The Effect of Behavioral Health Care Access on Communities: Evidence from New Mexico

• In Event: Mental Health Care and Its Impacts

Abstract

The unexpected 2013 freeze in Medicaid payments to 15 of New Mexico’s largest behavioral healthcare organizations caused a sudden, large disruption in behavioral healthcare access. Though based on false fraud allegations, these payment freezes forced most accused organizations to close entirely or suspend their behavioral healthcare services. The disruption created geographic disparities in access, with some counties—particularly rural ones—facing large reductions while others experienced minimal access changes. This natural experiment allows me to study how behavioral healthcare access affects health outcomes, treatment utilization, and mortality and assess spillovers to education, criminal justice involvement, and employment.

I estimate state-level synthetic difference-in-differences models using County Business Patterns (CBP) data to test whether the payment freeze had an impact on behavioral healthcare access. I establish two facts from the CBP data: one, New Mexico experienced substantial declines in the number of establishments and the number of employees working in office-based mental healthcare, and two, the extent of these supply shocks varies substantially across counties in the treated state. As a secondary source, I utilize Form 990 data and confirm that the majority of affected organizations closed entirely or ended their provision of behavioral healthcare services, which aligns with reports from legal research (Mathis, 2021).

Using a state-level synthetic difference-in-differences approach, I estimate the impact of the disruption on the number of admissions for substance use treatment with data from the Treatment Episode Data Set (TEDS). I find a marginally significant decline of 3.5 admissions per 1,000 in non-intensive outpatient treatment admissions (98% decline). These preliminary state-level analyses suggest that the payment freezes did cause a substantial disruption in behavioral healthcare access. Next, I will examine Medicaid prescription, mortality, educational, criminal justice, and economic outcomes.

This project contributes to three literatures. First, while research shows that Medicaid access provides long-term health and economic returns and reduces crime (e.g., Currie et al., 2008; Goodman-Bacon, 2021; Jácome, 2022; Deza et al., 2024), I isolate the impact of access to behavioral healthcare from the broader Medicaid services bundle. Second, building on evidence that access to behavioral healthcare providers reduces mortality and crime (e.g., Bondurant, Lindo, and Swensen, 2018; Deza, Maclean, and Solomon, 2022), I study a sudden access disruption to examine the impact on communities with limited or non-existent alternative care options. Finally, studies show that disruptions in primary care provider-patient relationships adversely affect patient outcomes, particularly among the Medicaid population (e.g., Sabety, Jena, Barnett, 2021; Staiger, 2022; Zhang, 2022; Kwok, 2024). I extend this work by examining disruptions in the behavioral healthcare setting, where relationship continuity is likely essential.

Author

• Abigail Cormier, University of Georgia
  Presenting Author