Last fall, forensic psychiatrist Susan Cave met with juvenile probation officers, social workers, representatives of OptumHealth—the company that holds the purse strings for public psychiatric care in New Mexico—and the adoptive mom of a troubled teenage boy.

Everyone but Optum and an out-of-state doctor who conferenced with the Optum reps by phone agreed the young man needed to be treated at a residential facility, but Optum declined to cover it.

Later that day, the teen committed another offense and was incarcerated at Santa Fe County Juvenile Detention Facility for 30 days, including Thanksgiving, Cave says, while Optum was supposed to be finding him alternative treatment. Finally, 1st Judicial District Court Judge Michael Vigil intervened, and the teen was sent in for treatment.

After numerous similar incidents made clear that Optum was denying too many kids treatment, the part of Optum's contract for juvenile forensic evaluations was revoked July 1, and the state Children, Youth and Families Department started managing those funds instead. Optum now has to pay for residential treatment when a judge orders it based on Cave or other psychiatrists' recommendations.

Optum spokesman Brad Lotterman writes SFR in an email that Optum's psychiatrists "guide people to the most appropriate care" based on state guidelines and industry standards. 

The forensic evaluation snafu is the latest in a series of problems with Optum, which is responsible for one of the most important aspects of New Mexico's health care system.

Since Optum won a contract to manage behavioral health care for the state in July 2009, many small behavioral health providers have shut down. In part, the closures are a result of Optum's history of delaying or denying reimbursements—a problem so acute that Optum is currently operating under corrective action.

Substance-abuse treatment center Ayudantes of Santa Fe closed after 30 years in business. A chain called TeamBuilders took over smaller providers in Albuquerque and Las Cruces, and now provides services in 22 New Mexico counties. Casa de Corazon and Amigos Unidos of Taos were absorbed by a larger provider in the area.

Lotterman counters that Optum increased the providers in its network by 21 percent in its first two years holding the contract. He says Optum helps providers update systems and services to help them adapt to the Optum network.

"For providers that are having difficulties, we will meet with them around their own financial situation to ensure they stay viable and in the network," Lotterman says.
But the consequences of losing small providers trickle down: There are not enough behavioral health providers to serve the state's population, and patients have fewer choices.

"As an organization that is serving as a core service agency via a contract with OptumHealth, I'm daily confronted with the problems of us not having enough behavioral health resources to meet the needs of all the people that need them," Larry Martinez, North Central Director of Presbyterian Medical Services, says.

The smaller providers needed to fill in those treatment gaps are the ones that struggle the most under the higher administrative costs of the current behavioral health system, Patsy Romero, former director of the Behavioral Health Collaborative's Local Collaborative 2, says.

Optum's lower reimbursement rates also strain small providers. Some, like Cave, are reimbursed 25 percent less under Optum than under its predecessor, ValueOptions. When providers that can't stay in business close, their patients can end up in jail after missing their normal treatment. Cave, who evaluates prisoners' mental competency for the 1st Judicial District Court, says she's evaluating about 15 prisoners per month these days, compared to nine or 10 maximum in the past.

"We're seeing more crazy people end up in jail than ever before," Cave says.

Reduction in patient choice can also have far-reaching repercussions for behavioral health patients, Romero explains, because patients build up trust in providers and services.

"The biggest complaint the consumers have is, 'We no longer have choice, and some of the services that keep us stable in the community and out of the jails are being taken away from us or limited,'" Romero says.

Optum did not provide a comment before press time.

At a series of recent meetings, experts explored options for redesigning the state's behavioral health delivery system to address some of these problems. One suggestion that has emerged is greater integration between physical and behavioral health.

Martinez cites a National Association of Community Health Centers study that shows 70 percent of issues addressed in public health clinics have a behavioral health component.

"Frankly, I think behavioral health is the critical issue of our time," Martinez says. "There are people with depression, with anxiety disorder, bipolar disorder—I think that's the critical challenge in our health care system."