Policy Study

Delivering Services for the Mentally Ill and Developmentally Disabled

A Consumer Choice Model

Executive Summary

With the shift to community programs and the integration of many disabled citizens into the community, vast changes have occurred in the way non-disabled citizens view the disabled and in the way in which services are provided and managed. Increasingly, services for the mentally ill and developmentally disabled are being provided with a focus on self-sufficiency, empowerment and readiness skills. Consumer choice and active participation in service planning are seen as important elements of quality and effectiveness.

Vouchers and other forms of consumer directed purchasing provide a mechanism for states and local governments to provide services in a manner that enhances consumer choice and improves the purchasing relationship between government, providers and consumers. Consumer directed purchasing has advantages over traditional state contracts with providers by focusing more on the needs of the consumer, improving monitoring by families, and enhancing competition among providers.

There are four different models of consumer directed purchasing currently in use, including: vouchers, individualized contracts or funding, direct cash disbursement programs and reimbursement programs. Each has different implications for choice and control over spending for the government agency to consider. These models were reviewed in nine states and one province in departments serving individuals with mental illness and developmental disabilities. In general, the programs reviewed were limited in scope and yet virtually all of the state and local administrators sought to expand and improve upon their systems.

In considering whether to implement a system of consumer directed purchasing, governments must consider a number of critical issues. These include: consumer and provider eligibility criteria, eligibility and service authorization procedures, reimbursement and financing systems, voucher or fund distribution systems, transition planning, consumer education, monitoring and management information systems. Central to the success of any initiative will be the ability of the state or government agency to fairly direct services and funding to those that are most in need and develop procedures for authorization and funding that are equitable to consumers and providers alike.

In this era of government reform, consumer directed purchasing of services holds forth the promise of empowering consumers, improving service quality, and streamlining government.