Los Angeles Homeless Experiment, The TRIESTE Project: “An Innovation Proposal to The Mental Health Services Oversight and Accountability Commission”

Los Angeles County Seal
Los Angeles County Seal

A large team of Los Angeles County Official traveled to Trieste Italy in late 2017 to examine how and why this Italian community has been so successful in dealing with their homeless population. The Trieste model has been examined now by many U.S. state and local governments and academics who have immersed themselves in the details of why Trieste has virtually no homeless on the street and how they ensure those that need treatment receive it compassionately and in a timely and consistent manner.

“Within three years of launching the pilot, we anticipate that we will begin to see not only improved outcomes and customer satisfaction among the members we serve”

California state leaders have traveled to Trieste to witness first hand the Trieste model.

Below is the proposal by The Los Angeles County Department of Mental Health as updated April 30, 2019. Discussions appear to be underway at this time to implement these Trieste methods in Hollywood as a multi-year test. The proposal also details the budget needed.

A PDF of the entire 65 page proposal can be found here. Below are the first few pages.



In November 2017, a group of 13 Los Angeles County officials and leaders visited Trieste, Italy to observe and study its World Health Organization (WHO)-recognized system of mental healthcare. The delegation (which refers to itself as the “Tribe”) was comprised of various stakeholders in our mental health system, most of whom find themselves at the nexus of mental health, homelessness and law enforcement policy and practice. In their professional roles, most of them are exposed – often on a daily basis – to heartbreaking stories of suffering experienced by people with severe and persistent mental illnesses who are also homeless, incarcerated, or simply living lives of quiet desperation in board and care facilities.

It is against this backdrop – and with the hope of finding alternatives that would better serve the most vulnerable and marginalized among us – that the Tribe travelled to Trieste to attend an international conference, “The Right and Opportunity to Have a Whole Life.” The conference was sponsored by the Trieste Dipartimento di Salute Mentale, whose leadership also planned site visits apart from the conference to introduce the L.A. delegation to the Trieste culture and practice.

What the members of the Tribe discovered both surprised and delighted them. There is little if any homelessness in Trieste and involuntary psychiatric hospitalizations have been virtually eliminated. They had the opportunity to meet and learn from their counterparts in the Italian provider community: clinicians, social workers, law enforcement, judiciary and peers. The Tribe was particularly impressed by the system’s ability to address the needs of the whole person – not just their illness – as well as the availability of and accessibility to off-hours and crisis services and the reduction of the need for inpatient psychiatric services.

Since their return, the Tribe has met regularly to consider ways to bring the principles and practices of Trieste to Los Angeles County. This proposal is the result of their ongoing discussions and reflects their hopes to improve mental health care for the most vulnerable citizens of Los Angeles County.


The concept of recovery has become the dominant paradigm for the provision of mental health services. Nearly everybody with mental health challenges, even those with the most severe impairments, is considered capable of “a life in the community not defined by their mental illness.” The Mental Health Services Act – the defining document for the provision of mental health services in California – requires an approach that goes beyond treating the symptoms of the illness and instead focuses on ensuring that people with mental illnesses have appropriate housing, social connection and belonging and purpose in their lives.

And yet, for all the acceptance and promotion of the recovery model, the actual on-theground results appear to be mixed at best. The increasing numbers of homeless people with a mental illness and the system’s relative inability to help people to achieve true community inclusion both suggest that there is something missing in the way that the recovery vision is being implemented.

It is our premise that the single greatest reason for our system’s failure to deliver on the promise of the recovery model is to be found in the way that we finance mental health care in the United States. At its core, the U.S. mental healthcare system is driven by two closely related factors: (1) compliance with the Medicaid-based fee-for-service payment system and its copious associated regulatory processes that are intended to ensure accountability, and, (2) an over-emphasis on the treatment and mitigation of the symptoms of the illness rather than on the well-being of people served and their re-integration into the community at large.

In essence, our current payment and funding systems – presumably out of their concern for “fiscal accountability” – constrain and restrict our best intentions to actually meet the needs of the people we serve. If the recovery model is to ever actually fulfill its promise, we must create new and innovative payment, accountability and documentation systems that free us from the bureaucratic constraints that prevent us from providing the services that people actually want and need.

This MHSA Innovation Project proposes to implement five related innovations to create a pilot project that will demonstrate how both individual and system outcomes and consumer satisfaction in our mental health system can be dramatically improved without increasing the cost of services.

These five innovations are: A. A Recovery-Informed Reimbursement System B. Recovery-Informed Documentation and Process-Monitoring C. Recovery-Informed Performance Measurement D. Shifting to the Provision of “Well-Being-Focused” Services E. Technology that supports payment, documentation and accountability reforms

While for narrative reasons we will address each of these innovations in turn, it is important to note that we believe that these innovations are closely-related and all are necessary components of a true recovery-informed systems approach.


In late 2017, a group of thirteen Los Angeles County officials and leaders took on the task of examining the reasons for the suboptimal performance of the mental health system in the Los Angeles County. In November of that year, the group (hereafter referred to as “the Tribe”) visited Trieste, Italy, to attend an international conference, “The Right and Opportunity to Have a Whole Life” and study the local mental healthcare system which is recognized as an exemplary system by the World Health Organization and celebrated by experts in the field. Among the many key observations made during their visit: 1) there are essentially no homeless people with a mental illness in Trieste; 2) the jails are not overcrowded with inmates with a mental illness, and; 3) involuntary psychiatric care has been virtually eliminated.

Though there are surely a multitude of factors accounting for these observations that contrast so dramatically with L.A. County, it is our contention that the most significant reasons for the differences in outcomes are 1) the ways the two systems are financed and 2) the enormous difference in their bureaucratic, regulatory and reporting requirements. The staff in Trieste are blissfully unaware of and unconcerned with how the services they provide are paid for. Staff are able to do “whatever it takes” because they are not concerned that an audit will determine that the service they provided did not meet the criteria for “medical necessity.” And staff do not spend anywhere near the 25% of their time documenting the services they provide that is typical in Los Angeles.

INNOVATION A: A Recovery-Informed Reimbursement System

Unlike the capitated system of Trieste, our public mental health reimbursement system is characterized by a fee-for-service reimbursement model that requires staff to bill by the minute (or hour or day, depending on the service). This reimbursement model diverts staff attention away from the care they are providing and the needs of the members they are serving to whether they are meeting their “billing goals.”

Furthermore, the fee-for-service reimbursement model creates a perverse incentive to provide more services (greater volume) than may be actually necessary for the member because the provider gets paid more as the amount of service increases. Because of the individual staff person’s need to provide billable hours, it becomes tempting to provide additional services even though they may not be needed or desired by the member

We believe that a reimbursement system that provides funding based on the outcomes of services (paying for value) rather than for the quantity of services provided (paying for volume) is best suited to provide the financial and accountability underpinnings for a true recovery-oriented system of mental health services. Therefore, we intend to implement a multi-tiered case rate system in which funding is based on the level of need of the persons served and is completely uncoupled from the amount of service provided. This approach will encourage and empower our caregivers to attend more flexibly to the successful personal recovery and community integration goals of those with serious mental health problems instead of forced compliance with relentless regulatory processes.

INNOVATION B: Recovery-Informed Documentation and Process Monitoring

The pilot project will implement a process-monitoring and documentation system that encourages staff to relate to their members as whole people rather than just to their illness. To promote the provision of well-being-focused rather than illness-focused services, we propose to completely eliminate the current Medicaid service classification system and replace it with a monitoring system that addresses all aspects of the member’s quality of life as well as describing what the staff person actually did in his/her interaction with the member. All services will be designed to help members achieve the following goals: (1) A safe and healthy home in the community (HOME & HEALTH), (2) Acquiring and maintaining familial, social and intimate relationships (LOVE AND BELONGING), and (3) Acquiring and maintaining meaningful roles in the larger community (PURPOSE).

Implementation of this system will ensure that staff are addressing the needs of the whole person – not just the illness – as well as having the effect of significantly reducing documentation time and increasing time for the actual provision of care.

INNOVATION C: A Recovery-Informed Performance Measurement System

Our current system is characterized by a focus on monitoring (and paying for) services based on the quantity of the services provided regardless of their effectiveness. The pilot will shift away from this type of process monitoring by fully implement the existing Key Event Tracking System (KETS) currently used by the State of California to track outcomes for Full Service Partnership (FSP) programs. These indicators will enable us to judge the pilot’s effectiveness in increasing independent living and employment and reducing rates of incarceration and hospitalization in the population served.

In addition, we propose to implement a two-component system that measures our pilot’s effectiveness in helping our members to develop the skills and the supports that they need to live in the larger community. The components of this system are the Milestones of Recovery Scale (MORS) and the Determinants of Care. The MORS defines recovery beyond symptom reduction, client compliance and service utilization. It sees meaningful roles and relationships as the driving forces behind achieving recovery and leading to a fuller life. The Determinants of Care help staff to understand which specific life domains the member is able to self-coordinate and the domains for which s/he needs either natural or professional support. Over time, it is expected that the member will learn to self-coordinate more aspects of his/her life.

The pilot will be able to evaluate its effectiveness in helping our members to become more self-coordinating, which in turn is expected to help the member to live more successfully in the larger community.

INNOVATION D: The Proposed Service Array: Shifting the Balance from “Illnessfocused” Services to “Well-being-focused” Services

The most foundational service offered in the pilot will be to act as the member’s health home in which both the mental and physical healthcare needs of the member can be addressed. Members will be assigned to a health home that reflects and is congruent with their level of need and their ability to self-coordinate their care. Wellness and PeerRun Centers, Outpatient Clinics and FSPs could all serve as the health home for the member, with each of these levels of care providing the appropriate (i.e., needed) amount of assistance for the member to achieve the maximum level of independence in the community.

It is our belief that implementing innovations A, B, and C will create the financial and regulatory environment in which true, recovery-oriented, well-being focused services are most likely to thrive and achieve their intended effect. But to increase the likelihood of the success of this endeavor even further, the pilot intends to employ a traumainformed, culturally competent approach that reverses the usual emphasis between clinical and psychosocial services by making the psychosocial services “primary” and the clinical services “ancillary.” For example, a wide variety of supported employment and supported education services will be available as well as an emphasis on leisure and recreational opportunities. But in all services offered, staff will be aware of the significant roles that trauma and racial, ethnic and gender disparities play in the lives of the people we serve.

While we of course recognize that many of the members we serve require very high levels of traditional clinical services and supports (e.g., therapy, medication support), we also believe that we must constantly remind ourselves of and focus on the whole life the member is trying to lead in spite of having a severe and persistent mental illness. It will be the extensiveness and robustness of these psychosocial, non-illness centered services that will to a large degree determine our success in this endeavor.

The pilot will also implement new levels of crisis and emergent services including Peer Respite, Crisis Residential, and Urgent Care that currently do not exist in the proposed pilot region.

INNOVATION E: Technology that supports documentation, accountability and payment reforms

The Reimbursement/Documentation/Accountability system proposed in Innovations A – C will require a significant investment in technology to realize its potential to reduce the documentation burden on staff and improve the effectiveness of care. We envision a HIPAA-compliant electronic health record that is accessible through a smart phone application. Staff will record not only their interactions with individual members but ALL the activities in their work.

Data will be entered into the EHR database either wirelessly or when staff return to the facility and dock their phone with the system. It is expected that this voice-enabled system will reduce keyboard data entry by as much as 90% and thereby reduce the data entry time for staff by several orders of magnitude. It also has the benefit of being much more accurate and reliable in that it requires staff to enter their documentation on an ongoing, real-time basis.


For at least 30 years, the recovery model has held out the promise of a system that will achieve true community inclusion for people who are marginalized by their experience with severe and persistent mental illnesses. That promise remains unfulfilled. It is our belief that the primary reason it remains unfulfilled is that our bureaucratic and regulatory systems have not kept pace with or supported our improved approaches to service. This innovation proposal offers a roadmap as to how to create a “recoveryoriented bureaucracy” – which we do not believe to be an oxymoron! To the contrary, we believe that the innovations described here will improve our effectiveness (better 8 outcomes) and will increase both staff morale and member satisfaction with the experience of care.

We believe that ultimately this project has the potential to transform the mental health system in the United States. We respectfully request that the Oversight and Accountability Commission fund this proposal.


This proposal to the Mental Health Services Oversight and Accountability Commission (MHSOAC) aims to obtain approval for the resources we need to administer and study a pilot system over a five-year period. In the first year of the project (July 1, 2019 – June 30, 2020), $11,850,000 is budgeted to reflect upfront, one-time infrastructure investment for purchasing and renting facilities as well as designing, implementing and supporting electronic health record technology. The first year of the project will be used to engage community stakeholders, secure all necessary regulatory waivers, establish evaluation contracts and protocols, and site new services.

New services will actually begin on July 1, 2020 and the pilot will run through June 30, 2024. The baseline annual budget will be $26,225,000 per year which reflects the current cost of all adults served in the geographic region over the 2017-18 fiscal year (approximately $18,000,000) plus the funds needed to add a number of new services plus the cost of the evaluation of the pilot.

Thus, total funding requested for the entire five-year innovation project totals $116,750,000 ($11,850,000 + ($26,225,000 * 4 years)).

Within three years of launching the pilot, we anticipate that we will begin to see not only improved outcomes and customer satisfaction among the members we serve, but will also see improved morale among service providers. It is our hope and expectation that within five years we will achieve sufficient proof of concept to feel confident expanding the model across our county’s mental health system. Ultimately, we are hopeful that the model will be so successful that we will be able to convince not only the state of California but also the federal government that the Medicaid financing and accountability system should be changed to reflect what we demonstrate though this project in Los Angeles County.

Proposed Timeline for Implementation – First 20 Months November, 2018  Initial draft of concept paper completed.

December, 2018  Determination of the geographic boundaries of the pilot.

March, 2019  “Final” draft of concept paper completed  Determination of the precise population to be served and initiation of economic analysis of current county expenditures for the population  Expanded stakeholder process to vet concept paper begins  Submission of concept paper to MHSOAC.

April, 2019  Initial presentation to members of the MHSOAC

May, 2019  Submission of full proposal for five-year innovation grant to the MHSOAC with expectation that grant will be awarded to begin effective July 1, 2019 through June 30, 2024.  Initial discussions/negotiations with potential independent evaluators to determine scope and cost of the evaluation  Initial discussions/negotiations with potential EHR vendors to determine scope and cost of the new EHR.  MHSOAC officially awards Innovation Grant (MH Month!)

July 1, 2019 – June 30, 2020  Securing all necessary regulatory waivers  Expanded stakeholder process to determine scope and implementation of services  Selection of independent evaluator and implementation of evaluation protocols  Selection of EHR vendor and implementation of system  Initial training of staff on all data collection and accountability systems

July 1, 2020  Doors open and services begin under the pilot project.


A PDF of the entire 65 page proposal can be found here. Above are the first few pages of the proposal.