The Problem(s) with Managed Care
| Leonard Holmes, Ph.D. http://mentalhealth.about.com |
Managed care is taking over as the predominant method of financing mental health care in the United States. Is this the solution to spiraling healthcare costs? It is creating more problems than it is solving? It may be helpful to consider how mental health has been financed in the past.
Mental health care in the United States has historically been funded both privately and publicly. State mental hospitals were funded by state governments to house and care for mentally ill individuals. Other individuals paid out-of-pocket for treatment. This combination of public and private funding continued until the period following World War II. Many companies were looking for ways to attract workers that didn't involve raising salaries. Benefit plans were developed where employers contributed toward funding health care for their employees.
These employer plans grew more costly as medical costs increased. Other countries nationalized their health care systems into a single payor system subsidized by the government. The United States continued on its unique course and employers and insurance companies struggled to find ways to cut health care costs. The currently dominant method of cost-cutting is managed care. Managed care refers to a system where an insurance company or other entity "manages" the payment of health care dollars and keeps any money which they do not spend on care. Often thereis an incentive to deny the care and keep the money, and that's what seems to happen. Health Maintenance Organizations (HMOs) and Preferred Provider Organizations (PPOs) are two forms of managed care. Other models exist, and new hybrids seem to emerge every few months.
Many managed care companies erect hurdles to providers
in order to discourage requests for further care.
One company that I
work with requires that I fill out a two page form after every four sessions with a
client. Another company recently "improved" their system by replacing their two
page form with a six page form. To make things even more difficult, every company has a
different set of forms. These forms require detailed information on sensitive matters
which was formerly kept private. Who has access to this information? Who knows.
It should be noted that there were abuses in the old "fee-for-service" system. Inpatient facilities were known in the past for keeping patients until their insurance ran out. One reason that 28 day inpatient treatment programs became a standard for substance abuse treatment is that most insurance companies wrote 28 days of coverage into the policies. Managed care has largely stopped this practice by carefully monitoring inpatient care. Some would say that this monitoring has been too strict, but it has made a huge difference in inpatient costs
Managed care has also turned the incentives around. In many cases providers are now paid not to see patients. Here's how it works:
Many HMOs have "capitated" contracts with mental health provider groups. The group is paid a small fee per member per month to handle all of the mental health needs for a certain population. (This can be as small as 50-75¢ per member per month, but it is often a slightly larger amount). The provider usually collects only a small additional "co-pay" if he or she does see a patient. A group of providers often makes the most money by seeing as few patients as possible for as few sessions as possible.
This change in incentives is not all bad. In the past therapists and physicians were paid only to see patients. This system was called "fee for service" and it encouraged patients to be seen for as many sessions as necessary. Did it encourage too many sessions? Some would say so.
Managed care plans (and most traditional insurance) discriminates against mental health care. Benefits for "medical" problems are usually much more comprehensive than mental health benefits. There are currently bills before congress and state legislatures which promise parity between mental health and physical health. A watered-down parity law takes effect January 1, 1998. It bars companies from setting a different maximim amount of coverage for mental disorders than it sets for physical disorders. Companies can escape the new requirements if they can show that it will raise their costs by 1%. Insurance companies are lobbying to weaken the law even further, and it is not expected to make much difference.
President Clinton has recommended an HMO "Bill of Rights" which addresses some minor issues in managed care. The Clinton proposal will give everyone
- The right to appeal the denial of care
- The right to a "reasonably large" choice of doctors
- The right to have an emergency room visit paid for if a reasonable person would have concluded that the problem was an emergency.
This is a modest list given the excesses of some managed care plans. An organization called the National Coalition of Mental Health Professionals and Consumers (NCMHP&C) has started a petition drive to encourage health policy makers to outlaw managed care in mental health. This is one of the more extreme positions in this debate, but more and more professionals and consumers are abandoning managed care for less burdensome (and more confidential) arrangements.
For further information:
- Managed Mental Health: What to Look For - What to Ask. Information from the Center for Mental Health Services to help you understand basic managed mental health concepts.
- Suicide by Managed Care. A Series examining the impact of managed care on mental health - by Rand Partridge, Ph.D.
- Choosing and Using a Health Plan. A consumer's guide developed by the Agency for Health Care Policy and Research in cooperation with the Health Insurance Association of America.
- Can you Sue your HMO? Lawsuits against managed care companies are beginning to happen.
- The HMO Page is a site developed by health professionals to highlight the abuses caused my managed care.
- The Company Therapist is a fictional web drama which includes elements of the managed care hassles which a psychiatrist must go through. There's more fiction than fact, but some events are extremely realistic.
- The National Mental Health Association advocates parity between mental health and physical health benefits.
- Ofer Zur, Ph.D. is an example of a new breed of psychotherapist who is fighting managed care.
- Spelling Out Managed Care is an article from the New Social Worker.
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| Leonard Holmes, Ph.D. http://mentalhealth.about.com |
Graphic by Corel Corporation used by permission.
