Perspectives: parity--prelude to a fifth cycle of reform

Based on 2000 Carl Taube Lecture at the NIMH Mental Health Economics Meeting.

This perspective article examines the relationship between a policy of parity in financing mental health services and the future of reform in service delivery.

Applying theories of static and dynamic efficiency to an understanding of parity and the evolution of mental health services, drawing upon Burton Weisbrod s concept of the health care quadrilemma .

Each of four cycles of reform in mental health services have contended with issues of static and dynamic efficiency. Each cycle was associated with static efficiency in the management and financing of services, and each was associated with a set of new treatment technologies intended to improve dynamic efficiency. Each reform proved ultimately unsuccessful primarily because of the failure of the treatment technologies to prevent future patient chronicity or to achieve sustained recovery. Recent advances in treatment technology and management of care can permit an unprecedented level of efficiency consistent with a policy of improved access to mainstream health and social welfare resources, including insurance coverage. This policy of so-called financing parity can improve current mental health service delivery, but it may also portend a future fifth cycle of reform. If new technologies continue to advance as full technologies - simple to deliver and producing true recovery - and mainstream resources are made available, then the specialty mental health services may contract dramatically in favor of effective care and treatment of mental illness in primary care and other mainstream settings.

Predicting the future of health care is speculative, but it may be easier using the Weisbrod formulation to understand the process of mental health reform. Over-reliance on administrative techniques for building static efficiency and false optimism about dynamic efficiency from new technology have stymied previous reforms. All the same, a fifth cycle of reform could succeed, if the right conditions are met and mainstream resources are available.