Budget Impact and Sustainability of Medical Care Management for Persons with Serious Mental Illnesses

Objective: The authors assessed the 2-year outcomes, costs, and financial sustainability of a medical care management intervention for community mental health settings.

Method: A total of 407 psychiatric outpatients with serious mental illnesses were randomly assigned to usual care or to a medical care manager who provided care coordination and education. Two-year follow-up chart reviews and interviews assessed quality and outcomes of care, as well as costs from both the health system and managerial perspectives.

Results: Sustained improvements were observed in the intervention group in quality of primary care preventive services, quality of cardiometabolic care, and mental health-related quality of life. From a health system perspective, by year 2, the mean per-patient total costs for the intervention group were $932 (95% CI=-1,973 to 102) less than for the usual care group, with a 92.3% probability that the program was associated with lower costs than usual care. From the community mental health center perspective, the program would break even (i.e., revenues would cover setup costs) if 58% or more of clients had Medicaid or another form of insurance. Given that only 40.5% of clients in this study had Medicaid, the program was not sustainable after grant funding ended.

Conclusions: The positive long-term outcomes and favorable cost profile provide evidence of the potential value of this model. However, the discrepancy between health system and managerial cost perspectives limited the program's financial sustainability. With anticipated insurance expansions under health reform, there is likely to be a stronger business case for safety net organizations considering implementing evidence-based interventions such as the one examined in this study.