“Alternative payment models are not an option for behavioral health providers,” Arizona Medicaid Director Tom Betlach said, “They are your growth strategy.” Betlach’s point was very clear and it resonated with the more than 5,500 attendees at NatCon, where Payment Reform – be it alternative payment methodologies (APMs) or value-based purchasing (VBP) models like Delivery System Reform Incentive Payment (DSRIP) initiatives – was a key theme. In line with this, New York State’s DSRIP efforts were highlighted repeatedly throughout the conference. (PCG has played an instrumental role in spearheading New York’s initiative). Government agencies have become “first movers” towards VBP, stressing the importance of “whole person care,” not just “sick care.” This methodology contrasts with the current Fee-For-Service (FFS) model of too much money being spent on health services like hospital visits, tests, and medications, and too little money spent on primary and behavioral health care.

Panelists from different national and state health agencies spoke about the need for Medicaid to be a “driver of health payment reform” and not just a payment system. While an interesting topic for policymakers, the ever-changing healthcare system has providers rightfully on edge about changing reimbursement models with limited data. Many behavioral health providers are now accustomed to FFS reimbursement arrangements, most are not ready for a complete shift to VBP.

Steps must be incremental. As this CMS graphic ¹  shows, there must be a deliberate, thoughtful, step-by-step approach to incorporating outcomes into behavioral health payment methodologies.

“This is an exciting time,” said Matt Salo, Executive Director of the National Association of Medicaid Directors. “We are transforming Medicaid and Behavioral Health. We will learn from our successes, and our failures. The system is broken, and we are fixing it.”

¹ CMS’s Innovation Center, Healthcare Payment and Learning Network https://innovation.cms.gov/initiatives/Health-Care-Payment-Learning-and-Action-Network/