Wed Jul 3

Mental health services are overloaded. We should pay them a bonus to improve your care

Written by Henry Cutler, Professor and Director, Macquarie University Centre for the Health Economy, Macquarie University

Australia’s mental health-care system is struggling to cope ^[1] with the demand. But more money won’t necessarily mean everyone gets the care they need.

As we outline in research out this week ^[2], we need to incentivise health providers to improve outcomes rather than paying them to do more of the same.

The research, which was funded by the Australian government’s National Mental Health Commission ^[3], outlines why such reform is needed and how it might work.

The problem with mental health care

Many Australians with mental ill health cannot access care when needed, due to long waiting lists and high patient costs.

Almost two-thirds of patients are waiting more than 12 weeks ^[4] to receive care for their mental ill-health. About one in five people reported cost ^[5] was a reason for delaying or not seeing a mental health professional.

Even when people do access care, this is often not evidence based, reducing the likelihood of becoming well quickly. For instance, nearly half of all encounters ^[6] to treat depression are deemed inappropriate and consequently of low value.

There are also gaps in individual care pathways. For example, some people who present to hospital after a suicide attempt may not receive mental health care when they leave. People find it difficult to navigate mental health-care services within the community, which means people can fall through the cracks and do not receive the care they need.

This results in poorer health outcomes and use of expensive acute inpatient care, instead of cheaper community-based care, wasting valuable health-care system resources.

How might we change things?

One reason why mental health care struggles to meet patient needs is how health care is funded. Medicare pays a fee to providers for their services based on the Medicare Benefits Schedule (MBS).

The MBS incentivises providers to deliver more services because providers are paid based on each service they deliver. This fee-for-service model does not incentivise providers to deliver good quality care, or to improve health outcomes efficiently.

So we need to reform how mental health care is funded, including paying for good care that delivers outcomes valued by the patient.

All Australian governments have agreed to reform health care ^[7], including starting to pay for value and outcomes.

Implementation has started but is slower than expected. The government also wants to shift GP funding towards payment models that blend Medicare with other payment types, such as value-based payments.

How do we pay for good-value care?

Our research explored how to embed greater value into mental health-care funding using value-based payments.

We interviewed state, territory and federal government departments and agencies, and held several national workshops with providers, care recipients, carers, peak bodies and academics.

Under a value-based payment model, doctors, psychologists and psychiatrists in the community would receive more funding if they delivered better care. We cannot rule out some also receiving less money for not hitting agreed targets, which may be controversial.

These financial incentives would seek to encourage providers to invest their time and effort into improving their care, skills and the patient experience.

Measured outcomes would be valued by patients, such as more capable social interactions and increased ability to function at work. This would require a shift in provider thinking, which primarily seeks to improve clinical outcomes. Our consultation suggested clinical outcomes do not always align with what patients value.

Incentives could be targeted at individual practitioners, multidisciplinary teams or practices, among other combinations. Value-based payments could bring together different health services to deliver care focused on patient needs and preferences. This could include physical and mental health services bundled into a package of care, given one typically brings about the other.

Value-based payments could also be used to bundle mental health services with non-health services that impact mental health outcomes, such as social care, housing, education and justice services. These bundles of care would aim to address the underlying causes of poor mental health while also treating the patient.

How do we know this would work?

There was consensus among our respondents for using value-based payment models in the Australian mental health-care system. Unfortunately, there is little evidence on how to best structure this.

Emerging evidence ^[8] demonstrates there are benefits from paying providers more to deliver better quality care, compared to using a fee-for-service model. However, some trials have failed to improve outcomes.

Our research suggests we need to know more about the size of the incentive and whether this should target individual practitioners, teams or practices, what outcomes we should measure, and what targets providers should seek to achieve.

This evidence can only be gathered through randomised-controlled trials conducted in the Australian health-care system, implemented over time and across different settings. We need to learn from these trials’ successes and failures.

Overcoming barriers

Reforming mental health-care funding towards value-based payments will be complex and challenging.

Our respondents identified barriers, including:

defining outcomes that matter to patients
overcoming a lack of evidence on how value-based payments can improve outcomes
addressing workforce gaps
navigating political complexities and procedural challenges
covering the cost of reform.

Providers would need to change their business models, and government would need to invest much more in data collection and data infrastructure.

What needs to happen next?

Government needs to better define what value means within mental health care and establish a unified set of agreed outcomes. It needs to raise provider awareness of why value-based payments are required and develop a ten-year strategy and implementation plan.

In the next four years, government should develop and implement a mental health data infrastructure strategy to help fill data gaps. Mental health-care funding reform should be integrated into ongoing payment reforms in hospitals and primary care.

There also must be greater accountability for reform. An independent value-based payment authority should be developed to work with state, territory and federal governments to design, coordinate and evaluate new value-based payment models.

Using financial incentives to change provider behaviour won’t fix Australia’s mental health-care crisis ^[9] alone. But the government can’t fix that crisis without reforming how we incentivise and pay for care that improves mental health.