How Value-Based Care Could Transform Serious Mental Illness Treatment

It’s no secret that patients with serious mental illnesses (SMIs) are costly to care for and have significantly worse outcomes than their peers.

But value-based care models could enable providers to get creative in caring for these patients, leading to better outcomes and lower costs. Specifically, the value-focused model could allow providers to use wrap-around services that address social determinants of health and focus on whole-person wellbeing.

“Care that is driven by financial reimbursement is not designed to solve a problem, and it’s designed to continue the cycle of reimbursement,” Sonia Garcia, co-founder and chief product officer of Amae, said during Behavioral Health Business’ VALUE event. “What value-based care does is it breaks that cycle.


“It breaks that cycle, she continued, by providing a new financial mechanism for providers to think about care delivery in a holistic way “that gets to true recovery” and “isn’t just concerned with what’s billable versus what is not.”

Sonia Garcia, chief product officer of Amae, speaks at VALUE. Photo: BHB

California-based Amae is looking to treat SMI by focusing on patients’ physical, psycho mental, and societal and community wellness. Amae plans to work with Medicaid and Medicare plans. Its investors include Virtue, Bling Capital, 8VC and Able Partners.

A whole-person approach 

The economic cost of SMI is more than $300 billion each year, according to SMI Advisor. But the toll of these conditions isn’t just financial. The World Health Organization reports that patients with SMI have a 10- to 20-year reduction in life expectancy.


While patients with SMI often have poor health outcomes, providers treat the head and the heart separately. Value-based care avoids this by promoting a whole-person approach with an emphasis on prevention.

“It’s a very fragmented delivery system, in particular around individuals with SMI, who often need to be treated on the physical side, the mental health side, and potentially on the social care side,” Christina Mainelli, Quartet’s CEO, said at VALUE. “The reimbursement model does not support the care required to get these patients well. So we are not today often reimbursed for correcting the physical or addressing physical health issues with someone with SMI, providing wrap-around services like peers, like employment support, like housing.”

New York-based Quartet teams up with health plans and systems to connect users to virtual behavioral health services. Its technology is designed to help match patients to providers that can meet their specific needs and preferences. Quartet has raised at least $219.5 million in venture capital funding.

Christina Mainelli, Quartet’s CEO, speaks at VALUE. Photo credit: BHB

Both Quartet and Amae are focused on using a whole-person approach to caring for patients with SMI.

Quartet, for instance, recently launched a value-based care model designed to treat the SMI population that uses multidisciplinary care from psychiatrists, primary care clinicians, nurse practitioners, peers, case manager and community-support sources, among others.

While Quartet does have some fee-for-service models, Mainelli previously told BHB, the company is looking to move further towards per member per month, full-risk models and value-based payment models in the SMI space.

Thinking outside the box

In addition to collaborative care teams, value-based care could include more wrap-around services that drive costs down – even if those services are on the non-clinical side of care. Garcia gave the example of the Chicago-based payer organization Zing Health.

The company found a spike in emergency room utilization, but no specific ailments or conditions correlated to this increase. There was, however, a heat wave passing through the city.

“By talking to their members, they understood that they didn’t have any [air conditioners] in their homes, and going to the hospital was a safe and cool place to land,” Garcia said. “They instead went and bought all their members air conditioners and installed them in their homes. And low and behold, overnight, the hospitals cleared and outcomes improved.”

One of the wrap-around services that could be a game changer in this space is peer support specialists and care managers, the panelists noted.

Peer-support specialists could be instrumental in building trust between patients with SMI and the medical system.

“The system hasn’t treated [the patient with SMI] well. They spent time in jail, the cops pick him up and they don’t take him for treatment; they take him to a correctional setting,” Samir Malik, CEO of firsthand, said at VALUE. “The ED simply wants to get them out as fast as they can, without … proper ongoing treatment. The system has failed this cohort time and time again.”

That’s contributed to a difficult-to-shake distrust, Malik explained.

“And that’s why so many folks are unengaged, not because they don’t want to get better,” he said. “They know they’re struggling.” 

Samir Malik, CEO of firsthand, speaks at VALUE. Photo credit: BHB

firsthand is a New York-based company that uses a peer-support model to help engage with patients with SMI. The company recently landed $28 million in a funding round led by GV, previously Google Ventures.

firsthand business model is focused on teaming up with payers to help address the needs of their patients with SMI. The company is currently prioritizing the Medicaid sector, where need and health care costs are the highest.

Malik noted that patients with SMI are often skeptical the first time they meet a peer-support specialist. But once that peer-support specialist gains their trust, it’s much easier to engage that person in care.

He noted that 7 out of 10 patients the peer-support specialists are engaging will enroll in firsthand’s program over time.

“That’s the power of the peer,” he said. “A caseworker will not get that done. A nurse and a doctor, as important as they are to delivering the outcome, are not the right mechanism to build the trust, which is the first door one needs to go through on a longer pathway to recovery.”

The ability to implement some of these wrap-around services, such as peer support, could also address some of the larger issues in the behavioral health space, namely staffing shortages.

“A traditional fee-for-service model, in many cases, won’t reimburse for coaching or service that would actually allow our [capacity-constrained providers] to operate at the top of their license,” Mainelli said. “So if you enable reimbursement for coaching, for example, or some of the other wrap-around services, it may actually free up provider supply to support patients that are [higher acuity].”

The tools to help patients thrive are not exactly a mystery. But the reimbursement challenge has prevented these services from reaching patients with SMI.

However, the value-based model could help change that in the future.

“These interventions are proven, peer-reviewed, double-blinded, all the good stuff,” Malik said. “We have just not brought them to market at scale because the contracting mechanisms have not allowed for it. You see these interventions proven out through funded programs, or academic programs, or, you know, state-focused investments in innovative models. But none of these will get to scale unless we build the economic model around it.”

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