the 1980s, a number of changes were occurring within the health care
industry which directly impacted the mental health provider network. The
emergence of new forces were determining where and how the health care
dollar would be spent. The health care industry today is characterized
by aggressive competition for that dollar.
and private psychiatric hospitals, due to increasing competition and
decreasing bed utilization, were looking beyond their traditional
inpatient, general medical model for new markets and a new array of
income-generating services. In addition, other providers not
traditionally involved in the provision of psychiatric care were
entering the market.
providers were being asked to consider mental health as a legitimate
part of health coverage. The types of treatment being covered, and
the duration and scope of treatment, were under constant review and
insurance companies, and private employers were pressuring the
health care industry to curtail rising costs. As a result, the
economic structure of the health care industry made fundamental
changes from cost-based reimbursement for health care providers to
competitive market pricing. Those purchasers expanded their
influence over how, where, and at what price the aggregate consumer
would receive services.
public funding base for mental health was under increasing pressure,
and a greater share of the responsibility being shifted to the
private sector through contractual arrangements.
changes created a number of potential problems for community mental
health providers. Many mental health centers were experiencing an
increase in competition either from private practitioners in their local
community or from private organized care facilities. While some centers
viewed this competition as healthy, or as meeting a need in the
community, most were very concerned about the implications of these
developments for their own operations.
of these and other factors, a group of executive directors of community
mental health centers across the country met several times during 1984
to discuss solutions to the above described problems. They recognized
that it was necessary for centers to re-evaluate their basic mission.
The inevitable conclusion was that centers could not continue to view
themselves as solely a part of the mental health care delivery system,
but rather a part of a much broader health care system.
general agreement with this conclusion, the dilemma most centers faced
was in finding a way to compete effectively in the marketplace. Limited
funding, lack of marketing expertise, an image as public or quasi-public
agencies for the indigent, relatively small size, and a history of
operation based on humanitarian rather than economic concerns, left most
centers ill-equipped to deal effectively with these problems.
strategies for dealing with the competition were already beginning to
form; some directors adopted aggressive counter-marketing strategies,
and others took a "wait and see" attitude. Those centers who
made up the original group forming MHCA realized that a "wait and
see" attitude would accomplish nothing more than allowing others to
determine for them their future scope of activities, responsibilities
and funding. From that realization emerged the Mental Health
Corporations of America, Inc.
September 1984, nineteen chief executive officers of community mental
health centers met in Orlando, Florida for the purpose of forming the
Mental Health Corporations of America, Inc. (MHCA). They hired a
consultant to help them organize and search for a chief executive
officer for the corporation. From that original 19 members, MHCA
has grown to a current membership of 146 members in 35
original purpose, organization and goals have remained much the same
(see ARTICLE II, Bylaws).
MHCA is the parent corporation of Mental Healthcare America, Inc., a
for-profit subsidiary that oversees special programs and projects.
MHCA is also a major shareholder in the Mental Health Risk Retention
Group, Inc., a captive insurance company created to provide liability
coverage for the behavioral healthcare industry.