OCA proposes measurement‑first approach for behavioral health investment benchmark; recommends delaying target until 2028 to collect better data

OCA staff recommended a measurement‑first approach for a behavioral health investment benchmark: finalize definitions, collect payer data and analyze HPD trends before setting a formal statewide benchmark. The recommendation asks the Board to defer setting a binding benchmark until spring 2028 to allow OCA to collect performance‑period data (recommended performance years 2024–2026), conduct supplemental analyses, coordinate with DHCS on Medi‑Cal and county spending, and reassess a multi‑year benchmark that could extend through 2034.

Why it matters: The statute directs OCA to measure behavioral health spending and to set an investment benchmark that sustains capacity and shifts resources to community and outpatient services. OCA said data gaps—particularly around capitation attribution, county specialty mental health spending, non‑claims services and out‑of‑pocket spending—make it difficult to set a defensible, long‑term target now.

OCA’s proposed structure: Staff proposed a two‑phase approach (previously discussed with the payment and investment work group). Under the updated, measurement‑first recommendation, OCA would: • Finalize definitions for claims and non‑claims behavioral health spending with work‑group input. • Collect payer submissions (commercial, Medicare Advantage and Medi‑Cal managed care) for the 2024–2026 performance years and use HPD and payer data to analyze trends and drivers. • Use the 2027 data to reassess and, if appropriate, set a benchmark in spring 2028 for performance years beginning 2029, and then consider a longer term target through 2034.

Evidence and rationale: OCA staff showed HPD and internal analyses that behavioral health claims as a share of total claims increased from about 6.6% in 2018 to about 8.2% in 2023 in the commercial HPD sample, driven largely by increases in in‑network outpatient and community‑based services. The HPD analysis also suggested per‑member‑per‑month (PMPM) spending for the targeted outpatient/community categories rose rapidly (average PMPM growth ~16% per year over the examined period). OCA and work‑group members said those pre‑existing growth trends may affect how aggressive an annual incremental benchmark should be.

Stakeholder views: Work‑group members and public commenters conveyed mixed views. Some supported focusing the benchmark on outpatient/community behavioral health and on integrated primary care behavioral services; others cautioned that many important services (county specialty mental health, justice‑system care, school‑based services and out‑of‑pocket spending) fall outside payer claims and therefore might be missed. Health Access and several work‑group members urged caution about setting a benchmark before OCA has fuller data; hospital representatives asked OCA to include inpatient and residential care in measurement discussions.

Next steps: If the Board agrees, OCA will finalize definitions with the advisory committee, update the data submission guide, begin payer data collection in 2026, and continue HPD analysis and coordination with DHCS and county partners. OCA will return with a recommendation on a benchmark in spring 2028, informed by 2024–2027 data and supplemental analyses.