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The Short Answer: Bring Two Years of Outcomes Data or Get Priced by the Comparison Set
If you operate a behavioral health treatment center with a Carelon, CVS/Aetna, or BCBS contract renewing in 2026, value-based care is the rate conversation, not a future-state slide. Operators who walk into that renewal with two years of clean PHQ-9 and GAD-7 data set the rate. The ones who wait get folded into the comparison set everyone else negotiates against.
In Q1 2025, a Carelon network rep asked one of our Massachusetts SUD clients for 18 months of PHQ-9 and GAD-7 score pairs, broken out by episode, before entertaining a rate conversation on ASAM Level 2.5 partial hospitalization (an outpatient level of care under the ASAM Criteria, 4th Edition). That was a value-based care intake form dressed up as a network request.
Carelon is not a boutique vendor operators can wait out. Carelon reports supporting the health journeys of 61 million individuals, and it manages the behavioral health carve-out for Elevance/Anthem plans plus multiple state Medicaid programs. When Carelon changes its intake protocol, a large share of the commercial book moves with it.
CMS planted the federal template alongside these payer moves. On December 18, 2024, CMS announced that Michigan, New York, Oklahoma and South Carolina state Medicaid agencies were selected to participate in the state-based Innovation in Behavioral Health Model, an eight-year model intended to improve care quality and behavioral and physical health outcomes for Medicare- and Medicaid-enrolled adults with moderate to severe mental health conditions and substance use disorders. Commercial payers track that template. If your contracting team has not been asked about outcomes data yet, you are next in line.
What Each Payer Actually Wants (and Where the Traps Live)
Carelon’s current ask, based on six contracts our team reviewed since January, centers on three things: measurement-based care administration at admission, mid-episode, and discharge; readmission tracking at 30 and 90 days; and a shared-savings structure benchmarked against a regional cost-of-care average the operator never gets to audit. That last piece is the trap. One Ohio client was offered a 40/60 upside-only deal that converted to two-sided risk in year two, with a corridor the provider had no historical data to model. They walked. Correct call.
CVS/Aetna is different. Behavioral VBC conversations at Aetna route through the medical cost lens, which means a residential SUD provider gets evaluated on whether their patients show up in an ED 60 days post-discharge. If your team does not have a release-of-information workflow that lets you see Aetna medical claims for your own discharged patients, you cannot defend your performance. Period.
BCBS plans vary wildly by state. Horizon BCBSNJ has been the most aggressive on bundled SUD episodes. BCBS of Massachusetts pushed a quality-bonus structure tied to HEDIS measures including Follow-Up After Hospitalization for Mental Illness (FUH) and Initiation and Engagement of SUD Treatment (IET). FUH is a HEDIS measure tracking outpatient follow-up within 7 and 30 days of a mental health discharge.
NCQA has expanded the FUH net in recent measurement years. NCQA proposed including peer services and occupational therapy as appropriate follow-up options, recognizing growing evidence for those services in post-discharge interventions. Your discharge workflow can no longer assume only psychiatry counts. The bonus pools we have seen run between 2 percent and 6 percent of allowable, which sounds like nothing until you realize your denial rate on the underlying claims is what actually moves the number.
Readiness: Five Capabilities You Need Before You Sign Anything
Before any operator signs a risk-bearing contract with Carelon, CVS/Aetna, or a Blue plan, five capabilities have to be in place. Miss one and your team negotiates from a deficit.
- Measurement-based care, actually deployed. Not a checkbox in the EMR. PHQ-9, GAD-7, BAM, or comparable instruments administered on a defined cadence aligned to ASAM Criteria, 4th Edition expectations, with clinician documentation of how scores changed the treatment plan.
- Attribution methodology in writing. Who counts as your patient, for how long, and what triggers attribution loss. Vague attribution language is where your margin disappears.
- Baseline cost and outcomes data you control. If the payer brings the only dataset, you lose every disagreement.
- Clean claim rate above 95 percent and days in AR under 35. VBC reconciliation pulls from claims data. Dirty claims poison your performance numbers before any clinical question is asked.
- A stop-loss or risk corridor you can live with. Our team will not let a client take downside risk without a per-episode cap. SUD episode costs vary widely across acuity, and that variance should not live entirely on your P&L.
If your team cannot check all five, the right answer is a one-year upside-only pilot with a data-sharing addendum, not a two-sided risk deal. CMS itself designed the IBH Model the same way. Each state selected for Cohort II will receive up to $7.5 million over seven years (2027–2033) to strengthen care coordination, expand health IT capacity, and test value-based payment models aligned across Medicaid and Medicare. If CMS is starting on an infrastructure-funded, upside-only footing, you should too.
What Operators With Outcomes Data Can Negotiate in 2026
Here is the part nobody at the payer wants operators to know. Behavioral health networks are thin, and the federal MHPAEA push made that thinness a regulatory exposure, not just an access problem.
On May 15, 2025, the Departments of Labor, Health and Human Services, and Treasury published a statement announcing that they will not enforce certain portions of the MHPAEA Final Rules previously released on September 9, 2024. Then the ground shifted. Per DOL’s own statement: “The Departments will not enforce the 2024 Final Rule or otherwise pursue enforcement actions, based on a failure to comply that occurs prior to a final decision in the litigation, plus an additional 18 months.”
Read that carefully. The 2013 rule and the underlying statute are still in force. The enforcement relief applies only with respect to those portions of the 2024 Final Rule that are new in relation to the 2013 final rule, and MHPAEA’s statutory obligations, as amended by the CAA, 2021, continue to have effect. Plans still owe NQTL comparative analyses. Patients still file private parity suits. HHS also encouraged states, which remain the primary MHPAEA enforcers with respect to issuers, to adopt a similar approach, and HHS will not consider a state to be failing to substantially enforce MHPAEA because the state adopts such an approach.
Payers still have to document network adequacy. Operators still have real room to negotiate. And the parity gap that fuels that room is real: RTI International found patients went out-of-network 10.6 times more often to see a psychologist and 19.9 times more often for sub-acute behavioral inpatient care, such as residential treatment, than for medical/surgical services. The same study documented that behavioral health clinicians are reimbursed at rates 22 percent lower than medical and surgical clinicians.
An operator with two years of measurement-based care data showing PHQ-9 reduction of 5+ points across 70 percent of completers, plus 30-day readmission rates below regional benchmarks, can credibly ask for:
- A 12 to 18 percent rate lift on the underlying fee schedule before any VBC overlay;
- Carve-outs from the standard prior auth process for ASAM Level 2.5 and Level 2.1;
- A single-case-agreement framework for out-of-network referrals at 85 to 90 percent of in-network allowable.
Our team negotiated exactly that structure for a Florida client last fall with one of the national Blues plans. The rate sheet moved. Not because we asked nicely. Because they showed up with their own data, and the data lined up.
What to Do in the Next 90 Days
If you operate in Florida, New Jersey, Pennsylvania, Massachusetts, or Ohio and you have a Carelon, Aetna, or BCBS contract renewing in 2026, the work starts now.
- Pull your last 24 months of MBC data, even if it is messy.
- Pull your denial rate by payer and CPT code.
- Pull your days in AR.
- Map your discharge follow-up workflow against HEDIS FUH and IET specs.
If your team does not have those numbers in one place by July, you are not ready for the renewal conversation that is coming.
Watch the federal template too. To apply for IBH Cohort II, states may submit an optional Letter of Intent by April 1, 2026, and must submit a full application by June 3, 2026, with CMS anticipating announcing awards by September 15, 2026. Up to five additional states will be selected for this second cohort, joining Michigan, New York, and South Carolina, with award notices expected in September 2026 followed by a seven-year model implementation period from 2027–2033. Whatever those Medicaid agencies design for Cohort II becomes the commercial template inside 36 months.
Operators who treat this as a contracting alert and start preparing now set the rate environment for the rest of the field in 2027. Operators who wait to be handed terms become the comparison set everyone else negotiates against.
If you have a draft VBC term sheet from Carelon, Aetna, or a Blue plan and you want a second set of eyes, our team at Atlantic Health Strategies reads contracts for a living. Bring the redline.
Frequently asked questions
Is the MHPAEA 2024 Final Rule still enforceable in 2026?
Not the new provisions. On May 15, 2025, DOL, HHS, and Treasury announced they will not enforce the 2024 Final Rule pending a final decision in the ERIC litigation, plus an additional 18 months. Per the Departments’ statement, MHPAEA’s statutory obligations, as amended by the CAA, 2021 (including the NQTL comparative analysis requirement), continue to have effect, and HHS encouraged states, which remain the primary enforcers with respect to issuers, to adopt a similar approach. Plan members can still bring private parity suits.
Which states are in the CMS Innovation in Behavioral Health (IBH) Model?
CMS originally announced Michigan, New York, Oklahoma, and South Carolina as Cohort I participants in December 2024; CMS’s current IBH page lists Michigan, New York, and South Carolina as active state participants. Up to five additional state Medicaid agencies will be selected for Cohort II, with full applications due June 3, 2026, award announcements anticipated by September 15, 2026, and a seven-year implementation period from 2027–2033. Each selected state receives up to $7.5 million through the cooperative agreement.
What HEDIS measures should a behavioral health operator track for payer contracts?
Start with the two that show up most often in commercial VBC term sheets: Follow-Up After Hospitalization for Mental Illness (FUH), which measures 7-day and 30-day post-discharge follow-up, and Initiation and Engagement of SUD Treatment (IET). NCQA has expanded FUH in recent measurement years, including proposals to recognize additional follow-up service types such as peer services and occupational therapy. That widens your numerator, so your discharge planning workflow should reflect the current specs.
Should a behavioral health operator accept downside risk in a payer VBC contract?
Not without five capabilities in place: deployed measurement-based care, written attribution methodology, baseline cost and outcomes data the operator controls, a clean claim rate above 95 percent with days in AR under 35, and a per-episode stop-loss or risk corridor the operator can live with. If your team cannot check all five, push for a one-year upside-only pilot with a data-sharing addendum. CMS structured the IBH Model with cooperative agreement funding to build infrastructure before performance-based payment, so if the federal template funds the ramp, your first commercial VBC contract should be structured with a comparable on-ramp.
References
- U.S. Departments of Labor, HHS, and Treasury, Statement Regarding Enforcement of the MHPAEA Final Rule (May 15, 2025)
- CMS Innovation Center, Innovation in Behavioral Health (IBH) Model
- American Hospital Association, CMS Announces State Participants in Innovative Behavioral Health Model (December 18, 2024)
- Aurrera Health Group, CMS IBH Cohort II: What State Medicaid Agencies Need to Know
- RTI International, Behavioral Health Parity. Pervasive Disparities in Access to In-Network Care Continue (April 2024)
- NCQA, Follow-Up After Hospitalization for Mental Illness (FUH) HEDIS Measure
- NCQA, Proposed Changes to Existing Measures for HEDIS MY 2025: FUH/FUM
- Carelon, Behavioral Healthcare Capabilities