Skip to main content
Log in

Designing a state-level prospective payment system for inpatient psychiatric services in medicaid

  • Articles
  • Published:
Administration and Policy in Mental Health and Mental Health Services Research Aims and scope Submit manuscript

Abstract

New Hampshire's new payment system for hospital psychiatric services is described. The system puts into practice arguments that incentives to reduce levels of care in a pure prospective payment system should be weakened and that “experience rating” should be used to ensure more fair payment to providers. This paper describes the system and summarizes the arguments.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Similar content being viewed by others

References

  • Camberg, L.G., & McGuire, T.G. (1989). Inpatient psychiatric units in nonteaching general hospitals: Response to public mental health policy or hospital economics?Medical Care, 27, 130–139.

    Google Scholar 

  • Cromwell, J., Harrow, B., & McGuire, T.G. (1989, October).Towards a modified TEFRA payment system for exempt psychiatric units. Paper presented at the annual meeting of the American Public Health Association.

  • Ellis, R.P., & McGuire, T.G. (1986). Provider behavior under prospective reimbursement: Cost sharing and supply.Journal of Health Economics, Sept., 129–151.

  • Ellis, R.P., & McGuire, T.G. (1988) Insurance principles and design of prospective payment systems.Journal of Health Economics, 7, 215–237.

    Google Scholar 

  • English, J.T., Sharfstein, S.S., Scherl, D.J., Astrachan, B., & Muzynski, I.L. (1986). Diagnosis-related groups and general hospital psychiatry: The APA study.The American Journal of Psychiatry, 142, 131–139.

    Google Scholar 

  • Frank, R.G., Lave, J.R., Taube, C.A., Rupp, A., & Goldman, H.A. (1987). The impact of Medicare prospective payment system on psychiatric patients treated in scatterbeds. In T.G. McGuire & R. Scheffler (Eds.),Advances in health economics and health services research, Greenwich, CT: JAI Press.

    Google Scholar 

  • Frank, R.G., & Lave, J.R. (in press). A comparison of hospital responses to reimbursement policies for Medicaid psychiatric patients.Rand Journal of Economics.

  • Frank, R.G., & Lave, J.R. (1985). The impact of Medicaid benefit design on length of hospital stay and patient transfers.Hospital and Community Psychiatry, 36, 749–754.

    Google Scholar 

  • Frank, R.G., & Lave, J.R. (1986). The effect of benefit design on the length of stay of Medicaid psychiatric patients.The Journal of Human Resources, 21, 321–337.

    Google Scholar 

  • Freiman, M., Ellis, R.P., & McGuire, T.G. (1989). Provider response to Medicare's PPS: Reductions in length of stay for psychiatric patients treated in scatter beds.Inquiry, 26, 192–201.

    Google Scholar 

  • Freiman, M., Mitchell, J.B., & Rosenbach, M.L. (1987). An analysis of DRG-based reimbursement for psychiatric admissions to general hospitals.The American Journal of Psychiatry, 144, 603–609.

    Google Scholar 

  • Jencks, S., Goldman, H., McGuire, T.G. (1985). Challenges in bringing exempt psychiatric services under a prospective payment system.Hospital and Community Psychiatry, 36, 764–769.

    Google Scholar 

  • Jencks, S., Horgan, C., Goldman, H., & Taube, C.A. (1987). Bringing excluded psychiatric facilities under the Medicare prospective payment system: A review of research evidence and policy options.Medical Care,25, No. 9.

    Google Scholar 

  • Lutterman, T., Glover, R., & Mazade, N. (1987).Funding sources and expenditures of state mental health agencies. Alexandria, VA: National Association of State Mental Health Program Directors.

    Google Scholar 

  • Manderscheid, R.W., & Barrett, S.A. (1987).Mental health, United States, 1987 (DHHS Publication No. ADM 87-1518). Washington, DC: U.S. Government Printing Office.

    Google Scholar 

  • McGuire, T.G., Dickey, B., Shively, G., & Strumwasser, I. (1987). DRGs and private health insurance: Implications for design of prospective payment systems.American Journal of Psychiatry, 144, 616–620.

    Google Scholar 

  • McGuire, T.G. (1989). Financing and reimbursement for mental health services. In Taube & Mechanic (Eds.),The future of mental health services research (DHHS Publication No. ADM 89-1600). Washington, DC: U.S. Government Printing Office.

    Google Scholar 

  • McGuire, T.G., & Scheffler, R. (Eds.). (1987).Research issues in economics and mental health. Greenwich, CT: JAI Press.

    Google Scholar 

  • Mosakowski, W.S., & Magnusson, P.R. (1988). Design and development of a prospective payment system for inpatient psychiatric services. Report from Public Consulting Group, Inc., Boston, MA, to the Division of Mental Health and Developmental Services, State of New Hampshire.

  • Prospective Payment Assessment Commission. (1989).Medicare prospective payment and the American health care system: Report to the Congress.

  • Taube, C.A., et al. (1984). DRGs in psychiatry: An empirical evaluation.Medical Care, 22, 587–610.

    Google Scholar 

  • Taube, C.A., Goldman. H.H., & Salkever, D. (1989). Medicaid coverage for mental illness: Balancing access and costs. (Unpublished manuscript).

Download references

Author information

Authors and Affiliations

Authors

Additional information

William S. Mosakowski is with the Public Consulting Group

Support for this research was provided by the New England Mental Health Commissioners' Association (NEMHCA), and grant number 1K05MH-00832-01 from the National Institute of Mental Health.

Rights and permissions

Reprints and permissions

About this article

Cite this article

McGuire, T.G., Mosakowski, W.S. & Radigan, L.S. Designing a state-level prospective payment system for inpatient psychiatric services in medicaid. Adm Policy Ment Health 18, 43–54 (1990). https://doi.org/10.1007/BF00706491

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1007/BF00706491

Keywords

Navigation