Funding Policies In Mental Health System

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Funding policies in the mental health system is very important when it comes to knowing, how the services being provided by the mental health systems are being paid for. A better understanding of factors that influence spending decisions for mental health services at the local or county level, mental health services on funding incomes above $1 million initiative statute in California. I am also going to discuss the mental health funding in Europe. Along with the funding for the Meadows Center and what the canter is all about and how it helps the patients that are in need.

A better understanding of factors that influence spending decisions for mental health services at the local or county level would be useful in service system development and in public policy planning. Indicators of county spending for services to persons with mental illness (dependent variables) were defined as the number of dollars budgeted by the county for mental illness and expenditures for mental illness per county population for fiscal year 1994(May 1998 American Psychiatric Association). Rural culture was defined by several county-based socioeconomic variables including the size of the population, the percentage of land classified as rural, the percentage of elderly persons (age 65 and older), the percentage of people with a college education, and the percentage of total income from farm earnings. Policy makers’ attitudes about services and funding priorities were assessed via a scheduled 15-minute phone survey of 97 of the state’s 99 county boards of supervisors in the fall of 1995(May 1998 American Psychiatric Association).

The results of analyses to determine factors associated with county funding for mental health services, the amount of money spent on services to persons with mental illness was correlated with the amount of money spent on mental illness per capita. County wealth, AMI advocacy, and characteristics related to rural culture, including population size, the proportion of rural and elderly inhabitants, the proportion of college-educated residents, and the proportion of farm income, all appeared to have a relationship with county funding for mental illness. Counties with larger populations and higher proportions of college-educated residents spent more money on mental illness, while counties with higher proportions of rural and elderly persons spent less. Counties in which a higher proportion of income was from farm earnings spent less money on mental illness. Policy makers’ attitudes were related to funding. County boards indicating that funding for mental health services should not be the responsibility of county government had lower budgets for persons with mental illness (Braddock 1992).

Counties are the primary providers of mental health care in California communities for persons who lack private coverage for such care. Both children and adults are eligible to receive such assistance. Counties provide a range of psychiatric, counseling, hospitalization, and other treatment services to patients (Mental health care, 2004). County mental health services are paid for with a mix of state, local, and federal funds. Revenues deposited in the Mental Health Services Fund would be used to create new county mental health programs and to expand some existing programs. These funds were not provided through the annual state budget act.

Although prevalence rates for the majority of psychiatric disorders vary very little across Europe, different health systems identify different level of need for mental health services, devote different levels of funding and choose different ways to deliver those (Knapp, 2005). This lack of funding is both inefficient, because of the substantial benefits that interventions would bring to Europe, given the significant burden of mental health problems, and the disproportionate impact they have on the poor. It looks at the ways in which mental health care is financed, and how available funds are distributed within countries in order to facilitate access to a range of services, often provide across a number of sectors such as social care, housing, criminal justice and education.

Mental health problems account for nearly 20% of the total burden of ill health in Europe, coming second only to cardiovascular disease (Knapp, 2005). Poor mental health has an impact on an individual’s physical health; mortality is significantly higher than in the general population. The funding for mental health in Europe is at historically low levels, promotion strategies, treatment and rehabilitation approaches that are known to be effective and cost-effective and inequitable, given that mental health problems account for at least one in five of all health problems in Europe, yet a great many people remain untreated.

Methods of financing mental health in Europe vary considerably with the level of resources available and do not differ much from those for health care in general. All countries rely largely on some form of income or sales-related taxation and/or social insurance. However, for countries in the former Soviet Union in particular, the transition to social health insurance systems has not always been effective, most of the health expenditures are out-of-pocket payments and private insurance (Knapp, 2005). The limited evidence available suggests that private expenditures on mental health is limited, owing in part to association of mental health problems with poverty, so that many individuals have to rely on state-funded services where these are available to them.

The role that is played by voluntary health insurance companies in Europe are voluntary (for-profit or not-for-profit) insurance schemes that provide minimal coverage for mental health in the European Economic Areas. One reason for this is because of the chronic nature and the high cost of mental health treatments and interventions. These treatments are covered; premiums are likely to be higher. Evidence from the US, where the private health-insurance market is most well-developed, illustrated the difficulty in achieving parity between mental and physical health insurance coverage, leading to unequal access to mental health treatment (Knapp, 2005). The importance of voluntary (private) insurance is growing in many parts of central and Eastern Europe (Knapp, 2005); the challenge will be to ensure that where countries shift towards more reliance on private insurance rather then social insurance or tax, mental health disorders are fully covered in the same ways as other conditions.

Out-of-pocket payments continue to provide a significant contribution to overall health expenditures in many European countries; where approximately one-third of costs are incurred out of pocket payments. Given the strong correlation between mental health problems, unemployment and deprivation, user charges for mental health services can be highly inequitable. These people needing these services will often be the least able to pay for the services that were provided (Knapp, 2005). The poor rate of diagnosis of mental health problems in primary care is not likely to be improved if those with mental health problems are discouraged from coming into contact because of the application of user charges. Moreover, people with mental health problems have poorer physical health than the general population; so again, inappropriate use of user charges could adversely impact upon them with the live in the country of Europe.

With going over the many ways that mental health is funded in Europe and in states in the United States and in rural areas, I want to now talk about the funding for the Meadows Psychiatric Center and also what services that they provide for their patients. The Meadows Psychiatric Center is the leading psychiatric treatment facility of Central Pennsylvania and is at the core of an integrated delivery system for the treatment of mental illness. Comprehensive services are offered to individuals of all ages with behavioral health and/or addictive disease problems. Individuals are referred into the most clinically appropriate and least restrictive level of care, which may include acute inpatient, partial hospitalization, intensive outpatient or outpatient services. These treatments are available for patients of all ages. Patients will be treated in the following treatment programs:
• Children’s Program, ages 5 through 12
• Adolescent Programs, ages 13 through 17
• Partial Hospitalization Programs for ages 5 through 17 located throughout Central Pennsylvania
• Outpatient Clinics – for Adults, Adolescents and Children
• WrapAround Services
• Inpatient adult program, with a stabilization unit for more acute adults
The funding that is provided for the Meadows Psychiatric Center can be done in many ways. There are three basic means of payment – shares; loan capital and cash. Whilst there is nothing to prevent an unlisted company from issuing shares for an acquisition, in practice sellers are not normally willing to accept such shares as there is no ready market for them. Also the buyers may not wish to have their controlling position in the company diluted. Therefore the issue of shares as payment for the acquisition of a private company is uncommon.
Loan notes – a loan by the seller or some other deferred payment is often included as an alternative to cash on a private company sale. From the buyer’s perspective it has the advantage of deferring payment without absorbing any bank credit facilities (although it might still be relevant for borrowing limits) particularly if the rate of interest is lower than the rate which would otherwise be payable on a bank loan. The terms of any loan such as the events of default and dates for repayment need to be considered carefully. Cash – this is the most commonly used consideration. Care needs to be taken that there is no breach of your borrowing limits or other covenants. With these being some of the ways that can be used for payment you can also use the payment of out-of-pocket payment as well.


As in conclusion I have discussed a better understanding of factors that influence spending decisions for mental health services at the local or county level. Along with understanding these factors I also talked about the factors that Europe follows when they are being funded in the mental health system, all of these factors are important to know and understand when being able to pay for the services provided in the mental health system.

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