The Journal of Behavioral Health Services & Research

, Volume 26, Issue 4, pp 381–389

Effects of a mental health carve-out on use, costs, and payers: A four-year study

  • Kyle L. Grazier
  • Laura L. Eselius
  • Teh-wei Hu
  • Karen K. Shore
  • William A. G'Sell


This study examines the effects of a mental health carve-out on a sample of continuously enrolled employees (N = 1,943) over a four-year time frame (1990–1994). The article presents a health care services utilization model of the effect of the carve-out on outpatient mental health use, cost, and source of payment in the three years post implementation relative to the year prior to the carve-out model. In the first three years of the carve-out, the likelihood of employees seeking mental health care increased in significant part because of the carve-out. For the outpatient mental health services user, the carve-out was not associated with the level of mental health services received. The carve-out was significantly associated over time with a reduction in the patient's and employer's mental health costs. This effect was more pronounced in the second and third years of the carve-out. The article explores the policy implications of these and other findings.


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Copyright information

© Association of Behavioral Healthcare Management 1999

Authors and Affiliations

  • Kyle L. Grazier
    • 1
  • Laura L. Eselius
    • 2
  • Teh-wei Hu
    • 3
  • Karen K. Shore
    • 4
  • William A. G'Sell
    • 1
  1. 1.School of Public HealthUniversity of MichiganAnn Arbor
  2. 2.Harvard UniversityBoston
  3. 3.the School of Public Health, University of CaliforniaBerkeley
  4. 4.Reden & Anders Ltd in San FranciscoUSA

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