Behavioral health providers are notoriously mission-driven, sometimes at the expense of being business-minded enough to remain financially viable. Additionally, they’ve been historically siloed.
Tallahassee, Florida-based MHCA has been trying to tackle those industry weaknesses and others since its founding back in 1985. Sailing into the choppy behavioral health waters of 2020, that mission remains.
Formerly known as the Mental Health Corporations of America, Inc., MHCA is a relatively small, invite-only trade group for innovative and entrepreneurial behavioral health providers. Unlike other trade organizations that prioritize lobbying, MHCA’s focus is on helping providers make the best of their current reality, encouraging creative and collaborative solutions to some of the biggest problems plaguing the industry.
President and CEO Dale Shreve has been leading the nonprofit since 2013. Behavioral Health Business recently connected with him to discuss MHCA’s 2020 vision and priorities, which include helping to guide members through workforce shortages to financial stability, all well helping them maintain a competitive edge.
Shreve also shared a number of consolidation considerations and succession strategies for behavioral health providers to keep in mind for the year ahead.
You can find the conversation below, edited for length and clarity.
BHB: First, can you tell me about your membership?
Shreve: Currently, we have 148 members, and our goal is to be somewhere around 150. Membership is by invitation.
Our members are behavioral health organizations. We have not-for-profit, for-profit, governmental and corporate structures. The one common denominator is they provide some amount of direct behavioral health care.
We look for organizations and leaders that demonstrate passion for innovation, entrepreneurship, value and collaboration. While the member is the organization, our focus is on the CEO and other C-suite leaders.
The secret sauce of MHCA is the relationships that develop among our member CEOs and C-suite leaders. Given the [intentionally] relatively small size of the association, the vetting of members for “fit” and the frequency of meetings, individuals are facilitated in developing relationships with their peers from across the country — which can be very valuable both from a strategic business perspective and a personal/supportive one.
We even have unique, more formalized peer collaboration groups of four to five member CEOs, who regularly serve as consultants to each other via visiting their peer organizations on a rotating basis.
What are your big goals for the year ahead?
We continue to be focused on member needs and how those continue to evolve. For most of our members, their biggest struggles are around financial stability and what they need to do to be successful financially in the current environment. A lot of that is anticipating the shift to value-based reimbursement and what that means.
Along with [that] is dealing with new competitors in the space. For a number of years, our members didn’t worry too much about competitors because no one wanted to do what they were doing. Now that has changed to some degree.
Workforce continues to be an issue, especially professional clinical employees. Finding them and retaining them is a struggle. Much of that is compounded by traditionally low reimbursement rates, which allows our members to not pay high salaries.
Two of the problems you mentioned — competition and workforce shortages — are somewhat in opposition but also go hand-in-hand. It seems like the most competitive providers would be the ones that know how to leverage their workforce.
Exactly. Who knows how to leverage it and who knows how to augment it with technology or extender kind of arrangements.
A number of our members are looking at peer-provided services, which is something that alcohol and drug abuse have done for a number of years but hasn’t been big mental health until recently.
Also, how can you use technology to deal with patient issues before they get to you or between visits?
It’s always been hard to find psychiatrists, so many [providers] are using advanced practice nurses to help cover that need.
To some degree, some providers have just had to sort of pull back and focus on only particular niches because they don’t have enough personnel to deal with broad brush kinds of behavior health care.
You also mentioned value-based reimbursement. Is that something you’re seeing a lot of participation in among your members?
Right now, the majority of them don’t have much of their budget tied into value-based structures. They’re all anticipating that and looking for that evolution, but it isn’t something that is a predominant style.
One of the struggles is, how do you define value with behavioral health care? You can’t do an X-ray and say that the broken bone is mended appropriately.
The struggle is defining what value means and then having there be some consistency with that across multiple payers. Providers ought to be more involved in that process, but the reality is it’s more player-driven.
Interesting. Apart from that, what big trends do you think the behavioral health industry will see in the year ahead?
I think we’ll continue to see integrated care across a number of sectors — not just integrating with primary health care, but continued integration of behavior healthcare into a number of different settings.
I think we’ll see providers continuing to work with payers. As an association, we think that it’s important that those partnerships develop and evolve, but it’s not something that has been historically in place.
Achieving scale continues to be an issue for members, especially if the hospitals and health care systems in their areas decide they’re going to start doing behavioral health care. They’re a whole lot bigger and able just to take on that whole market.
I think integrating different technology systems … is something providers will be trying to do.
Succession planning — we haven’t talked about that. We’ve already had a lot of retirement happening with baby boomers, and that’s going to continue, so I think some of these leadership shifts are important.
Founders of our members are retiring, and the new leadership is coming in. Many of our newer CEOs are coming from more business backgrounds, whereas traditionally, the initial CEOs were clinicians that got promoted.
I’m interested in that trend — of some new leadership having business rather than clinical backgrounds. Is that a good thing or a bad thing?
I think it’s both. At least within the top leadership, you have to have the ability to tap across those skill sets.
I don’t know that the CEO needs to have a clinical background, but they sure need some people within their leadership team that they can rely on that bring that skill set to what they’re doing.
If the leader really has a clinical background, they’re going to need to have partners at the table who have [business] and technology expertise.
It’s really important to have all those ingredients, and you can get out of balance real quickly.
For some organizations, [necessary] business moves can be made more difficult because of the board composition. It might be filled with people who joined the board because of the mission, maybe to the exclusion of seeing some of the business realities.
You also talked a little bit about consolidation. What are you seeing on that front?
Our members are all across the board. We have some with relatively small operating budgets of $5 million. We have other members that are larger, maybe $300 million.
We have some members that are probably targets to be acquired, and we have other members that are actively looking to expand their footprints, and others in there are looking at affiliations with hospitals and healthcare systems.
They’re all aware that you have to be of sufficient scale to be able to operate cost-effectively. No matter how big you are, you need a medical record system, you need an HR system. All those things are required, whether you’re one of the smallest or one of the largest.
What should providers consider going into those acquisitions?
The cultural pieces need to be in place for a successful marriage. You’ve got to be able to get along and make sure your visions align.
What we’re seeing to some degree is formal affiliations with hospitals and healthcare systems, [which are] tricky. They have a lot more zeros in their budgets than we do, so it’s fairly typical that they start taking control of things that maybe weren’t anticipated. The behavior health side of that has to be cautious when they’re looking at those arrangements.
Is there anything else that you would like to add?
It’s an interesting time and an interesting industry. When I think back I remember always thinking, ‘Well, if we get over this hurdle, we will be smooth sailing for a while’ — and I’m not sure we’ve ever hit smooth sailing.
There’s always been struggles and changes that are happening. While the industry is changing, we still have some obstacles that we need to overcome. I think we have the capability to do that, but it’s just having the endurance to get that done.