Why do so few therapists accept health insurance and why is it so hard to find one who does? ProPublica investigated by interviewing therapists about their reasons. The answer is complicated, more complicated that ProPublica lets on. I wrote about it several years ago. I explained one reason 80% of therapists do not accept insurance is because they do not have to, saying:
There are more people needing counseling than there are therapists to treat them. The imbalance between supply and demand means therapists can pick and choose their patients.
There is a shortage of therapists. As ProPublica also found, those who require patients to pay out of pocket earn much higher fees than those who accept insurance. The news outlet interviewed more than 100 therapists, who shared their experiences. These include bureaucracy, having to repeatedly call to prod insurance companies to pay what they owe. Reimbursements sometimes took months. In one example insurers came back months later and tried to claw back payments that had already been made, claiming something missing in their files. Counselors also complained about insurers interfering in patient care, demanding 45-minute sessions rather than 60-minute ones, limiting how many sessions were covered and making therapists’ job more difficult. The following is from ProPublica:
The interviews underscore how the nation’s insurers — quietly, and with minimal pushback from lawmakers and regulators — have assumed an outsize role in mental health care.
It is often the insurers, not the therapists, that determine who can get treatment, what kind they can get and for how long. More than a dozen therapists said insurers urged them to reduce care when their patients were on the brink of harm, including suicide.
It took one therapist 45 calls to an insurance company to collect less than $1,400 for an ADHD evaluation on a college student. On the other hand, dropping insurance network affiliation can reduce bureaucratic hassles and also boost pay.
Reimbursements rates are largely stagnant and notoriously low. Therapists on average earn about $98 for a 45-minute session from commercial insurers, whereas their out-of-network colleagues can earn more than double that amount.
There is more to the story than ProPublica identified. Why are health insurers stricter about mental health counseling than for a physical diagnosis? It all has to do with how mental health care is different. Mental health differs from physical health in five key areas. The following is from “The Case against Mental Health Parity, Part I: Faulty Assumptions,” by John Goodman and Wess Mitchell (2002):
Subjectivity. In contrast to the direct observation employed in other branches of medicine, providers in the mental health field must rely largely on the patient’s subjective experience of the illness. Patient reports are not always reliable.
No Objective Standards. Partly because the medical community has not studied mental illnesses as intensely as physical illnesses, few objective standards exist for either diagnosis or treatment.
Doctor Discretion. The providers of mental health care services exercise considerable discretion in prescribing drugs and administering other treatments, and their choices vary considerably.
Patient Discretion. Patients have a wide choice of providers: physicians, psychiatrists, psychologists, social workers, family therapists and counselors, to name a few. Greater patient discretion in mental health is also reflected in the fact that the demand for mental health services is four times more sensitive to changes in price than the demand for general health care.
Patient Cooperation. Patient behavior does not have much impact on the setting and mending of a broken leg. But in the case of diabetes and many other chronic conditions, patient cooperation (e.g., taking the proper drugs, maintaining the proper diets) is essential. The same is true for mental illness.
Therapists are labor intensive. Whereas a primary care physician may only need one 10-minute visit to treat an infection, it may take a dozen 45-minute sessions with a therapist for a mental health disorder to get it under control. That probably does not even cure the disorder, only manage it. Both therapists and patients have an incentive to drag out care if they perceive the slightest benefit. There are no objective standards to show when a patient is cured. There are no blood tests. The following is from Goodman and Mitchell:
An apparent reflection of the problem of moral hazard is a National Bureau of Economic Research study finding that 38 percent of all mental health patients representing 28 percent of all treatment visits are people who do not have any mental health disorder.
A common observation in the mental health field is that the number of visits it takes to cure a patient often equals the maximum number of visits allowed under the patient s insurance plan.
Suffice it to say that if health insurers generously and eagerly paid mental health counselors as readily as they reimburse for physician visits, there would be a lot of unnecessary care for garden variety social anxiety, discussing the meaning of life, teenage angst and numerous other topics patients would be unlikely to pursue if they were paying the tab. Health insurance premiums would be a lot higher.
Goodman and Mitchell: The Case against Mental Health Parity, Part I: Faulty Assumptions
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