Obamacare Shreds Mental Health Care

Obamacare Shreds Mental Health Care
By Robert M. Goldberg on 1.18.11 @ 6:06AM

As the House of Representatives debates a bill to repeal Obamacare and start over, the Left will invoke the tragedy in Tucson as a reason to keep the law in place. Liberal bloggers and some patient groups are claiming that states are already cutting mental health budgets to balance budgets, Arizona among them. They will claim that overturning Obamacare, which offers mental health benefits through an expansion of Medicaid, would only deepen the danger. The New Republic's Jonathan Cohn provides the familiar liberal narrative: "We may never know whether a better mental health care system would have averted this massacre. But we can be sure that it would avert some future ones."

While we can't be sure a "better" mental healthcare system could stop an obsessed schizophrenic from committing violence, we can be sure that Obamacare will shred mental health treatment in America.

Cohn notes that we don't warehouse the mentally ill in asylums anymore. Instead, we warehouse them in jails. That's accurate enough to be misleading. Budgets for mental health everywhere soared and state mental hospital spending fell when Medicaid, in 1970, said it would pay for mental health care but not institutionalized treatment for people between the ages of 21 and 65. State psychiatric hospitals that provided long-term care closed and were replaced by psychiatric units of general hospitals with fewer beds. Or by prisons.

The emphasis on community-based or residential care has been well-intentioned and in the vast majority of cases has been fairly effective thanks to the introduction of medications that permit individuals to live free of psychotic episodes. In this respect, the pharmacological revolution made it possible for states to use Medicaid to rapidly expand treatment to millions of Americans. At the same time, because Medicaid was and is such an important source of money for states, it continues to skew mental health investment away from what's best for patients.

For example, while delivering care to people at home or at residential centers costs a fraction of doing so in a psychiatric hospital or prison, Medicaid won't pay to move people from hospitals to outpatient care and in some cases will only pay a smaller share of the less institutionalized setting. The savings can't be counted. Further, if states can generate more Medicaid dollars elsewhere -- and reduce mental health spending in the process -- they will. Federal Medicaid dollars cover about 40 percent of mental health programs and still have all the strings attached. So states that can get the federal government to cover a bigger share of other programs' costs -- nursing homes, for instance, or dialysis -- it will increase spending there.

Finally, as Harvard economist Richard Frank observed, states have shifted much of their mental health funding into Medicaid, leaving funding for other programs bare. So now when states are faced with budget shortfalls it is mental health that is receiving the brunt of the cuts.

Obamacare will speed the hollowing out of mental health coverage thanks to its increased dependence on shoving most Americans into Medicaid. Obamacare proponents claimed they were protecting the mentally ill -- most of whom they would cram into Medicaid -- by barring states from limiting eligibility from what they now have.

Once again, mental health services are likely to be chopped. If states "save" money, the law requires it give a chunk of it to the federal government. Moreover, states can't raise money by imposing or raising copays on Medicaid beneficiaries.

That means two things. First, services will be cut indirectly by cutting what doctors are paid. Fewer doctors means the state will pay for less care.

Second, under Obamacare the cheapest drugs for Medicaid will get the most business. That means doctors have to start with the cheapest medication, not the medication that is right for a patient. Several studies conducted over the last decade by Stephen Soumerai show that such restrictions actually make mental illness worse and expose patients to dangerous side effects. As a result, less than half of all people in mental health programs under Medicaid stick to their treatment plan. And since medications are the key to better outcomes, the rationing undermines care across the board.

As Cohn observed, it is these people who "could benefit from therapy, drugs, and community supports -- frequently living totally normal, productive lives -- instead end up without treatment and sometimes without homes. Inevitably some of these people end up committing crimes, overloading a criminal justice system ill-equipped to handle them."

And in its infinite wisdom the Left seeks, through Obamacare, to force states to stick to failed strategies and refuses to give them the flexibility to do better by its citizens. Instead, it insists upon expanding a system that debases and imprisons, a system that is a shameful symbol of liberal intentions.