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Evaluation of Texas Behavioral Health Performance Measures, Contract Processes, and Payment Mechanisms

August 31, 2017

The State of Texas’ Health and Human Services Commission (HHSC) and the Department of State Health Services (DSHS) engaged Health Management Associates (HMA) and partner National Association of State Program Directors Research Institute (NRI) to evaluate behavioral health performance measures, contract processes, and payment mechanisms utilized by the Department in contracts with the Texas Local Mental Health Authorities (LMHAs).  The goal of the evaluation was to conduct a thorough review of existing mental health, substance use disorder, inpatient and outpatient measures, as well as aligning those performance measures to national norms and industry standards.

The HMA/NRI Team provided guiding principles for consideration as the State of Texas transitions to increased use of value based purchasing and pay for performance models in behavioral health. These guiding principles support the State’s efforts to meet the needs of individuals and their families who receive public behavioral health services, and the LMHAs and providers who serve them.  The goal of pay for performance payment models is to move away from fee-for-service or other reimbursement methods that incentivize volume, and instead to move toward mechanisms that are tied to quality and value.

The report describes the importance of differentiating among measures that should be maintained for pay for performance purposes and those that should be used for contract compliance monitoring purposes. Finally, the report makes suggestions for new measures to be considered based on the latest trends nationally in behavioral health performance measurement activities.