STAWAR: The Wal-Mart of mental health?

By TERRY STAWAR
Local Columnist

May 18, 2008 12:57 am

— For the past several years, Indiana’s Family and Social Services Administration has been encouraging consolidation in the state’s community mental-health system.
Just recently, Quinco Behavioral Health Systems, headquartered in Columbus, the Center for Behavioral Health, in Bloomington, and Centerstone, a large Tennessee behavioral health provider, merged to become one of the country’s largest behavioral-health providers. Just where will such developments lead?
When President John F. Kennedy signed the Community Mental Health Centers Act in 1963, it provided federal funding to establish community-based mental-health services across the country. The centers, as originally envisioned, were responsible for geographic territories called “catchment areas,” with the goal in mind that everyone should have ready access to a full continuum of affordable services.
The State of Indiana has chosen to challenge this tradition by championing three imprudent trends on both ideological and economic grounds. The state has de-emphasized the notion of geographic service areas, strongly encouraged competition among community mental-health providers and promoted the consolidation of local mental-health organizations into larger entities.
Despite some advantages, these three trends threaten to significantly transform the values of community mental health from one of community service to one of unprincipled corporate expansion.
Competition has been touted as a way to offer more choice for consumers, while promoting better outcomes and competitive prices — the classic and powerful “more bang for your buck” political argument.
Encouraging competition among mental-health centers, however also has its dark side, as some providers abandon their established responsibilities to build service capacity within their own communities and invade neighboring regions to strip away the more lucrative business.
Centers must then divert precious resources into defending market share, instead of increasing service capacity. For example, our organization has spent nearly $250,000 to stave off an outside incursion and the best guess is that the other parties spent almost as much, so that an estimated half million dollars has been spent for legal fees, rather than community services. In a system that is so underfunded to begin with, this is an unconscionable consequence of imprudent public policy and misguided organizational values.
Promoting such competition not only has a chilling effect on service availability, but also threatens hard-won infrastructure. To fulfill their missions, all mental-health centers must cost shift. Like hospital emergency rooms, they can not afford to provide many highly expensive services, unless they are adequately reimbursed for others. Profits in one area are routinely shifted to cover losses in others. When competitors cherry pick profitable services, this shifting is no longer possible.
There also are concerns regarding continuity of clinical care. One organization, for example, provided only profitable services — case management and therapy — while referring their patients to another center for the unprofitable ones — medical and inpatient). According to some patients, they were actually encouraged to withhold the fact that they were receiving services from the organization that did not provide the more costly services, in order to access them from the other organization.
Because of the public service role of community mental-health centers, competition among them can be roughly compared to that among police departments. Such competition, with no jurisdictional responsibility, would eventually lead to the collapse of the hard won infrastructure, leaving no one left to do the “dirty work.”
The consolidation of local community mental-health organizations into mega-agencies may have economies of scale and size and some technical advantages. Indiana seems especially concerned about managing a large number of contracts and evidently believes that a reduction in the number would increase their competence in this area.
Unthinking and unrestrained consolidation, however, ultimately leads to less choice for consumers and less true competition. It also invariably results in a dilution of local input, participation and direction. Organizational governance may take place hundreds of miles away from the communities being served. It may also negatively impact local economies.
Will Indiana tax dollars go to pay for services or create jobs in others states? It seems clear that local control and responsiveness to community needs stand to be significantly diminished — resulting in a community mental-health system minus the community.
Several large national not-for-profit providers have been competing locally this way for many years. Where there is no local provider that can effectively meet community needs, such intrusions may occasionally even be welcome. However, such competition can be especially destructive when it undermines historical relationships, community ownership, and existing infrastructure.
The creation of extremely large mental health care organizations, which compete with smaller indigenous community agencies, parallels the Wal-Mart phenomena. The giant retailer can easily purchase influence, undercut prices and win so much market share that smaller retailers are summarily driven out of business. Some localities have rebelled against this assault on the economic and social fabric of their communities, enacting “anti-big-box store” ordinances.
Indiana needs better planning and should start considering the long term implications and unintended consequences of its mental health policies.
Dr. Terry L. Stawar lives in Georgetown and is the CEO of LifeSpring in Jeffersonville.

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