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Ann Marie T. Sullivan, M.D., Commissioner
Governor Andrew M. Cuomo

Behavioral Health Managed Care

In 2011, Governor Cuomo called for “a fundamental restructuring of (the) Medicaid program to achieve measurable improvement in health outcomes, sustainable cost control, and a more efficient administrative structure.” To achieve these goals for individuals with mental health and/or substance use conditions, the Governor appointed a Medicaid Redesign Team (MRT) Behavioral Health Workgroup. The Workgroup developed principles and recommendations for moving behavioral health services into managed care. New York is developing a managed care system for behavioral health that closely follows the MRT guiding principles listed below:

The NYS Office of Mental Health (OMH) is closely collaborating with the Department of Health (DOH) and Office of Alcoholism and Substance Abuse Services (OASAS) to implement managed care transition in response to the recommendations and guiding principles set forth by the MRT BH Subcommittee. In an effort to ease the impact of transition, a two-phase transition was planned to take place over a three-year period.

Behavioral Health Organization (BHO) Phase 1

As an initial phase, BHOs were contracted to manage the high cost FFS behavioral health services through a concurrent review process for FFS inpatient care and to focus on high-quality engagement post discharge. The purpose of BHO Phase 1 was to assist in transitioning substance use disorder and mental health service systems from a fee-for-service environment to managed care.

Behavioral Health Managed Care (BHO) Phase 2

Behavioral Health Managed Care Phase 2 will integrate all behavioral health (BH) and physical heath (PH) services under the management of risk bearing Qualified Mainstream Managed Care Plans and Health and Recovery Plans (HARPs).

The implementation dates for the final phase in the behavioral health transformation are:


Comments or questions about the information on this page can be directed to the Bureau of Program and Policy Development.