Treatment of behavioral health is booming, but payments are not, CarePlus NJ CEO says

By Anjalee Khemlani
Bergen County | Mar 13, 2019 at 1:26 pm

Joseph Masciandaro is proud of his 40-year history at CarePlus New Jersey, but he worries about the future of its specialty service — behavioral health — which still is not fully understood.

The CEO and president of the Bergen County-based organization has seen the sudden shift of awareness that behavioral health has received in the past five to seven years — and the boost it received from former Gov. Chris Christie’s attention to the opioid issue. And he’s glad it has helped erase the stigma and boosted the number of patients seeking treatment.

But, he said, other pressures — and a movement to change billing to a fee-for-service-based system — are threatening the viability of organizations like his to operate independently.

It’s why mergers such as Hackensack Meridian Health and Carrier Clinic make sense, he said.

This is just one example of mergers and acquisitions activity in the sector around the state, Masciandaro  said.

CarePlus NJ
Joseph Masciandaro of CarePlus New Jersey.

Masciandaro wouldn’t rule out the possibility of CarePlus New Jersey or any other facility in the sector merging, though he doesn’t know of any talks going on now.

It’s all part of the uncertain future of the specialty.

CarePlus has been able to woo medical professionals away from large health systems in the state, has launched a school for those with disabilities and has a presence in schools around the state for behavioral health needs.

Despite all this, changes to the fee-for-service Medicaid reimbursement under the Christie administration, as well as grant funding that will run out this year and next, will make it hard for CarePlus and others to sustain their current levels of service.

Tara Augustine, chief operating officer of CarePlus, said the new reimbursement system, which changed to fee-for-service from a contract-based payments per patient, threatens the quality of service.

Behavioral health used to be reimbursed in lump-sum payments because of the amount of attention a patient needs, Augustine said.

Ironically, the system has changed in reverse from the rest of the health care community.

Health systems in the state have been having discussions of moving away from fee-for-service payments to value-based systems — which focus on keeping patients engaged with the health care system and healthier to avoid costly emergency visits.

In the behavioral health space, it was easier to follow up with patients and give them the time and attention they needed. But, with a fee associated with each service, there is more incentive for behavioral health centers to focus on the number of services provided.

The state isn’t seeing the implications, Augustine said, but the more patients CarePlus sees, the more money it loses.

“The only way to make it work in fee-for-service is to focus on productivity,” Augustine said.

“When you’re focusing on productivity, you’re really diminishing the quality of service. The types of clients we are seeing sometimes need multiple engagements … because they are very resistant or paranoid. And if you’re only being paid when you see the patient, you don’t get paid for all of those attempts. So, people just don’t attempt. And (patients) get dropped and you’re seeing an increase in hospitalization.”

Which is why the more entities joining in to provide care, the better, Masciandaro said.

“There is just not enough capacity to provide (care) with the current system,” he said. “The only way that you can solve is by growing the total pool of money that’s available to share. When we talk about fee for service, it’s not based on real cost. Hospitals at least have the advantage that their payment methodology is based on retrospective cost. So, they may be able to drive the market up.”

Which may also be why hospitals are increasingly playing in the behavioral health space.

It’s something Masciandaro says is a welcome change, even if it does bring competition.

“I’m not saying I don’t experience some level of threat by it,” Masciandaro said.

“Ultimately, the quality is going to be the differentiator.”

Anjalee Khemlani | akhemlani@roi-nj.com | AnjKhem