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Report: Integrating Behavioral Health into Medicaid Managed Care: Design and Implementation Lessons from State Innovators

Medicaid enrollees with behavioral health needs have a high prevalence of chronic conditions and are often frequent users of physical and behavioral health services. More and more states are pursuing managed care models that integrate behavioral and physical health services to enhance care coordination, improve outcomes, and control costs for this high-need population. As of January 2016, 16 states currently provide or are planning to offer behavioral health services through an integrated managed care benefit — up from just a handful a few years prior.

This brief, made possible by Kaiser Permanente Community Benefit, provides insights from Medicaid officials and health plan representatives in five states — Arizona, Florida, Kansas, New York, and Texas — that are integrating behavioral health services within a comprehensive managed care arrangement. It explores three emerging options for integration, including comprehensive managed care carve-in, specialty plans for individuals with serious mental illness, and hybrid models. Common strategies used by these states to facilitate integration include a focus on engaging key stakeholders, balancing oversight and collaboration in state-plan relationships, and advancing clinical integration and cross-system accountability.

A key takeaway from states profiled is the need to develop flexible integrated care approaches that leverage existing capacity and account for variations in managed care landscapes. Lessons from these five early innovators offer valuable guidance for other states pursuing similar initiatives.