[Congressional Record Volume 141, Number 64 (Thursday, April 6, 1995)]
[Extensions of Remarks]
[Pages E812-E813]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


[[Page E812]]
             MEDICARE MENTAL HEALTH IMPROVEMENT ACT OF 1995

                                 ______


                        HON. FORTNEY PETE STARK

                             of california

                    in the house of representatives

                         Thursday, April 6, 1995
  Mr. STARK. Mr. Speaker, today I am introducing the Medicare Mental 
Health Improvement Act of 1995. This bill will improve the mental 
health services available to Medicare beneficiaries. It represents an 
urgently needed change in benefits to reflect contemporary methods of 
providing mental health care and prevent unnecessary hospitalizations.
  The bill expands Medicare Part A and Part B mental health and 
substance abuse benefits to include a wider array of settings in which 
services may be delivered. It eliminates the current bias in the law 
toward delivering services in general hospitals. It permits services to 
be delivered in a variety of residential and community-based settings. 
Through use of residential and community-based services, costly 
inpatient hospitalization can be avoided. Services can be delivered in 
the setting most appropriate to the individual's needs.
  In 1991, as a nation we spent approximately $58 billion for treatment 
of mental illness and another $17 billion for substance abuse 
disorders. Medicare expenditures in these areas for 1993 were estimated 
at $3.6 billion or 2.7 percent of Medicare's total spending. Over 80 
percent of that cost was for inpatient hospitalization.
  In addition to these direct medical costs there are also enormous 
social costs resulting from these disorders. It has been estimated that 
severe mental illness and substance abuse disorders cost $78 billion 
per year in lost productivity, lost earnings due to illness or 
premature death, and costs for criminal justice, welfare and family 
care giving.
  Mental disorders affect about 22 percent of the adult population in a 
1 year period; 2 to 3 percent of the population experience severe 
mental illness or substance abuse disorders. This population is very 
diverse. Some people experience problems of recent origin that never 
recur, given appropriate treatment. Others have severe problems that 
persist for a long period of time. Mental illness and substance abuse 
disorders include many different diagnoses, levels of disability and 
duration of disability. Therefore, the people affected have many 
different needs.
  Diagnosis and treatment of mental illness and substance abuse have 
changed dramatically since the Medicare benefit was designed. No longer 
are treatment options limited to large public psychiatric hospitals. 
The great majority of people can be treated on an outpatient basis, 
recover quickly and return to productive lives. Even those who once 
would have been banished to the back wards of large institutions can 
now live successfully in the community.
  In recent years, the range of settings for care has diversified and 
providers have become more specialized. Treatments are more numerous 
and more effective than ever before. Treatment for mental disorders is 
in many cases just as effective as treatment for many physical 
disorders. For many people, however, appropriate treatment is 
inaccessible because they lack adequate insurance coverage. Medicare 
benefits have not kept pace with advancements in the field of mental 
health.
  This bill would permit Medicare to pay for a number of intensive 
community-based services. In addition to outpatient psychotherapy and 
partial hospitalization that are already covered, beneficiaries would 
also have access to psychiatric rehabilitation, ambulatory 
detoxification, in-home services day treatment for substance abuse and 
day treatment for children under age 19. In these programs, people can 
remain in their own homes while receiving services. These programs 
provide the structure and assistance that people need to function on a 
daily basis and return to productive lives.
  They do so at a cost that is much less than inpatient 
hospitalization. For example, the National Institute for Mental Health 
in 1993 estimated that the cost of inpatient treatment for 
schizophrenia can run as high as $700 per day, including medication. 
The average daily cost of partial hospitalization in a community mental 
health center is only about $90 per day. When community-based services 
are provided, inpatient hospitalizations will be less frequent and 
stays will be shorter. In many cases hospitalizations will be prevented 
altogether.
  This bill will also make care management available for those with 
severe mental illness or substance abuse disorders. People with severe 
disorders often need help managing many aspects of their lives. Case 
management assists people with severe disorders by making referrals to
 appropriate providers and monitoring the services received to make 
sure they are coordinated and meeting the beneficiaries' needs. Case 
managers can also help beneficiaries in areas such as obtaining a job, 
housing, or legal assistance. When services are coordinated through a 
case manager, the chances of successful treatment are improved.

  For those who cannot be treated while living in their own homes, this 
bill will make several residential treatment alternatives available. 
These alternatives include residential detoxification centers, crisis 
residential programs, therapeutic family or group treatment homes and 
residential centers for substance abuse. Clinicians will no longer be 
limited to sending their patients to inpatient hospitals. Treatment can 
be provided in the specialized setting best suited to addressing the 
person's specific problem.
  Inpatient hospitalization, of course, will remain an important avenue 
of treatment for some beneficiaries. Currently, the law contains a bias 
toward providing inpatient services in general hospitals. That bias 
results from the payment differences between psychiatric hospitals and 
general hospitals.
  Right now in psychiatric hospitals, benefits may be paid for 190 days 
in a person's lifetime. This limit was established primarily in order 
to contain Federal costs. In fact, CBO estimates that only about 1.6 
percent of Medicare enrollees hospitalized for mental disorders or 
substance abuse used more than 190 days of service over a 5-year 
period.
  In general hospitals, benefits are available for 90 days in a benefit 
period and a person may have numerous benefit periods throughout his or 
her lifetime. This can result in people who have almost used up their 
190 lifetime days in a psychiatric hospital being forced to receive 
services in a general hospital.
  They are also shunted into nursing homes. A recent study found that, 
among nursing home residents who did not have a cognitive impairment, 
such as Alzheimer's disease, 13 percent exhibit mental disorders. While 
some general hospitals and nursing homes are up to this task, others 
are ill-equipped to meet the needs of people with severe mental illness 
or substance abuse problems.
  Under the provisions of this bill, beneficiaries who need inpatient 
hospitalization can be admitted to the type of hospital that can best 
provide treatment for his or her needs. Inpatient hospitalizations 
would be covered for up to 60 days per year. The average length of 
hospital stay in 1992 for an adult was 16 days and for an adolescent 
was 24 days. The 60 day limit, therefore, would adequately cover 
inpatient hospitalization for the vast majority of Medicare 
beneficiaries, while still providing some modest cost containment. 
Restructuring the benefit in this manner will level the playing field 
for psychiatric and general hospitals.
  The bill I am introducing today is an important step toward providing 
comprehensive coverage for mental health. Timely treatment in 
appropriate settings will lessen health costs in the long run. It will 
also lessen the social costs of crime, welfare, and lost productivity 
to society. This bill will assure that the mental health needs of 
Medicare beneficiaries are no longer ignored. I urge my colleagues to 
join me in support of this bill.
  A summary of the bill follows:


                               in general

  The bill revises the current mental health benefits available under 
Medicare to de-emphasize inpatient hospitalization and to include an 
array of intensive residential and intensive community based services.


                           part a provisions

  The bill permits benefits to be paid for 60 days per year for 
inpatient hospital services furnished primarily for the diagnosis or 
treatment of mental illness or substance abuse. The benefit is the same 
in both psychiatric and general hospitals.
  The following ``intensive residential services'' are covered for up 
to 120 days per year: Residential detoxification centers; crisis 
residential or mental illness treatment programs; therapeutic family or 
group treatment home; and residential centers for substance abuse.
  Additional days to complete treatment in an intensive residential 
setting may be used from inpatient hospital days, as long as 15 days 
are retained for inpatient hospitalization. The cost of providing the 
additional days of service, however, could not exceed the actuarial 
value of days of inpatient services.
  A facility must be legally authorized under State law to provide 
intensive residential services or be accredited by an accreditation 
organization approved by the Secretary in consultation with the State.
  A facility must meet other requirements the Secretary may impose to 
assure quality of services.
  Services must be furnished in accordance with standards established 
by the Secretary for management of the services.
  Payment for intensive residential services would be the lesser of 
reasonable cost under 1816(v) or customary charges less the amount the 
provider may charge under 1866(a)(2)(A).
  Inpatient hospitalization and intensive residential services would be 
subject to the same 
[[Page E813]] deductibles and copayment as inpatient hospital services 
for physical disorders.


                           part b provisions

  Outpatient psychotherapy for children and the initial 5 outpatient 
visits for treatment of mental illness or substance abuse of an 
individual over age 18 have a 20-percent copayment. Subsequent therapy 
for adults would remain subject to the 50 percent copayment.
  The following intensive community-based services are available for 90 
days per year with a 20-percent copayment (except as noted below): 
Partial hospitalization; psychiatric rehabilitation; day treatment for 
substance abuse; day treatment under age 19; in home services; case 
management; and ambulatory detoxification.
  Case management would be available with no copayment and for 
unlimited duration for ``an adult with serious mental illness, a child 
with a serious emotional disturbance, or an adult or child with a 
serious substance abuse disorder (as determined in accordance with 
criteria established by the Secretary).''
  Day treatment for children under age 19 would be available for up to 
180 days per year.
  Additional days of service to complete treatment can be used from 
intensive residential days. The cost of providing the additional days 
of service, however, could not exceed the actuarial value of days of 
intensive residential services.
  A non-physician mental health or substance abuse professional is 
permitted to supervise the individualized plan of treatment to the 
extent permitted under State law. A physician remains responsible for 
the establishment and periodic review of the plan of treatment.
  Any program furnishing these services (whether facility-based or 
freestanding) must be legally authorized under State law or accredited 
by an accreditation organization approved by the Secretary in 
consultation with the State. They must meet standards established by 
the Secretary for the management of such services.


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