In October 2003, the Health Resources and Services Administration issued Program Information Notice (PIN) 2004-05 regarding Medicaid Reimbursement for Behavioral Health Services. The PIN requires Medicaid agencies to reimburse Federally Qualified Health Centers and Regional Health Centers for behavioral health services provided by a physician, physician assistant, nurse practitioner, clinical psychologist, or clinical social worker, whether or not those services are included in the state Medicaid plan. The PIN clarifies that “FQHC/RHC providers must be practicing within the scope of their practice under the state law.”

What might PIN 2004-05 mean for the Medicaid population? Categorically eligible Medicaid beneficiaries (e.g., TANF, aged/blind/disabled) may or may not be able to easily gain access to public mental health services, depending on definitions of target populations and medical necessity, which vary from state to state.

In states with public mental health systems that focus on populations with serious mental illness and serious emotional disturbance, PIN 2004-05 creates an opportunity for other Medicaid populations, with higher physical health and lower behavioral health risks, to obtain behavioral health services through a CHC. This is consistent with the HRSA initiative to reduce health disparities and create behavioral health capacity in CHCs. PIN 2004-05 helps to assure that safety net populations are served.

But what does PIN 2004-05 mean in terms of financing and the behavioral health services now provided to populations with serious mental illness? The answer varies from state to state because of differing Medicaid models. This variability requires every community partnership between a CHC and a CMHC to assess their specific financing and policy environment in order to identify a business model that will support integration activities. Such partnerships must develop policy direction that addresses the need for greater access to behavioral health services for the Medicaid population, without disadvantaging any populations now served by the public mental health system.

Learning from Pilot Sites:

“Depression in Primary Care: Linking Clinical and System Strategies” is a Robert Wood Johnson Foundation national program to increase the effectiveness of depression treatment in primary care settings. The program charged its eight demonstration sites with addressing financial and structural issues as well as implementing clinical models. A special issue of Administration and Policy in Mental Health and Mental Health Services Research contains a series of resulting papers, some of which speak directly to the financial and policy barriers in the system.

The pilots reveal the commitment of sites around the country that continue to patch together funding because they believe in the integration approach. For example, in Washington State there is a partnership between the CMHC and the Federally Qualified Health Center, where the CMHC’s clinicians in the FQHC sites are financed by an annual golf tournament – hardly a sustainable model. The IMPACT trials, Depression in Primary Care project, state Medicaid pilot sites, and an Aetna project all identify similar components for financing:

- Screening

- Care management

- Psychiatric consultation

These are close to the components identified in the report of the President’s New Freedom Commission on Mental Health, which emphasized that there must be a relationship between mental health and general health. However, these service components are currently missing from public and private sector billing codes and financing policy. The challenge – for federal, state and private payors – will be to align financial/policy incentives to support clinical integration, which research demonstrates is effective in achieving positive outcomes.

Barbara Mauer is a nationally known expert in behavioral health and primary care integration. She has more than 15 years of experience in this field and is a managing consultant for MCPP Healthcare Consulting in Seattle as well as a National Council senior consultant. She offers consulting services to public and private sector health and human service organizations on integration as well as strategic planning, quality improvement, and project management. Mauer has authored many papers and books on behavioral health and primary care integration.