New Report: Collaborative Care Reduces Costs

Evangelists of the Collaborative Care Model frequently highlight its proven efficacy and measurable impact on patient outcomes. A little less well known is the model’s ability to reduce expenses and its impact on the total cost of care.

"Mounting Evidence That Use of the Collaborative Care Model Reduces Total Healthcare Costs," was published in November 2025 by the Bowman Family Foundation, a nonprofit organization with a mission to improve the lives of people with mental health and substance use conditions. It serves as a second edition issue brief highlighting how the Collaborative Care Model addresses the national mental health crisis while simultaneously lowering overall health care expenditures.

As with the first edition, we’ve made the report available on our website. We encourage you to read the full report. What follows below is a summary of the key points around how Collaborative Care reduces the cost of health care.

The Economic and Access Crisis

The report frames a national crisis: millions of Americans struggle to access affordable, effective treatment for mental health and substance use disorders (MHSUDs). This gap has major financial consequences for insurers. Individuals with co-occurring physical and mental health conditions incur annual total health care costs that are 3 to 6 times higher than those without MHSUDs, driven predominantly by physical health care expenses. Specifically, a study of 21 million lives found that the 5.7% of individuals with both medical and MHSUD claims accounted for 44% of all health care spending.

The Solution: Cost-Effective and Accessible

As primary care is the main and often the only source of MHSUD care for many Americans, Collaborative Care is viewed as the "gold standard" for integration. The Collaborative Care Model utilizes a team-based approach where a primary care provider (PCP) is supported by a behavioral care manager and a psychiatric consultant. Key benefits include:

• Increased Capacity: One psychiatric consultant can typically impact 3–8 times more patients than through traditional 1:1 care.
• Improved Equity: Collaborative Care is one of the few interventions proven to reduce health disparities across race, ethnicity, and socioeconomic status.
• Sustainable Funding: CMS has established specific billing codes to make the model financially self-sustaining for providers.

Evidence of Cost Savings

The central finding of the report is that Collaborative Care is often cost-neutral or cost-saving because it reduces expensive physical health care utilization. Major and recent studies illustrate how:

• IMPACT Study: Over four years, Collaborative Care led to $3,363 in savings per patient, which is six times the cost of the intervention itself.
• Kaiser Permanente Colorado: A 2024 report (based on 2015 data) showed a 13% reduction in total health care costs per member per month (pmpm) compared to "treatment-as-usual".
• Arkansas Blue Cross and Blue Shield: In 2025, the organization reported a $340 per member reduction in overall costs just six months after accessing Collaborative Care.
• UPenn/Independence Blue Cross: Found a modest savings of $29.35 pmpm, confirming that expanded access does not increase overall spending.

Strategic Recommendations

To accelerate adoption, the report offers specific recommendations for health care stakeholders:

• Payers: Should reimburse Collaborative Care at rates at least equivalent to (Medicaid) or 30% above (Commercial) Medicare rates and eliminate patient cost-sharing.
• Regulators: Should allow Collaborative Care services to count toward network adequacy requirements for MHSUD specialists.
• Employers: Should require their third-party administrators (TPAs) to remove limits on follow-up care and implement zero-dollar copays for these services.