“Deer in the Headlights”: How Behavioral Health Providers Experience System Reform

Introduction: In July 2005, New Mexico became the first state in the nation to place all publicly-funded behavioral health services under the management of one private corporation. This reform promoted conventional managed care principles, such as cost-effectiveness and performance, while emphasizing the provision of care that was both “evidence based” and “culturally competent.” Methods: Participant observation and semi-structured interviews with 192 administrators, staff, and clinical service providers were carried out in 14 behavioral health agencies during the first year of the reform, prior to the onset of major changes in the service delivery system. Results: Common features pervading agencies included low morale and lack of appropriately qualified providers. Providers were generally unaware of “big picture” implementation issues, asserting that their clinical work had yet to be affected by the reform. Nevertheless, new enrollment, billing, and reimbursement requirements led to substantial paperwork demands, payment problems, and financial stress within agencies. Providers worried that agencies might cut programs to remain fiscally solvent. Providers often lacked knowledge about and training in evidence-based practices and tended to underestimate the complexity of delivering culturally competent care. Discussion: Policymakers must account for the challenges that agencies are likely to face as the reform continues to unfold. The long-term financial viability of agencies is of critical importance in light of the omnipresent fear that providers are sacrificing “billable hours” to complete administrative tasks. Efforts are needed to increase training opportunities in evidence-based care and cultural competency; agencies typically lack resources to pursue these opportunities on their own.