Blue Cross and Blue Shield (BCBS) of Minnesota says it will increase
payment for psychiatric services by 20 percent a year over the next three
years in an attempt to improve access to mental health services in the
The move has been hailed by psychiatrists, the Minnesota Psychiatric
Society (MPS), and APA leaders as a welcome first step toward addressing what
all agree is a complex problem of access in Minnesota and across the
"Increasing compensation for psychiatrists is overdue and is a
critical piece in solving the access puzzle, and [the move by Minnesota BCBS]
appropriately recognizes the role of psychiatrists as key physician
specialists," said Irvin (Sam) Muszynski, J.D., director of APA's Office
of Healthcare Systems and Financing.
Muszynski said it did not appear that the move represents a national trend,
either among other state BCBS plans or insurance companies generally. A
spokesperson with the national headquarters of BCBS said the organization had
no information on whether other state plans—which operate independently
of each other—were considering such an increase.
The rate increase in Minnesota applies to all psychiatry specialties,
including child and adolescent psychiatry. However, it applies only to
clinicians in individual and small group practices; the state's large health
system networks—such as the Mayo Clinic and Park
Nicolett—negotiate contracts separately and typically receive better
Matthew Eastwood, Ph.D., director of behavioral health for BCBS of
Minnesota, told Psychiatric News that psychiatrists will be able to
bill at the higher rate for consultations with primary care physicians.
"We know that a lot of people with mental illness are being seen by
primary care physicians," he said. "There is a consultative role
for psychiatrists to play in this, and we are trying to build in incentives to
make it a viable option for psychiatrists.
"We know that in and of itself this will not solve the access
problem, but we think it is a step in the right direction. There are a number
of issues that need to be addressed regarding the entire mental health system,
but we are hoping that by reimbursing psychiatrists better for their role as
specialists we can attract more psychiatrists to the state and attract medical
students to the practice of psychiatry."
MPS officials said that the move represents the fruit of years of efforts
by groups in Minnesota to address access problems in the state.
The announcement of an increase in reimbursement by BCBS comes a month
after Minnesota Gov. Tim Pawlenty announced a mental health
initiative—including $109 million in new and redirected government
investments—to transform the way the state provides mental health
services and improve mental health care and treatment for children and
"MPS thanks BCBS-Minnesota for this increase in psychiatric
reimbursement, a positive first step in improving access to psychiatrists and
to allowing psychiatrists to take more time with patients when
necessary," the organization said in a statement following the
announcement. "More definitive improvements will only come if more
payers follow their lead and if we work together to define what high-quality,
efficient psychiatric care should look like."
The MPS statement also noted that Medica, another Minnesota insurer, has
increased child and adolescent psychiatry reimbursement by 30 percent.
Eric Larson, M.D., president of MPS, said he hopes that other insurers
"This is a major advance," he said. "It gives BCBS the
moral high ground for recognizing that money is a factor in the access
problem. We hope their competitors will follow suit. If only one insurance
company does it, this new level of reimbursement is not going to change
Larson echoed many others in saying that better reimbursement is far from
the only thing necessary to fix problems of access in Minnesota. But he
especially welcomed the increased reimbursement for the effect he said it
could have on psychiatrists' ability to spend more time with patients. Many
patients are being seen for 15-minute medication checks and nothing more, he
"Money has driven the decision to do that," Larson said."
By being better paid, we should have the flexibility to spend more time
At least one psychiatrist was much more circumspect in predicting the
effect an increase in reimbursement would have on access.
MPS President-elect Roger Kathol, M.D., said that BCBS largely serves
patients in the private sector, but the real crisis of access is in the public
sector. He said he doubted that psychiatrists in private practice, some of
whom do not see publicly insured patients, and some of whom serve only
self-paying patients, were likely to open their practices to public-pay
patients because of the move by BCBS.
Kathol is not in private practice but is founder and president of Cartesian
Solutions, a health care consulting firm in Burnsville, Minn.
"I'm not saying this isn't a good thing," Kathol said."
At least it improves the equity of reimbursement, but I don't think
just paying psychiatrists more is going to improve the needs of the