Marketplace matters

By Russ Newman, PhD, JD
APA Executive Director for Practice

In recent months, the legal, legislative and public education components of the Practice Directorate?s agenda have been most visible, particularly when compared to the marketplace piece of our agenda. However, this should not be interpreted to mean that there are no activities under way in the marketplace area. Indeed, this area is one of the cornerstones of our efforts to confront problems created by the constantly changing health-care system. The Committee for the Advancement of Professional Practice, the Board of Professional Affairs and the Practice Directorate are engaged in numerous activities intended to influence directly the current healthcare marketplace and the market forces driving it.

To truly understand the target of these efforts, it is important to first understand what is meant by the directorate?s marketplace agenda. In the last decade, political and fiscal attempts to stem the rising costs of health care in this country have relied heavily, if not exclusively, on a market-driven solution. However, health care does not respond to market forces in the manner predicted by traditional economic theory about competition. Instead, the health-care industry produces competition mostly around cost issues and little, if any, competition for quality services. The result is'cheap' care rather than cost-effective care.

Despite the failure of market forces to produce cost-effective care and in spite of mounting efforts for an alternative system, market forces do exert a significant influence on health-care delivery unlike ever before. In the past, for example, a professional group that believed it had inadequate opportunity to serve patients could have legislation enacted mandating the profession?s ability to participate. Psychology itself benefited from the enactment of freedom-of-choice laws in more than 40 states in the 1970s and 1980s. These laws?which required psychologists to be reimbursed for psychotherapy services if an insurance company reimbursed psychotherapy by psychiatrists?in essence statutorily mandated the profession?s ability to participate in the health-care marketplace.

The current complex, market-driven health-care system has rendered such statutory solutions simplistic and obsolete. Legislation is helpful, but, to the extent that psychologists wish to participate in today?s health-care system, we need to demonstrate the value of our services and develop as much negotiating power as possible to leverage marketplace decision making. This is no easy task given some of the parties with whom we must negotiate. It does not mean, as some have misinterpreted the directorate?s message, that we should accede to the marketplace or to managed-care arrangements. Rather, we must utilize marketplace forces?along with legislation, legal remedies and public education?to enhance health services delivery.

Employer-purchasers of health care are powerful parties, along with health-care consumers, in the health-care marketplace. While we have made good progress in developing strong partnerships with consumers, we still have our work cut out for us with employer-purchasers. Our marketplace agenda revolves largely around this latter facet of partnership building. For example, we have developed the Business of Practice Network (BOPN), composed of state psychological association and APA division representative practitioners with significant business, employer and economic expertise, to orchestrate collaborative efforts with the business and employer communities.

As an extension of the BOPN?s work, we are finding evidence that managed care?s reliance on short-term treatment modalities, such as psychoactive medication, often results in termination of care before underlying psychological issues are adequately addressed. This, in turn, appears to be fueling a growing trend toward forcing under-treated employees into disability benefit programs. Treatment costs associated with the employer?s health plan, while seemingly decreasing, actually are being shifted to the disability benefit plan and to the indirect'hidden' costs of disability such as increased absenteeism and reduced employee productivity. According to UNUM Corporation, the world?s largest disability insurance carrier, mental health claims alone have doubled in the last eight years.

Demonstrating the effect psychological services can have on employer disability programs offers a potent way of using market forces to influence the marketplace. New projects in this area will add to our existing demonstration projects involving the integration of psychological services into the treatment of physical disorders such as breast cancer and cardiovascular disease.

Beginning next month, the Monitor Practice section will include a regular feature entitled'Marketplace Matters' focusing on significant marketplace trends and developments. Topics will include the integration of psychological care into disease management, psychological primary care, disability benefits management and niche practices. In each instance, we hope to use this feature to provide convincing evidence that the marketplace does indeed matter and that psychology can use it to the profession?s best advantage.