Confronting Utilization Review in New Mexico’s Medicaid Mental Health System: The Critical Role of “Medical Necessity”


The insertion of managed care into Medicaid services for the mentally ill has created contention about clinical decision making. At the center of this debate is the matter of what constitutes a medical necessity. Employing ethnographic methodology, this study examines utilization review (UR), the context in which decisions concerning the authorization of mental health care services are made. Interviews carried out in the study contrast ideological underpinnings of providers and advocates of the mentally ill, on the one hand, with employees and administrators of managed care institutions, on the other. The result is an exploration into the ways discourses surrounding the mental health care needs of New Mexico’s Medicaid population are being constructed and are determining the actual care they receive.