Louisiana has undertaken several reforms in the organization and financing of behavioral health services during the past decade (DHH 2012b). In 2003, the state Department of Health and Hospitals (DHH) ceased providing substance abuse services through Medicaid and began providing them through the Office of Addictive Disorders in response to concerns about fraud and abuse (DHH 2012b). From 2003 to 2005, DHH also worked to strengthen requirements for mental health provider accreditation and revise service definitions.
In 2005, the Office of Mental Health and Medicaid developed a state-owned and state-operated administrative services organization responsible for overseeing the behavioral health provider network and managing the quality of behavioral health services. Experience with the state-operated administrative services organization led to legislation in 2007 that allowed DHH to establish a single statewide management organization (SMO) to manage the delivery of all behavioral health services. During this same period, the Office of Mental Health and Office of Addictive Disorders were merged to create the OBH and OBH began consolidating state-operated substance abuse and mental health clinics with the goal of creating integrated care settings to address co-occurring disorders.
In 2009, the state began developing a comprehensive system of care (CSoC) for children and youth with behavioral health challenges. A planning process brought together state agencies (OBH, DCFS, DOE, OJJ), advocates, and families and led to the idea of combining funding from state agencies to provide behavioral health care for children and adults. Pooling funding from across state agencies was intended to leverage SGFs to obtain Medicaid financing. Using this pooled funding approach, OBH contracted with Magellan to become the SMO and manage all behavioral health services for Medicaid-eligible and non-Medicaid-eligible adults and children effective March 1, 2012. It is important to note that LBHP includes Magellan as the SMO but the LBHP refers to a broader initiative of behavioral health care reforms and activities in Louisiana.