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Illinois to Combine Managed Care, Fee for Service in Innovative Plan

Illinois plans to implement a statewide managed Medicaid system with mental health services paid on a fee-for-service basis for moderate and severe diagnoses.

The plan is now being reviewed by the Health Care Financing Administration, which must give its approval before the system can be put in place. It is not known how soon a decision may be reached.

The Illinois Psychiatric Society applauds the state's recognition that certain mental illnesses deserve specialized treatment, according to President-elect Valerie Raskin, M.D., of Forest River, Ill.

Mental health providers will be able to continue to see patients whose diagnoses match an approved list of moderate and severe mental disorders and be paid directly by the state. Patients with "mild" disorders would be treated in a capitated managed care system.

Raskin told Psychiatric News, "Nonetheless, we have many concerns about how decisions were made at the state level. We have found that the devil is in the details."

District branch officials, many of whom work in the public sector, learned about the list of mental diagnoses after it was published in the state's rules, which were finalized in February.

"As experts in the mental health field, we feel we should have been asked to review the final list of diagnoses," complained Raskin. "My advice to other district branches is get a seat at the table early in the discussions."

Jacquetta Ellinger, deputy administrator of the Division of Medical Programs in the Illinois Department of Public Aid, responded that "a draft of the rules were accessible to anyone who asked for them." She noted that the Department of Mental Health convened a large external review committee, and there were many opportunities for comment.

"However, we can make minor changes within existing diagnoses. We can also enact new rules if we are convinced we made a mistake in the approved final list," said Ellinger.

A mistake that district branch members discovered in the final list was that simple phobia was included, but not dysthymia and delusional disorder. Raskin said the district branch has communicated the problem to the state agency.

Raskin also voiced concern that the final rules did not specify what type of physician would treat moderate and severe mental illnesses. "The carveout was presented to the public as a safety net for mental health services. It doesn't make sense to say mental illnesses deserve special treatment and then not say who the specialists are. We believe they should be psychiatrists."

Ellinger responded that the rules were written "broadly," allowing physicians to decide whom they are qualified to treat. She added that the state medical society agrees with that position.

"We structured the program that way based on legislation enacted in 1994. The existing rules allow the same group of qualified Medicaid providers including hospitals and physicians to serve the same population. Community mental health centers in particular had expressed a lot of concern that HMO's would not do business with them. The fee-for-service carveout protects their Medicaid funding stream," said Raskin.

(Psychiatric News, May 16, 1997)