A tumultuous 10 years

Russ Newman

The past decade has brought about nothing less than an upheaval in health care. Not the least of the fundamental changes has been a shift from a patient-focused system to one that is cost-focused and market-driven.

Much of the growing impact of this changing system on health-care professionals and consumers originated as third-party payer demands to constrain rapidly rising health-care costs in the mid-1980s. Initial efforts, particularly by employers, focused on changing health-plan design to lower spending on mental health by increasing coinsurance while limiting covered outpatient sessions and inpatient stays. Health-plan sponsors increasingly transferred responsibility for administering benefits to the managed-care industry, which arose in response to demands for drastic health-care cost containment. According to the 1997­98 edition of Managed Care Facts, Trends and Data, while managed-care plans covered only 29 percent of employees with employer-sponsored health coverage in 1988, that percentage grew to 81 percent by 1997.

In addition to widespread proliferation among the commercially insured population, managed care has gained a substantial presence in Medicaid and other public sector health programs. The managed-care industry's methods have fundamentally altered the delivery of and payment for patient care, and the consequences for patients and providers alike have been enormous.

As the shift to managed care neared completion in the late 1990s, increased competition among health plans helped fuel consolidation in the health-care marketplace. Through mergers and buy-outs, larger corporations swallowed up smaller ones. Of the 142 million lives covered under managed behavioral health plans by 1998, 99 million, or 55 percent, were covered by the three largest companies (Magellan Health Services, FHC Health Systems and United Behavioral Health).

The introduction of institutional and corporate investing in health care further heightened the adverse effect of the changing healthcare marketplace on psychologists and psychological services. Whether public or private, such investment has greatly influenced managed-health plans and all types of corporate entities to focus on maximizing investor profit. These trends have spawned health-care marketplace competition based on cost and return on investment at the expense of quality care.

Clearly, the growing use of managed care has had a disproportionately negative impact on consumer access to quality behavioral health-care services. According to the National Alliance for the Mentally Ill, between 1988 and 1997, behavioral health-care expenses were slashed 670 percent more than general health-care benefit costs. As a percentage of the total health-care benefit, behavioral health dropped 50 percent­from 6.2 percent in 1988 to 3.1 percent in 1997. Meanwhile, the widespread use of narrowly defined "medical necessity" criteria has made it more difficult for consumers to obtain appropriate treatment.

The cost-driven decision-making embodied in the current health-care system has had far-reaching consequences for practitioners as well. Treatment autonomy has been greatly constrained. Access to patients has suffered as managed-care organizations have excluded psychologists from provider panels and steered health plan participants to lesser-trained, lower-cost providers. And third-party fees paid to psychologists for their professional services have been scaled back.

An additional consequence of the cost-driven health-care system stems from managed care's reliance on short-term treatment modalities and psychopharmacological interventions. This approach has increased the incidence and risk of premature discharge and undertreatment of patients, thereby increasing the likelihood of employee disability.

In fact, there is growing evidence that treatment costs have been shifted from health to disability plans. According to UNUM Corporation, the world's largest disability carrier, mental and nervous claims alone have doubled in the past eight years. Health-care purchasers are beginning to implement disability-management programs that focus on providing appropriate care at the proper time to alleviate symptoms and help employees address underlying psychosocial problems and improve their functioning. Practicing psychologists are beginning to shift their focus toward integrating psychological services with physical health services in light of such a marketplace shift toward disability management.

Yet another result of the changing health-care marketplace is the emergence of disease management, which theoretically promotes the use of the full continuum of care, thereby yielding the greatest likelihood of a favorable, cost-effective outcome for a specific disorder. Another area ripe for the application of mind-body research, disease management is developing as a focus of
psychologists' integration of psychological services into the previously segmented physical health domain.



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