Impact of Law and Regulation on Professional Practice and Use of Mental Health Services: An Empirical Analysis

This is a case study under natural conditions of the effects that laws and regulations have had on professional practice and mental health service use in Hawaii from 1981 to 1989. Three major plans (Civilian Health and Medical Program of the Uniformed Services [CHAMPUS], Hawaii Medical Services Association [HMSA], and Medicaid) had the same fiscal intermediary and were served by the same pool of providers. Under conditions of direct access, psychologists provided more outpatient services than did psychiatrists. Under physician referral, the opposite was true. Trends over time are noted. To overturn certain restrictive Medicaid regulations, corrective legislation was introduced and enacted. Follow-up demonstrated that, when both psychologists and psychiatrists could certify mental impairment but the certifier could no longer be the therapist, service volume dropped-and so did public expenditure by $4.8 million (on removal of this conflict of interest, despite more than doubling the number of practitioners who could certify).