Financing of Care for the Chronically Mentally Ill in the USA: A Patchwork of Policies

Abstract

Chronic mental illness poses a continuing public-policy challenge in the United States. A substantial number of Americans suffer from chronic illness, and the costs of providing services to them is very high. However, many people with chronic mental illness are poor and unemployable and thus do not have private health insurance — the primary method of financing health care in the United States. Thus, the responsibility of meeting the needs of these individuals falls mainly on the various levels of government in the United States, but the governments have not met this responsibility in any systematic way. In this paper we review some of the issues related to the financing of mental health services for the chronically mentally ill. We begin with an overview of the estimated number of people with chronic mental illness, their characteristics, and the costs of their medical care. Next, we briefly describe some of the financing programs that cover the medical care costs of the chronically mentally ill. We go on to examine the role that different types of institutions play in providing services to these individuals, with particular emphasis on the role of the general hospital. Finally, we examine some of the likely consequences of the current cost-containment movement in the United States for people with chronic mental illness.