ESTIMATING the COST of PREVENTIVE SERVICES
in Mental Health and Substance Abuse Under Managed Care
Summary and Discussion
Before summarizing the estimated PMPM cost of these six preventive interventions, it is important to restate some of the major assumptions and limitations that had to be addressed.
Most of the originally published research did not present enough details regarding the specific costs of the various elements of their intervention. For example, most studies did not indicate the salaries paid to the staff members required to carry out the intervention. Most studies also did not indicate the unit costs of various booklets, brochures, videotapes, or assessment instruments distributed to participants.
A more serious limitation in the published research was the lack of information regarding the incidence or prevalence of the disease, disorder, or poor lifestyle behavior toward which the intervention was directed. While many studies reported the number of persons invited to participate and the number screened in or out, most studies did not describe the size of the population from which these participants were drawn. Therefore, it was necessary to estimate the rate of participation per 100,000 MCO members. Any MCO that considers the feasibility of offering any of these interventions will need to assess the likely volume of users who will start and complete the intervention.
Because MCOs are likely to vary widely with respect to the demographics and health/illness case mix among their members, it was necessary to create alternative scenarios to encompass the full range of low- to high-cost assumptions. For example, the Least Expensive Scenario encompasses all the least costly assumptions about the case mix of members (educated, employed, commercially insured), the salary costs of employees, and the unit costs of material and travel. The Most Expensive Scenario encompasses the most expensive set of assumptions about membership, salary levels, and supplies and materials. A fairly wide range of possible values had to be assumed for such variables to ensure that most of the cost-related values applicable to most MCOs would be encompassed.
Each intervention cost model was an amalgamation of several different, specific interventions that shared a common theme or targeted illness, condition, or behavior. Thus, each model is not an exact cost representation on any one published study but a generic model that was designed to incorporate the essential variables that would drive the overall cost of similar interventions. In some cases, such as the model for Health Promotion Through Self-Care Education, the model was designed to incorporate all the component interventions used across all published studies. Thus, the estimated average PMPM costs are likely to overstate the costs for an MCO that implements only a subset of all the possible components.
Only one model (Targeted Short-Term Mental Health Therapy) assumed any revenue to offset costs.
Table 2 summarizes the midpoint value between the median PMPM cost of the Least Expensive Scenario and the median PMPM cost of the Most Expensive Scenario.
These results suggest that the incremental costs for an MCO to implement any one of these interventions are very small relative to existing monthly premiums.
Table 3 expresses the midpoint between the median PMPM cost of the Least Expensive Scenario and the median PMPM cost of the Most Expensive Scenario of each intervention as a percentage of the average monthly HMO premium rates for single individuals in 1997 as reported by Baker et al. (2000). The average monthly HMO premiums are lowest in regions of the country (Mountain and East South Central) where the highest percentage of the community population is enrolled in an HMO.
As can be seen in Table 3, the most expensive intervention, Health Promotion Through Self-Care Education (midpoint PMPM = $1.54), would add 1.09 percent, at most, to the estimated 1997 average monthly single premium of an HMO in the Mountain region and only 0.84 percent to the premium in the New England region. The average percentage increase across all six interventions in all four regions is only 0.5 percent.
Given the documented effectiveness of these interventions in improved medical outcomes, increased patient satisfaction, reduced use of medical resources, and cost, and their low cost relative to existing premiums, it is highly recommended that MCOs give serious consideration to implementing the interventions.
Table of Contents | Previous | Next
|
