Managed care and the rationalization of mental health services

Managed care represents a response to the wider institutional demand for technical rationality and efficiency, and it may be in conflict with professionally generated logics of mental health care which emphasize the delivery of quality care, as well as providing services to all who need care. The organizational and policy conundrum is to balance conflicting institutional demands for efficiency (cost savings) and effectiveness (access and quality). This paper examines managed care in one public sector mental health care system that has attempted to incorporate the principles of managed care into a community based system of care and to overcome the potential contradictions between demands for efficiency and professional logics of care. Both qualitative and quantitative data are used to examine changes in organizational structure and service offerings; providers' experience of managed care, and the effect of managed care on working conditions and work experiences, and changes in the goals of the organization as measured by the specification of client outcomes. I find that, while increased performance accountability and outcome assessment (in keeping with demands for efficiency) have the potential to improve mental health care services, in fact, providers report that the primary effect of managed care has been an emphasis on cost containment, and there has been a corresponding de-emphasis on the provision of community based services for clients with long term care needs. However, there is potential for professional logics to be maintained by larger institutional forces demanding quality care.