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Special Report:
Policy Report: School-Based
Mental Health Services
Under Medicaid Managed Care

Appendix B: Site Visit Reports

Appendix B-1
Albuquerque, New Mexico

I. Introduction

The Albuquerque Public School (APS) Medicaid managed care pilot for school-based/ linked mental health services began in 1998 as an attempt both to increase the resources available for school-based care and to expand the size of the managed care network for behavioral health organizations. The following case study documents the experiences of two schools that participated in the pilot during the 1998-99 school year. The first section reviews structural components of the program. Following this description is a review of participants’ experiences with the program to date. This review incorporates the perspectives of State and local officials, a managed care representative, mental and physical health care providers, and numerous school staff, including principals, teachers, and guidance counselors.

II. Structure

The APS district is the 27th largest independent school district in the Nation, with an enrollment of nearly 90,000 students. It comprises 11 high schools, 24 middle schools, 78 elementary schools, and 6 alternative high schools. School-based/linked health care was introduced to the district in 1993. Currently there are nine school-based health centers and two school-based/linked primary care programs operating in the APS system.

The University of New Mexico (UNM) played a large role in facilitating expansion of school-based/linked services in the APS system. The UNM School of Medicine began a community-based program in 1993, including the creation of satellite clinics within APS. The satellite clinics, or school-based health centers, offer a range of services, including primary physical health care and mental health treatment.

Financing and administration of school-based mental health care in UNM-sponsored school-based health centers have undergone substantial changes over the past 6 years. The changes were precipitated, in part, by implementation of New Mexico’s Medicaid managed care program -- Salud! UNM began accessing Medicaid reimbursement for many of the mental health services provided in the schools in 1994 (Exhibit B-1-1). For the first 3 years of billing, UNM billed Medicaid directly on a fee-for-service basis. The university also relied heavily on funding from its outpatient mental health center as well as State and Federal grants to finance the program.

In 1998, New Mexico implemented Salud!, its Medicaid managed care program. Salud! is a statewide capitated managed care program covering Medicaid-eligible individuals on a voluntary basis. Under Salud!, the Human Services Division (Medicaid) contracts with three health maintenance organizations (HMOs) to provide primary physical health care services to Medicaid-eligible individuals. Each HMO then contracts with a behavioral health care organization (BHO) to provide all mental health and substance abuse services. In the Albuquerque area, the BHOs contract with Regional Care Centers (RCCs), including the University of New Mexico and the Consortium, a group of six community providers.

Shortly after the implementation of Salud!, one of the BHOs (Options)² approached the State Department of Health, Office of School Health, with a proposal to initiate a pilot program in mental health managed care within a cluster of Albuquerque’s school-based health centers. Options was interested in linking its Medicaid managed care mental health services directly to school sites. APS and the State Department of Health selected five schools within the Albuquerque High School cluster as the initial pilot sites. The decision was based on results of an assessment as well as on the recognition that there are a disproportionately high number of Medicaid-eligible students attending school within the cluster. During the 1997-98 academic year, approximately 500 children enrolled in the APS SBHCs were Medicaid-eligible.

The pilot was implemented concurrent with the 1998-99 academic school year. It includes participation by all three HMOs/ BHOs and their corresponding providers. Under the pilot, UNM no longer is the sole provider of school-based mental health services. Social workers from either UNM or the Consortium are assigned to work within the SBHCs and provide individual, group, and family therapy.

The mental health Medicaid managed care pilot is currently operating in five Albuquerque public schools, including one high school, one middle school, and three elementary schools. Three of the schools provide mental health services in addition to primary physical health care services within SBHCs sponsored by UNM. The other two schools do not have SBHCs and provide only mental health services.

A variety of State and local actors collaborate to administer and manage the pilot program. At the State level, both the Human Services Division (Medicaid) and the State’s Department of Health have regulatory oversight of the program. Medicaid manages the HMO/BHO contract, while the Department of Health sets policy with respect to general operation of the SBHCs. At the local level, the APS district hosts SBHCs operating within their jurisdiction and is involved in planning and general oversight of the program. Regional Care Centers (UNM and the Consortium) contract with the BHOs and provide mental health clinicians to treat children who are registered with the SBHC. The RCCs are also responsible for submitting claims to the BHOs for reimbursement. Exhibit B-1-2 shows the relationships among the agencies involved in the program.

Mental health services available under the pilot include individual, family, and group therapy; case management; and behavior management services. These services are provided by either a licensed social worker or a psychiatrist. Physical health care services within the SBHC are provided by physicians employed by the University of New Mexico and by a part-time nurse practitioner. Services offered include health assessment and physical examinations, disease prevention, immunization programs, limited on-site laboratory services, health promotion and education, and prevention programs. Although not part of the Medicaid managed care pilot, staff in the centers coordinate enrollment, diagnosis, and referral efforts.

Children in the Albuquerque Public School system who require mental health care or counseling have multiple avenues to access care in the school-based health center.³ Any school employee may refer a child to the SBHC, or a child may refer him- or herself. If the child is not enrolled in Medicaid, the school nurse or the SBHC intake worker may presumptively enroll a child who meets the eligibility requirements.

Once the child is enrolled in the SBHC, either a social worker or a psychiatrist is assigned, based on the child’s need and the availability and the special expertise of staff members. Additionally, if the child is Medicaid-eligible, the type of HMO and corresponding BHO in which the child is enrolled strongly influences staff assignment decisions. If, for example, a child enrolled in the Options plan presents at an SBHC, where both a UNM and Consortium provider are available, the child is more likely to be seen by the Consortium provider because a contractual relationship is in place between the Consortium and Options. If a Consortium provider is not available, the UNM provider must contact Options to obtain authorization before treating the child.

The SBHCs are open on all school days, but not all services are available every day. Each child psychiatrist and part-time social worker is available to treat children in the SBHC 1 day a week. When the schools are closed for summer vacation, services are provided off-site in the community.

Contracting between HMOs/BHOs and SBHCs is strongly encouraged by the State’s Medicaid office but not required. Although school health advocates lobbied to include language in the Medicaid Managed Care Request for Proposals (RFP) to mandate a contractual relationship between SBHCs and managed care organizations, the language was deleted from early drafts.

Despite omission of such requirements in the RFP, HMOs/BHOs in the Albuquerque region have initiated relationships with five SBHCs under the pilot program for mental health Medicaid managed care. However, the contractual relationships between the various HMOs/BHOs, their respective providers, and SBHCs are not consistent. Each HMO/BHO has established separate contractual relationships with the two RCCs (UNM and the Consortium), which, in turn, have established separate policies and procedures for the clinicians they provide to each of the participating SBHCs.

Currently, UNM contracts with two BHOs to provide mental health services in the schools, Value Behavioral Health and MCC. UNM does not have a contract with Options. The Consortium, on the other hand, has contracts with Options and MCC but currently not with Value Behavioral Health (see Exhibit B-1-3).

The contractual agreements between the BHOs and the RCCs establish UNM and the Consortium as the preferred providers, authorized to deliver services to students enrolled in the respective HMO/BHO Medicaid health plans. As preferred providers, UNM clinicians generally treat students who are enrolled in Value Behavioral Health and MCC, while clinicians from the Consortium generally treat students who are enrolled in either MCC or Options. However, these contractual arrangements do not preclude either UNM or Consortium providers from treating students enrolled in other plans. If the provider does not have a contractual arrangement in place with a plan for one of the patients it is treating, it must obtain prior authorization from the plan before proceeding with treatment in order to obtain appropriate reimbursement.

Generally, mental health providers must obtain authorization within 5 days of seeing a child. School-based clinicians must contact representatives from a child’s health plan and request authorization for the type and amount of services they wish to provide. Each of the three BHOs (Options, MCC, and Value Behavioral Health), however, has established distinct prior authorization policies.

Options usually authorizes 10 outpatient sessions automatically. At the end of those sessions, the SBHC clinician must gain authorization for an additional 10 sessions. Beyond 20 sessions, providers must submit a written justification for further treatment. MCC, on the other hand, requires both UNM and Consortium providers treating enrolled children to participate in phone interviews with a utilization review clerk to discuss the necessity for services. As with Options, 10 sessions are generally authorized initially, with follow-up requests made if the child needs further services.

Relative to the other two BHOs, Value Behavioral Health’s prior authorization requirements are the most streamlined. UNM providers are not required to obtain formal authorization before treating a patient. Instead, a utilization review representative from the BHO participates in wrap-up meetings held by clinic staff and school representatives to discuss cases under their review and to decide on appropriate treatment plans. This process has made it possible for clinicians to forgo the formal prior authorization process.

Before pilot implementation, UNM-sponsored SBHCs received Medicaid reimbursement, private insurance, and the Healthier Kids fund (HKF),⁴ a primary care fund for uninsured children developed by the State. They have also received funding from State and Federal grants, such as the Maternal and Child Health Block Grant, that were allocated to the university’s Health Science Center, and funding from the UNM Department of Psychiatry for mental health services.

Under the pilot for Medicaid managed care, financial support is still obtained from a variety of sources, including direct billings to families/private insurance, capitation rates from Cimarron/Value Behavioral Health as part of UNM Programs for Children, fee-for-service contracts with Options and MCC, State and Federal grants, and UNM Department of Psychiatry faculty funds. Clinicians in each health center submit all Medicaid reimbursable claims for mental health services to their sponsoring organization, either UNM or the Consortium, that in turn submits the claim to the appropriate BHO/HMO. Reimbursement goes directly to the sponsoring organization. All school-based mental health clinicians who provide services in the SBHCs are salaried employees paid directly by their sponsoring organization.

Mental health school-based/linked services through the managed care pilot project are currently the only Medicaid reimbursable services. Similar agreements have not been forged among SBHCs, their community providers, and the Medicaid HMOs responsible for authorizing reimbursement of physical health care services.

III. Experiences

Clinicians at both schools found the administrative process cumbersome and time-consuming. A common complaint centered on students’ enrollment; often the enrollment process can take months. Delays are blamed on paperwork lost by the MCOs as well as on family ignorance of eligibility requirements or the process. In many instances, parents are either unwilling or unable to verify the insurance status of the child. Although clinicians generally are able to identify whether or not the child in question is eligible under the contracted plan, they experience great difficulty verifying eligibility if the child belongs to a competing plan. Without accurate insurance status information, it is difficult to assign a child to the appropriate clinician and to determine the appropriate prior authorization procedures to be followed. In the interim, services provided to the child are not reimbursable and cannot be billed.

One final concern is the continual fluctuation in staffing at each of the BHOs. High turnover rates and job swapping within organizations make it difficult for clinicians and their respective sponsoring organizations to determine the appropriate contact for prior authorization, treatment planning, reimbursement, and grievance or appeal. Consequently, clinicians spend a fair amount of time calling BHO representatives to identify the appropriate contact and then must often explain repeatedly the child’s relevant background information. Respondents indicated that, to date, they were never notified when staffing changes were made, nor were they ever given a list of contacts and corresponding phone numbers for the BHOs.

In general, program providers and administrators were fairly positive about the range of services offered by each of the plans under the pilot. Managed care has made the availability of services more standardized across school-based health centers. In addition a greater emphasis has been placed on expanding community-based mental health care since the pilot was initiated.

Yet these community-based services do not necessarily match the need. All of the providers interviewed felt that the acuity of children’s behavioral health needs has risen substantially over the past few years, citing an increased number of psychotic, suicidal, and depressed children in the schools. They attribute some of the problem to a decrease in the use of residential treatment facilities and hospitalizations by the BHOs.

According to many school health advocates, complicating the situation is the general dearth of psychiatric services for children in the State. Initially, many child psychiatrists signed on with the Salud! program; however, low reimbursement rates and limited service definitions have gradually led to a decline in the number of psychiatrists willing to treat Medicaid recipients. As a result, school providers have found it difficult to refer children out for services beyond the scope of the school-based heath center.

In theory, under the managed care mental health pilot, SBHC services are not supposed to be based on the types of reimbursement available for treatment. In practice, however, respondents overwhelmingly indicated that the sponsoring organizations’ perception of their ability to obtain reimbursement profoundly affects the types of services provided to certain children. On the basis of previous experience with the plans, providers are aware of the services that are likely to be authorized. The time associated with the prior authorization process for some plans has led some providers to initiate only treatments they are fairly confident will result in reimbursement. This was particularly true for the medications prescribed by psychiatrists in each of the centers. In this sense, providers felt that they were moving away from diagnosis-based treatment.

Additionally, providers expressed frustration with the prior authorization process. They found the systems are difficult to navigate; the avenues through which authorization could be obtained were limited. The different definitions of medical necessity in each plan complicate the process still further. However, UNM providers have found placing children in UNM facilities and obtaining authorization for UNM services comparatively easier than accessing those services for children enrolled in the Options/Presbyterian plan, for which UNM does not have contracts. This may be because UNM providers are better acquainted with the UNM system and have contacts in the various departments to ease these processes.

Overall, providers feel that under the pilot they have less time to treat children. Although providers are required to spend a certain percentage of their time seeing patients, with the level of paperwork required to gain prior authorization, they report that it is difficult to find the time to do both jobs. In fact, one school-based health center reported that it closed its doors and sent waiting children away twice in one semester because of cases that required all members of the staff to either treat the child or make phone calls to get the child admitted somewhere for further treatment. In efforts to be more available to children, some providers ignore insurance status and paperwork, rendering many of their services unreimbursable.

Although frustrated, providers indicated that they are adapting to the managed care pilot. As mentioned above, they sometimes rely on school resources to help children gain access to treatment. Additionally, to expedite the process, providers at Albuquerque High School have begun to heavily document their evaluations, making it more difficult for a health plan to turn a child away. In addition, providers are becoming accustomed to calling admitting officers to follow up on cases and to advocate for their patients.

According to SBHC and State representatives, working out the terms of the contract or requirements has been a fairly smooth process. Program administrators indicated that meetings took place on a regular basis to negotiate the terms of the contracts and to make modifications as necessary. In fact, several individuals interviewed mentioned meetings that were taking place to resolve issues pertaining to prior authorization.

Nevertheless, some problems have been reported. In addition to high turnover rates, interest in BHO participation in the pilot has been uneven. Since participation in the pilot is not mandated, BHOs that have a fairly strong provider network or that do not believe the pilot to be in their best interest financially have been reluctant to work with the centers and their satellite providers to resolve administrative issues. Additionally, because contracts are negotiated between sponsoring organizations and BHOs, the BHOs are often too far removed from the process to realize some of the difficulties faced by SBHCs.

Project administrators indicated that, overall, managed care has not radically altered the types of funding used to support school-based mental health services. Complicated reimbursement processes and a high BHO claims denial rate have limited resources obtained through Medicaid reimbursement. As a result, the pilot still relies heavily on grants and State funding to support the provision of services.

Sponsoring organizations appear to have incurred high costs under the new system. According to providers, UNM has been "running in the red" since Medicaid managed care was implemented, running a $1.5 to $3 million deficit in the past 2 years for mental health services provided in the schools and through its other community-based clinics. Providers indicated that low reimbursement rates have contributed to the situation. Before Salud! program, UNM’s school-based mental health program was expanding; providers indicated that Medicaid reimbursement was less complicated and more predictable at that time. As a result of financial constraints, UNM has been unable to further expand its mental health program, despite requests from schools in the Albuquerque area.

IV. Conclusion

New Mexico’s Medicaid managed care pilot for school-based mental health services is still in its infancy. At the time of initial interviews, the program was less than a year old; thus, many of the programmatic and administrative details are still being discussed. Environmental changes around the delivery and financing of health care services have paralleled and complicated development of the pilot. The statewide Medicaid managed care program was in place for less than 6 months before planning for the pilot began. The short lead-in period for both initiatives has left little opportunity for providers to adapt to their new environment.

Despite these challenges, most administrators of the pilot at both the State and local levels believe that the mental health system and public health workers have made great strides to integrate school-based mental health into the statewide Medicaid managed care program. Although the operation of the program has been fraught with challenges, they are working hard to overcome the growing pains associated with such a young program. They are hopeful that ongoing discussion with the BHOs about prior authorization, claims submission, and referral will improve upon the provision of care during the first year of operation.

Reflecting this optimism, efforts have already been undertaken to expand the program beyond the five pilot sites. On the basis of the high number of school children who are Medicaid-eligible and in need of mental health services, the Human Services Department began funding additional pilot sites for the 1999-2000 academic year.

Appendix B-2
Baltimore, Maryland

I. Introduction

The Baltimore City Health Department (BCHD) has a unique and close working relationship with the independent local mental health authority, the Baltimore Mental Health Systems (BMHS), for they were both established in mid-1980s. BMHS manages, coordinates service, and oversees all the city’s mental health providers. Today, BMHS works with BHCD to fully integrate mental health care in its school-based health centers (SBHCs) under the State’s managed care plan. This case study focuses on the city of Baltimore, Maryland, and two SBHCs within the city limits. The first section of the study reviews structural components of the program, and the second section describes participants’ experience with the program before and after introduction of Medicaid managed care. This review incorporates the perspectives of State and local officials, mental and physical health care providers, and numerous school staff, including principals, teachers, guidance counselors, and school nurses.

II. Structure

Baltimore, Maryland, has one of the largest (46 SBHCs) and longest-running SBHC programs in the country that provides mental health services. The oldest center opened its doors in the mid-1980s. During the 1997-98 school year, students at these centers used mental health services more than other types of services. During this same period, a total of 2,860 students in 53 schools were referred for mental health services.

Two SBHC models operate in the Baltimore City Public School System (BCPSS)⁵ -- a full-service SBHC providing mental health care and a separate, freestanding mental health provider. The Baltimore City Health Department sponsors mental health services in 80 different schools; 15 of them are part of comprehensive SBHCs. The 15 SBHCs are located in 7 high schools, 3 middle schools, 1 middle/high school, 3 elementary schools, and 1 K-8 school. The remaining schools have community-based mental health providers who come into the schools on a periodic basis to provide services to students.

School-based mental health services, provided through a collaboration among BCPSS and eight community-based mental health agencies, are available to all students in regular education. These services address underlying emotional and behavioral concerns, thereby enabling students to participate in academic instruction. The schools themselves do not play active administrative or financing roles in the SBHC; however, a school may provide the SBHC with in-kind support and clinic space.

Before the implementation of Medicaid managed care in 1997, SBHCs in Maryland billed for provided services under a fee-for-service arrangement with little bureaucracy and limited paperwork. SBHC providers served all children in the school, regardless of their insurance status, relying heavily on private grants and financial support from the Baltimore City Health Department and the Baltimore Public School Board. However, with the State’s move to managed care, SBHCs were deemed essential providers under the Medicaid waiver. Accessing these funds has meant observing all the requirement complexities of Maryland’s Medicaid waiver.

Since Maryland has a partial carve-out system for mental health under its Medicaid managed care waiver, mental health services are provided by both managed care organizations (MCOs) and the Specialty Mental Health System (SMHS). The SMHS is administered by the Mental Hygiene Administration (MHA) in conjunction with 19 local Core Service Agencies (CSAs) and a behavioral health company, Maryland Health Partners (MHP), that assists them with administration and monitoring of the SMHS.

The roles of agencies involved in the delivery of school-based mental health care are described below:

Mental Hygiene Administration -- The MHA administers the SMHS, along with the 19 CSAs. The MHA is responsible for over-seeing all publicly funded mental health services and thus monitors CSA performance.

Core Service Agencies -- CSAs are locally based government or private nonprofit entities that fund community-based mental health services on behalf of the State. Under the carve-out, CSAs continue their role as local governance entities.

Baltimore Mental Health Systems, Inc. -- BMHS is a public nonprofit CSA that acts as manager, coordinator, and local authority for mental health services in Baltimore. It is the only CSA in Baltimore. BMHS is not a direct service provider but oversees the provision of mental health services in seven catchment areas throughout the city. BMHS was established in 1986 by the Baltimore City Health Department with a 5-year, $2.5 million grant from the Robert Wood Johnson Foundation Program on Chronic Mental Illness. Maryland Health Partners -- MHP is made up of private, competitively procured behavioral managed care organizations retained as an administrative service organization (ASO) to provide extensive administrative and monitoring services.

Community Mental Health Provider Agencies (sponsoring agencies/MHPAs) -- Baltimore City Public Schools are served by 13 community mental health providers that employ and station mental health clinicians in Baltimore city schools.

Mental health programs integrated into SBHCs do not operate in the same way as freestanding mental health programs. Typically, SBHCs with mental health services include multidisciplinary health professional staff to address the varied needs of the school population. The mental health professionals can rely on the SBHC staff for issues related to students’ physical health. Providers in schools with freestanding mental health services usually rely on school nurses to address the physical health needs of their students.

This case study includes both models -- Harford Heights Elementary School, which has a full-service SBHC, and Winston Middle School, which has a freestanding mental health program. Harford Heights has roughly 1,700 students enrolled in kindergarten through eighth grade. Winston has a relatively small student population of about 600. Winston’s school nurse attends to students’ physical health needs; one full-time mental health clinician, employed by a mental health provider agency, attends to students’ mental health issues. In contrast, the student population at Harford Heights is substantially poorer: more than half of its students receive free or reduced-cost lunches. Since the school is fairly large, the sponsoring agency has allocated two-and-a-half full-time mental health clinicians for Harford Heights’ students.

The sponsoring provider agencies administer these two programs in very similar ways. The North Baltimore Center provides Winston Middle School with a mental health clinician and collects provider reimbursement claims, submitting them to the Baltimore Public School System, Office of Third-Party Billing (OTB). The North Baltimore Center also facilitates prior authorization requests and treatment plan submissions. Similarly, the East Baltimore Mental Health Partnership provides Harford Heights with mental health clinicians and assistance with prior authorization, treatment plans, and reimbursement documentation.

Harford Heights, which is typical of other SBHCs in Baltimore, and Winston Middle School provide physical and mental health services to students and members of their families. Mental health and substance abuse services are provided on-site or through referrals. SBHCs provide mental health assessment, treatment, referral, and crisis intervention. Services include individual mental health assessment, treatment, and follow-up; alcohol or other substance abuse assessment, counseling, and referral; suicide prevention; crisis intervention; group and family counseling; and psychiatric evaluation and treatment.

A student can be referred to the mental health provider in the school or SBHC in a variety of ways. In many instances, teachers identify children in their classrooms who may benefit from a visit with the mental health provider(s). School counselors, nurses, and other school staff may use the mental health provider when they believe that a student has a problem at school or at home. For schools with SBHCs, mental health needs are sometimes identified when a student enters the SBHC for physical health services. Additionally, students refer themselves or their friends to the mental health provider.

Baltimore SBHCs do not contract directly with managed care organizations; Maryland Health Partners does not have formal contracts with either SBHC staff or individual mental health clinicians. Rather, it contracts with community mental health provider agencies that in turn supply mental health clinicians to the schools. The contracts stipulate procedures for reimbursement, prior authorization, and documentation of treatment plans.

Mental health providers in Baltimore city schools must submit prior authorization forms and treatment plans to MHP for students they believe will require more than 12 visits. Typically, 12 visits will be approved automatically. A treatment plan must be completed by no later than the eighth visit and must be timed at least 3 weeks prior to the twelfth visit. To gain authorization for therapy sessions beyond 12 visits, the student must have a Diagnostic and Statistical Manual (DSM-IV) diagnosis. Depending on the agreement between the school and the sponsoring provider agency, some provider agencies act as central depositories for their schools and will forward treatment plans and prior authorizations to MHP after collecting them from the schools. Other sponsoring provider agencies require that their clinicians submit the proper documentation directly to MHP. However, all mental health clinicians in schools are required to submit reimbursement forms to their respective provider agencies. The provider agencies are then responsible for processing those claims to the OTB in the BCPSS. The OTB submits reimbursement claims to MHP; reimbursement dollars are funneled back to the OTB (Exhibit B-2-1).

On July 1, 1997, with the implementation of the Medicaid managed care waiver, Medicaid funding for specialty mental health was joined with the resources of MHA to provide a single funding stream to Baltimore Mental Health Systems (and its mental health provider agencies) to provide Medicaid mental health services.

The MHA combines Medicaid with its own resources (State mental health grant funds and State hospital funds) and allocates sponsoring mental health providers a global budget based on historical rates of use. MHP collects reimbursement claims from the BCPSS OTB and processes them for collection. MHP is paid a set fee for its services; reimbursement dollars are then sent to the OTB, which pays sponsoring provider agencies on a fee-for-service basis. The provider agencies, in turn, employ and pay mental health providers on a salary basis (Exhibit B-2-1).

The school board allocates $1.6 million for mental health programs for students who do not receive services under special education. The $1.6 million is then directed to sponsoring provider agencies that provide mental health services to students in 53 BCPSS schools. In addition, during the 1997-98 school year, State and Federal funds allocated through BMHS provided $1,105,200 to supplement funding provided by the BCPSS in many of the 53 schools and to fund mental health services in 10 additional schools (Table B-2-1).

Exhibit B-2-2 illustrates the flow of funds among the different actors in the financing and reimbursements of school-based mental health services. Sponsoring mental health provider agencies receive grant money from Baltimore Mental Health Systems, Inc., and an allocation from the Baltimore City Public School System to place mental health clinicians in the schools. Sponsoring provider agencies in turn collect reimbursement information from their clinicians and forward it to the OTB, which then submits claims information to MHP for treatment provided to eligible individuals. Reimbursements are paid directly to the OTB, and are used to offset the $1.6 million the BCPSS allocates to provider agencies to provide mental health services in the schools.

For OTB to gain reimbursement for services provided to Medicaid-eligible students in regular education, several steps are necessary. First, the mental health professional providing the service must be either one of the following:

1. Functioning as an employee of a licensed outpatient medical health center (OMHC) that follows Code of Maryland (COMAR) regulations and is paneled with MHP

2. An individually licensed mental health professional who has a Medicaid provider number and is paneled as an individual provider with MHP

Before billing can begin, each student for whom mental health services are provided must be registered with MHP. A DSM-IV diagnosis must be entered on the encounter form. If the student does not have a diagnosable mental health condition, the student cannot be registered with MHP, nor can the treatment costs be reimbursed.

A treatment plan must be completed and submitted to MHP no later that the eighth session for any student who (1) has a DSM-IV diagnosable condition and (2) is likely to require more than 12 sessions with a mental health clinician. MHP requires that the treatment plan be mailed 3 weeks before the twelfth visit.

After the required treatment plan has been submitted and reviewed by MHP, a treatment authorization form is mailed to the provider. It is the responsibility of the mental health clinician to track the number of sessions as well as the start and end dates on the approvals. In this way, the clinician can ensure that updated treatment plans for any additional sessions needed are submitted in a timely fashion. Also, if the student is receiving services from another community provider, those services count against the allotted 12 sessions.

III. Experiences

According to Baltimore city officials, the administration of the program runs relatively smoothly, despite the complexity of the claims and documentation process. Administrators reported that a positive outgrowth of the increased documentation is the collection of school-health-related outcome data. Since providers were not required to submit treatment plans or prior authorization forms before managed care, valuable data on treatments provided and client demographics were lost. The increased documentation of school mental health activity increases provider accountability and assists in strategic management of the program.

However, administrators of the program stressed that Baltimore is unique given the role of its local mental health authority (BMHS) in advocating for appropriate mental health services. BMHS has continued to resolve and fill in treatment gaps when they occur. For instance, BMHS recently implemented a prevention program in which mental health clinicians can bill for their time to community prevention and support activities. By using State-only Medicaid money, the BCPSS and BMHS have created service codes for preventive sessions, including mental health education, conflict resolution, anger management, after-school clubs, and self-esteem issues. Clinicians can bill using these service codes after submitting a proposal to their sponsoring mental health provider agencies.

Mental health issues are consistently the foremost reason for student to visits their SBHC or mental health clinician. During the 1997-98 school year, over 20,000 individual sessions and more than 8,800 group contacts were provided. Reported teacher contacts totaled more than 8,000, and over 4,000 parent contacts were made during the course of the school year.

Despite the growing need for services, respondents indicated that introduction of Medicaid managed care in the school-based environment has reduced the time mental health clinicians have available to treat patients. The administrative work that accompanies billing and registration requirements is both cumbersome and time-consuming, according to school mental health clinicians. Providers must now keep a record of how many sessions are authorized, how many have been used, and for whom they need to request more sessions. If a child requires more sessions, treatment plans have to be written or adjusted.

Two reasons underlie why mental health clinicians are under pressure to treat only students eligible for Medicaid and the Child Health Insurance Program:

1. Sponsoring agencies are strongly encouraged to replace the $1.6 million allocated from State-only educational funds with Federal Medicaid dollars.

2. Sponsoring agencies want to avoid the cumbersome and idiosyncratic reimbursement processes required by private insurers.

Unintended consequences of these unstated policies are that few non-Medicaid-eligible students receive therapy; group rather than individual therapy is offered; and less time is available for prevention services. Compounding the pressure on therapists is the growing number of students with more serious mental health problems. Last year, one school had nine children with suicidal ideation and many more with depression. Many clinicians and school staff are seeing more and more children in need of mental health services.

The Baltimore Public School System, Office of Third Party Billing, began seeking reimbursement in July 1998. The office set a target of $350,000, based on the amount collected in the preceding year under the nonmanaged fee-for-services system. To date, this goal has not been met.

In fiscal year 1999, claims totaling approximately $156,000 were submitted for Medicaid reimbursement, but only $82,000 was actually recovered. Clinicians are not submitting all eligible claims because of the tremendous paper burden.

Issues of stigma have also affected the claims submission process. MHP requires a DSM-IV diagnosis before services can be authorized for reimbursement. Many clinicians are concerned about the possibility of stigmatizing students by assigning a DSM-IV diagnosis. Therefore, clinicians will refrain from assigning such a diagnosis to a student (but continue to provide services), making it impossible to obtain reimbursement for services rendered. Of the approximately 2,700 students seen in 1999, 1,000 were given DSM-IV diagnoses.

IV. Conclusion

Though Baltimore is unique in the sense that the school board provides a large portion of the funding for mental health services, the city’s desire to recover reimbursements as they did before managed care requires clinicians to adjust the services they provide and to make decisions about who can receive those services. This adjustment in services usually leads to less one-on-one treatment and allows little flexibility in treating students not covered under Medicaid.

Although Medicaid managed care has shifted the ways in which services are provided, organizations such as Baltimore Mental Health Systems, Inc., are instrumental in resolving billing issues and filling some of the gaps not provided for under the current system. BMHS’s prevention program is unique, providing clinicians with service codes to bill for mental health education and illness prevention. Administrators hope that these additional services will provide greater flexibility and help ease some of the pressures that clinicians incur surrounding billing and reimbursement.

Appendix B-3
New London/Groton, Connecticut

I. Introduction

In 1985, with an initial grant of $50,000, Connecticut opened its first Department of Public Health-funded SBHC in the city of Bridgeport to provide needed medical services to underserved children. Today, Connecticut has the sixth-largest SBHC program in the Nation, with 51 SBHCs operating throughout the State on a budget of more than $5 million. Unique to the Connecticut model are regulatory requirements mandating formation of contracts between SBHCs and Medicaid managed care contractors. Since 1997, SBHCs have been considered "ancillary providers" within the managed care network and are reimbursed on a fee-for-service basis. This case study focuses on the communities of New London and Groton and their experiences under Medicaid managed care. Both communities are served by the Child and Family Agency (CFA) of Southeastern Connecticut, Inc., which has a distinguished history of providing mental health services in the region. The first section of the study reviews the structure of the program, while the second section describes participant experiences with the program before and after introduction of Medicaid managed care. This review incorporates the perspectives of State and local officials, mental health and physical health care providers, and numerous school staff, including principals, teachers, guidance counselors, and school nurses.

II. Structure

Of Connecticut’s 51 SBHCs, the State Department of Public Health (DPH) funds 46 centers in 15 cities.⁶ Eighteen SBHCs are located in high schools, 12 in middle schools, 9 in elementary schools, 6 in K-8 schools, and 1 in an early childhood center. Statewide, 26,204 students are enrolled in DPH-funded school health centers.

Under the original model for school-based health care developed by the DPH, SBHCs were not required to seek reimbursement for Medicaid-eligible clients. By 1993, however, DPH found that State grants could not support 100 percent of the costs incurred by the centers. With the introduction of Medicaid managed care in 1997, in an effort to establish additional revenue, the decision was made to require SBHCs to work with the Department of Social Services (DSS- Medicaid) to seek reimbursement.

SBHC reimbursement for individuals eligible for Medicaid is managed under the current Medicaid managed care contract. Connecticut’s DSS operates a Medicaid managed care program -- Connecticut Access -- that includes physical health, mental health, and substance abuse services under a 1915(b) Medicaid waiver. DSS contracts with seven private, for-profit HMOs and two federally qualified health centers on a fully capitated basis. Four plans with contracts in Connecticut are required by DSS to use SBHCs and child guidance clinics as part of the traditional community provider network.

In the New London and Groton region, there are two models of SBHCs typical of those found throughout the State -- a full-service SBHC providing mental health care in the school and a school-linked health center that operates in the community near the school. SBHCs selected for the site visit were both full-service SBHCs in the schools, providing physical and mental health services through a multidisciplinary team of providers.

Two State organizations have oversight responsibility for financing and delivery of SBHC services. SBHCs in Connecticut are accountable to the DPH, and Medicaid managed care organizations (MCOs) that contract with SBHCs are governed by the State DSS. The DPH and the DSS communicate about the feedback they receive from schools regarding managed care issues, and jointly mediate relationships between MCOs and SBHCs.

In southeastern Connecticut, the Child and Family Agency manages 10 SBHCs and performs contracting, billing, and other administrative functions. Since CFA is the sponsoring organization for 10 SBHCs in the region, they are also required to meet Department of Public Health reimbursement and administrative requirements (see Exhibit B-3-1).

CFA receives DPH grants for SBHCs operating in southeastern Connecticut. It also negotiates and maintains contracts with MCOs on behalf of SBHCs in the region. Since the DPH requires SBHCs to bill Medicaid to obtain funding, CFA coordinates the billing for its 10 schools, negotiating reimbursement and prior authorization procedures with its partner MCOs. CFA in turn employs and stations mental health professionals in the SBHCs and school-linked health centers. Although these clinicians work with school nurses and counselors, they typically regard themselves as guests in the schools. The role of the schools is usually limited to providing in-kind support such as clinic space or administrative support.

Connecticut’s SBHCs are comprehensive primary care facilities located within schools on school grounds and serving youth enrolled in prekindergarten through twelfth grade. They are staffed by multidisciplinary teams of pediatric and adolescent health specialists, including nurse practitioners, physician assistants, social workers, doctors, and, in some cases, dentists and dental hygienists. SBHC services include treatment of acute injury and illness; routine checkup; physical examination and health screening; immunization; dispensing of prescriptions and medications; diagnosis and treatment of sexually transmitted disease; oral health screening; and, in some sites, full dental care, crisis intervention, and individual, family, and group counseling.

CFA’s SBHCs in the southeastern region of the State offer approximately the same physical health services as all Connecticut SBHCs, as well as the following mental health services:

Students gain access to SBHC services in a variety of ways. Teachers, counselors, school nurses, coaches, and parents may refer students to the SBHC. At the Norwich Free Academy in New London, for example, teachers frequently refer those students they believe may be having problems at school or at home to the mental health providers in the SBHC. Self-referrals and word-of-mouth referrals between students also occur commonly.

Mental health issues are a significant part of student visits to health centers. Statewide, 33 percent of all student visits to the centers are for mental health or substance-abuse-related services. A 1997-98 annual report from the Connecticut Department of Public Health documented 73,836 visits to SBHCs, of which 24,523 were related to mental health and substance abuse issues. In the southeastern region of the State, the demand for such services is even greater. More then 40 percent of all student SBHC visits in the New London and Groton areas are related to mental health or substance abuse.

Once a student is seen by a mental health provider in the SBHC, that student is medically assessed and can be seen by a mental health clinician up to five times. If the student needs services beyond five visits, the MCOs require referral to community providers in the MCO’s network. SBHC staff refer students to community providers if they believe individuals require services that they cannot provide.

Since Medicaid managed care began in Connecticut in 1997, SBHCs have been required by the Department of Public Health to contract with MCOs to continue receiving grants allocated by the DPH. Likewise, MCOs are required to include SBHCs in their provider network as a condition of contracts with the State Medicaid office. All SBHCs in Connecticut have at least one contract covering mental health services. Acting as liaison in the contract negotiation process, both the DPH and the DSS are in constant communication with one another, monitoring feedback from SBHCs and MCOs about difficulties experienced in contracting and reimbursement. The two departments may also facilitate negotiations to ensure a fair and reasonable process.

Statewide, nine SBHC sponsoring organizations have contracts with Preferred One, six have contracts with Kaiser that include mental health services, three have contracts with Pro Behavioral, three with CMG, and two with Magellan (formerly Merit). Five SBHC sponsoring organizations previously had contracts with Value Behavioral Health; however, because Value Behavioral is no longer a vendor in Connecticut, these SBHCs now contract with a new vendor.

Although contract requirements differ for each MCO, prior authorization requirements for treating students at SBHCs generally are similar to the requirements for more traditional outpatient clinics:

Several SBHCs are required to have primary care physician involvement in the authorization of behavioral health services. One SBHC noted that its behavioral health contract permits two sessions before authorization, after which a client’s primary care physician must be contacted for referral.

The Connecticut Department of Public Health makes grants to all SBHCs in Connecticut through a noncompetitive process as long as they are in compliance with DPH standards and State funding is available. Funding for school-based health has grown from $100,000 in 1986 to $5 million in 1998. In the 1997-98 school year, $288,096 came from Title V MCH Block Grant, $3,837,129 from the State General Fund, $725,270 from the Robert Wood Johnson Foundation, and $104,122 from the Safe and Drug-Free Schools initiative.

CFA receives a portion of these resources for its SBHCs and has an endowment producing an annual budget of $3.5 million. The endowment supplements the costs of providing care if costs exceed revenues available for a given year.

III. Experiences

The kinds of mental health services available in southeastern Connecticut’s SBHCs have been unchanged since the introduction of contractual arrangements with Medicaid managed care plans. Respondents indicated that although not all mental health services provided to Medicaid-eligible children in the centers are reimburseable under contract, the SBHCs have been able to offer the same services that existed before the implementation of the contract. Services outside the scope of the Medicaid managed care contract continue to be funded through Federal and State grants.

However, contracting with Medicaid managed care plans has affected the amount of mental health services available to students in the centers sponsored by CFA. Overall, respondents indicated that they have less time available to treat students who are in need of mental health services. Two factors have contributed to this decline: (1) the amount of time that must be devoted to prior authorization procedures and (2) an increase in the number of students who need more intensive forms of mental health care.

To be eligible for reimbursement, mental health services must be authorized by the managed care plan before treatment commences. Unlike physical health care services, mental health services require that prior authorization be obtained by a physician. According to respondents, this process often creates a backlog of paperwork and phone calls for the part-time physician on staff at the center. In some instances, physicians are "on hold" with the managed care organization for up to an hour trying to obtain authorization for a single client, decreasing the amount of time available for seeing patients. Overall, estimates of time required varied from 30 minutes per client for an initial request to 1 hour for treatments extending beyond the initial authorization.

Prior authorization procedures have also affected the amount of care available to patients. Some clinicians reported finding that the number of sessions authorized by plans limits therapy. Clients may not receive the full amount of time in therapy they would have were they seeing a community provider. Clinicians noted that students are seen for several 20-minute sessions to minimize the loss of class time. Thus, two or three sessions may be needed to provide the same service that ordinarily would be provided in a 1-hour session in an out-of-school setting. Since authorizations are for sessions, not time with a client, only limited services can be provided under this arrangement.

Access to mental health care in the SBHC is also compromised by the increasing time clinicians spend treating children with severe emotional disturbances. Clinicians find that they sometimes spend a full day or several days with students in crisis. For instance, an SBHC staff member once identified a student with suicidal ideation and stayed with her for an entire day before the SBHC located services outside the school. When such situations occur, the clinician’s caseload gets pushed back and other students’ sessions must be rescheduled or canceled.

SBHC staff in New London and Groton reported an increase in students who require more intensive services. Because of the dearth of providers in the community, staff reported having to treat serious cases to the best of their ability in the health center. Barriers to referrals for students in need of intensive services and hospitalization were reported. For example, one student at the Norwich Free Academy displayed signs of serious depression, leading SBHC staff to take the student to the local emergency room. The emergency room physician called eight different hospitals to arrange a psychiatric bed but couldn’t find one. The physician tried to admit the student into a partial hospitalization program but was again unsuccessful. Eventually, a hospital in Hartford, more than an hour away, was found for the student. SBHC staff also indicated that even when referred to an outside agency, students may wait 4 to 6 weeks for medication.

Statewide, negotiations establishing contracts between sponsoring organizations (on behalf of SBHCs) and managed care companies were difficult. The majority of disagreements centered on the list of services to be provided and the prior authorization process. Representatives for SBHCs objected to tying insurance status or the ability to recover dollars to the services that would be covered in the centers. They also felt that managed care companies did not understand the SBHC model and philosophy. As a result, the negotiation process in some areas of the State was quite lengthy, according to DPH officials, taking up to 2 years to solidify the contracts in some regions.

These experiences, however, do not reflect the negotiation process that took place between CFA and managed care organizations serving southeastern Connecticut. Officials from CFA indicated that their previous experience with managed care organizations prepared them to better resolve disputes about service definitions and prior authorization requirements.

Confidentiality is one area that continues to concern both CFA representatives and clinicians. Because the MCO requires that a student’s primary care physician be involved in the prior authorization process, physical health care providers routinely have access to patients’ mental health records. Clinicians reported that some students have refused services to avoid the involvement of their family physician.

The vast majority of SBHC mental health services are funded by grants from public and private sources. When Medicaid managed care became prevalent, SBHCs were expected to enter managed care provider networks and bill for reimbursement, a shift in funding for SBHCs. However, despite contracting requirements, SBHCs across the State reported severe drops in Medicaid revenue under managed care. Statewide, the highest estimate of costs recovered through Medicaid managed care for mental health care is 5 percent of costs incurred. One year after the implementation of Medicaid managed care, 19 SBHCs responding to a Department of Public Health survey had signed contracts with at least 1 plan; only 12 were billing. Even fewer were billing for mental health services.

SBHCs in southeastern Connecticut indicated that they see very little value in submitting claims to MCOs. A high denial rate, the cumbersome nature of the process, and CFA’s heavy reliance on public and private grants to supplement administrative and treatment expenses have influenced CFA’s decision not to submit all claims for reimbursement. Typically, CFA recovers about $35,000 in Medicaid reimbursements. This amount barely covers the administrative costs the organization has incurred, including a $25,000 annual salary for extra staff to offset the paper burden of billing Medicaid for reimbursements. Overall, CFA respondents question the value of billing Medicaid, as significant revenues are not realized. The CFA reported that it makes the effort to bill just to continue receiving DPH grants, but it is not aggressive in this pursuit.

IV. Conclusion

Because of CFA’s extensive experience in mental health and prior experience contracting with MCOs for services, SBHCs in New London and Groton have been somewhat immune to the effects of Medicaid managed care. CFA SBHCs also have a financial advantage, relative to other centers, because of CFA’s rich endowment and private supporters. Its financial strength allows CFA to be more flexible and therefore less dependent on reimbursement from Medicaid.

Nevertheless, CFA SBHCs still face some administrative problems that have compromised students’ access to mental health services. Clinicians indicated that the increased paperwork burden imposed by MCOs limits the time available to attend to students’ mental health needs. Because the prior authorization process is cumbersome, a significant amount of clinicians’ time is taken up with phone calls to the MCO and paperwork. Additionally, several environmental issues affect the access to mental health services for underserved students in New London and Groton. Respondents are concerned with the high number of students they treat who require access to more intensive services, and the lack of available resources in the community to fulfill this need.

To address these issues, respondents suggested streamlining prior authorization by (1) removing the requirement that the primary care physician request authorization and (2) making the phone-in process easier by limiting wait times for approval. Clinicians believed that these changes would allow them to identify and treat more students in a more efficient manner.

²Since interviews for this report took place, changes have been made in Salud! administration. Value Behavioral Health is no longer the subcontractor for the Cimarron Health Plan (CHP). CHP has created an internal behavioral health care department to manage all mental health and substance abuse services for the plan.
³ Information on the need and current utilization for mental health services within APS schools was not available.
⁴ The State allocated $1 million to the Department of Health to develop a primary care fund for uninsured children. The fund is primarily used to treat children who are not yet enrolled in Medicaid but are eligible. It is also used by SBHCs to sign up many children for Medicaid.
⁵ The SBHCs in the Baltimore City Public School system are a subset of the 46 SBHCs in Baltimore.
⁶ Non-DPH-funded schools are financed through private donations and institutional partners.

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