Psychiatry suffers under managed care Patients, not costs, must come first, and stigma must end


AN EPIC STRUGGLE is occurring over the control of health care and the doctor/patient relationship. Although this is occurring throughout the new medical marketplace, nowhere has it been felt more than in the diagnosis and treatment of mental disorders.

Today, more than 100 million Americans have their mental health and substance abuse benefits managed by for-profit behavioral health subcontractors known as "carve out" companies. This is a growing and dominant presence in the daily lives of psychiatrists and their patients.

Managed "care" companies achieve their financial goals by limiting freedom of choice for patients, curtailing the use of expensive services, and "selecting out" high-risk patients and high-cost physicians. This process of use management and cost shifting can be characterized as "managed cost and mangled care."

Real managed care

Genuine managed care, in contrast, could and should lead to more opportunities for care and treatment by providing support for effective outpatient interventions for more people with mental illness and substance abuse disorders who are not now receiving them. When this expansion of treatment occurs, we can say we are managing care in the interest of the patient and society.

Throughout the modern era, psychiatric care has been misunderstood and stigmatized. The public still believes that individuals suffering with mental illness are violent, crazy, and act like Brad Pitt in the current film "12 Monkeys." Insurance companies traditionally discriminate against treatment for mental illness by limiting the dollars for care, and payers vacillate between extreme views: that the mentally ill are hopelessly disabled or, in the opposite stereotype, among the "worried well;" that is, not seriously ill and therefore undeserving of support for treatment dollars.

Psychiatry is a part of medicine and with the increasing effectiveness of treatment, the traditional distinctions between "mental" and general medical conditions are no longer valid. Patients with general medical conditions such as diabetes or heart disease who also have depression, severe anxiety or substance abuse are among the highest users of hospital and medical care. The timely provision of psychiatric care can dramatically reduce the use and costs of medical care for these patients. Yet despite its demonstrated effectiveness, cost containment driven by managed care threatens access to care, leading to widespread demoralization among practitioners, and a reluctance on the part of medical students to pick psychiatry for a career.

Two case examples illustrate how "managed cost" in its present form can be destructive for patients, or how "managed care" can improve opportunities for treatment and expand services to patients in need.

A 35-year-old lawyer faces financial ruin due to a serious mental illness. Her health maintenance organization covers only "acute care and short-term therapy" and has a $25,000 lifetime maximum. This contrasts with coverage for all other general medical conditions with limits on length of stay, or office visits based on a generous definition of medical necessity and a $1 million lifetime maximum. She suffers from severe depression, alternating mania, which has been successfully stabilized over the years through a variety of medication strategies and psychotherapy. Unfortunately, she occasionally relapses, requiring short-term hospitalization. With her fourth episode requiring inpatient care, the family faces treatment costs approaching $20,000 per month and financial devastation.

This scenario demonstrates a real problem with a significant population of individuals who suffer from severe and persistent mental illness. All too often these individuals will run out of money in the face of managed care denials and low lifetime limits. Without effective treatment, many patients, like this lawyer, wind up homeless on the street or in the judicial and penal system. Eventually tax dollars end up footing the bill for this person's care, either by subsidizing mental health services from local governments or by paying for incarceration by a society that does not know how to care for individuals with severe mental illness. This kind of dehumanizing treatment should not happen here in the United States today. This social policy moves us back to what was more common in the 19th century.

Where managed care worked

A 47-year-old married man with two teen-age children became severely depressed after losing his job as an advertising executive. He began drinking alcohol heavily and ended up being pulled over by the police for speeding, and in the process received a DWI. The court system sentenced him to a substance abuse rehabilitation program, which eventually referred him to a psychiatric facility for evaluation after a suicide attempt.

During his three-day inpatient stay, approved by the managed care company, he was diagnosed by a psychiatrist, and placed on a treatment program that included anti-depressant medication and psychotherapy. With the approval of the managed care company, he was discharged into a partial hospitalization program for two weeks, which allowed him to receive comprehensive treatment during the day and return home to the support of his family at night.

Follow-up outpatient visits rounded out his course of treatment as his symptoms subsided allowing him to return to the work force. He has had no relapses for the last two years.

This case highlights the results of a more effective relationship between a managed care company, the treating psychiatrist and a patient willing to be treated. All of the factors in his case study worked in unison, and the fact remains that short-term hospital treatment and non-inpatient interventions are extremely effective with certain populations.

Until recently, it was either inpatient hospital stays covered by insurance or poorly covered outpatient visits to a therapist -- that was it. Over the past 10 years a number of new non-inpatient services have developed and expanded such as intensive outpatient visits, crisis beds, day hospitals, evening programs, psychosocial programs, and alternative residential programs. These services have become the continuum of care. The guiding philosophy being that the patient is treated in the least restrictive environment, allowing a healing environment to get the patient to function at her or his highest level in society. Managed care should expand these opportunities for outpatient care for patients in need.

Although managed mental health care has been mostly a private-sector phenomenon, increasingly states have turned to the same behavioral health care carve out companies to manage mental health benefits for public employee and for Medicaid recipients.

Proposals in Assembly

In Maryland, the legislature will consider proposals this session for a federal Medicaid "waiver" to allow managed care companies (HMOs and behavioral health carve outs) to use techniques of cost management for a high-risk and vulnerable population: the seriously and persistently mentally ill. Key services, such as psychosocial rehabilitation, are threatened in such a shift of fiscal accountability.

Can psychiatry and managed care co-exist for the benefit of those in need of mental health services?

The answer is "maybe," but first we must understand the major social and economic forces at work fighting the cooperation of psychiatry and managed care. Those forces include:

* Limited and shrinking dollars for mental health care;

* The need to provide more mental health servces to a broader spectrum of society;

* The allocation and payment of mental health services based on corporate entities competing for patients and profits rather than the doctor/patient relationship;

In order for any health care system to work, the patient must always come first. Excessive reliance on corporate entities managing only the costs creates suffering and hardship for patients and their families. Psychiatrists and other mental health clinicians working with patients and families need autonomy to treat their patients, and support from third parties within cost constraints to truly manage necessary and effective care.

Steven S. Sharfstein, M.D., is president and medical director of Sheppard Pratt Health Systems and a clinical professor of psychiatry at the University of Maryland.

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