The Fate of Mental Health in Health Care Reform: II. Realistic Solutions Jos#{233}M.
Santiago,
M.D.
in the second part of a two-part paper, the three major proposals for U.S. health care reform-the government-sponsored model, the em-
ployment-based
model,
and
the
market reform model-are reviewed. Barriers to their success indude the currect economic crisis, the lack of a ckar consensus, and the high costs oftheproposals. Most proposals limit the extent ofpsycbiatric coverage; some exclude such coverage from minimum benefit packages, an area ofconcernfor clinicians. The author concludes that any substantial health care reform is unlikely in the near future. A thoughtful, realistic, andyet vigorous strategic plan is needed now to forestall the possible exclusion of significant mental health coverage. The basic ekments of such a plan are reviewed. The U.S. health care crisis has reached considerable proportions. The system is costly, fragmented, and a source of worry for most Americans (1). The debate on reform is ubiquitous in social, political, and medical circles. Reform proposals are confusing and difficult to assess, but they have similar intents: universal health care coverage, cost control, and preservation of quality care. Despite several innovative reform proposals, the equation of cost, access, and quality continues to elude satisfactory solution. Undesirable choices are inevitable.
Dr. Santiago is professor chiatry at the University
zona North
College Campbell
of psyof An-
of Medicine, 1501 Avenue, Tucson,
Arizona
85724.
Hospital
and Community
Psychiatry
Services
For mental health services, these choices could pose a serious threat (2). Consumers may be least likely to notice a severe reduction in psychiatnc benefits to satisfy cost controls as long as other essential medical services are maintained. To properly prepare for the future, mental health professionals must understand what is at stake. They must master the concepts that underlie the current reform proposals, understand the implications for psychiatry, and decide which course of action will preserve, as much as possible, what is essential to psychiatric patients. Current reform proposals Government-sponsored (singlepayer) model. Under the government-sponsoned model everyone is equally covered. Benefits are mandated and usually include liberal mental health benefits (3). Medicare and Medicaid are replaced by the universal public plan. Long-term care is usually included. Copayments, deductibles, and caps on personal expenses may apply in some cases. Based on the experience of other countries with national health insurance (4-6), cost containment is achieved by setting a national health expenditure cap; negotiating hospital and physician payment rates, for example, using Medicare reimbursement rules; and streamlining administrative costs. Funds would come from income, excise, and payroll taxes. Substantial new financing would be required. Employer-based (“pay-or-play”) reform. Under the market reform model, employer-based insurance is retained for large- and medium-sized employers. Businesses have an option to buy insurance for their cmployees or pay a percentage of employces’ salaries into a pool to coven
November
1992
Vol.
43
No.
11
employees in a government-operated insurance program, such as Mcdicare. Employees of very small companics and uninsured persons would receive coverage through the same government-run risk pools. Coverage is universal in most pay-or-play plans. Benefits are mandated and may include several levels of mental health services. Long-term care is usually not part of these reform proposals. Financing is achieved mainly through payroll taxes and Medicare taxes. The cost to employees, employens, and individuals would be substantial. Cost containment would be achieved through development of uniform claims forms and processing procedures, managed cane, expenditune targets for national health care, and Medicare payments. Hawaii has developed and expanded the employen-based reform model for four years with interesting results (7,8). Massachusetts has had a difficult time with this experiment in recent years (9). Market reform. There are two major components of the market reform approach. First, a reform of the health insurance market is undertaken to address the current disincentives and contradictions in coyerage. Employer-based insurance is thereby made more accessible and affordable. Second, the current publicly funded system ofcare is expanded and strengthened to cover uninsured individuals and families. Coverage is increased but may not be universal. A basic benefit package is mandated that may include limited mental health benefits. Small companies join together as a single purchaser of health care to develop purchasing power and decrease costs. Under this plan, the tax code is
1095
reformed to involve individuals in the cost of health care. The amount ofemployer-pnovided health benefits exempted from income tax is limited. In addition, a possible option is to give individuals a refundable tax credit to purchase health cane coverage from an array of choices. Mcdicare and Medicaid remain as they are or are replaced by a system of vouchers. Tax credits and vouchers force the consumer to be selective in the purchase of services and lead to increased competition in the provision of services. Managed competition and integration of systems of care become fundamental components ofmarket reform (10). Barriers to successful reform Major difficulties stand in the way of successful implementation of each of the three main reform scenarios. First and foremost, in the current economic crisis, national public policy on health care makes access and quality victims of a polarized policy on cost. As a result, acceptability of the remedies will be greatly diminished. Second, no clear public consensus on health cane reform exists. A poll taken injanuary and February 1992 revealed that public opinion was equally divided among single-payer, pay-or-play, or market reform options ( 1 1 ). There is significant disagreement between the public and policymakers that makes consensus difficult to reach. The public perceives the problem of overall costs as relatively minor and focuses instead on out-of-pocket expenses (12). Furthermore, the public overlooks the complex causes of increasing costs, reducing them to the greed of the parties involved. Finally, the public perceives the uninsured as being the poor and elderly populations rather than impoverished workers and their dependents (12). A third barrier to reform is that despite some optimistic predictions (13), the costs of universal coverage are difficult to estimate and could, potentially, run into the hundreds of millions of dollars. Fourth, Americans show a significant distrust of government, making a federalor state-operated
1096
system difficult to implement. Fifth, small businesses not only fear increased costs attributable to health care coverage, but also do not seem to be interested in providing health insurance to their workers (14). In addition, policymakers are reluctant to make coverage mandatory (15,16). The result could be a massive and costly shift toward public-sector coyerage. Sixth, a competitive market reform requires a level of consumer sophistication that is lacking. Implications
for
mental health services Most proposals contain clauses limiting the extent of psychiatric coverage. Even though many present a “minimum psychiatric benefit package,” in reality they aim to set a limit on coverage, as is already the case in health maintenance organizations. Usually included are 45 days of inpatient cane, 25 outpatient visits, and 20 to 50 percent copayments. Few other specialties are subjected to such specific benefit limitations and descriptions (17,18). Thirty states and the District of Columbia have mandated benefits for the treatment ofmental illness. Seventeen of these states require inpatient and outpatient treatment, and 1 3 simply require that insurers offer coverage (19). The employerbased and market reform proposals would threaten mandated coverage for mental illness in these states. Furthermore, several states have recently attempted to develop “strippeddown” benefit packages for employens; these packages would preempt existing mandated benefits. Twenty-five states have already enacted basic benefit plans, and other states arc contemplating such bills (20). Seven ofthe 25 states with basic benefit packages require a minimum level of psychiatric coverage. So far, the practical results are modest. Small employers are less than eager to purchase health benefit plans for their employees even if they are penmitted to buy “bare-bones” packages (14).
Basic benefit packages For the preservation ofmental services
health
in reformation
efforts,
therefore
important
to understand
November
1992
VoL 43
it is
No.
11
how benefit packages are created. Usually, the concept of minimum health care needs leads to the categonization of health services as essential, desirable, and optional. Essential health services are thus descnibed as medically necessary. The addition of desirable benefits depends on resources. Optional services do not meet the criteria for inclusion in a basic benefit package. The basic benefit package purports to guarantee everyone a minimum amount of medical services. The problem lies in the definition of what is essential medical care and what can be considered as superfluous, luxurious, or simply an option (21). Consensus may lead to pruning out coverage of mental health or other services because ofsheer ignorance or calculated utilitarianism. The notion of medical necessity as a basis for reimbursement, and as a justification for inclusion in a basic benefit package, is elusive and has no scientific basis. It is a policyand consensus-driven concept (22). Managed care Most reform proposals rely on managed care or its variations to achieve cost containment without loss of quality. Recent surveys show that managed cane is increasingly popular with employers (23). The public is growing accustomed to some form of intervention that controls their health care demands and limits costs (1). Whether the techniques used so far in managed care, including those for managing mental health services, can yield the desired results is a subject ofdcbate (24-26). Nevertheless, because the continued rise in mental health services costs, a majority of payers are willing and eager to incorporate managed care into mental health services (27,28). Equating utilization management, the most common form of cost control, with managed care is an important source of confusion. Further study will be needed to demonstrate the effectiveness of managed care in mental health (29). Rationing Managed cane and other methods of controlling use of health and mental health services conjure up the threat
Hospital
and
Community
Psychiatry
ofrationing. Since cost control is the bottom line for many policymakens, rationing may seem the only method available, despite aversion to it in the U.S.(25). Rationing is seen by many as unacceptable and a threat to be avoided at all costs. The reality is that we presently ration health care and mental health care in the U.S., even though we do not readily acknowledge it. By pricing, we make certain goods unavailable to many people and some goods available to a few privileged ones. In the United States health care is not a public good but rather a market commodity. Uninsuned patients, especially children, suffer the consequences of price rationing (30,31). What has been unacceptable in the U.S. so far is rationing that makes a medical good inaccessible regardless of the ability to purchase it. And yet other goods, such as seat belts in school buses, arc not available at any price by societal consensus. The debate in health care, as well as in mental health care, is not whether rationing is acceptable or even exists, but how to ration and which form ofrationing is tolerable. The Oregon Medicaid demonstration project offers a good cxample ofthe difficulties in introducing rationing as a public policy (32). The experiment can be lauded for tackling the issue of rationing as a means to ensure universal coverage for the poor while controlling costs. It can be criticized because those affected by the plan are those least likely to participate in the process used to arrive at consensus. To significantly modify a state Medicaid program, a waiver is required from the U.S. secretary of health and human services. The federal government recently denied the required Medicaid waiver to Oregon because it felt that the Americans With Disabilities Act was violated when the consensus building included quality-of-life rankings of people with certain medical conditions. Finally, the Oregon experiment demonstrates the risk of underestimating the vulnerability of mental health services in the reform arena. Initially, the efforts of mental health advocates centered on preventing
harm to psychiatric patients; they thus requested that mental health services be excluded from the initial Oregon Health Services Commission deliberations. It quickly became clean that this approach could cxdude mental health services from any basic benefit package. Only dedicated and diligent efforts by interested parties restored the mental health benefits, although with a oneyear delay in implementation (33).
Hospital
November
and Community
Psychiatry
Predicting the future One ofthe most important questions in evaluating reform efforts is whethen all the variables that determine outcome have been considered. For example, higher investments of resources do not automatically translate into guaranteed access to care or improved quality of services. Reinhardt (34) and others have argued that after a point on the cost benefit curve, additional resources and mcdical interventions add little value to the quality of care. The access, quality, and cost equation may therefore not be entirely addressed by simply choosing from the current reform models and increasing the resources available. Past cxpeniences and current practice seem to indicate that additional factors must be considered to attempt to provide universal coverage with a benefit package that includes psychiatnic services, while maintaining quality care at an affordable cost. Consumer behavior. Demand for health care services in the U.S. is antithetical to cost controls. Most patients are shielded from cost considerations by insurance coverage. The incentive is for patients to consume health cane services to avoid death, relieve pain, and recover mobility. Furthermore, the demand is for cure and avoidance of rationing. Inefficiency is the price for this approach. In the face of pressure to limit costs, purchasers of insurance coverage usually underestimate the need for mental health services. A combination ofstigma, denial, and misinformation about the risks of mental illness leads to undercoverage. Methods used to increase consumers’ sophistication about mental health needs, risks, and services have been
1992
VoL 43
No.
11
mostly ineffective. Demand must be reviewed as a national policy (35). Services that simply seek unobtamable cures must be reconsidered. As of 1980, 70 percent ofall health care outlays were consumed by 10 percent ofthe population, and usually in the last two years oflife (36). Increased use of mental health services has been driven by the availability of services and the extent of available coverage. Cost containment efforts that have restricted mental health services have not been met by public outcry. Equitable coverage of mental health services will require, paradoxically, increasing the demand for mental health services among punchasers of health insurance. Provider behavior. Whether in medicine in general or mental health in particular, the idea that professionals can be trusted by patients because of their greaten knowledge to act solely on behalf of the patient must be reviewed. The provider has a triple role: as the patient’s agent, as a practitioner with his on her own goals to fulfill, and as a guarantor of social good (37). Balancing the inherent conflicts in these roles is a necessity.
Practice parameters. Practice guidelines have generated a substantial amount ofdebate, fear, and rejection in medicine in general and in mental health in particulan(38). The first set ofpnactice guidelines in psychiatny (covering eating disorders) was recently approved by the board ofthe American Psychiatric Association. The controversy has not abated and is, in pant, based on misunderstanding and on a genuine concern oven the clinician’s ability to decide and be flexible. A powerful argument for the creation of practice parameters is the variability of clinical decision-making in medicine, and especially in psychiatry. Moreover, most medical and psychiatric procedures have not passed rigorously controlled evaluations (39). As a result, Brook and Lohr (40) estimated that at least 30 percent of health care services in the U.S. are unnecessarily rendered. Mental health services are highly vulnerable to this analysis, which could result in arguments in favor of
1097
public and the private sector by coordinating them and by ensuring adequate funding proportional to the burden assumed. Education. Eddy (43) stated that “the solution is not to remove the de-
Conclusions and strategy for the future A realistic and informed analysis of the current health cane crisis has made the debate on diagnosis-related groups (DRGs), Medicaid reimbunsement, managed care shortcomings, and other points of contention among mental health professionals seem somewhat trivial (2). At stake is survival of mental health services as a legitimate item in any reform effort. First, the mental health field must not rely on a sweeping reform in which we will be able to argue the case for mental health services. Reform is likely to be stalled or to be slowly incremental until the late 1990s. Second, the case for mental health services as part ofa minimum benefit package is pressing and, so far, madequately presented. For example, the offset studies, so often used to justify the cost-effectiveness of mental health services, must be reviewed and presented carefully. Overstating the case will hurt an already tenuous credibility. Careful analysis of the best offset studies available reveals that the issue is complex and cannot be presented simplistically (44). The case for the value of mental health services must continue to be vigorously researched and must include cost in outcome studies. Third, the behavior of the public must be taken into consideration in any attempt to properly influence the fate of mental health services in the reform arena. The wish for cure, the fascination with high-tech treatments, and the misconception and
ignorance about mental illness and treatment constitute a formidable combination. Informing the public on the consequences of ignorant choices must be high on the agenda. Fourth, our behavior as mental health clinicians must be reconsidcred. We must learn the fundamentals behind clinical decision making and their relation to practice parameters. Small-area analysis and outcome studies must be encouraged and supported. Cost must be an integral part of our daily decisions, which goes beyond merely asking the price ofa medication or a laboratory test. Patients must share in the decision making to enhance effectiveness and efficiency. Fifth, the importance of managed care must be understood. Few reform proposals leave it out. It has become the principal instrument to change consumer and provider behaviors and to contain costs. The debate for mental health clinicians and administratons should center on what type of managed care will achieve the stated goals. Simply decrying the current abuses will not prevent its application, however inadequate. Sixth, the public and private system must be integrated in a continuum, and short-sighted cost shifting must be avoided. The public-private dichotomy is not a reality in national health care reform, which considcns national expenditures, not just private versus public. Seventh, access and quality will not be achieved unless the current shortcomings are identified and dealt with. Inaccessibility and mappropniateness of mental health services for many rural and inner-city areas severely limit attempts to providc universal coverage. Making reimbursement available for services that cannot be obtained does not resolve the issue ofaccess to care. Eighth, prevention must be addressed vigorously in mental health. Secondary and tertiary prevention can target the small percentage of patients that account for the majority of expenditures. Substantial savings can be achieved if mental health clinicians and researchers address this issue more attentively. In conclusion, beyond the nation-
1098
November
Hospital
classifying mental health services as optional. Practice guidelines must be approached forcefully by mental health services ifinclusion in a minimum benefit package is to be achieved. Clinical decision making. The use of outcome studies is at the core of practice parameters (4 1 ). Clinical decision making must be examined and understood in this context so as to effectively develop practice guidelines (42). Two steps can be identified in clinical decisions. First, a review and analysis of the evidence is conducted, including variability in practices and availability of outcome studies. Second, consideration is given to more subjective issues such as cost and preference. Patients must be intimately involved in the process, especially in the second step. In mental health, the vulnerability in the clinical decision-making area is greater than in the nest of medicine. In part, the vulnerability is due
to the
clinical cal areas On the ceived mental actual labels
substantial
variation
in
practice between geographiand between practitioners. other hand, there is also a perlack of standardization in health that goes beyond the practices and that unfairly
psychiatric
treatment
and
out-
comes as difficult to predict. Public-private interface. Curnently, and especially with the advent of managed care, the private insurance sector tends to define its responsibility in the mental health area as limited to acute care. Acute cane is mostly defined as single episodes with clearly demarcated boundaries ofduration. Chronic illness, loosely defined, is often excluded, especially in severe illnesses such as schizophrenia or bipolar disorder. The task of treating severe and prolonged illness is shifted to the public sector, which is most often overburdened and underfunded. Assuming that national health insurance is not in the immediate future, the solution lies in balancing
the
responsibilities
of
the
cision-making power from physicians, but to improve the capacity of physicians to make better decisions. To achieve this solution, we must give physicians the information they need; we must institutionalize the skills to use that information; and we must build processes that support, not dictate, decisions. In mental health, the same philosophy should apply to all clinicians involved in decision making, not just psychiatrists. Future clinicians must be taught to operate in a cost-conscious society that also demands reliability, efficiency, and quality. “
1992
VoL 43
No.
11
and Community
Psychiatry
insurance.JAMA
al debate and the specific reform proposals, mental health administrators and clinicians need to understand the seriousness of the crisis, the threat posed to mental health services, and the forces that will prevent significant reforms. Establishing a strategic plan for the survival and the significant role of mental health services is still possible and a pressing necessity.
15.
27,
17.
Cost
18.
Mental
health
services
insuranceplan. Psychiatry
under
21
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JW: Reforming seven European nations. 10 (3):7-21, 1991 Ikegami
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low
cost through regulated fees. Health fairs 11(2):87-109, 1991
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Holoweiko
health
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care reform: what
Hawaii have to teach? Medical nomics 69 (3):158-174, 1992 JB, Crichlow
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DB: Managed care: a means psychiatric treatment. HosCommunity Psychiatry 41:
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MM: dollar.
its health care Afl#{224}irs 7(1):46.-60, 1988
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Managed and reality
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Community 1990
RA:
mental health in the 1990s. Psychiatry 41:
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Caseunin-
patients in the Boston area. JAMA 265:374-
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al: Taking the public’s pulse on health system reform. Health Affairs 11(2): 125-133, 1992 12. ImmerwahrJ: Faulty Diagnosis: Public
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Eisenberg JM: Understanding Vanstions in Physicians’ Practice Patterns: Doctors’ Decisions and the Cost of Mcdical Cane. Ann Arbor, Mich, Health Ad-
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Reviewers
Needed
Hospital and Community Psychiatry seeks expert reviewers in the areas of quality assurance, patient elopements, psychopharmacology, consultation with police, and dual diagnosis ofmcntal illness and mental retandation. Prospective reviewers should be familiar with the literature in their areas of expertise and be familiar with H&CP’s editorial focus and content. Send curriculum vitae with areas ofinterest toJohn A. Talbott, M.D., Editor, H&CP, American Psychiatric Association, 1400 K Street, N.W., Washington,
D.C.
20005.
1099
Santiago,
M.D.
in the second part of a two-part paper, the three major proposals for U.S. health care reform-the government-sponsored model, the em-
ployment-based
model,
and
the
market reform model-are reviewed. Barriers to their success indude the currect economic crisis, the lack of a ckar consensus, and the high costs oftheproposals. Most proposals limit the extent ofpsycbiatric coverage; some exclude such coverage from minimum benefit packages, an area ofconcernfor clinicians. The author concludes that any substantial health care reform is unlikely in the near future. A thoughtful, realistic, andyet vigorous strategic plan is needed now to forestall the possible exclusion of significant mental health coverage. The basic ekments of such a plan are reviewed. The U.S. health care crisis has reached considerable proportions. The system is costly, fragmented, and a source of worry for most Americans (1). The debate on reform is ubiquitous in social, political, and medical circles. Reform proposals are confusing and difficult to assess, but they have similar intents: universal health care coverage, cost control, and preservation of quality care. Despite several innovative reform proposals, the equation of cost, access, and quality continues to elude satisfactory solution. Undesirable choices are inevitable.
Dr. Santiago is professor chiatry at the University
zona North
College Campbell
of psyof An-
of Medicine, 1501 Avenue, Tucson,
Arizona
85724.
Hospital
and Community
Psychiatry
Services
For mental health services, these choices could pose a serious threat (2). Consumers may be least likely to notice a severe reduction in psychiatnc benefits to satisfy cost controls as long as other essential medical services are maintained. To properly prepare for the future, mental health professionals must understand what is at stake. They must master the concepts that underlie the current reform proposals, understand the implications for psychiatry, and decide which course of action will preserve, as much as possible, what is essential to psychiatric patients. Current reform proposals Government-sponsored (singlepayer) model. Under the government-sponsoned model everyone is equally covered. Benefits are mandated and usually include liberal mental health benefits (3). Medicare and Medicaid are replaced by the universal public plan. Long-term care is usually included. Copayments, deductibles, and caps on personal expenses may apply in some cases. Based on the experience of other countries with national health insurance (4-6), cost containment is achieved by setting a national health expenditure cap; negotiating hospital and physician payment rates, for example, using Medicare reimbursement rules; and streamlining administrative costs. Funds would come from income, excise, and payroll taxes. Substantial new financing would be required. Employer-based (“pay-or-play”) reform. Under the market reform model, employer-based insurance is retained for large- and medium-sized employers. Businesses have an option to buy insurance for their cmployees or pay a percentage of employces’ salaries into a pool to coven
November
1992
Vol.
43
No.
11
employees in a government-operated insurance program, such as Mcdicare. Employees of very small companics and uninsured persons would receive coverage through the same government-run risk pools. Coverage is universal in most pay-or-play plans. Benefits are mandated and may include several levels of mental health services. Long-term care is usually not part of these reform proposals. Financing is achieved mainly through payroll taxes and Medicare taxes. The cost to employees, employens, and individuals would be substantial. Cost containment would be achieved through development of uniform claims forms and processing procedures, managed cane, expenditune targets for national health care, and Medicare payments. Hawaii has developed and expanded the employen-based reform model for four years with interesting results (7,8). Massachusetts has had a difficult time with this experiment in recent years (9). Market reform. There are two major components of the market reform approach. First, a reform of the health insurance market is undertaken to address the current disincentives and contradictions in coyerage. Employer-based insurance is thereby made more accessible and affordable. Second, the current publicly funded system ofcare is expanded and strengthened to cover uninsured individuals and families. Coverage is increased but may not be universal. A basic benefit package is mandated that may include limited mental health benefits. Small companies join together as a single purchaser of health care to develop purchasing power and decrease costs. Under this plan, the tax code is
1095
reformed to involve individuals in the cost of health care. The amount ofemployer-pnovided health benefits exempted from income tax is limited. In addition, a possible option is to give individuals a refundable tax credit to purchase health cane coverage from an array of choices. Mcdicare and Medicaid remain as they are or are replaced by a system of vouchers. Tax credits and vouchers force the consumer to be selective in the purchase of services and lead to increased competition in the provision of services. Managed competition and integration of systems of care become fundamental components ofmarket reform (10). Barriers to successful reform Major difficulties stand in the way of successful implementation of each of the three main reform scenarios. First and foremost, in the current economic crisis, national public policy on health care makes access and quality victims of a polarized policy on cost. As a result, acceptability of the remedies will be greatly diminished. Second, no clear public consensus on health cane reform exists. A poll taken injanuary and February 1992 revealed that public opinion was equally divided among single-payer, pay-or-play, or market reform options ( 1 1 ). There is significant disagreement between the public and policymakers that makes consensus difficult to reach. The public perceives the problem of overall costs as relatively minor and focuses instead on out-of-pocket expenses (12). Furthermore, the public overlooks the complex causes of increasing costs, reducing them to the greed of the parties involved. Finally, the public perceives the uninsured as being the poor and elderly populations rather than impoverished workers and their dependents (12). A third barrier to reform is that despite some optimistic predictions (13), the costs of universal coverage are difficult to estimate and could, potentially, run into the hundreds of millions of dollars. Fourth, Americans show a significant distrust of government, making a federalor state-operated
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system difficult to implement. Fifth, small businesses not only fear increased costs attributable to health care coverage, but also do not seem to be interested in providing health insurance to their workers (14). In addition, policymakers are reluctant to make coverage mandatory (15,16). The result could be a massive and costly shift toward public-sector coyerage. Sixth, a competitive market reform requires a level of consumer sophistication that is lacking. Implications
for
mental health services Most proposals contain clauses limiting the extent of psychiatric coverage. Even though many present a “minimum psychiatric benefit package,” in reality they aim to set a limit on coverage, as is already the case in health maintenance organizations. Usually included are 45 days of inpatient cane, 25 outpatient visits, and 20 to 50 percent copayments. Few other specialties are subjected to such specific benefit limitations and descriptions (17,18). Thirty states and the District of Columbia have mandated benefits for the treatment ofmental illness. Seventeen of these states require inpatient and outpatient treatment, and 1 3 simply require that insurers offer coverage (19). The employerbased and market reform proposals would threaten mandated coverage for mental illness in these states. Furthermore, several states have recently attempted to develop “strippeddown” benefit packages for employens; these packages would preempt existing mandated benefits. Twenty-five states have already enacted basic benefit plans, and other states arc contemplating such bills (20). Seven ofthe 25 states with basic benefit packages require a minimum level of psychiatric coverage. So far, the practical results are modest. Small employers are less than eager to purchase health benefit plans for their employees even if they are penmitted to buy “bare-bones” packages (14).
Basic benefit packages For the preservation ofmental services
health
in reformation
efforts,
therefore
important
to understand
November
1992
VoL 43
it is
No.
11
how benefit packages are created. Usually, the concept of minimum health care needs leads to the categonization of health services as essential, desirable, and optional. Essential health services are thus descnibed as medically necessary. The addition of desirable benefits depends on resources. Optional services do not meet the criteria for inclusion in a basic benefit package. The basic benefit package purports to guarantee everyone a minimum amount of medical services. The problem lies in the definition of what is essential medical care and what can be considered as superfluous, luxurious, or simply an option (21). Consensus may lead to pruning out coverage of mental health or other services because ofsheer ignorance or calculated utilitarianism. The notion of medical necessity as a basis for reimbursement, and as a justification for inclusion in a basic benefit package, is elusive and has no scientific basis. It is a policyand consensus-driven concept (22). Managed care Most reform proposals rely on managed care or its variations to achieve cost containment without loss of quality. Recent surveys show that managed cane is increasingly popular with employers (23). The public is growing accustomed to some form of intervention that controls their health care demands and limits costs (1). Whether the techniques used so far in managed care, including those for managing mental health services, can yield the desired results is a subject ofdcbate (24-26). Nevertheless, because the continued rise in mental health services costs, a majority of payers are willing and eager to incorporate managed care into mental health services (27,28). Equating utilization management, the most common form of cost control, with managed care is an important source of confusion. Further study will be needed to demonstrate the effectiveness of managed care in mental health (29). Rationing Managed cane and other methods of controlling use of health and mental health services conjure up the threat
Hospital
and
Community
Psychiatry
ofrationing. Since cost control is the bottom line for many policymakens, rationing may seem the only method available, despite aversion to it in the U.S.(25). Rationing is seen by many as unacceptable and a threat to be avoided at all costs. The reality is that we presently ration health care and mental health care in the U.S., even though we do not readily acknowledge it. By pricing, we make certain goods unavailable to many people and some goods available to a few privileged ones. In the United States health care is not a public good but rather a market commodity. Uninsuned patients, especially children, suffer the consequences of price rationing (30,31). What has been unacceptable in the U.S. so far is rationing that makes a medical good inaccessible regardless of the ability to purchase it. And yet other goods, such as seat belts in school buses, arc not available at any price by societal consensus. The debate in health care, as well as in mental health care, is not whether rationing is acceptable or even exists, but how to ration and which form ofrationing is tolerable. The Oregon Medicaid demonstration project offers a good cxample ofthe difficulties in introducing rationing as a public policy (32). The experiment can be lauded for tackling the issue of rationing as a means to ensure universal coverage for the poor while controlling costs. It can be criticized because those affected by the plan are those least likely to participate in the process used to arrive at consensus. To significantly modify a state Medicaid program, a waiver is required from the U.S. secretary of health and human services. The federal government recently denied the required Medicaid waiver to Oregon because it felt that the Americans With Disabilities Act was violated when the consensus building included quality-of-life rankings of people with certain medical conditions. Finally, the Oregon experiment demonstrates the risk of underestimating the vulnerability of mental health services in the reform arena. Initially, the efforts of mental health advocates centered on preventing
harm to psychiatric patients; they thus requested that mental health services be excluded from the initial Oregon Health Services Commission deliberations. It quickly became clean that this approach could cxdude mental health services from any basic benefit package. Only dedicated and diligent efforts by interested parties restored the mental health benefits, although with a oneyear delay in implementation (33).
Hospital
November
and Community
Psychiatry
Predicting the future One ofthe most important questions in evaluating reform efforts is whethen all the variables that determine outcome have been considered. For example, higher investments of resources do not automatically translate into guaranteed access to care or improved quality of services. Reinhardt (34) and others have argued that after a point on the cost benefit curve, additional resources and mcdical interventions add little value to the quality of care. The access, quality, and cost equation may therefore not be entirely addressed by simply choosing from the current reform models and increasing the resources available. Past cxpeniences and current practice seem to indicate that additional factors must be considered to attempt to provide universal coverage with a benefit package that includes psychiatnic services, while maintaining quality care at an affordable cost. Consumer behavior. Demand for health care services in the U.S. is antithetical to cost controls. Most patients are shielded from cost considerations by insurance coverage. The incentive is for patients to consume health cane services to avoid death, relieve pain, and recover mobility. Furthermore, the demand is for cure and avoidance of rationing. Inefficiency is the price for this approach. In the face of pressure to limit costs, purchasers of insurance coverage usually underestimate the need for mental health services. A combination ofstigma, denial, and misinformation about the risks of mental illness leads to undercoverage. Methods used to increase consumers’ sophistication about mental health needs, risks, and services have been
1992
VoL 43
No.
11
mostly ineffective. Demand must be reviewed as a national policy (35). Services that simply seek unobtamable cures must be reconsidered. As of 1980, 70 percent ofall health care outlays were consumed by 10 percent ofthe population, and usually in the last two years oflife (36). Increased use of mental health services has been driven by the availability of services and the extent of available coverage. Cost containment efforts that have restricted mental health services have not been met by public outcry. Equitable coverage of mental health services will require, paradoxically, increasing the demand for mental health services among punchasers of health insurance. Provider behavior. Whether in medicine in general or mental health in particular, the idea that professionals can be trusted by patients because of their greaten knowledge to act solely on behalf of the patient must be reviewed. The provider has a triple role: as the patient’s agent, as a practitioner with his on her own goals to fulfill, and as a guarantor of social good (37). Balancing the inherent conflicts in these roles is a necessity.
Practice parameters. Practice guidelines have generated a substantial amount ofdebate, fear, and rejection in medicine in general and in mental health in particulan(38). The first set ofpnactice guidelines in psychiatny (covering eating disorders) was recently approved by the board ofthe American Psychiatric Association. The controversy has not abated and is, in pant, based on misunderstanding and on a genuine concern oven the clinician’s ability to decide and be flexible. A powerful argument for the creation of practice parameters is the variability of clinical decision-making in medicine, and especially in psychiatry. Moreover, most medical and psychiatric procedures have not passed rigorously controlled evaluations (39). As a result, Brook and Lohr (40) estimated that at least 30 percent of health care services in the U.S. are unnecessarily rendered. Mental health services are highly vulnerable to this analysis, which could result in arguments in favor of
1097
public and the private sector by coordinating them and by ensuring adequate funding proportional to the burden assumed. Education. Eddy (43) stated that “the solution is not to remove the de-
Conclusions and strategy for the future A realistic and informed analysis of the current health cane crisis has made the debate on diagnosis-related groups (DRGs), Medicaid reimbunsement, managed care shortcomings, and other points of contention among mental health professionals seem somewhat trivial (2). At stake is survival of mental health services as a legitimate item in any reform effort. First, the mental health field must not rely on a sweeping reform in which we will be able to argue the case for mental health services. Reform is likely to be stalled or to be slowly incremental until the late 1990s. Second, the case for mental health services as part ofa minimum benefit package is pressing and, so far, madequately presented. For example, the offset studies, so often used to justify the cost-effectiveness of mental health services, must be reviewed and presented carefully. Overstating the case will hurt an already tenuous credibility. Careful analysis of the best offset studies available reveals that the issue is complex and cannot be presented simplistically (44). The case for the value of mental health services must continue to be vigorously researched and must include cost in outcome studies. Third, the behavior of the public must be taken into consideration in any attempt to properly influence the fate of mental health services in the reform arena. The wish for cure, the fascination with high-tech treatments, and the misconception and
ignorance about mental illness and treatment constitute a formidable combination. Informing the public on the consequences of ignorant choices must be high on the agenda. Fourth, our behavior as mental health clinicians must be reconsidcred. We must learn the fundamentals behind clinical decision making and their relation to practice parameters. Small-area analysis and outcome studies must be encouraged and supported. Cost must be an integral part of our daily decisions, which goes beyond merely asking the price ofa medication or a laboratory test. Patients must share in the decision making to enhance effectiveness and efficiency. Fifth, the importance of managed care must be understood. Few reform proposals leave it out. It has become the principal instrument to change consumer and provider behaviors and to contain costs. The debate for mental health clinicians and administratons should center on what type of managed care will achieve the stated goals. Simply decrying the current abuses will not prevent its application, however inadequate. Sixth, the public and private system must be integrated in a continuum, and short-sighted cost shifting must be avoided. The public-private dichotomy is not a reality in national health care reform, which considcns national expenditures, not just private versus public. Seventh, access and quality will not be achieved unless the current shortcomings are identified and dealt with. Inaccessibility and mappropniateness of mental health services for many rural and inner-city areas severely limit attempts to providc universal coverage. Making reimbursement available for services that cannot be obtained does not resolve the issue ofaccess to care. Eighth, prevention must be addressed vigorously in mental health. Secondary and tertiary prevention can target the small percentage of patients that account for the majority of expenditures. Substantial savings can be achieved if mental health clinicians and researchers address this issue more attentively. In conclusion, beyond the nation-
1098
November
Hospital
classifying mental health services as optional. Practice guidelines must be approached forcefully by mental health services ifinclusion in a minimum benefit package is to be achieved. Clinical decision making. The use of outcome studies is at the core of practice parameters (4 1 ). Clinical decision making must be examined and understood in this context so as to effectively develop practice guidelines (42). Two steps can be identified in clinical decisions. First, a review and analysis of the evidence is conducted, including variability in practices and availability of outcome studies. Second, consideration is given to more subjective issues such as cost and preference. Patients must be intimately involved in the process, especially in the second step. In mental health, the vulnerability in the clinical decision-making area is greater than in the nest of medicine. In part, the vulnerability is due
to the
clinical cal areas On the ceived mental actual labels
substantial
variation
in
practice between geographiand between practitioners. other hand, there is also a perlack of standardization in health that goes beyond the practices and that unfairly
psychiatric
treatment
and
out-
comes as difficult to predict. Public-private interface. Curnently, and especially with the advent of managed care, the private insurance sector tends to define its responsibility in the mental health area as limited to acute care. Acute cane is mostly defined as single episodes with clearly demarcated boundaries ofduration. Chronic illness, loosely defined, is often excluded, especially in severe illnesses such as schizophrenia or bipolar disorder. The task of treating severe and prolonged illness is shifted to the public sector, which is most often overburdened and underfunded. Assuming that national health insurance is not in the immediate future, the solution lies in balancing
the
responsibilities
of
the
cision-making power from physicians, but to improve the capacity of physicians to make better decisions. To achieve this solution, we must give physicians the information they need; we must institutionalize the skills to use that information; and we must build processes that support, not dictate, decisions. In mental health, the same philosophy should apply to all clinicians involved in decision making, not just psychiatrists. Future clinicians must be taught to operate in a cost-conscious society that also demands reliability, efficiency, and quality. “
1992
VoL 43
No.
11
and Community
Psychiatry
insurance.JAMA
al debate and the specific reform proposals, mental health administrators and clinicians need to understand the seriousness of the crisis, the threat posed to mental health services, and the forces that will prevent significant reforms. Establishing a strategic plan for the survival and the significant role of mental health services is still possible and a pressing necessity.
15.
27,
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Reviewers
Needed
Hospital and Community Psychiatry seeks expert reviewers in the areas of quality assurance, patient elopements, psychopharmacology, consultation with police, and dual diagnosis ofmcntal illness and mental retandation. Prospective reviewers should be familiar with the literature in their areas of expertise and be familiar with H&CP’s editorial focus and content. Send curriculum vitae with areas ofinterest toJohn A. Talbott, M.D., Editor, H&CP, American Psychiatric Association, 1400 K Street, N.W., Washington,
D.C.
20005.
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