care is needed. It's estimated that 60-90% of the 65M Americans living with at least one behavioral health (BH) condition and the 25M who are living with a substance use disorder (SUD) are going untreated. Start-ups are trying to fill this gap.

According to telehealth company Cerebral, “In 2021, new behavioral healthcare startups raised more than $5.1 billion, more than any other clinical space." These digital native start-ups are not hindered by traditional silos, lack of measures, technology, and old paradigms.

Digital companies are able and willing to engage in VBC in ways traditional behavioral health providers cannot, yet. The challenge, and opportunity, for traditional payers and providers is purchase, partner, or create VBC arrangements or miss out. Once payer and provider organizations make that initial decision, they need to integrate, scale, and perform.

Forge Health, for example, studied the health and behavior of 70 patients over the 12 months prior to engaging with them and compared it to the 12 months following treatment. Their value-based behavioral health model found that “patients both achieved and maintained significant improvement in overall health, while also taking better care of themselves by seeing their primary care doctors more frequently." Additional results were striking:

• 62% Reduction in emergency room visits
• 75% Reduction in medical hospital admissions
• 39% Reduction in all-cause hospital admissions
• 20% Increase in primary care visits

Vytalize Health, an accountable care organization (ACO), partners with primary care practices, offering a value-based care solution that supports care delivery for Medicare patients, data analytics and network management with integrated behavioral health.

Oceans Healthcare is expanding outside of Texas with VBC models, leveraging PHQ-9 as their outcomes measure of choice.

Crossover Health touts a 100% compliance rate with their mental health providers using their standardized progress measures. Their focus on value-based hybrid care uses a membership model from individual to corporate to health plans.

Blue Cross Blue Shield of North Carolina and Quartet Health partnered to develop payment models that incorporate accountability for health and cost outcomes. They created a quality framework around behavioral health access and health outcomes and developed a behavioral health platform to manage the program.

Seize the VBC opportunity while solving longstanding behavioral health challenges

These six challenges to value-based behavioral healthcare offer the opportunity to address the longstanding separation of physical and mental health, help fill the professional shortage, and provide more integrated and higher-quality care to people living with new and persistent conditions.

RTI Health Advance works with healthcare organizations who want to pursue value-based payment and care models. From partnering to selecting the right technologies to population health data analysis and adopting quality measures, we can help. Contact us.