How do health systems finance and control spending on mental health, particularly spending on acute psychiatric inpatient care: A rapid response to the ‘Psychiatric Cap Committee’, 2024

This rapid response examined how health systems in selected high-income countries finance and control spending on mental health (MH) services, particularly acute inpatient psychiatric care. Countries sampled included Canada, Finland, Denmark, England, Germany, and Israel. Data was collected from experts in each country on topics such as the existence of dedicated MH budgets, mechanisms for determining inpatient psychiatric spending levels, payment methods for inpatient care, and tools to promote outpatient MH service development. The review found that National Health Insurance (NHI) systems like Israel and Germany do not have earmarked MH budgets but set revenue caps for psychiatric hospitals to control inpatient spending. Conversely, single-payer National Health Service (NHS) systems sometimes allocate specific MH budgets that inherently limit inpatient expenditures. Payment methods vary, with global budgets common in NHS systems and per-diem payments with revenue caps used in NHI systems. Promoting outpatient MH services typically requires separate targeted investments rather than relying on inpatient spending controls alone. Overall, countries employ a mix of budget-setting practices, payment mechanisms, and targeted programs to simultaneously fund and regulate mental health care spending across inpatient and outpatient settings. Policymakers can consider adopting multi-pronged approaches suited to their health system’s financing structures. 

Citing suggestion: Waitzberg, R. (2024). How do health systems finance and control spending on mental health, particularly spending on acute psychiatric inpatient care: A rapid response to the ‘Psychiatric Cap Committee’, 2024. RR-002-24. Myers-JDC-Brookdale Institute. (Hebrew)