Psychiatrists Outside of Managed Care Value Autonomy in Treatment Decisions

Psychiatrist Robert Emmons, M.D., is just saying “No.” To managed care, that is. The Burlington, Vt., psychiatrist is one of a surprising number of physicians around the country who are finding that they can survive outside the enormous system of third-party reimbursement and insurance company oversight by which Americans receive health care.

It is a choice that is not without cost: it means foregoing the security of a guaranteed patient load that comes from contracting through health plans with private employers and state and local government agencies. But it reaps in return for Emmons the right to practice the way he wants, without the interference of a third party.

He does not accept payment from private managed care companies and does not participate in provider panels. He benefits, in a way, from the growing number of health plans that provide reimbursement for out-of-network physicians, but even in those cases he deals only with the patient, not the health plan. He also does not accept payment from Medicare or Medicaid.

“The way I describe it, I have a relationship with my patient, who pays me at the time of the service,” Emmons said. “If the patient has health insurance, that is the property of the patient, and he or she can be reimbursed. But if I have the serious responsibility of caring for a person, I want to have complete clinical authority to make decisions unhindered by a third party.”

Independent Practice, Not Opting Out

According to the 2002 National Survey of Psychiatric Patients conducted by the American Psychiatric Institute for Research and Education’s (APIRE) Practice Research Network (PRN), a surprising 52 percent of psychiatrists are not on any managed care panels. Approximately 1,200 psychiatrists, randomly drawn from the American Medical Association master file, responded to the survey.

The PRN is expected to have more detailed information about patient access to psychiatric care across various health plans.

“Psychiatrists in managed care work with low fees, administrative hassles, and late claim payments,” said Lawrence Lurie, M.D., chair of APA’s Committee on Managed Care. “The ones who opt out say it takes up too much of their time for too little pay, and they want to opt out even if it means fewer patients. They say they can control their own life and can provide better care.”

Psychiatrists who spoke with Psychiatric News said their choice is in part a protest against a system of financing that they believe is bound to be detrimental to patient care. But it is also a more basic matter of exercising the physician’s autonomy to use a medical license to practice as he or she pleases.

“Physicians tend to be a fairly independent lot, and they don’t like to feel controlled,” said Lisa Mellman, M.D., chair of APA’s Committee on Psychotherapy by Psychiatrists, who has also chosen to opt out.

She said that many senior psychiatrists in New York City have done so and that the phenomenon is liable to be widespread in areas where there is high penetration of managed care and where the level of stigma surrounding mental health care is not so great.

Emmons said that even the phrase “opting out”—implying that one is quitting the only game in town—cedes to managed care the right to define the rules of the game; he prefers the term “independent practice.”

He confirmed locally what the PRN survey appears to show nationally. “By my count, we have 30 psychiatrists in private practice in Burlington, and I know of 10 who are independent.”

No Longer the ‘HMO State’?

That independent practice is by no means an isolated phenomenon, nor one that is confined to psychiatrists, is underscored by data from a December 2002 report by the Center for the Health Professions at the University of California, San Francisco, which found that only 58 percent of all physicians in California were accepting new patients with HMO coverage.

The figures are noteworthy in a state that has been called the “bellweather” of managed care. The report also found that the percentage of specialists with HMO patients fell from 77 percent to 62 percent between 1998 and 2001, and that the rate of physician participation in HMO plans is approaching the historically low rate of physician participation in MediCal, the state’s insurance plan for low-income Californians.

William Callahan, M.D., a California psychiatrist in independent practice, said it was while in his residency working in a university system with many managed care contracts that he saw the interference in patient care those plans entailed.

“I wanted to do both therapy and medical management, but frequently could not because the managed care plan split the treatment,” said Callahan, who is a member of the Psychiatric News Editorial Advisory Board.

Lurie said the experience described by Callahan is typical of many psychiatry residents today, at least among those he has known in San Francisco. “A lot of the residents leaving training have felt so burnt,” he said. “They ran the inpatient service and were the ones who made the calls and were told that they couldn’t keep this patient for an extra day or that that patient had to be discharged because he or she wasn’t suicidal on the day they called. It really turned them off.”

Callahan likened the compromises and rationalizations a physician is forced to make to accommodate managed care to those that an abused party makes in acquiescence to an abusive relationship.

“I know countless physicians who are unhappy doing 10- and 15-minute med checks,” he said. “But they don’t see any other way to do it, because that’s the way the reimbursement is.”

But if opting out is not exactly an isolated phenomenon and is even in some areas of the country on the rise, it is nevertheless far from a trend. A November 2002 report by the Center for Health System Change found that more than nine of 10 physicians in 1997 and 2001 owned or were members of a medical practice that had at least one contract with a managed care plan (see chart).

Edward O’Neil, Ph.D., director of the Center for the Health Professions, which produced the report on California physicians, said that media attention to the increase in the number of physicians opting out of managed care obscured the more subtle and more important story from that report, which is the changing relationship between physicians and managed care organizations.

“While the number of physicians in California not taking payment from managed care increased, it wasn’t a wholesale movement by any stretch,” he told Psychiatric News. “These were single-digit adjustments.”

The real news, he said, is that physicians are feeling somewhat more empowered to take back control of their practices in a variety of ways. In some cases, it is taking the form of independent practice.

It is just as likely, however, that physicians are moving in the opposite direction, joining large integrated systems of care, independent of the way they are financed, to take advantage of the benefits of financial stability, technology, and access to other physicians. And, in California, they are leaving behind the independent practice associations, the loose network of office-based physicians that had been the primary mechanism by which doctors contracted with managed care.

At the same time, the Center for Health Professions report on California physicians found that health plans are moving away from strict capitation toward preferred provider organizations (PPOs) that allow for reimbursement of out-of-network physicians. Data from the CSHSC confirm the same trend nationally.

For this reason, O’Neil said the degree of a physician’s involvement with managed care becomes a matter of semantics: what many doctors think of as “managed care”—the strictly capitated HMO—is no longer the predominant model.

In contrast, PPOs can involve many features of managed care, including some that have been found objectionable by physicians. O’Neil said that 90 percent of Californians are covered by some kind of managed care.

For just that reason, opting out is not liable to become widespread any time soon. “I don’t see it as a trend,” said Callahan. “For one thing, it’s risky. When you sign a contract, you have a big business funneling you all kinds of patients. The physician doesn’t have to market himself, and there is a guaranteed patient flow. There’s a security to that.”

Emmons agreed that to “go it alone” can be anxiety producing, but he believes it can be done. He said he works 20 clinical hours and earns $75,000 a year. “That’s lower than many, but I’m working 20 hours with only five hours of administrative time,” he said.

He added, “I’ve never known a colleague who opted out who failed. But I have known some who practiced in managed care and left medicine altogether because they were demoralized.” ▪