OCA outlines behavioral health spending measurement and options for a focused investment benchmark

OCA presented its proposed approach to measuring behavioral health spending and canvassed options for a behavioral health investment benchmark to incentivize prevention, community‑based services and integration with primary care.

Staff described a two‑part measurement strategy: a numerator of behavioral health spending (claims and allocated non‑claims payments) and a denominator of total medical expenses. For claims‑based spending OCA proposes including lines where the primary diagnosis is a behavioral health diagnosis and additional service codes for screening/assessment; pharmacy spending would be included when the National Drug Code (NDC) corresponds to a behavioral health treatment. Non‑claims spending would be captured through an expanded framework that classifies payments into categories (for example, capitation, performance payments, population health payments) and allocates portions to behavioral health using established formulas. OCA said it would include behavioral health capitation in full and allocate a portion of broader capitations and practice transformation payments to behavioral health where appropriate.

On the benchmark design, staff described two broad approaches: set the benchmark as a percentage of total medical expenses (consistent with OCA primary care practice) or as a per‑member‑per‑month (PMPM) amount (used in Rhode Island’s recent benchmark). OCA noted tradeoffs: a TME percentage signals reallocation across the health spending pie, while PMPM better reflects the incremental per‑member cost of expanding community‑based care and can guard against undue inflation if TME rises. Staff also asked whether the benchmark should focus on short‑term annual improvement, a long‑term investment target (e.g., through 2034) or a combination — and whether the timeline should align with OCA’s other multi‑year goals (primary care/APM goals to 2034 and spending‑growth targets through 2029).

Committee members and public commenters emphasized capturing behavioral health in primary care (integration), the importance of including outpatient and community‑based services, and the need to measure access and equity. Several committee members urged OCA to consider Medi‑Cal dynamics and how non‑plan payments (employer EAPs, nonprofit funding) are counted. Some suggested a PMPM approach; others preferred a TME‑based goal that would require resource reallocation rather than overall spending increases.

OCA said it will present a recommended benchmark to the board in July 2025 after ongoing work with an investment and payment work group and stakeholder engagement. Staff said they will continue to refine the service categories, NDC lists for behavioral health drugs, and non‑claims allocation methods and will align reporting with payer submission timetables.