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HCAI outlines behavioral-health spending definition, plans HPD analyses and Medi-Cal adjustments
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Summary
HCAI staff summarized the behavioral-health spending definition (primary-diagnosis rule for claims; NDC-based pharmacy identification; allocation methods for non-claims) and said HPD analyses and DHCS collaboration will inform future benchmarks; Medi-Cal under-21 services will be included regardless of diagnosis in 2026 reporting.
Debbie Lindes, health care delivery system group manager at HCAI, walked the work group through the agency's behavioral-health spending definition and the analytic work planned to support a future investment benchmark.
"The main test is whether the claim includes a behavioral health diagnosis as its primary diagnosis," Lindes said, noting an exception for screening and assessment lines that do not require a primary behavioral-health diagnosis. Pharmacy spending will be identified by national drug codes, and non-claims payments will be allocated to behavioral health using an expanded framework that includes population health, behavioral-health integration, care management, and formulas for allocating portions of capitation similar to the method used for primary care.
Lindes summarized recent stakeholder input: advisory-committee members supported measuring behavioral health occurring in primary care and requested analyses of secondary diagnoses and out-of-plan spending; the HCAI team will run HPD analyses to quantify the impact of including secondary diagnoses and to explore out-of-plan spending data sources. In response to concerns that MEPS (Medical Expenditure Panel Survey) estimates were unreliable for California, HCAI said MEPS'based estimates had a small California sample and divergent trends versus HPD, so the agency will pursue other institutional partners and data sources for out-of-plan estimates.
On Medi-Cal, Lindes said HCAI collaborated with DHCS to add a methodology for capturing behavioral-health spending for Medi-Cal members under age 21 in 2026, reflecting Medi-Cal policy that youth may receive behavioral-health services without a diagnostic code. Jeff Norris of DHCS told the group that accounting for county specialty mental-health and Drug Medi-Cal spending remains a complex area and that HCAI and DHCS will continue to explore approaches over the next 6 to 12 months.
Lindes said HCAI has prioritized HPD analyses including variation by market (commercial, Medicare Advantage, Medi-Cal), payer-level trends, spending by age and geography, and decomposing spending growth into price versus utilization drivers. The results will inform whether the board is ready to set a behavioral-health investment benchmark in 2026.
Next steps: HCAI will publish the draft 2026 DSG (including behavioral-health code-set updates) for public comment and present HPD analysis plans and later findings to the work group.
