Press Release:
For immediate release
Tuesday, May 9, 2006
12:01 a.m. EDT


Christopher Fleming

Erosion Of Community-Based Services For The Mentally Ill Reported In Health Affairs May/June Theme Issue On Mental Health Care

Leading Health Policy Journal Also Looks At Medical Malpractice Premiums, The Effects Of Quality Reporting, And More

Bethesda MD -- State and local budget pressures and a surge in efforts to contain Medicaid spending have led to“noticeable erosion” in community-based services for low-income people with serious mental illnesses, particularly those who lack health insurance, reports a national study released in the journal Health Affairs. In 12 communities around the United States, this erosion has led to emergency room overcrowding, a shortage of psychiatric beds, a shortage of residential housing, and a higher-than-average prevalence of serious mental illness among prisoners and homeless people. The study can be found at

“The promise made long ago by the government that community services would take care of deinstitutionalized people has not been kept. And as states shift their funding for mental health services, primarily onto Medicaid, that just squeezes out the seriously mentally ill people who are uninsured,” says the study’s lead author, Peter Cunningham, Ph.D., a senior health researcher at the Center for Studying Health System Change in Washington, D.C.

What’s in the issue. Cunningham’s study is one of several articles in the May/June Health Affairs, http://content.healthaffairs/org/current.shtml, that examine mental health care in the United States. In the words of Health Affairs founding editor John Iglehart, the issue -- titled “Mental Health: Progress and Pitfalls” -- describes “some modest signs of progress, but, overall, a lack of political will to improve the mental health system.” The issue is published with the support of the John D. and Catherine T. MacArthur Foundation.

Other mental health highlights include the following:

-- Medicare Part D. University of Pittsburgh researcher Julie Donohue asserts that the structure of the Medicare Part D drug benefit creates incentives for health plans to underprescribe persistently used and expensive medications such as psychotropic drugs. Donohue advocates close monitoring of the use of pharmacy management tools by drug plans, as well as improving the Part D risk adjustment mechanism. She also suggests that instead of retrospectively reimbursing plans for part of the costs incurred by enrollees with high drug expenses, Medicare should share risk with plans for prospectively identified high-risk beneficiaries, such as those with schizophrenia and other serious mental disorders. This “would dampen the incentive for plans to discourage the enrollment of high risks,” Donohue writes.

-- Mental Health Coverage Parity. Yale University School of Medicine assistant professor Colleen Barry and coauthors review two eras of economic research on mental health insurance and conclude that comprehensive parity under a managed care system would have little effect on total spending. The researchers, warn, however, that parity is not a panacea: “Parity in benefit structures means little if alcohol, drug, and mental health care is managed more stringently than other types of health care.”

Additional highlights include the following:

Medical Malpractice Premiums. Despite claims by the American Medical Association and others that rising malpractice premiums are driving physicians out of business, self-employed physicians paid lower premiums in 2000 than they did in 1986, according to data from surveys conducted by the AMA itself from 1970 to 2000.

In constant 2000 dollars, mean malpractice premiums rose from $5,934 in 1970 to $20,106 in 1986, then declined to $15,478 1996, reports a study in the May/June Health Affairs that analyzes the AMA data. Premiums rose from 1996 until the AMA discontinued the surveys after 2000, but in 2000 mean premiums were $18,400, still below the 1986 level.

“The reported recent demise of medical practice as a result of rising malpractice premiums has been greatly exaggerated,” Suffolk University law professor Marc Rodwin and coauthors write. The AMA surveys “indicate that premiums have consistently been a small percentage of total practice expenses.”

Quality Reporting. Heart patients who pick a top-performing hospital or surgeon are half as likely to die as those who pick a poor-scoring provider, reports a new study assessing the merits of New York’s 15-year-old public report card system for deaths from coronary artery bypass graft (CABG) surgery. Despite this disparity, patients and their cardiologists are not giving top performers more business, says the study.

“That patients can so dramatically cut their chances of dying by selecting a top performer says something powerful about how good the reporting system is. But there’s no real evidence that patients use the information to pick a better hospital, even though it’s free and easy to access,” says Harvard School of Public Health assistant professor Ashish Jha, M.D., the lead author.

Although patients are not paying attention to the report cards, physicians clearly are. The study, the first to thoroughly evaluate the affect of reporting individual surgeons’ performance data on physicians’ livelihood, found that one in five surgeons who ranked poorly for CABG surgery relocated or discontinued practice within two years of a report card’s release.


Health Affairs, published by Project HOPE, is the leading journal of health policy. The peer-reviewed journal appears bimonthly in print with additional online-only papers published weekly as Health Affairs Web Exclusives at


©2006 Project HOPE–The People-to-People Health Foundation, Inc.