OCAH work group backs primary-diagnosis approach to measure behavioral health spending, flags gaps for future analysis

SACRAMENTO — The Office of the California Actuary's (OCA) Investment and Payment Work Group on behavioral health continued refining how the state will measure behavioral health spending, recommending that payers count claims where a behavioral health diagnosis appears as the primary diagnosis and that payers not be asked to restrict measurement to specific provider taxonomies.

The recommendation, presented by Debbie Lindes, manager of the Healthcare Delivery System Group at OCA, and Mary Jo Condon, principal consultant with Freedom Healthcare, proposes starting from the Milbank code set and having payers report behavioral health pharmacy claims using national drug codes (NDCs). OCA also proposed apportioning portions of capitation and other nonclaims payments to behavioral health using a fee‑for‑service (FFS) equivalent ratio, the group heard.

Why this matters: California statute requires OCA to measure behavioral health spending as a percentage of total medical expenditures reported by health plans. How the state defines what counts as “behavioral health” will shape any future benchmark and could incentivize payers to invest in community‑based, outpatient services the state seeks to expand.

OCA recommended using only the primary diagnosis field to designate a claim as behavioral health. Mary Jo Condon said, “the diagnosis code would have to be the primary diagnosis code.” That approach is intended to reduce the risk of overcounting…