Cost and cost-effectiveness of hospital vs residential crisis care for patients who have serious mental illness

BACKGROUND

This study evaluates the cost and cost-effectiveness of a residential crisis program compared with treatment received in a general hospital psychiatric unit for patients who have serious mental illness in need of hospital-level care and who are willing to accept voluntary treatment.

METHODS

Patients in the Montgomery County, Maryland, public mental health system (N = 119) willing to accept voluntary acute care were randomized to the psychiatric ward of a general hospital or a residential crisis program. Unit costs and service utilization data were used to estimate episode and 6-month treatment costs from the perspective of government payors. Episodic symptom reduction and days residing in the community over the 6 months after the episode were chosen to represent effectiveness.

RESULTS

Mean (SD) acute treatment episode costs was $3046 ($2124) in the residential crisis program, 44% lower than the $5549 ($3668) episode cost for the general hospital. Total 6-month treatment costs for patients assigned to the 2 programs were $19,941 ($19,282) and $25,737 ($21,835), respectively. Treatment groups did not differ significantly in symptom improvement or community days achieved. Incremental cost-effectiveness ratios indicate that in most cases, the residential crisis program provides near-equivalent effectiveness for significantly less cost.

CONCLUSIONS

Residential crisis programs may be a cost-effective approach to providing acute care to patients who have serious mental illness and who are willing to accept voluntary treatment. Where resources are scarce, access to needed acute care might be extended using a mix of hospital, community-based residential crisis, and community support services.

A survival strategy for an academic psychiatry department in a managed care environment

The changing economics of medical practice have had a profound effect on the educational, research, and service missions of academic departments of psychiatry across the country. The authors describe the development of a managed behavioral health care organization in their parent academic health system as a survival strategy for allowing their department to function in a managed care environment. They present a series of lessons learned in this effort to adapt to a highly volatile managed behavioral health care market: know how you fit into your market as well as your institution, form cooperative alliances within and outside of your institution, provide incentives to manage risk, focus on core competencies, innovate in your areas of strength, and collect data.

Mental health services. On the look-out

A survey of medium-secure units in England and Wales found a total of 1,939 beds. Two-thirds were provided by the NHS and one-third by the independent sector. Average occupancy was over 90 per cent. The bulk of units cost 2,000 Pounds-2,500 Pounds a week per patient. The independent units were among the most expensive. The units were planning expansions that would provide an extra 1,135 beds over the next four years.

[Hospital financing in in-patient psychiatry via DRG-based prospective payment--The Salzburg experience]

Hospital financing via case-related prospective payment sometimes is suspected to be responsible for accelerating the "revolving-door"-phenomenon in psychiatry. According to this reasoning, establishing diagnoses-related groups (DRGs) ruling a prospective payment system could not only reduce lengths of stay but could also simultaneously raise hospitalization and readmission rates. This study analyses the Austrian experience after the implementation of such a payment system, the "performance-oriented financing of hospitals" (leistungsorientierte Krankenanstalten-Finanzierung, LKF) in 1997. Time series analyses based on the complete hospital discharge statistics of the Salzburg province were used as methods. Results showed that neither length of stay, nor hospitalization or readmission rates in psychiatry have substansially changed or deviated from their long-term trends after implementation of the LKF system. Other medical disciplines have experienced statistically significant changes. The possibility to transfer these results to the German psychiatric health care system is discussed.

Variations in utilization and cost of inpatient psychiatric services among adults in Maryland

The author examined variations in the clinical characteristics, costs, utilization, and discharge patterns of adult inpatients who were hospitalized for psychiatric disorders in Maryland state general hospitals in 1998. Administrative discharge data on all 30,121 adult psychiatric patients in the state in 1998 were used to calculate descriptive statistics on elderly (age 65 years and over) and nonelderly (age 19 to 64 years) patients. The most common reasons for hospitalization were substance-related disorders, which affected 25 percent of the patients, and major depressive disorders, which affected 24.6 percent of the patients. After the effects of Medicare's prospective payment system were disregarded, the average cost of treating elderly persons for depression was calculated to be around 80 percent higher than national estimates.

Financial management challenges for general hospital psychiatry 2001

Psychiatry programs are facing significant business and financial challenges. This paper provides an overview of these management challenges in five areas: departmental, hospital, payment system, general finance, and policy. Psychiatric leaders will require skills in a variety of business management areas to ensure their program success. Many programs will need to develop new compensation models with more of an emphasis on revenue collection and overhead management. Programs which cannot master these areas are likely to go out of business. For academic programs, incentive systems must address not only clinical productivity, but academic and teaching output as well. General hospital programs will need to develop increased sophistication in differential cost accounting in order to be able to advocate for their patients and program in the current management climate. Clinical leaders will need the skills (ranging from actuarial to negotiations) to be at the table with contract development, since those decisions are inseparable from clinical care issues. Strategic planning needs to consider the value of improving integration with primary care, along with the ability to understand the advantages and disadvantages of risk-sharing models. Psychiatry leaders need to define and develop useful reports shared with clinical division leadership to track progress and identify problems and opportunities. Leaders should be responsible for a strategy for developing appropriate information system architecture and infrastructure. Finally, it is hoped that some leaders will emerge who can further our needs to address inequities in mental health fee schedules and parity issues which affect our program viability.

Using quality management to balance the economic and humane imperatives in behavioral health care

The authors describe how quality management can be used to achieve an ethical balance between economic pressures and high-quality patient care.

Costs and characteristics of heavy inpatient service users in outer London

"Heavy users" is a new term often used to describe those who occupy a disproportionate number of psychiatric beds. In this study we identified the heaviest 10% (193) inpatient service users in one London borough over a 6 year period and compared these with a control group of 400 ordinary inpatient users. A weighting index was used to combine frequency of admission with duration. Heavy users were diagnostically and demographically similar to ordinary inpatient service users and only differed by their extensive use of services, about 3 times more than ordinary users in terms of health care costs, during the measured year. Their heavy use mainly depended on occupying hospital beds, and their use of outpatient, day patient and community services was relatively light.

Psychiatric inpatient care planning via telemedicine

We assessed the costs of psychiatric inpatient care-planning consultations to remote areas using videoconferencing, instead of the conventional face-to-face consultations at a hospital. The data were collected from all wards at the department of psychiatry of Oulu University Hospital over 11 months. A total of 14 videoconferences were conducted with two primary-care centres located 220 km and 160 km from Oulu. During the same period, 20 conventional consultations at the Oulu University Hospital were also assessed. A questionnaire was completed by a total of 124 patients, relatives and health-care personnel; the response rate was about 90%. Of the respondents, 90% were satisfied with the quality of communication afforded by videoconferencing. At a workload of 20 patients per year, the cost of the videoconferences was FM2510 per patient; the cost of the conventional alternative was FM4750 per patient. At 50 care consultations per year, a remote municipality would save about FM117,000.

Constant observation practices in the general hospital setting: a national survey

The authors conducted a national survey of 355 general medical/surgical hospitals to assess constant observation (CO) practices. The authors assessed overall use, expense, staffing patterns, funding strategies, and cost-saving interventions. Virtually all responding hospitals (N = 102) reported using some form of CO. Several hospitals reported significant decreases in CO expenditures after the implementation of cost-saving interventions (the largest annual decrease reported was $340,000). Cost-saving interventions included utilizing consolidated bed spaces, relocating patients near nursing stations, placing at-risk patients in bed enclosure devices, and regularly assisting patients to the toilet. In addition, less costly personnel were hired, and volunteers and/or patient family members provided CO (or were required to assist with the cost of CO). Finally, hospital staff were educated about the costs and the appropriate use of CO. They were also taught to recognize and effectively treat delirium.

[Cost evaluation in psychiatry]

At scientific and technical level rigorously the concepts of psychiatry and economy do not seem to have contact points. The fields of specific competence are independent between they and peculiarly are addressed to different purposes. The mental disease is extremely versatile, it's composed in personal, affective, human, physical, psychological factors, to neurological times, social and cultural of the life of a patient little and leaves space considerations of economic type.

Mental health. Taking a pounding

Reduction in NHS beds for mental health patients has led to increasing use of the private sector. The cost of a bed in the private sector can be 75 per cent more than one in the NHS. The use of private beds diverts funding away from community mental health teams. Extensive use of private beds present problems for community mental health teams which struggle to keep track of patients.

Inequity in the hospital care of patients with alcoholism and medication addiction

In a psychiatric/ecological study, the authors investigated which aspects of a town district would provide an explanation to the fact that alcoholics are treated above average in addiction-psychiatric wards in a given city district, while in other districts treatment is carried out in internal medical wards. The research was based on data collected between 1988 and 1994 from approximately 77% of all patients suffering from alcohol and legal drug abuse (n = 15,473) in 41 hospitals in Hamburg. It was established that in somatic departments, mainly internal medicine, 70% of male and 67% of female patients were admitted for alcohol and legal drug abuse. The results of a geographical analysis of hospitalization risks showed that the addiction-psychiatric facilities of psychiatric wards are mainly utilized by inhabitants from nearby districts. Risks of above-average hospitalization for alcoholics and legal drug abusers in internal wards, as well as insufficient addiction-psychiatric care, are to be expected in town districts where a shortage of psychiatrists exists, and where the unemployment rate is high. In these crucial areas, addiction-specific facilities, such as qualified programs for detoxication or techniques for short intervention, should be established within the framework of an addiction-specific liaison service in general hospitals.

The admission of Alzheimer's patients to hospital inpatient psychiatric units

Alzheimer's Disease presents extreme challenges not only to the individuals afflicted with it and their families, but also to both our legal and healthcare systems. The nature of the disease is such that current legal standards and requirements simply fail to function in an appropriate manner. So too, the health system currently is not in a position to handle the anticipated influx of Alzheimer's patients over the next several decades. This Article examines some of the challenges presented by this disease, and suggests several possible methods to improve our response to it.

Implications of the Balanced Budget Act of 1997 for general hospital psychiatry inpatient units providing medical and psychiatric services

Since 1983, the Tax Equity and Fiscal Responsibility Act (TEFRA) of 1982 has determined payment for services in most psychiatry units located in general hospitals. This system provided reimbursement on a cost-per-discharge basis. In 1997, a Balanced Budget Act (BBA) was passed by Congress which has replaced the TEFRA system of 1982 (H.R 2015). As a result of this law, many general hospital psychiatry units, particularly those that address the needs of elderly patients with high levels of medical comorbidity, will experience a reduction in their reimbursement when compared with the old TEFRA system. This reduction will average 7.8% and affect up to 84% of health care organizations. Those with higher TEFRA target amounts, such as is found with most general hospital programs, will have proportionately greater reductions. This article summarizes legislation affecting Medicare reimbursement and suggests a service reorganization approach that would allow billing to both medical and psychiatric payers. Finally, it encourages active participation in psychiatric access and quality standards development and with legislation, such as The Medicare Psychiatric Hospital Prospective Payment System Act of 1999.

[Drug management at the level of the Psychiatry Department of the Fann University Hospital Center: problem and perspectives]

Health system in developing countries is facing difficulties due to lack of resources and poor management of the available ones reinforced by the economic crisis and the structural adjustment program since 1980. The situation will be worsened by the recent devaluation of the France CFA. The consequences are a permanent shortage of drugs, a decreased motivation of the health personnel with at the end the decrease of health services reliability. Teaching Hospitals, which are essential for the implementation of PHC, are facing such situation. Thus, a study was conducted at the Department of Psychiatry, Fann Hospital to analyse the process of drug management and to find out suitable solutions. The study, qualitative, showed that that the main problems encountered are: inexistence of management tools with inexploitable health information systems, insufficient budget allocated for drug purchase, selection of drug exclusively on brand name with a standard list unrenewed since 1986, weak drug delivery system, frequent stock-outs. Prescribers are unaware of available drug at the pharmacy. Patients are not informed about their diseases and the use of drugs prescribed. Therefore, adopting the EDP in Teaching Hospitals will help for better management of drug delivery.

Availability and performance of psychiatric acute care facilities in California from 1992 to 1996

OBJECTIVE

The acute care psychiatric hospital industry has been challenged by managed care, government policies, and marketplace competition to control rising costs. This study examined changes in the availability and performance of acute care psychiatric delivery facilities in California between 1992 and 1996.

METHODS

A retrospective longitudinal research design was used. Data on facilities, licensed psychiatric beds, discharged patients, days of care, occupancy, average length of stay, licensure, and type of ownership for the years 1992, 1994, and 1996 were purchased from the California Office of Statewide Health Planning and Development. Data were analyzed using numerical description and percent-change calculations.

RESULTS

Between 1992 and 1996 licensed beds, days of care, and average length of stay decreased in acute psychiatric facilities and services, while psychiatric discharges and facility occupancy increased. The for-profit sector and the specialty acute care sector experienced large decreases in facilities, licensed beds, days of care, and average length of stay. The generalist sector-general psychiatric units licensed within acute general hospitals-and not-for-profit facilities experienced large increases in discharges.

CONCLUSIONS

Challenges to institution-based services for the mentally ill population now extend beyond the state hospital system to include community-based acute care psychiatric hospital services. Recent declines in the for-profit, acute care psychiatric hospital specialty sector and the success of the generalist and not-for-profit sectors demonstrate the lack of uniform responses to environmental pressures. However, changes in federal Medicare reimbursement policy enacted in the Balanced Budget Act of 1997, as well as competition from alternative providers, are likely to result in further closures of all types of acute care psychiatric facilities over the next few years.

The Nordic Comparative Study on Sectorized Psychiatry--length of in-patient stay

OBJECTIVE

Length of stay (LOS) of 'first' in-patient episodes was investigated in this study, which is part of the Nordic Comparative Study on Sectorized Psychiatry.

METHOD

A total of 837 consecutive 'new' patients (not in contact with the psychiatric services for at least 18 months) admitted as in-patients during a period of 1 year to seven psychiatric hospitals in four Nordic countries were included.

RESULTS

Survival analyses showed considerable differences in LOS between the hospitals, and the factors analysed in this study could not explain this variance. Older age, being female, having no children at home, psychosis, planned admission and out-patient contacts were all associated with increased LOS.

CONCLUSION

Stratifying on gender, diagnostic group and hospital revealed a general pattern of associations except for age.

General hospital psychiatry from the perspective of medical economics

The purpose of this study was to investigate the efficacy of consultation-liaison (C-L) psychiatry from the perspective of medical economics, by comparing a part-time and full-time psychiatric department. One full-time (5 days per week) psychiatrist began work at a general hospital (GH-A), and one part-time (once per week) psychiatrist had been working at another general hospital (GH-B). Both general hospitals are teaching hospitals of the same size. The number of patients and the medical reimbursements were investigated each month and compared. This study demonstrated that the establishment of C-L psychiatry was economically profitable in contrast with what was the common belief among general hospital administrators. Also, the differences in the total number of patients (GH-A: GH-B = 500:35-50 patients/month) and the total reimbursement (GH-A: GH-B = 3 million: 2-300000 yen/month) was not explained by the number of working days (GH-A: GH-B = 5:1 day/week). The full-time model of C-L psychiatry has also indirect effects (i.e. educational and relieving effects) on the hospital staff. Promoting the establishment of C-L psychiatry requires many evidence-based studies that demonstrate the necessity for C-L psychiatry and can directly persuade hospital directors.

Mental health. Open and shut case

Acute mental care consumes about two-thirds of all mental health spending. But many beds are blocked by patients who no longer need intensive support. They stay in hospital because of a lack of alternative services. If each patient left hospital when they were deemed ready, inpatient costs would be almost halved. More than a third of these patients are re-admissions. A range of alternative crisis services, including 24-hour nursing care and staffed hostels, are needed.

Systematic review of the effectiveness of planned short hospital stays for mental health care

OBJECTIVE

To determine the effectiveness of planned short hospital stays versus standard care for people with serious mental illness.

DESIGN

Systematic review of all randomised controlled trials comparing planned short hospital stay versus long hospital stay or standard care for people with serious mental illness.

SUBJECTS

Four trials enrolled 628 patients.

MAIN OUTCOMES MEASURES

Relapse; readmission; death (suicides and all causes); violent incidents (self, others, property); lost to follow up; premature discharge; delayed discharge; mental state (not improved); social functioning; patient satisfaction, quality of life, self esteem, and psychological wellbeing; family burden; imprisonment; employment status; independent living; total cost of care; and average length of hospital stay.

RESULTS

Patients allocated to planned short hospital stays had no more readmissions (in four trials, odds ratio 0.93, 95% confidence interval 0.66 to 1.29 with no heterogeneity between trials), no more losses to follow up (in three trials of 404 patients, 1.09, 0.62 to 1.91 with no heterogeneity between trials), and more successful discharges on time (in three trials of 404 patients, 0.47, 0.27 to 0.85) than patients allocated long hospital stays or standard care. Some evidence showed that patients allocated planned short hospital stay were no more likely to leave hospital prematurely and had a greater chance of being employed than those allocated long hospital stay or standard care. Data on mental, social, and family outcomes could not be summated, and there were few or no data on patient satisfaction, deaths, violence, criminal behaviour, and costs.

CONCLUSION

The effectiveness of care in mental hospitals is important to patients, carers, and policy makers. Despite inadequacies in the data, this review suggests that planned short hospital stays do not encourage a "revolving door" pattern of care for people with serious mental illness and may be more effective than standard care. Further pragmatic trials are needed on the most effective organisation and delivery of care in mental hospitals.

Description of a geriatric medical/psychiatry unit in a small community general hospital

This article describes a geriatric medical/psychiatry inpatient unit (GMPU) in a small community general hospital. A program description and data from the second year of the unit's operation are presented. The GMPU provides comprehensive geriatric assessment and interdisciplinary treatment for frail, medically ill elderly patients with neuropsychiatric disorders. Many of the patients have dementia or other neurobehavioral disorders, and most reside in nursing homes. The GMPU provides a valuable clinical link in the continuum of care for the elderly. Moreover, it has proven to be an economically viable financial asset for the hospital.

Reorganizing departments of psychiatry, hospitals, and medical centers for the 21st century

Market forces are reshaping health care, transforming it from a public service into a product that is sold in a highly competitive marketplace. This transformation has been particularly disruptive for hospital departments of psychiatry and medical centers that were the early targets for managed care efforts at cost containment. To survive, health care institutions have embarked on a clinical and administrative re-engineering process. The author describes a series of steps for reconfiguring departments, hospitals, and medical centers as they enter the 21st century. The steps include identifying the leadership team, formulating a mission statement and strategic plan, creating a legal entity capable of achieving the organization's goals, drawing up an organizational chart, and developing the provider network. Other steps in the process include enhancing the continuum of services offered, developing administrative capability, dealing with managed care, paying attention to fundamental business practices, integrating psychiatric services into the health care system, and marketing psychiatric services.

Inpatient psychiatric treatment of elderly Medicare beneficiaries

OBJECTIVE

The clinical characteristics and treatment patterns of elderly Medicare beneficiaries hospitalized for psychiatric disorders were examined.

METHODS

Administrative data on all elderly Medicare beneficiaries in the United States hospitalized in a nonfederal hospital for a primary psychiatric disorder in 1990-1991 were used to calculate descriptive statistics on case-mix by age group, hospital type (psychiatric hospital, general hospital psychiatric unit, or general hospital nonpsychiatric unit), and primary diagnosis. Length of stay, costs, and discharge destination by hospital type and primary diagnosis were also determined.

RESULTS

A total of .6 percent of elderly Medicare beneficiaries were hospitalized for a psychiatric disorder in 1990, accounting for more than 240,000 admissions and $1 billion in Medicare payments. The most common reasons for hospitalization were major depressive disorder (28.1 percent), dementia and other organic disorders (26.8 percent), and substance-related disorders (12.6 percent). Organic disorders were particularly prevalent among the oldest old, accounting for more than half of psychiatric admissions among those 85 and older. A total of 43 percent of the psychiatric admissions were to general hospital nonpsychiatric units, 38 percent to general hospital psychiatric units, and only 19 percent to psychiatric hospitals. Within each diagnostic category, patients admitted to general hospital nonpsychiatric units had the shortest average lengths of stay and the lowest average costs. Among beneficiaries with organic, affective, and psychotic disorders other than schizophrenia, those admitted to general hospitals had shorter lengths of stay, higher rates of discharge to nursing homes, and lower rates of discharge to self-care than those treated in psychiatric hospitals.

CONCLUSIONS

Case-mix-adjusted treatment patterns varied substantially across hospital types, due to differences in either illness severity or treatment styles.

Homelessness: health service use and related costs

OBJECTIVES

This study examines health service use and costs for homeless and domiciled veterans hospitalized in psychiatric and substance abuse units at Department of Veterans Affairs (VA) medical centers, nationwide.

METHODS

A national survey of residential status at the time of admission was conducted on all VA inpatients hospitalized in acute mental health care units on September 30, 1995. Survey data were merged with computerized workload data bases to assess service use and cost during the 6 months before and after the date of discharge from the index hospitalization.

RESULTS

Of 9,108 veterans with complete survey data, 1,797 (20%) had been literally homeless at the time of admission, and 1,380 (15%) were doubled up temporarily, for a total homelessness rate of 35%. Combining patients from general psychiatry and substance abuse programs, the average annual cost of care for homeless veterans, after adjusting for other factors, was $27,206; $3,196 (13.3%) higher than the cost of care for domiciled veterans (P < 0.0001). Approximately 26% of annual inpatient VA mental health expenditures ($404 million) are spent on the care of homeless persons.

CONCLUSIONS

Homelessness adds substantially to the cost of health care services for persons with mental illness in VA, and most likely, in other "safety net" systems that serve the poor. These high costs, along with the prospect of declining public funding for health and social welfare programs, and an anticipated increase in the numbers of homeless mentally ill persons, portend a difficult time ahead for both homeless patients and the organizations that care for them.

Do treatment restrictions imposed by utilization management increase the likelihood of readmission for psychiatric patients?

OBJECTIVES

The use of utilization management as a cost-containment strategy has led to debate and controversy within the field of mental health. Little is currently known about how this cost-containment approach affects patient care or quality. The aim of this investigation was to determine whether treatment restrictions imposed on privately insured psychiatric patients by a utilization management program affected the likelihood of readmission.

METHODS

The utilization management program included three review activities: preadmission certification, concurrent review, and case management. During a 5-year period (1989-1993), 3,073 inpatient reviews were performed on 2,443 privately insured psychiatric patients. Using logistic regression, restrictions imposed by utilization management on length-of-stay in relation to 60-day readmission rates were investigated.

RESULTS

The most common diagnoses among the psychiatric patients whose care was reviewed were alcohol dependence (22.9%), recurrent depression (22.5%), and single-event depression (20.8%). On average, 22.4 days of inpatient psychiatric treatment was requested through the review procedures, and 15.5 days of care were approved by the utilization management program. Of the 2,443 patients reviewed, 7.9% had a readmission within 60 days of their initial admission. Patients whose length-of-stay was restricted by utilization management were more likely to be readmitted. For each day that the requested length-of-stay was reduced, the adjusted odds of readmission within 60 days increased by 3.1% (P = 0.004).

CONCLUSIONS

The utilization management program restricted access to inpatient psychiatric care by limiting length of stay. Although this approach may promote cost containment, it also appears to increase the risk of early readmission. Continuing attention should be paid to investigating the effects on quality of utilization management programs aimed at containing mental health costs.

Outcomes focused service delivery: developing an academic-management partnership

OBJECTIVE

Current mental health policies emphasise the need for services to be integrated and to develop outcomes-based evaluation systems. An overview of the challenges faced by service managers and clinical academics who develop the appropriate financial, personnel and academic infrastructure for these tasks is presented.

METHOD

By drawing on experiences within the St George Service and references to other services, we propose a model for a successful partnership between the academic and management components of a district service.

RESULTS

Major logistic impediments to the development of a partnership are identified, although the long-term scientific and service delivery benefits are highlighted. Key areas within both academic practice and managerial approaches requiring transformation are discussed.

CONCLUSIONS

A successful long-term partnership between management and an academic department within a district service may provide the opportunity for rapid progress in population-based service evaluation and health outcomes research.

Long-term patterns of service use and cost among patients with both psychiatric and substance abuse disorders

OBJECTIVES

This is a longitudinal study designed to determine: (1) if patients dually diagnosed with psychiatric and substance abuse disorders incur higher health care costs than other psychiatric patients and (2) if higher costs can be attributed to particular subgroups of the dually diagnosed or types of care.

METHODS

Two cohorts of veterans treated in Veterans Affairs mental health programs at the start of fiscal year 1991 were followed for 6 years: one cohort of inpatients (n = 9,813) and the other of outpatients (n = 58,001). Data were analyzed on utilization of all types of Veterans Affairs health care. Repeated measures analysis of variance was used to examine cost differentials between dually diagnosed patients and other patients.

RESULTS

Dually diagnosed outpatients incurred consistently higher health care costs than other psychiatric outpatients, attributable to higher rates of inpatient psychiatric and substance abuse care; however, this difference decreased with time. Costs were substantially higher in the inpatient cohort overall, but there were no differences in cost between dually diagnosed and other patients.

CONCLUSIONS

In an atmosphere of cost cutting and moves toward outpatient care, the dually diagnosed may lose access to needed mental health services. Possibilities of developing more intensive outpatient services for these patients should be explored.

Identifying costs for capitation in psychiatric case management

This article presents an example of how one hospital identified costs for capitation in psychiatric case management. An 18-month postacute case management pilot project collected data on a nurse-specific and patient-specific basis. Costs were identified using activity-based costing methodology.

Psychiatric hospitalization characteristics associated with insurance type

This study examines the relationship among types of insurance and characteristics of inpatient psychiatric treatment. Data include 46,998 adult psychiatric or substance abuse cases from all 1991-1992 Washington State discharges from short-stay general hospitals. Large and significant differences among payers exist in treatment characteristics, controlling for diagnosis and patient age. For example, length of stay is longest among commercial and Medicare payers. Emergency admissions are more common among public payers, and elective admissions are more common among private payers, including HMOs. Results and discussed in light of policy and administration issues that will arise as financing for mental health services comes under greater capitation.

The cognitively limited severely mentally ill: concerns for managed care

The managed care needs of cognitively impaired severely mentally ill inpatients have not been estimated. The aims of the study were to estimate and describe the demographic and clinical characteristics of cognitively impaired patients in an urban inpatient sample. By doing so, we hoped to identify areas that need further study and treatment modification in planning capitated contracts.

A new approach to managed care: the provider-run organization

Behavioral managed care has been dominated by for-profit carve-out managed care organizations who deliver mental health and substance abuse services by reducing services and fees to the detriment of patients and providers. We offer a new model of managed care based on a provider-run, hospital-based approach in which provider groups contract directly with HMOs and eliminate the managed care organization intermediaries. This approach allows providers to maintain or regain control of the delivery of behavioral health services. A model is presented of an academically based organization which has achieved utilization patterns compatible with the demands of payors. Innovations in service delivery, network management and fiscal issues are reviewed.

Academic psychiatry and managed care: a case study

An academic department of psychiatry in New York City eliminated the need for behavioral managed care intermediaries by transforming itself from a fee-for-service system to a system able to engage in full-risk capitation contracts. The first step was to require health maintenance organizations to contract directly with the department. The department formed two legal entities, a behavioral management services organization for utilization management and a behavioral integrated provider association. The authors describe these entities and review the first year of operation, presenting data on enrollees, capitation rates, and service utilization for the first three contracts. The fundamental differences in the treatment model under managed care and under a fee-for-service system are highlighted. The authors conclude that by contracting directly with insurers on a full-risk capitation basis, departments of psychiatry will be better able to face the economic threats posed by the cost constraints inherent in managed care and maintain or re-establish their autonomy as care managers as well as high-quality care providers.

Effectiveness and cost of the inpatient treatment of posttraumatic stress disorder: comparison of three models of treatment

OBJECTIVE

This study compared the outcomes and costs of three models of Department of Veterans Affairs (VA) inpatient treatment for posttraumatic stress disorder (PTSD): 1) long-stay specialized inpatient PTSD units, 2) short-stay specialized evaluation and brief-treatment PTSD units, and 3) nonspecialized general psychiatric units.

METHOD

Data were drawn from 785 Vietnam veterans undergoing treatment at 10 programs across the country. The veterans were followed up at 4-month intervals for 1 year after discharge. Successful data collection averaged 66.1% across the three follow-up intervals.

RESULTS

All models demonstrated improvement at the time of discharge, but during follow-up symptoms and social functioning rebounded toward admission levels, especially among participants who had been treated in long-stay PTSD units. Veterans in the short-stay PTSD units and in the general psychiatric units showed significantly more improvement during follow-up than veterans in the long-stay PTSD units. Greatest satisfaction with their programs was reported by veterans in the short-stay PTSD units. Finally, the long-stay PTSD units proved to be 82.4% and 53.5% more expensive over 1 year than the short-stay PTSD units and general psychiatric units, respectively.

CONCLUSIONS

The paucity of evidence of sustained improvement from costly long-stay specialized inpatient PTSD programs and the indication of high satisfaction and sustained improvement in the far less costly short-stay specialized evaluation and brief-treatment PTSD programs suggest that systematic restructuring of VA inpatient PTSD treatment could result in delivery of effective services to larger numbers of veterans.

A combined inpatient and partial hospital program

This paper describes a combined inpatient and partial hospital program, with a ten-bed short-term inpatient unit and a partial hospital program that can accommodate 24 patients. Inpatients and partial hospital patients are treated together by the same staff in a program located in the partial hospital. The authors highlight features of the program that address the five elements of continuity: place, personnel, program, patient-peers, and plan for treatment. The discussion focuses on the importance of continuity in sustaining a combined unit; potential benefits for patients, families, staff, and trainees; attractiveness to third-party payers; and impediments to fully realizing the potential of the unit.

Managed psychiatric care: a suburban medical department activity model

Munson Army Community Hospital has successfully realized substantial cost savings by instituting psychiatric managed care. The development of an external partnership with a civilian psychiatric facility is a unique aspect of the psychiatric managed care initiative and has resulted in most of the savings. We staff this partnership hospital with one-half full-time-equivalent psychiatrist. Other psychiatric managed care program elements include: (1) using CHAMPUS "recapture" funds to hire additional personnel; (2) maximizing personnel utilization by combining mental health staff from the social work and psychiatry services; (3) working closely with the community to identify local mental health needs; (4) offering additional therapeutic modalities; and (5) reducing rehospitalization rates through improved discharge planning. We reduced our financial-year first quarter costs by 76% from 1993 to 1995. We attributed much of these savings to reduced residential treatment admissions. Although the total number of outpatient visits increased, Munson's psychiatric services reduced outpatient costs by increasing clinic access. We have used the Gateway to Care program to prepare for the initiation of Tri-Care in our region.

A model for psychiatric services in primary care settings

The integration of mental health care and primary medical care enhances the quality of patient care and may improve the overall cost-effectiveness of a health care system. The authors describe implementation of a program that provides mental health care at 12 locations in a network of primary care sites associated with a university-affiliated community hospital in Rochester, New York. A project of the hospital's department of psychiatry, the program has as its goals improved recognition, diagnosis, and treatment of mental health problems and education of primary care providers in these areas. Each of the program's three primary therapists provide short-term, symptom-focused individual, marital, family, and group therapies and case consultation at several primary care sites. The program director, a psychiatrist, makes diagnostic assessments and provides medication consultation to both the primary therapists and the primary care physicians. The authors discuss the advantages and disadvantages of the program model and plans for its future development.