Supporting the holistic person: Mental health and Pay for Success

By: Elly Bringaze, Capital Formation Associate at Social Finance

At least one in five individuals in the United States struggles with mental health; it affects over 43 million people, their families and their communities. Globally, depression is the single largest cause of disability. According to estimates by the World Health Organization, mental health treatment costs over $2 trillion annually and effects 450 million individuals.

For those facing mental illness, the consequences can reverberate throughout their life experiences. It can prompt or exacerbate substance use disorders, housing instability, and interactions with the criminal justice system, among other challenges.

Many of our projects at Social Finance address mental health challenges, either directly or indirectly. These projects span workforce development, criminal justice, family stability and healthcare. We have seen firsthand how critical mental health support is in addressing a number of societal issues, from homelessness to employment to substance use disorders. Mental health is a common link that ties much of our work together and can be the lever by which strong interventions create positive change in the lives of individuals.

Workforce Development: Individuals with mental health conditions struggle to maintain jobs and have higher rates of unemployment. For Veterans with post-traumatic stress disorder (PTSD), rates of competitive employment can be as low as 30%.

The Veterans CARE Pay for Success project will provide employment assistance to veterans with service-connected PTSD. The project scales Individual Placement and Support (IPS), an evidence-based approach to employment counseling that integrates mental health treatment. IPS specialists are co-located within PTSD and mental health clinics to provide integrated services — they work closely with clinicians to ensure that Veterans’ treatment plans are well matched with their employment goals and vice versa.

Criminal Justice: Jails in New York, Los Angeles and Chicago are now the three largest institutional providers of psychiatric care in the United States. Mental health support is a critical component of programs that help individuals re-integrate and thrive in their communities.

The Ventura County Project to Support Reentry, which we launched with our project partners in 2017, aims to reduce recidivism, improve public safety, and promote family stability and economic opportunity for those on formal probation. Recognizing the connection between an individual’s mental health and frequent interactions with the criminal justice system, the project intervention includes Moral Reconation Therapy (MRT) for some clients. MRT is a trauma-informed, cognitive-behavioral treatment system that leads to enhanced moral reasoning and better decision making.

Additionally, through a grant from Blue Shield of California Foundation, Social Finance is working with Interface Children and Family Services — the project’s service provider — to strengthen the coordination of care with Medicaid providers of mental health services.

Housing Stability: According to the Substance Abuse and Mental Health Services Administration, 20 to 25% of the homeless population in the United States suffers from severe mental illness, compared to only 6% of Americans overall. A number of mental health factors can lead to circumstances that cause a person to become homeless and vice versa — homelessness can preclude a mentally ill individual from receiving the support and stability they need to address the issue.

Photo Credit: Ending Community Homelessness Coalition (ECHO) in Austin, Texas

Social Finance is working with communities in Texas, Alaska and Rhode Island to address homelessness and improve lives through an intervention called Permanent Supportive Housing (PSH). In addition to housing, the PSH intervention provides a holistic set of services to individuals that aim to address employment, health care and criminal justice outcomes associated with homelessness. The intervention we are exploring with our partners in Austin, for example, includes Assertive Community Treatment (ACT) to address mental health issues. ACT is an evidence-based practice that offers a menu of health and care coordination services tailored to individuals. The goal is to improve outcomes for people with severe mental illness who are most at-risk of homelessness, psychiatric crisis and hospitalization, and involvement in the criminal justice system.

The Need for Systems Change

Pay for Success provides upfront, flexible funding to service providers to better enable them to deliver lasting outcomes. When comprehensive services are needed to address issues ranging from homelessness to employment, Pay for Success offers a path to impact. Such projects, however, remain a small fraction of service provision in what can be a limiting and challenging funding environment.

Those suffering from mental illness often have to navigate a complex system of financial, legal and bureaucratic obstacles to obtain the treatment they need. Medicaid is now the single largest funder of mental health treatment in the United States, accounting for 27% of all mental health care spending but coverage varies significantly from state to state. According to the National Alliance for Mental Illness (NAMI), nearly half of Americans who suffer from mental health conditions go without any treatment at all.

Just like physical health, mental health can reverberate across all areas of an individual’s life. Yet, the mental health treatment in the United States is chronically underfunded, particularly in areas that address the social determinants of mental health. There is significant value — for individuals and their communities — in funding holistic preventative treatments that improve mental health and consequently, social outcomes. In the face of a challenging funding environment, Pay for Success provides a way for governments to invest in the preventive, comprehensive services their communities need.