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Bill Aims to End Insurance Company Management of Behavioral Healthcare

Advocates for change say providers know best, while insurers call criticism misplaced

sen. robert m. gordon
Credit: NJTV
Sen. Robert M. Gordon (D-Bergen and Passaic) chairs the state Senate Legislative Oversight Committee.

Providers of mental-health and addiction services believe that insurers get in the way of delivering appropriate care to clients and want them to move aside, saying they know what’s best for their patients.

Both physicians and patients cite cases where insurers prevented providers to deny patients more intensive treatment, leading to setbacks and in some cases deaths. They are pushing for a bill, S-2180/A-3450, that would require insurers to cover the treatments that providers determine are medically necessary.

Insurers shoot back that they base their decisions on medical research and what’s been found to work in the past. They argue that they’re in a unique position to coordinate the care a patient receives.

Another factor that could prevent problems for patients is a newly implemented federal law that requires insurers to provide the same level of care for behavioral health as they do for other medical concerns.

The proposed bill would apply to those who receive benefits through the public-employee benefit plans, as well as those in the individual and small-group markets, covering roughly 30 percent of residents. It wouldn’t apply to those covered by employers that self-insure (paying for employee claims as they arise) or who are in federal programs like Medicare and Medicaid.

Bill sponsor Sen. Robert M. Gordon (D-Bergen and Passaic) said he was concerned that insurers were using the review process to intentionally wear down patients and providers. He added that individual patient needs vary so widely in behavioral healthcare -- a term that covers both mental-health and addiction services -- that the managing of care by insurers is inappropriate.

“Just a prescribed set of protocols I don’t think makes sense in behavioral health,” Gordon said.

But insurance executives said that the while providers and insurers may have been adversaries over payments in the past, the Affordable Care Act and other changes in healthcare have more closely aligned their interests by shifting payments toward patient outcomes.

“Incentives no longer align purely on the basis of how much care is utilized -- there’s much more of a focus on ‘Show me the results,’” said Dr. Mark Friedlander, chief medical officer for Aetna Behavioral Health.

Bill opponent Sen. Gerald Cardinale (R-Bergen and Passaic), a dentist, said the bill would be a “boon to the providers” but would have serious cost implications to the state government and others that pay for insurance. He noted that state benefits already are facing rising costs in 2018 under a surcharge for high-value health plans under the Affordable Care Act. He expressed concern that the bill amounts to a “blank check” to providers and that it would harm patients by bankrupting the system.

“You really are going to be able to do whatever you’re going to do and the insurance company can’t do anything about it,” he told providers.

Insurance-industry representatives estimate that the bill would cost $65 million annually for the State Health Benefits Program alone.

The bill received support from the Medical Society of New Jersey, the state’s largest doctors group. Society chief operating officer Mishael Azam said the measure is particularly timely as the state attempts to address a rising number of opioid overdose deaths, putting doctors in the position to decide what is best for their patients.

Cherry Hill addiction specialist Dr. Michael Shore said insurers are increasingly using the review process to slow down treatment. The ability of patients in need of buprenorphine, a medicine used to treat opioid addiction, to survive can depend on whether they have the cash to cover $100-plus prescriptions until their insurer has reviewed the claim, Shore said.

“It’s sadistic, and people are dying,” Shore said of the extended reviews.

He predicted that allowing doctors to determine the course of treatment would actually save money, since earlier treatment could prevent some hospitalizations.

Psychotherapist Stephanie Samuels recalled a patient with opiate and alcohol addictions as well as post traumatic stress disorder, and who happened to be a police officer, who killed himself after his insurer denied him extended, 75-minute therapy sessions.

Samuels also addressed the need for insurers to prevent unnecessary care, saying that they could conduct audits of provider practices. As it stands, she said, patients and providers must fight an insurance “machine.”

“There should never be a machine to fight in order to get anyone the psychological help they need,” she said.

Henry A. Stryker III, a local fire marshal and volunteer firefighter, said he was only able to make progress on his drinking problem with the help of a therapist who was willing to go unpaid for some sessions after an insurer denied coverage for more frequent extended sessions.

And Donald Palumbo, a software consultant, said he suffered a setback in his treatment for bipolar disorder when his insurer cut back his counseling from twice a week to once a week.

Matthew Wolf, vice president of addiction treatment provider Seabrook House, attributed an increase in the number of addiction deaths that his institution has seen from one or two per year a decade ago to 31 last year to coverage denials from insurers. “We need this bill because in our experience managed mental healthcare has failed,” Wolf said.

Insurance executives said that insurers are using their management of treatment to better integrate mental health into other medical treatment. They also are using the latest medical science to determine treatment, such as supporting the use of medication to treat some cases of drug addiction rather than relying on inpatient detoxification programs preferred by some providers.

They also said that their management of treatment can better position patients to switch between different levels of care. For example, an insurer may approve a local treatment program rather than a better-known program that’s further away, which will make it easier to later coordinate outpatient care, according to Friedlander.

Finally, insurers can provide equally effective medications at a much lower cost than those prescribed by providers, since they can use their purchasing power to negotiate better prices, he said.

Sarah M. Adelman, vice president of the New Jersey Association of Health Plans, noted that patients can appeal denials to an independent review board, which rules in favor of insurers 65 percent of the time.

The Senate Commerce Committee released the bill on Monday on a 4-2 vote, with both Republicans voting against it. It’s been referred to the Senate Budget and Appropriations Committee.

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