Managed Care: Conspiracy of Greed in Contemporary Healthcare

By Mickey Skidmore, ACSW

Simply put, managed care and insurance companies (for the purposes of this writing, these terms are interchangabe) are out of control. And make no mistake about it, this dispicable reality is due to nothing short of greed. While managed care takes credit for the halting of run away healthcare costs, they skirt any responsibility for the emerging and increasing crises of healthcare consumers.

The truth is, there is roughly the same amount of money circulating within the healthcare industries. However, insurance companies have been extremely skillful in their ability to create convoluted (yet systematic) layers of buearacracies which funnel increasing amounts of insurance premiums into their bank accounts. Part of this has been their success at subverting state laws requiring insurance companies to recognize certain providers. And while they state they do not dictate treatment, their refusal to pay for providers recognized legally withing each respective state, in effect results in patients not receiving treatment.

Regarding the specific arena of psychiatry and mental health, consider the following story recently published in the Raleigh New & Observer:

Point of View: Patients and payments in a convoluted system (2/22/98, The N&O)

Sunday
February 22, 1998

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Point of View: Patients and payments in a convoluted system

By MICHAEL DEWITT

     RALEIGH -- I met a delightful young person on a recent Saturday, a student at one of our local universities. She is bright, accomplished in athletics and academics -- in short, a child of promise. In recent weeks and months, however, she had developed a major depressive disorder, one of the most insidiously malignant of diseases. By the next Friday she had lost all hope.
     She was discovered approximately five hours after taking a potentially lethal overdose in secret. Public safety officers responded with skill and efficiency. She was taken by them to a local general hospital where she received excellent medical care. I was informed of her situation by a university psychologist because I have a contract with the university to provide emergency psychiatric care and it was my weekend on call.
     Thankfully, she stabilized quickly from the overdose. It was my job to determine what the problem was and how best to treat it. What was necessary to ensure that this didn't happen again? What could I do to prevent the flame of this young woman's dream from being extinguished? Ironically, her dream is to be a doctor, specifically an oncologist.
     My initial treatment plan consisted of a brief psychiatric hospitalization to get safely past the high risk of suicide in a depressed person who has tried it before. I wanted to transfer her to another local general hospital which has a psychiatric unit. There her treatment could be continued by doctors I know, ones who are familiar with this university and have ongoing relationships with personnel there that would facilitate working out plans for after her discharge.
     My specific plans for treatment would not be arranged, because I got the patient's insurance card and an odyssey began.
     The card said, "US Healthcare." I called the number and an automated response answered "Aetna/US Healthcare." After a long menu and interminable wait, I spoke with someone to try to arrange precertification for psychiatric inpatient treatment. I was told that mental health benefits are managed by "Human Affairs International" and given another number. Notice that we are now on the third corporation.
     I called and learned that "those benefits are carved out in North Carolina" to a fourth corporation: "Merritt Behavioral Care." I called them, they verified coverage and told me a "clinician" would call me.
     Eventually I was called and began to present the case. I explained that this young woman had been hospitalized overnight after an overdose and identified the specific hospital. The clinician interjected that this hospital is not approved on this plan. I politely said that that was not my concern and added, with sarcasm, that when someone is unconscious and has taken a potentially lethal overdose, saving a life takes priority over choice of hospitals.
     In fairness, this clinician listened attentively and with genuine concern and agreed that my patient needed hospitalization. She said the the only hospitals in the patient's plan were in Durham County.
     I called the first, which had no beds, and ultimately arranged transfer to the second. I had now spent three hours and 15 minutes on this case, of which at most 75 minutes were spent with the patient and her family. At least, or so I thought, I had assisted the patient in getting transferred to a safe place for definitive care.
     On Sunday morning, university personnel informed me she was about to be released by the hospital!
     She returned to her dormitory that afternoon, where the psychologist had already alerted housing personnel to be aware of her situation and provide assistance as needed. On Monday I learned that counselors at the university had stretched themselves and their heavy schedules to see her. In fact they made the plans for her living situation and academic status.
     In approaching such a complicated picture, which is the rule these days, one must ask a few basic questions: Who provided what treatment and who paid for it? Also, where did the patient's premium dollars go?
     The last question first: At least four corporations seem to have made money from the patient's premium. The purpose of three of these corporations is to "control costs"!
     A stay of less than 24 hours at the receiving hospital in Durham will be paid by the insurance company. You can be sure that this is at a drastically discounted rate, a rate which other reasonable hospitals (such as all the ones in Wake County) could not afford -- or one would expect they would be in the network.
     Now let's look at the treatment. The individuals who responded to the scene and efficiently got the patient to the general hospital were public safety officers employed by the university. The psychologist who assisted with arrangements at the time of emergency, and spoke with the family before my meeting with them, is also employed by the university. So was the other psychologist who made the specific living arrangement and academic plans for the patient after discharge.
     I will also be paid by the university for my time. It is unclear whether the general hospital and physicians who provided life-saving treatment will be paid. I was told by the clinician that this hospital is not in the network. The hospital may not be paid at all, though it has incurred all the expense of treating her and pays the salary of the emergency room physician.
     The attending physician, who cared for the patient during her overnight admission at this general hospital, didn't expect to be paid and said he didn't care. The hospital either ends up paying by providing it for free, or charges the patient and her family, who will be appropriately upset about having to pay for treatment that they assumed was covered by their insurance policy.
     Let me point out a few of the more subtle problems. At least three corporations make a profit "cutting costs" and create such a complicated situation that my time, and therefore my charges, are approximately tripled. Total costs for this treatment event were increased by the so-called cost-cutters, but that cost will be paid primarily by tuition dollars.
     The vast majority of the excellent medical care given this young woman was provided by people who will not be paid by the insurance company on which this family relies. If the university or I attempted to charge the insurance company, we could not be paid.
     As I was wrapping things up with this young woman and her family, I said "hang in there. I may need an oncologist some day."
     She smiled; her hope was alive. I congratulated myself for this once saying just the right thing -- something encouraging and affirming, something that brought back the perspective of the future. Then I got to the car and wondered. Should I really be encouraging a young person to be a doctor?
     Michael E. DeWitt, M.D., is a Raleigh psychiatrist.

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To refer to these practices as "managed care" is abserd. Let's call it what it is: "Managed Cost". And let's also begin to explore the cost of this approach. For starters, the practices of insurance companies today have in effect reduced the role(s) of every professional in psychiatric inpatient care. Insurance companies in effect will no longer pay for inpatient "treatment". One must be imminantly at risk of or in danger of serious (homicidal or suicidal) harm to self or others to be admitted for an inpatient psychiatric stay. And the minute it becomes clear one is no longer homicidal or suicidal, managed care pulls the plug. (It doesn't matter if your grossly psychotic, severely depressed, acutely anxious, traumatized or greif-strickened. This can be managed on an outpatient basis (provided of course within the 4-6 sessions an insurance company will generously certify). RN's in the hospital are reduced to clerks, submerged in the mounds of paperwork work involved in admitting and discharging patients of increasingly shorter stays. Social Workers and Counselors are reduced from Master's prepared therapists to being bogged down with intensive Case Management (as discharge planning begins at the time of admission -- if not before), and less with less time for group, individual, or family therapies.

In the twelve years I've been a practicing Social Worker, I have witnessed a ruthless and systematic eradication of anything resembling "long-term" care or treatment. Insurance companies will not pay for treatment of personality disorders, despite the fact that they are perhaps one of the most prevalent variables effecting the landscape of mental health treatment. Moreover, insurance companies are making it increasingly difficult to access drug/addiction treatment. (How can it be less expensive to build and support jails and prisons rather than pay for clinical treatments?). Even state hospitals for the indigent (in North Carolina) no longer accept alcohol or drug related conditions; MR patients; and the longest term treatment available anywhere at best is 90 days.

As managed care companies look for more and more ways to say NO to their consumers; and insurance companies develop increasing strategies to deny claims, we may be witnessing the death of any realistic outpatient mental health care. Forget that sooner or later this short sighted approach will result in revolving door recidivism (which will cost more than longer termed therapy or outpatient treatment). This trend will not change until there is a consumer revolt resulting in significant legislation at the national level. And do not allow yourself to be conned by the legislature. More insurance is NOT the answer. Managed care and insurance companies are an increasing part of the problem. We need another way. But it won't happen until we insist upon it.

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