Canary in the Coal Mine Fights Back: What Access to ‘Intermediate Levels of Care’ Says About Managed Care

In the early 20th century, coal miners carried caged canaries into mines to detect dangerous levels of coal gas. A dead canary was an early warning of danger in the mine. Today, in mental health and substance use (MH/SU) treatment, access to care criteria for treatment at so-called intermediate levels of care (intensive outpatient programs, or IOPs; partial hospital programs, or PHPs; and residential treatment centers, or RTCs) are canaries in the coal mine. Problems accessing these levels of care should alert us to a pervasive problem with managed care criteria that tend to view psychiatric treatment as focused on crisis stabilization rather than on recovery. In this instance, though, the canaries are not willing to die quietly.

Our training and experience as psychiatric clinicians ground us in knowledge of the appropriate interventions for MH/SU treatment, yet few of us use related terms like “medical necessity” and “generally accepted standards” in our day-to-day clinical work. Medical necessity arises when dealing with insurance companies or managed care entities claiming authority to define generally accepted standards for MH/SU treatment. Based on the frequency with which clinicians face denials of requests for treatment at a given intensity or level of care, insurance companies and managed care entities appear to define medical necessity differently from us. To understand what this means, we need to understand terms like “medical necessity,” “generally accepted standards,” and aspects of the Mental Health Parity and Addiction Equity Act (MHPAEA) of 2008.

Medical Necessity and Generally Accepted Standards

The 2014 MHPAEA Final Rules state that parity applies to access to intermediate levels of care for MH/SU disorders (IOPs, PHPs, and RTCs are specified), just as in medical and surgical treatment. Intermediate levels of care are recognized as part of the continuum of care available when “medically necessary.” The medical necessity of medical-surgical and MH/SU treatment depends on whether the treatment in question meets generally accepted standards.

There is no one source of generally accepted standards. Instead, they are a set of clinical practices based on (1) research evidence, (2) professional society perspectives (for example, APA clinical practice guidelines), (3) practice patterns, and (4) other potentially relevant sources, like the Medicare Manual, since it addresses treatment issues for large numbers of patients.

Although there is no formal list of such generally accepted standards, the knowledge and training we receive as clinicians enable us to identify treatments as being within or outside the boundaries of generally accepted standards. Bleeding for pneumonia and prefrontal lobotomy for schizophrenia are outside generally accepted standards, while antibiotics and neuroleptic medications are within generally accepted standards for these disorders.

It is understood that many patients with MH/SU disorders have complex comorbid presentations; early adversity or recent trauma and losses and their sequelae have an enduring impact on lifetime course of illness; a combination of medications and psychotherapy is often superior to either alone; many patients struggle with recurrent or chronic disorders; and our treatments, though effective, leave many patients without much benefit. Given these realities, generally accepted standards call for treating MH/SU disorders in an integrated, biopsychosocial approach that typically includes medications and psychotherapy.

Role of Intermediate Levels of Care in Treatment and Recovery

Recovery—achieving a self-directed life as a member of society—is the principal long-term goal of MH/SU treatment. Although most treatment occurs in outpatient settings, effective outpatient treatment depends on patients having two skills.

First, they need the capacity to use the sessions, face the affects and dilemmas that emerge, and engage in an outpatient treatment process. Second, patients must have the capacity to function adequately between sessions in terms of work or school and interpersonal functioning.

If crises emerge that are associated with imminent risk of harm or major impairment in self-care, acute inpatient treatment focused on crisis stabilization with prompt return to outpatient treatment is within generally accepted standards. However, many outpatients lack the capacity to function adequately between sessions—even with medications, more frequent sessions, and the like. These are patients for whom generally accepted standards support treatment in intermediate levels of care—IOPs, PHPs, and RTCs. Intermediate levels of care look beyond acute crises. They are designed to help patients grapple with the impact of underlying comorbidity, adversity, trauma, chronicity, or risk of recurrence. They target these underlying issues that drive repeated crises or interfere with adequate use of outpatient treatment to achieve recovery. It’s the difference between taking the lid off a boiling pot or turning down the flame. Intermediate levels of care offer this extra support long enough to help patients return to outpatient treatment better equipped to use it productively.

Intermediate levels of care in MH/SU treatment are comparable to intermediate levels of care in medical and surgical care. They are not simply an alternative to acute hospital treatment, but a differentiated, subacute level of care intended to improve functional capacity for those not needing acute inpatient treatment. An example is the stroke patient who no longer needs inpatient care but cannot yet function adequately as an outpatient because of impaired ability to walk, talk, and do self-care. An intermediate level of care offers such patients the opportunity to improve functional capacity in the same way an IOP or RTC might improve the functional capacity of patients with MH/SU disorders.

Generally Accepted Standards for Assigning Level of Care

There are instruments for determining the appropriate level of care congruent with this model and recognized as within generally accepted standards, such as the Level of Care Utilization System (LOCUS) developed by the American Association of Community Psychiatrists. The LOCUS assesses patients’ needs for outpatient, IOP, PHP, RTC, and inpatient treatment across six domains that include risk of harm and functional capacity, but also include the impact of comorbidity, past treatment response, readiness to change, and the supports or stresses in a patient’s environment. However, requests for access to intermediate levels of care—even in patients who meet LOCUS criteria for them—often lead to denials or authorization of very brief lengths of stay from insurance utilization reviewers.

There is a worrisome reason for this. Despite the 2014 Final Rules of the MHPAEA stating that obstacles to access to intermediate levels of care in MH/SU treatment should not be substantially different from those to gain access to intermediate levels of care in medicine and surgery, many insurance plans do not offer this kind of access. Many insurers view the focus of intermediate levels of care in MH/SU treatment as limited to crisis stabilization followed by prompt return to outpatient functioning or the end of treatment. This insurance perspective is illustrated by a white paper on the website of America’s Health Insurance Plans (AHIP), a trade group of about 175 insurance plans that works to “improve and protect the health and financial security of consumers, families, businesses, communities, and the nation.”

The AHIP white paper addressing challenges in implementation of the parity law for intermediate levels of care is written not by a psychiatrist but by an internist described as responsible for establishing behavioral health criteria for her insurance plan. The white paper describes intermediate levels of care in MH/SU treatment as focused primarily on crisis stabilization and as an alternative to brief inpatient treatment. Non-AHIP insurance plans often share the same stance about intermediate levels of care. Insurance companies and managed care entities apparently do not agree that generally accepted standards for intermediate levels of care are comparable for MH/SU treatment and medical-surgical care. Instead, they refocus MH/SU intermediate levels of care on crisis stabilization, not on addressing underlying issues that interfere with adequate use of outpatient treatment to achieve recovery. Intermediate levels of care are a canary in the coal mine here.

Why do insurance plans and a group like AHIP promulgate a flawed understanding of generally accepted standards for intermediate and other levels of care? Why do many insurers cite the LOCUS, an instrument solidly within generally accepted standards for determining level of care, as a source for their criteria but then develop criteria markedly at variance with the LOCUS? Why are nonpsychiatrists defining MH/SU access-to-care criteria? Does this reflect mere ignorance or, more cynically, a willfully shortsighted approach that limits MH/SU treatment to crisis stabilization at all levels of care to cut costs, with the assumption that those for whom such treatment fails will soon move to another insurance plan or to taxpayer-funded plans like Medicaid or Medicare?

The Canary in the Coal Mine Fights Back

Recognizing the implications of this approach explains the common experience of denials of medical necessity in the treatment of MH/SU disorders. Many insurance plans and their reviewers interpret generally accepted standards in ways that misrepresent the nature of MH/SU treatment—and rely upon nonpsychiatrists to do so! One response to recognition of this approach has been patients and their attorneys filing class-action lawsuits against some of the nation’s largest insurance companies. These suits allege breach of contract by insurers for issuing insurance policies guaranteeing access to medically necessary care, but then using flawed medical necessity criteria that are outside generally accepted standards to determine access to intermediate levels of care. This time, the canaries are fighting back!

As clinicians, we, too, should be responding to this problem both as individuals and through professional societies. When it comes to determining appropriate levels of care, the American Association of Community Psychiatrists leads the way with its development of the LOCUS. We should work toward defining generally accepted standards that go beyond the managed care focus on crisis stabilization for all kinds of MH/SU treatment. Addressing comorbidity, chronicity, and the impact of trauma or early adversity are essential to maximizing a patient’s capacity to use outpatient treatment. If we are serious about helping our patients achieve recovery, we clinicians cannot abdicate the role of defining generally accepted standards to insurance companies and managed care entities. ■