Hochul will present her executive budget proposal to the state Legislature next month and she’s not been shy about her desire to limit hikes in state spending.
That’s why mental and behavioral health advocates are hoping she’ll consider a proposal they say would save the state “hundreds of millions” of dollars in Medicaid spending. They’re pushing hard for it to make it in her budget.
It would change how the state pays for community-based behavioral health services provided by the state Office of Mental Health and Office of Addiction Services and Supports.
The idea would be to carve those services out of the state’s Medicaid managed care program and have them switch to a fee-for-service model instead. That would remove health insurance companies from acting as fiscal intermediaries for those services.
Without getting too deep into it, managed care organizations use health care networks to direct someone’s care through close coordination. A fee-for-service model allows people on Medicaid to see providers who accept it but is less organized.
Advocates say the state would save money by switching those services to fee-for-service because that would cut out payments made to managed care organizations through insurance providers.
They made their case for the switch in a recent letter to Hochul. The letter was led by the New York State Council for Community Behavioral Healthcare, which represents providers across the state.
“By carving out behavioral health from Medicaid managed care, the state can save hundreds of millions which can be reinvested into much-needed mental health and addiction care and a well-trained workforce to provide these lifesaving services,” the letter said.
There’s a staffing shortage in the health care industry but that’s particularly problematic in mental health. The demand for mental health treatment has increased over the past five years.
Hochul has previously said she intends to find ways for the state to find “efficiencies,” but we’re not expected to see details until January, when she presents her State of the State and executive budget proposal.