Cash Flow: How Money Makes Its Way
through the Mental Health System

This paper describes the mental health system in the United States from an economic perspective, addressing three questions: How much money is involved? Where does the money come from? How does it get spent? The answers stem from ten current trends in the mental health system:

1. behavioral health spending has grown faster then GDP, slower than overall health care
2. government's role in mental health has been large and growing
3. state mental health systems have decentralized
4. out-of-pocket payment rate has fallen
5. inpatient care has declined relative to outpatient care
6. medication has been on the rise relative to therapy
7. primary care's contribution to mental health care has been relatively flat
8. managed behavioral health organizations have taken over
9. MBHOs have cut costs dramatically
10. the parity movement has boosted mental health benefits, but its impact has been largely symbolic