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Special Report
Contracting for Public Mental Health
Services Opinions of Managed
Behavioral Health Care Organizations
Summary
Focus group participants believed that the MBHO industry will
continue to be interested in public sector contracting.
However, they indicated that their organizations were calling
for much more rigorous evaluations of public sector RFPs and a more
cautious approach to entering into such arrangements. They believed
less competition for those programs will require a large investment from
MBHOs in terms of marketing, start-up, and ongoing administration yet
offer little financial reward.
Furthermore, focus group participants
noted the importance of policymakers’ willingness
to stand behind the program design
and the agency administering, even under
highly politicized circumstances. Study participants
distinguished between ongoing
improvements and modifications made during
the course of a program on the one hand
and broad-based changes driven by a political
process on the other. Through various
stakeholders’ influence on State legislators,
county administrators, and the governor’s
office, programs are sometimes changed
without sufficient rationale for or planning
behind the change.
Such changes impose administrative burdens
on the MBHOs and can increase their
costs significantly. Although it is difficult to
formulate a simple recommendation to avoid
this phenomenon (particularly as it can occur
in environments that include an open and
participatory process for program planning
and design), study participants cautioned that
MBHOs should consider the political environment
when deciding to bid on a program. As
their experience has grown over the past several years, MBHO business planners are
more cognizant of potential political pitfalls.
Agency policymakers will face more pressure
to manage the political process to ensure that
qualified organizations continue to show
interest in their business.
The future of public-sector-managed
behavioral health contracting, as depicted by
the MBHO study participants, will depend
on public payers’ ability and willingness to
design and administer programs that permit
contractors to succeed. Participants believe
that payers should approach programs with
an attitude of partnership and collaboration.
Equally important, they should avoid actions
or requirements that tend toward micromanagement.
These characteristics will help to maintain
healthy competition among MBHOs for State
and local-managed behavioral health care
contracts. By further establishing a cooperative
program management style toward the
contractor, public behavioral health programs
can better meet the objectives of the
public payers and continue to attract experienced,
high-quality, reputable contractors.
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