Skip to main content

Changing Montana’s Mental Illness Treatment System to Reflect Payment Reimbursement Constraints

By August 8, 2017November 24th, 2020No Comments

This suggestion is being offered by NAMI Montana as a path to saving Montana’s public mental health services in the faces of potentially devastating budget cuts.

Montana’s mental health centers have relied on targeted case management rates for years to subsidize insufficient billing rates for psychiatrists, psychiatric nurses and mental health therapists. This process is no longer sustainable due to the pending cuts to targeted case management rates.


  1. Montana’s mental health centers ability to provide psychiatric and mental health therapy to Montanans with serious mental illness will be dramatically and dangerously reduced when the case management rates are finalized.
  2. Montana’s Federally Qualified Health Centers (FQHCs) can lawfully accept a larger role in caring outpatient serious mental illness in Montana as those services “are appropriate to meet the health needs of the population served by the health center involved.” (Footnote 1) 
  3. Montana’s FQHC’s have a higher billable rate for psychiatrists, psychiatric nurses and mental health therapists than Montana’s mental health treatment centers. That rate structure is not going to change in the foreseeable future.
  4. It is not feasible to convert all of the private mental health centers into FQHC’s in order to qualify for the increased billable rates for psychiatric care and mental health therapy, because the existing FQHC’s have competing federal grants that cover certain geographical area.
  5. Targeted case management services are outside of scope of project services for FQHC’s and will remain so for the foreseeable future. Montana’s FQHC will retain their federally-required case management services, but they will refer all clients that require intensive case management services to mental health centers.

Proposed Medium-Term Solution:
Incentivize Montana’s FQHC’s to further develop integrated mental health treatment module to provide primary health care with mental health services to better serve the needs of Montanans with serious mental illness. Montana’s FQHC’s would either (1) contract with Montana’s mental health treatment centers for psychiatric and mental health therapy services that will be provided in the FQHC approved sites for people with serious mental illness, or (2) hire their own psychiatrists, psychiatric nurses, and mental health therapists. All of these clients would need to receive their primary health care through the FQHC. The FQHC’s would refer all clients with serious mental illness to mental health centers for targeted case management services.

This solution would allow full reimbursement for psychiatry and mental health therapy through the FQHC’s fee schedule. This would solve a major fiscal challenge that has not previously been able to be solved due to the structure of the mental health center’s billable rates. It would also allow for full reimbursement for targeted case management services through the mental health centers.

Critical Requirements and Rules:

  1. FQHC’s may provide, “Mental health services are the prevention, assessment, diagnosis,treatment/intervention, and follow-up of mental health conditions and disorders(e.g., depression, anxiety, attention deficit and disruptive behavior disorders) including care of patients with severe mental illness who have been stabilized. These services may include treatment and counseling for health center patients such as individual or group counseling/psychotherapy, cognitive-behavioral therapy or problem solving therapy, 24-hour crisis services, and case management services. Psychiatry is considered a specialty service.” (Footnote 2) (emphasis added)
  2. FQHC’s “may directly employ or contract with individual providers, may have arrangements with other organizations or may utilize volunteers.” (Footnote 3)
  3. The mental health centers will have to provide the malpractice insurance for the contracted clinicians, because the contracted clinicians will not be covered by the FQHC’s malpractice insurance. (Footnote 4)


(1) 42 U.S. Code § 254b(b)(2), See,

(2) “Service Descriptors for Form 5A: Services Provided,” Page 19,   

(3) U.S. Department of Health and Human Services, “Policy Information Notice 2008-01,” Page 13.

(4) Id. at page 13. (“For example, volunteer providers, physicians contracted under a professional corporation or employed by another corporation, as well as interns/residents/medical students not employed by the health center may be included as part of scope of project, but are not covered under FTCA. “)  

Developed and offered by:

Matt Kuntz, J.D. 
Executive Director
NAMI Montana

Leave a Reply