Healthplan Contracts and Psychotherapy: Beware Shell Games

Some Healthplans are offering psychotherapists contracts that are unethical, illegal, and in some cases harmful to the public.
Psychotherapists need transparent regulatory and contractual standards that are reliable, valid, ethical, lawful and do not harm the public or psychotherapists.
Many Healthplans offer mental health professionals ambiguous criteria and documentation requirements concerning medical necessity of services.
Psychotherapists should be aware that the longer Healthplan shell games continue, the more stridently Healthplans may assert that their expectations are prescriptive rights which cannot be questioned by psychotherapists
Healthplans pay physicians for patients’ completion of mental health screening measures but are currently unwilling to pay mental health professionals who are expected to use the same or similar measures.
Since the pandemic began, psychotherapists show symptoms of major depression, anxiety and PTSD for which their clinical coping mechanisms look much like repression, denial and acting out. Despite their personal and vicarious traumas, psychotherapists, like other front line professionals, continue their diligent work.

Healthplans (particularly those which are Medicaid funded) require providers (1) to use specific treatment planning methods and progress note formats, (2) to use payers’ software to measure patient outcomes and satisfaction, and (3) to submit claims that are a potentially fraudulent (e.g. upcoding, down-coding and miscoding). Therapists’ incentive to comply is the looming threat of audits by Healthplans with internal criteria and processes hidden beneath their corporate shell.

Healthplan expectations, accountability and profit goals have become a “shell game.” Psychotherapists don’t know what is expected, The Center for Medicare and Medicaid Services (CMS), which sets standards for service provision, doesn’t evaluate ways in which consumers may be harmed and Healthplans are not held accountable. Unfortunately, using Oregon as a case example, psychotherapists challenge Healthplans only when reimbursement rates are reduced. Fee reduction seems to be the only message from Healthplans that mental health professionals agree is problematic.

Psychotherapists should be aware that the longer Healthplans’ shell games are allowed to stand, the more stridently Healthplans will assert that their expectations are prescriptive rights which cannot be questioned by psychotherapists.

Healthplan Contracting: Value-Based & Otherwise

Research has demonstrated that about 25% of psychotherapists are 7 times more effective than the lowest 25%.
After decades of research, there is no longer doubt that mental health services reduce healthcare costs and contribute to improved health and well-being.

Healthplans have begun to support development of value-based contracts in which compensation is based on use of patient-reported outcome and satisfaction measures. Historically Healthplans’ focus has been on utilization review to limit and restrict services and reduce the cost of psychotherapy services. Healthplans continue to invent strategies to reduce psychotherapy costs. In Oregon, Healthplans’ default position during contract negotiations has been that psychotherapists should be using patient reported outcome measures (PROMs) and/or feedback informed treatment (FIT) measures. Healthplans’ verbal commitment to proposed reimbursements for PROMs and/or FIT have not yet resulted in contracts with psychotherapists which compensate for gathering measurement data. Instead, required use of PROMs and FIT are part of the shell game that Healthplans play to their advantage.

Examples of contracting strategies using PROMs and FIT are:

A Healthplan reduces their reimbursement rates and then requires PROMs and/or FIT if psychotherapists want to be reimbursed at the old, higher rate. The goal of this strategy is to compel psychotherapists to provide PROMs and/FIT.
A Healthplan offers a small increase in fees-for-service and a slightly higher reimbursement increase if the psychotherapist uses PROMs and/or FIT. One goal of this payer strategy is to put responsibility for rejecting the offer on psychotherapists. In fact, the offer should be rejected because the reimbursement is low, and the professional risk and effort is high.
A Healthplan restricts network enrollment to groups that submit their claims for all psychotherapists in the group under a single TaxID. That contract requires the psychotherapists, as a condition of employment, to use PROMs and/or FIT. A goal of this strategy is to compel psychotherapists to provide PROMs and/or FIT.
A Healthplan opens their network to psychotherapists who use a specified PROMs or FIT software; the contract requiring psychotherapists to provide that data when audited. The primary goal of this strategy is gather valuable information from therapists, to profile psychotherapists, and to validate and create local norms. Such norming data can be used to evaluate psychotherapists’ outcomes, compare providers to one another; ultimately to limit, restrict, or allow services based on criteria owned and controlled by the Healthplan.

Healthplan Use of PROMs & FIT

Physicians and allied health professionals widely accept and use PROMs. The reason; patient reports are considered reliable, valid and useful measures of symptom burden and functional impairment. FIT is primarily recognized by mental health professionals, less well recognized among medical professionals.

CMS and the Oregon Health authority fund more than 50% of healthcare services in Oregon and expend more than 1 of every 3 healthcare dollars. CMS has become the predominant standard of care.
FIT is a self-limiting process measurement system that does not provide information pertaining to medical necessity, only measuring whether the patient and psychotherapist are effectively engaged in treatment.
PROM measures functional problems and symptom burdens in ways that provide evidence for medical necessity of services.
Healthplans are requiring providers to gather PROM and/or FIT assessment data which is protected health information (PHI) and requiring report of that that information to Healthplans.

Healthplans & CPT Codes

Following the recent passage of Oregon House Bill 3046, some Healthplans are considering changing their existing contracts to adoption of CMS relative value unit (RVU) reimbursements. Multiplied by a conversion factor, the RVU for a specific CPT code becomes the reimbursement rate for that specific CPT code. Healthplans have a long history of changes in their RVU formulas and of limiting the CPT codes for which psychotherapists can submit claims.

The CPT® Editorial Panel is responsible for maintaining the CPT code set. The panel is authorized by the AMA Board of Trustees to revise, update, or modify CPT codes, descriptors, rules and guidelines. The panel is composed of 17 members.

Healthplans currently require psychotherapists to combine services which each have a unique CPT code into a single CPT code.
Healthplans assert that the committee that maintains CPT codes has rules that do not allow the use of CPT codes that would support value-based contracts. There is no reason that Healthplans cannot create special codes for commercial contracts.
Merging unrelated and clearly distinct services into a single CPT code for services hides the service provided and invalidates accounting and auditing for those services.
Psychotherapists required to provide multiple services and to submit claims for those services with CPT codes which do not meet CMS standards are vulnerable to allegations of fraudulent billing practice (i.e. up-coding, down-coding, or miscoding).
Requirements for services that cannot be correctly defined by a reimbursable CPT code will invalidate utilization and quality of providers’ outcome and satisfaction measures.
Inclusion of non-treatment services in a CPT code designated for treatment takes time away from providing therapy services and involves miscoding and/or down-coding.
Up-coding, miscoding and down-coding hide the true nature of services, costs and value. These errors are defined by CMS as violations of General Auditing Procedures (GAPs).
Healthplans are requiring levels of documentation detail for “medical necessity” that violate federal “Minimum Necessary” regulations.
Healthplans charting requirements are based on charting methods developed in the 1980s. These methods ignore 40 years of research on psychotherapy effectiveness and its medical benefits.
Healthplans are requiring psychotherapists to perform self-audits and are unwilling or unable to provide guidance regarding errors and irregularities, instead referring contracted psychotherapists to the Oregon Health Authority.

References

Clinical Necessity Guidelines for Psychotherapy, Insurance Medical Necessity and Utilization Review Protocols, and Mental Health Parity. May 2018 Journal of Psychiatric Practice 24(3):179-193
Revisiting Offsets of Psychotherapy Coverage. Benjamin Ly Serena. Department of Economics. University of Copenhagen February, 2021
The Medical Offset Effect: Patterns in Outpatient Services Reduction for High Utilizers of Health Care. Crane & Christenson. Contemporary Family Therapy. · June 2008
The Medical Offset Effect: Patterns in Outpatient Services Reduction for High Utilizers of Health Care. Contemporary Family Therapy.· June 2008.
Depression Treatment: The impact of treatment persistence on total healthcare costs. Melek, Halford & Perlman, Milliman, June 2012.
Improving Clinical Outcomes for Digital Self-Care. Brown & Jones. https://societyforpsychotherapy.org/improving-clinical-outcomes-for-digital-self-care. Society For Psychotherapy. 2021.
Are You Any Good…as a Therapist? Brown, Simon, & Minami. https://societyforpsychotherapy.org/are-you-any-good-as-a-therapist. April 2015.
GRID Charting and Training. An AMHA sponsored Training to “audit proof” a psychotherapy practice.
Download Grid Charting and Training example