Manderscheid on Medicaid

May 31, 2007
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An interview with federal government veteran Ronald W. Manderscheid, PhD

Medicaid is an important funding source for mental health services, and changes to this state/federal program can have drastic implications for behavioral health provider organizations and the consumers they serve. Despite Medicaid's multiple and well-documented problems, some see it as the logical starting place for a national health insurance program. To gain some insight on Medicaid's role in behavioral healthcare today and what could be done to address some of its challenges, Behavioral Healthcare turned to Ronald W. Manderscheid, PhD.

“ONE of the reasons that we spend so much money in the united states on healthcare, with so little result, is that consumers and families have very little to say about payment for care.“ —ronald w. manderscheid
Ronald W. Manderscheid, PhD Dr. Manderscheid retired in 2005 from an impressive 30-year career in the federal government, having worked at the National Institute of Mental Health and as the long-time chief of the Survey and Analysis Branch in the Center for Mental Health Services, part of the Substance Abuse and Mental Health Services Administration (SAMHSA). During the national healthcare reform debate in the 1990s, he served as a policy advisor in the Office of the Assistant Secretary for Health in the Department of Health and Human Services. Dr. Manderscheid is a past chair of the Mental Health Section of the American Public Health Association and former president of the Washington Academy of Sciences.

Dr. Manderscheid hasn't slowed down since his retirement from public service. He still advises members of Congress (see sidebar, page 20) and recently was appointed as an adjunct professor in the Department of Mental Health at Johns Hopkins University's Bloomberg School of Public Health. He also directs the mental health and substance use programs at the consulting and research firm Constella Group, LLC. In addition, he is a member of Behavioral Healthcare's Editorial Board and a frequent contributor to the magazine.

Behavioral Healthcare Washington Editor Michael J. Stoil, PhD, conducted the following interview.

You've been a very astute and well-placed observer of the changes in behavioral healthcare during the past 30 years. One set of those changes relates to the role of Medicaid. In your view, what is Medicaid's role today, and what does it mean for its future relationship with behavioral healthcare?

Dr. Manderscheid: Let me begin by giving some background. In my last 10 years at SAMHSA, I conducted a project on Medicare, Medicaid, and private insurance. That project resulted in about 60 papers and publications on a range of topics, including a series of chapters in Mental Health, United States. I was researching the patterns of service use and expenditures in each of those areas. I recently cited these data in testimony before the House Ways and Means subcommittee exploring Medicare reform, including Medicare's 50% copay for outpatient mental health services [see sidebar]. I am very interested in moving Medicare's and Medicaid's agendas toward better accessibility, quality of care, and outcomes for persons with mental and substance use conditions.

I want to discuss some of the big picture issues in the context of Medicaid's future. First, in 2006 the total cost of healthcare services in the United States was about $2 trillion. That number is projected to increase to $4 trillion by 2016. The federal component of healthcare services in 2006 was about $800 billion, and the federal component in 2016 is projected to be $2 trillion. By comparison, President Bush's proposal for the entire federal government budget in 2008 is $2.9 trillion. You can see that the projected healthcare numbers for 2016 are neither achievable nor sustainable.

Anybody that I've talked to—David M. Walker, the U.S. Comptroller General; former Surgeon General David Satcher; the wonderful people who worked on the 2005 Institute of Medicine [IOM] report—all consistently say the same thing: The U.S. healthcare system is broken and unsustainable. Something has to give—including Medicaid.

Second, the presidential candidates are discussing proposals for universal health insurance coverage. About 47 million people in the United States don't have any health insurance, representing between 17 and 19% of the population. Medicaid helps a lot of people who otherwise would lack healthcare coverage. In fact, one-fourth of all children in the United States have their only health insurance coverage through Medicaid.

Some presidential candidates and members of Congress are proposing to use the State Children's Health Insurance Program [SCHIP] to cover a larger percentage of uninsured children. One proposal is that SCHIP should cover all children who live at less than 100% of the poverty level, and that Medicaid should cover all other people who live at less than 200% of the poverty level. Look for the presidential candidates to debate what role, if any, the federal government should play in covering those without health insurance.

In addition to escalating cost drivers and proposals for universal health insurance, a third issue is healthcare system reform. The recent problems at Department of Defense healthcare facilities and with veterans' care are very symptomatic of problems in other healthcare sectors. These system deficiencies have dramatic consequences for people with serious mental illness. For example, in 2006 Craig Colton and I looked at the mortality figures for public mental health clients, defined as people cared for by state mental health agencies. We were astonished to find that those consumers die an average of 25 years younger than other people.

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