Implementing and evaluating outcome indicators of performance for mental health agencies

Regulation-based processes for evaluating the performance of mental health agencies are gradually changing to focus on measuring the effectiveness of mental health services in obtaining the best possible outcomes. The decreased availability of resources for serving people with mental health problems has led to an emphasis on effectiveness, which is often expressed in terms of accountability. Thus, a singular reliance on compliance with practice standards has shifted to the need to be able to demonstrate that funds appropriated for mental health services are being used in ways that result in valued outcomes. In Colorado, this shift has led to the development of performance indicators that provide information reflecting stakeholder values about the performance outcomes of the mental health system. This article describes these performance indicators and presents the data that led to a decision to award monetary incentives to two community agencies. Potential benefits and pitfalls of Colorado's performance indicator process are also discussed.