In a California county of one million people, 500 clients, 4% of all those served in 1994, were found to use 38% of publicly funded mental health services. A controlled experiment was designed to test whether a capitated Assertive Community Treatment (ACT) program could produce outcomes that were equivalent or better than “usual services” for a subset of very-high-utilizing clients while reducing costs. Results showed that major challenges in using an ACT program for cost reduction were successfully met. Costs over all 4 years were substantially lower for the experimental group than for a randomly assigned comparison group.
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