California is funding managed care plans to bring mental healthcare to schools. Here's how it's going

Child and teen mental health hospitalizations, suicide rates and overdose deaths are on the rise. COVID-19 contributed to isolation and stress, raising rates of anxiety, depression and school absences. Addressing child mental health early is crucial to preventing downstream consequences in adulthood. And schools are uniquely positioned to do so.

Children are six times more likely to get mental healthcare when it is offered in school, and receiving such services in school has been shown to improve attendance. In California, more than half of the state’s children are enrolled in Medi-Cal, and a third (PDF) don’t have reliable access to mental health resources.

To address behavioral health access barriers for students, California launched a program with a $389 million budget (PDF) in early 2022. The Student Behavioral Health Incentive Program (SBHIP) offers incentive payments to Medi-Cal managed care plans to build capacity for behavioral health services in K-12 schools. The funding is not intended for behavioral health services themselves, since they are already reimbursable under Medi-Cal.

There are currently 22 Medi-Cal managed care plans and approximately 300 local educational agencies participating in SBHIP, a spokesperson for the California Department of Health Care Services told Fierce Healthcare. Among the projects initiated thus far, some counties are observing a number of positive outcomes, including fewer student absences, more students passing classes and teachers being more accommodating to students' behavioral health needs.

SBHIP is expected to impact 1.4 million school-aged children, according to the spokesperson. 

Doing the work in Los Angeles County

One of California’s most populated counties is Los Angeles, accounting for more than a quarter of the entire state’s population. It has 80 diverse public school districts, and, so far, 63 of them have signed up to participate in SBHIP. 

“It's a whole lot of geography and a whole lot of districts,” Michael Brodsky, M.D., senior medical director for community health at L.A. Care Health Plan, told Fierce Healthcare. The plan is working with Health Net and Hazel Health on the SBHIP program. Kaiser Permanente, active with SBHIP across all counties in its footprint since the program's launch, began supporting the effort in LA in 2024.

When first engaging in the work, L.A. Care quickly landed on telehealth as a feasible, sustainable solution, per Brodsky: “We thought it would be appealing to a wide variety of school districts.” It surveyed superintendents in the county to gauge their interest, and the vast majority responded saying telemental health for kids was a high priority. 

From there, L.A. Care engaged Hazel Health, a virtual provider of mental health services working with schools. Hazel provided tablets, privacy screens and training to school staff to facilitate virtual counseling sessions on campus and at home. Its providers don't do psychological evaluations or medication management.

“We were particularly interested in SBHIP because it was one of the first times … I had seen, essentially, a program design where healthcare was being charged with how to work better with schools and school districts to facilitate care,” Hazel’s president, Andrew Post, told Fierce Healthcare. Post was previously Hazel’s chief innovation officer and head of behavioral health.

The behavioral health services are currently available to all public school students, regardless of their insurance status, through the end of the next school year. Parents and teachers can refer students for services. “We wanted to address as many kids as possible,” said Brodsky.

The first district in Los Angeles that expressed interest in participating was Compton Unified School District, which has about 20,000 students. Nearly a quarter are English language learners, or what the state considers to be high-needs students. 

Though the LA Unified School District (LAUSD) has one of the highest concentrations of low-income students in the state, it also has robust existing healthcare offerings. “They're the exception, not the rule,” Brodsky noted. “It was no surprise to us that a district like Compton … was the first to raise their hand and say, 'hey, we could really use the help.'”

Compton Unified (PDF) has a fraction of LAUSD's (PDF) revenue, though the latter serves 27 times more students. Outside of the SBHIP program, LAUSD has 17 school-based centers that provide physical and mental health services and referrals. The district employs 800 psychiatric social workers across these centers. It also has 19 wellness centers, offering physical and mental health, dental and vision services, throughout LA for students and community members.

“This is not typical of most school districts,” acknowledged Smita Malhotra, M.D., the district’s chief medical director. “LAUSD has the most school-based health centers of any school district in the nation. It’s what makes us unique. We invest in the health of students, because we know healthy students learn.” 

Through SBHIP, LAUSD gets 49 additional partners that cover services ranging from outpatient mental health, substance abuse prevention or cessation and family therapy. “With Hazel Health, we’ve expanded that access even more,” Malhotra said. 

As of mid-May 2024, Hazel had done more than 16,300 total visits, including intake and therapy, as part of SBHIP. Nearly three-quarters of the students being served are BIPOC, and the average age of students being referred is middle-school age. Common reasons for a referral, which are not diagnoses, include suspected anxiety, sadness, family concerns, social isolation and relationship issues, according to Hazel.

“It is both a little unnerving to see the amount of need at the earlier ages, and honestly incredibly empowering that we are bringing care to younger students,” Post said. 

Impact on attendance: "I was pretty shocked"

California uses attendance rates to allocate funding to public schools. Absenteeism in the state’s public schools went up 89% during COVID. That was not only bad news for revenues: Chronic absenteeism is also a strong predictor of poor academic achievement. Ironically, access to mental health services—dependent on a budget—can help reduce absences and in turn boost school revenues.

So far, some SBHIP participants are finding that mental health services are helping reduce absenteeism rates. Paramount Unified School District, in LA, found that among 195 students active with Hazel, 63% improved their attendance from September 2023 to March 2024. And 44% had zero absences since their referral. 

“If I'm being honest, we did ask them to triple- and quadruple-check the data,” Post said. “I was pretty shocked, in a good way.” 

In total, thousands of kids have been referred and seen, according to L.A. Care. But not everyone will be. Some might decline the services, or they might be hard to reach for consent, per Brodsky. Hazel offers a school-facing dashboard to help track who is referred and seen or not.

About 45% of sessions are happening in schools, while the rest take place in homes, according to Hazel. The flexibility and effectiveness of the modality is meaningful. So far, 84% of families have noticed a positive change in the behavior or mental well-being of their child through the program.

“The fact that we are seeing such strong, clinically significant outcomes kind of validates that not only do they like it, but it is effective for them,” Post said.

The program is designed to provide short-term counseling. Though there is no cap on how many sessions a student can have, the average ranges from six to 10 sessions. Anyone with more long-term needs can be referred back to L.A. Care.

Half of all lifetime cases of mental health conditions start by 14 years of age. And nearly half of teens with mental health issues do not receive any mental health services. “This being focused on pushing services through schools enables and empowers that care to happen much earlier, which then requires a much lower level of intensity for care,” Post said.

Editor's Note: This story was updated to include statewide SBHIP data shared by the California Department of Health Care Services.