New Contracts Focus on Improved Behavioral Health Outcomes The new contracts with Local Management Care Entities/Managed Care Organizations (LME/MCOs) include performance benchmarks related to care coordination, follow-up care and housing

Raleigh, NC

The North Carolina Department of Health and Human Services is strengthening its contracts by seeking improved outcomes from the organizations that manage behavioral health care services supported with Medicaid and state mental health funds.

The new contracts with Local Management Care Entities/Managed Care Organizations (LME/MCOs) include performance benchmarks related to care coordination, follow-up care and housing. For the first time, they also include financial consequences for failing to meet one or more of these goals.

DHHS provides oversight of the LME/MCOs that manage the care of individuals receiving mental health, intellectual/developmental disabilities and substance use disorder services in the state.

“Our first priority is to make sure that the individuals receiving care are getting the services and supports they need,” said DHHS Secretary Mandy Cohen, M.D. “These new contracts hold each organization accountable to meeting key performance measures to ensure high-quality care.”

Through monitoring of LME/MCO contract performance, DHHS will determine whether benchmarks are achieved. For those not achieved, a corrective action plan must be developed. LME/MCOs will face monthly assessments of $50,000 to $100,000 for each goal not met.

The performance measures include: 

  • Medical care coordination for individuals with intellectual/developmental disabilities in the last year. 
  • Follow-up within seven days after discharge from a hospital (including facility-based crisis services) or detox service. 
  • Transitioning individuals into supportive housing. 

In addition, the new contracts require the LME/MCOs to submit complete and accurate encounter data. Encounter data are records that reflect health care services and expenditures LME/MCOs pay to providers of those services. Encounter data is used for both rate setting and performance measurement. All LME/MCOs must meet a 95 percent acceptance rate of encounter data submitted to NCTracks, North Carolina’s system for paying covered health care services.