Mental health services are overloaded. We should pay them a bonus to improve your care

**The Crisis in Mental Health Care**

Australia’s mental health-care system is struggling to cope with the demand. Despite the challenges, many mental health services are not providing evidence-based care, leading to poor health outcomes and wasteful use of resources.

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**The Problem with Mental Health Care**

Many Australians with mental ill-health cannot access care when needed, due to long waiting lists and high patient costs. Almost two-thirds of patients are waiting more than 12 weeks to receive care for their mental ill-health. About one in five people reported cost as a reason for delaying or not seeing a mental health professional.

Even when people do access care, it is often not evidence-based, reducing the likelihood of becoming well quickly. For instance, nearly half of all encounters to treat depression are deemed inappropriate and consequently of low value.

There are also gaps in individual care pathways. For example, some people who present to hospital after a suicide attempt may not receive mental health care when they leave. People find it difficult to navigate mental health-care services within the community, which means people can fall through the cracks and do not receive the care they need.

**How Might We Change Things?**

One reason why mental health care struggles to meet patient needs is how health care is funded. Medicare pays a fee to providers for their services based on the Medicare Benefits Schedule (MBS). The MBS incentivises providers to deliver more services because providers are paid based on each service they deliver. This fee-for-service model does not incentivise providers to deliver good quality care, or to improve health outcomes efficiently.

**Paying for Good-Value Care**

Our research explored how to embed greater value into mental health-care funding using value-based payments. We interviewed state, territory and federal government departments and agencies, and held several national workshops with providers, care recipients, carers, peak bodies and academics.

Under a value-based payment model, doctors, psychologists and psychiatrists in the community would receive more funding if they delivered better care. These financial incentives would seek to encourage providers to invest their time and effort into improving their care, skills and the patient experience.

**How Do We Pay for Good-Value Care?**

Our research suggests that paying for good-value care could be achieved through value-based payments. This could involve paying providers more to deliver better quality care, compared to using a fee-for-service model. However, there is little evidence on how to best structure this.

Emerging evidence demonstrates there are benefits from paying providers more to deliver better quality care, compared to using a fee-for-service model. However, some trials have failed to improve outcomes. Our research suggests we need to know more about the size of the incentive and whether this should target individual practitioners, teams or practices, what outcomes we should measure, and what targets providers should seek to achieve.

**Overcoming Barriers**

Reforming mental health-care funding towards value-based payments will be complex and challenging. Our respondents identified barriers, including:

* Defining outcomes that matter to patients
* Overcoming a lack of evidence on how value-based payments can improve outcomes
* Addressing workforce gaps
* Navigating political complexities and procedural challenges
* Covering the cost of reform

**What Needs to Happen Next?**

Government needs to better define what value means within mental health care and establish a unified set of agreed outcomes. It needs to raise provider awareness of why value-based payments are required and develop a ten-year strategy and implementation plan.

In the next four years, government should develop and implement a mental health data infrastructure strategy to help fill data gaps. Mental health-care funding reform should be integrated into ongoing payment reforms in hospitals and primary care.

There also must be greater accountability for reform. An independent value-based payment authority should be developed to work with state, territory and federal governments to design, coordinate and evaluate new value-based payment models.

**Conclusion**

Reforming mental health-care funding towards value-based payments is a complex challenge. However, it is essential to improving the quality and efficiency of mental health care. By paying providers a bonus to improve patient care, we can incentivise them to deliver better outcomes and reduce wasteful use of resources.

**FAQs**

Q: Why is the mental health-care system struggling to cope with demand?
A: The mental health-care system is struggling to cope with demand due to long waiting lists and high patient costs.

Q: How do we know that paying providers a bonus to improve patient care will work?
A: While there is limited evidence on how to best structure value-based payments, emerging evidence demonstrates that paying providers more to deliver better quality care can improve outcomes.

Q: What are the barriers to reforming mental health-care funding towards value-based payments?
A: The barriers to reforming mental health-care funding towards value-based payments include defining outcomes that matter to patients, overcoming a lack of evidence on how value-based payments can improve outcomes, addressing workforce gaps, navigating political complexities and procedural challenges, and covering the cost of reform.

Q: What needs to happen next to reform mental health-care funding towards value-based payments?
A: Government needs to better define what value means within mental health care and establish a unified set of agreed outcomes. It needs to raise provider awareness of why value-based payments are required and develop a ten-year strategy and implementation plan.