Access to mental health and substance abuse services may increase in Missouri as a result of a shift in the way Medicaid providers are paid for their services, starting July 1.
"We know that under the current fee-for-service system, the rates we are paying to providers for psychiatric services is below the actual cost of the service," said Dorn Schuffman, project director of the demonstration project at the Missouri Department of Mental Health. "If providers are paid for the actual cost of these services, they could potentially afford to serve more patients."
Under the current model, Missouri uses a fee-for-service payment plan where Medicaid providers are paid for every unit of service they provide. This will change as the state transitions to a prospective payment system demonstration, where providers are paid a flat cost.
Schuffman told the News Tribune the federal government wants to find a standard way of paying providers.
"The shift is intended to improve access to services by requiring certain standards and measures, covering the actual costs of services, allowing providers to serve more people and freeing up state dollars," Schuffman said.
He explained the benefit associated with the state's current model is providers are being paid for every service they provide, so the incentive is to provide more services.
"For example, if a provider gave a quarter-hour of service to one client and an hour of service to another one, they would be paid for both units of service. Theoretically, the fee-for-service payment plan works this way, but not in practice," Schuffman said. "It doesn't really work this way because there is a limited allocation to providers, so they could eventually run out of funds."
Under these changes, participating agencies are required to uphold a set of standards previously not required. Only five of 27 service areas across the state are not participating in the change.
Under the demonstration project, participating providers are required to provide substance and psychiatric services, where previously they could offer one without the other.
The downside is providers won't be paid for every unit of service they provide to patients, but the Department of Mental Health is working to implement measures that would track the number of services provided, as well as the quality of those services.
Missouri was selected as one of eight states to participate in the federal demonstration program, where additional federal funds could be allocated to the respective state agency.
"The state could receive roughly an additional 12 percent increase in federal funds," Schuffman said.
For the funds to reach the Department of Mental Health, the Legislature would have to appropriate it to the agency, and the governor would need to approve it.