Thomas P. Kalman, MS, MD

Why do so many New York City psychiatrists refuse to join insurance provider panels, or resign from them in droves after a period of participation? There may be many possible explanations, but the essence is economics. The costs of living and working in this metropolis are so prohibitive that accepting the fee schedules of insurers (including Medicare) is virtually incompatible with survival in the Big Apple. And, this pattern is hardly limited to psychiatrists these days, as specialists of all varieties must deal with the disparities of reimbursement and the costs of practicing in this area.

For psychiatrists the calculation involves the essence of providing psychiatric treatment: 1 patient at a time for an agreed upon duration: usually 45 or 50 minutes, the traditional “analytic hour.” Even psychopharmacologists have a set interval (perhaps as little as 15 minutes, but often 20 or 30 minutes) that is dedicated to one patient. Since a practitioner’s time availability is finite, committing hours to lower fee patients (those with insurance) can be quite costly.

Insurance-paid fees are so out of kilter in New York that it is not unusual for a nonparticipating clinician to realize fees that are double (or more) those paid by insurers. And so, in a locale where large numbers of wealthy individuals reside and receive medical care, joining an insurance company’s panel of participating physicians, a survival necessity in much of the country, is dispensable to many New York psychiatrists. This does, of course, depend on the solvency of a practice such that one can give up the assured flow of referrals from the ranks of the insured looking for a participating doctor. And this is where Manhattan’s population density (even given the large numbers of psychiatrists) and affluence come into play-it is not about psychiatrists being mercenary, but simple Economics 101.

The tougher question is the corollary-why indeed do some (any) psychiatrists agree to accept insurance? And the answers are not so straightforward. Every practitioner’s circumstances are unique, but in my acquaintance with hundreds of fellow practitioners, a few themes emerge that describe those who choose to participate.
 

Doctors starting out in practice, either fresh out of residency or changing from one career to another (eg, full-time academic or researcher to full-time clinician) are frequent participants. Understandably this is a transition that is fraught with uncertainty, so the logic of accepting lower, assured fees in exchange for a flow of referrals is compelling. With time and the establishment of their practices, many in this group will resign from insurance panels and join the majority as nonparticipants.

Not all will drop out of insurance panels; indeed I know several practitioners who have established practices and still accept insurance from some of their patients. There are many explanations for this, including inertia, a love of clinical work, satisfaction with realized incomes, altruism, the desire to continue working with particular patients, or a fundamental belief in the fairness and integrity of the insurance system. Others who accept insurance have favorable personal financial circumstances that permit them to work with reduced fees.

I personally accepted insurance for 5 years during the mid-nineties, before deciding that my practice could sustain itself without this source of referrals and freeing myself from the attendant hassles (preauthorization, phone calls, and billing paperwork) that came with participation. Despite having formally resigned from the provider panels, I remain on their lists and so have to disappoint the weekly callers who contact me believing that I will accept their insurance.

The tragedy of it all is that there are not enough participating psychiatrists to accommodate all who would seek treatment if it were affordable. This is not a good situation-perhaps 1 out of 10 practitioners accepts insurance, but at least half of the New York patient population depends on insurance to afford sufficient treatment.

The imbalance is great but fixable: if fees paid by insurers were not so outlandishly out of kilter with prevailing private rates or with the skyrocketing costs of living in and practicing in New York City, many more practitioners would accept insurance. Their incomes would not be so compromised and thousands more could obtain sufficient, needed treatment. But where, an insurance executive might ask, should these funds for higher reimbursement come from? How about from dismantling or at least dramatically cutting the expensive, behemoth, oversight infrastructure that costs millions under the guise of containing costs? But don’t get me started.

Articles

There are not enough participating psychiatrists to accommodate all who would seek treatment if it were affordable. This is not a good situation.

Accept Insurance? I Wish I Could

By now, insured Americans are familiar with the routine “cost-saving” measures created and implemented by insurance companies. Examples include different copayment schedules and reimbursement rates depending on physician network status; designated contracted facilities; medication choices; significant surcharges for brand-name medications over generics; and pre-approval for a range of procedures (eg, colonoscopies and MRIs). Such intrusions into patient care have become so routine that they are now the normal experience for patients and physicians alike.

What is probably not known to most people, however, are other, routine oversight procedures that intrude on patient care, aggravate “providers,” and consume untold amounts of time-presumably in the service of controlling health care expenses. The following examples illustrate “cost-containment machinery” out of control.

A patient of mine requests a new prescription for her antidepressant, Venlafaxine, a popular, generic form of the brand-name drug Effexor. This medication is available in several strengths: 37.5 mg, 75 mg, and 150 mg. Over time, balancing effectiveness and side effects, my patient and I had arrived at an optimal dose for her of 112.5 mg per day, so I wrote a month’s prescription for 90, 37.5-mg tablets and thought no further of this routine matter-that is, until her pharmacy called to say that the patient’s insurance company had refused to authorize the prescription until they received a call from the physician.

As most doctors will recognize, such requests presage time-consuming ordeals: assuming one has the insurance information on file (insured I.D., carrier contact information) and doesn’t first have to place additional calls to the patient or pharmacy to get this, the call to the insurer predictably entails long delays, automated menu choices (which must be listened to lest one make a wrong selection and be sent to the wrong department, necessitating starting over), and, eventually, the opportunity to speak to an administrative screener, who may or may not be able to provide the reason for the requested call. If the caller is fortunate, the call is passed on to a pharmacy assistant, who vets the call for the pharmacist, explains the reason for the denial of coverage, and then connects the caller to the pharmacist who is the only one empowered to resolve the matter.

Each of these conversations includes asking the physician/caller to identify him/herself, confirming name, address, telephone number, and various physician credential numbers, as well as restating the entire premise of the call.

In this particular instance, the explanation for denial was the following: The patient’s plan would only cover a maximum of 60 pills of 1 dosage of a medication for a 30-day period. They insisted that I write 2 prescriptions-1 for 30 tablets of 75 mg and another for 30 tablets of 37.5 mg-in order to provide 112.5 mg in total!

As any health care professional knows, treatment compliance is always a major issue and facilitated by the simplicity of a treatment regimen. Using 2 prescriptions that involve different strength tablets when only 1 size pill could be provided constitutes poor care and only serves some contracted financial restriction. In this instance, I was able to convince the pharmacist to authorize 90 tablets of the 1 strength-but only for 1 year, at which time I would have to repeat the process and re-authorize the deviation from contracted coverage. The entire call, which I placed with my patient present, lasted 25 aggravating minutes and demonstrated for her the previously unrealized influence of her insurance plan on the care she receives.

Similar to the previous scenario, a pharmacy called me after being denied coverage for a patient’s monthly prescription of 30 antidepressant tablets. After the customary, time-consuming, repetitive screening process, the explanation for the denial was that, without a call from a physician documenting clinical need, the patient’s insurance only allowed her to receive 21 tablets in any 30-day period!

Pharmacologic treatment for depression requires daily antidepressant medication, not alternate days or 7-out-of 10-day dosing. Requiring physicians to plead on behalf of their patients to receive a daily allotment of medication is absurd. As in the first example, I was able to obtain an override of the patient’s nonsensical contractual limitation, but again this was a lengthy, unnecessary intrusion into a patient’s care. This individual, himself a business owner and the payer of the premiums, also overheard the entire conversation with the insurer and was aghast and horrified at the interference passed off as cost oversight.

One can only imagine what this massive bureaucratic machinery costs the insurance companies, and, by extension, the patients and the employers who pay premiums. Savings achieved through the hassling of physicians and the implementation of ridiculous limitations cannot be achieved without compromising the quality of care so provided-in the first instance, adherence to the policies would have threatened compliance or led to prescribing a different dose than the clinically optimal one. In the second scenario, adherence to policies would have meant inadequate treatment and exposing the patient to a significant risk of relapse.

Many physicians and institutions have dealt with these oversight problems by hiring dedicated staff to deal with these matters. Most solo practitioners, like me, cannot consider this alternative-but even if affordable, such a solution seems to legitimize the absurdity of the problem. If health care reform-not health care compromise-is to evolve, this bureaucratic insanity must be addressed. Perhaps greater transparency to patients and employers of exactly what they are purchasing with their insurance premiums might be a worthwhile first step.

 By now, insured Americans are familiar with the routine “cost-saving” measures created and implemented by insurance companies. What is probably not known to most people, however, are the routine oversight procedures that intrude on patient care, aggravate “providers,” and consume untold amounts of time.

Thomas P. Kalman, MS, MD

Articles

Accept Insurance? I Wish I Could

Insurance Practices: This Insanity Must Stop