Health Care

The state of California has successfully reached a settlement of $200 million with Kaiser in relation to the overhaul of mental health care.

Kaiser Permanente is required to undertake a comprehensive restructuring of its behavioral health care services and remit a fine of $50 million as per the settlement agreement disclosed by the California Department of Managed Health Care. Additionally, Kaiser will allocate a sum of $150 million over a span of five years to enhance the quality of its behavioral health care services.

Governor Gavin Newsom expressed his appreciation for the settlement on Thursday, asserting that it will ensure Kaiser enrollees receive prompt and complete access to the services they are legally entitled to under state regulations.

"Today's actions signify a significant paradigm shift in terms of our responsibility for the provision of behavioral health services," stated Governor Newsom. "The accountability of the private sector is fundamental in ensuring that our comprehensive system of behavioral health care caters to the needs of all Californians," Governor Newsom further emphasized.

According to DMHC Director Mary Watanabe, the $50 million fine is the largest ever imposed by the state's managed health care agency.

This agreement arises from two separate actions conducted by the state agency, namely an enforcement investigation and an atypical survey.

The state agency discovered that Kaiser Permanente had been cancelling behavioral health appointments and, in numerous instances, failed to provide enrollees with appointments that adhered to the required timely access and clinical standards, despite a strike by mental health clinicians in August 2022.

In addition to the duration of time that enrollees were required to wait for appointments, the state discovered infractions that encompassed a deficiency of contracted high-level behavioral health care facilities within the network outlined in the plan, as well as insufficient supervision of the plan's medical groups in assessing the provision of suitable care.

According to the settlement agreement, Kaiser Permanente shall engage the services of an external consultant with the specific objective of implementing remedial measures and offering professional advice.

The National Union of Healthcare Workers, which represents over 4,000 psychologists, social workers, and marriage and family therapists employed by Kaiser Permanente in California, expressed their approval of the settlement.

Sal Rosselli, the president of the union, stated that this settlement represents a significant triumph for both Kaiser Permanente patients and its mental health therapists. Over the past decade, these therapists have engaged in multiple strikes in an effort to compel Kaiser to address its flawed behavioral healthcare system.

Rosselli stated that the report from the managed health care agency validates all the claims made by Kaiser therapists regarding the patients' incapacity to access timely and sufficient mental health care.

In a formal statement regarding the settlement, Greg Adams, the CEO of Kaiser, expressed that there has been an unparalleled surge in the demand for mental health care services in the past three years, primarily attributed to the global pandemic and its subsequent consequences.

(Kaiser experienced a significant surge in demand, with a 33 percent increase during the pandemic. Furthermore, there has been a 20 percent rise in the number of individuals seeking care in 2023 compared to the same period last year, as stated by Adams.

Adams highlighted several factors that have made it exceedingly challenging to meet this escalating demand for care. These include an ongoing scarcity of qualified mental health professionals, clinician burnout and turnover, and even a 10-week strike by 2,000 mental health clinicians in California last year.

To address this issue, Kaiser has taken measures to augment its staffing and facilities. Additionally, since 2020, the organization has allocated an extra $1.1 billion towards providing mental health treatment for its members, according to Adams.

Kaiser has employed nearly 600 additional therapists, expanded its networks to incorporate thousands of community therapists, and allocated an additional $195 million towards the establishment of new clinical facilities, which consist of 329 mental health provider offices.

"Nevertheless, throughout the duration of the DMHC survey, we failed to meet the expectations of both our members and ourselves," stated Adams.

"Our agreement with the DMHC assumes complete responsibility for our performance during the survey period, including our shortcomings. It acknowledges our efforts to enhance mental health care and ensures that our ongoing investments not only benefit the members of Kaiser Permanente but also contribute to the development of a stronger mental health infrastructure in the communities we serve," Adams added.