Mental Health Consumer Protection Manual

A guide to solving problems with
insurance and managed care

Mental Health Consumer Protection Manual:

A guide to solving problems with insurance and managed care

Table of Contents

Editor's Introduction  

Section I

How do I know if I have managed care?
Specific managed care cost-cutting methods

Questions to ask the managed care company

Talk with your therapist

Consumers have a right to appeal
Who is involved in an appeal?
Should the professional or the patient conduct the appeal?
Special issues regarding professional assistance in the appeal process

How do companies evaluate treatment denials and appeals?
Elements of a strategy for winning your appeal
The steps to making an appeal

The state insurance commissioner
Self-insured or ERISA insurance programs
Health Insurance Portability and Accountability Act of 1996 (HIPAA)
Mental Health Parity Act of 1996
Eight common problems - You are not alone

Managed care encourages negative information about patients
Medical records are permanent
Who has access to private information?
Will managed care companies divulge confidential information to employers?
Isn't patient consent required to release records?
What happens to pharmacy records?
Privacy is often not respected
How can consumers protect their privacy?

Indicators of a good policy
Marketing promotions that should be ignored in evaluating a company
Indicators of a poor policy
Are some companies better than others?

Does it help to choose a different professional within the same managed care system?
A good protection is a second opinion
What about choosing a professional outside of your managed care company?
What about the professional who recommends treatment that is longer than necessary?
What about serious problems with professionals?

Section II

Insurance commissioner
Legislature
Governor and Congress
Ombudsman service
Licensing Boards
Professional ethics committees
Media

Who is the right attorney?
When should consumers consider a lawsuit?
What should a consumer do to prepare for a lawsuit?
How will managed care defend itself?
Information for attorneys about managed care medical liability and ERISA lawsuits

Editor's Conclusion

Editor's Introduction

Mental health problems are so common that one third of Americans will suffer from a mental health condition in their lifetime (American Journal of Psychiatry, 1992). However, in spite of the need for mental health services, mental health has been a primary target for managed-health-care cost cutting. Even though health insurance has historically restricted and underfunded mental health services, since 1988 managed care has further reduced mental health coverage by eliminating 54% of insurance-based mental health funding (Hay Group, 1998). This cut in mental health funds is seven times as severe as the managed care cut in overall health care spending. Making matters worse, independent audits of managed mental health care companies show that over 50% of mental health funds are now consumed by the administration and profit expenses created by managed care companies (Wrich, 1997). As a result of these excessive funding cuts, mental health consumers commonly encounter problems with their managed mental health care services.

We have written this Manual to offer consumers and consumer advocates the information they need in order to obtain the best managed mental health care benefits to which they are entitled and to solve problems with insurance and managed care. Armed with this information, consumers have several choices about how to deal with managed mental health care. Many consumers decide that they must pay out-of-pocket in order to receive quality and/or confidential treatment. Other times, consumers cannot afford to pay out-of-pocket and try to make their managed mental health treatment as productive as possible. Often the strategies in the Manual will solve the major problems that arise with managed care. However, even when the problem cannot be solved for an individual patient, by following the suggestions in the manual, assertive consumers can choose to help change the system so that it works better for others in the future.

We wish that we could have written a manual telling consumers that by understanding their managed mental health insurance, they could be assured of quality treatment. Unfortunately, this is not true and most managed mental health has been compromised to some degree. Even though most professionals and managed care employees strive to provide the best quality care, our experience is that even when employees of managed care are well intentioned, company rules often do not allow for quality mental health services. In this manual, we are blunt about the negative effects of managed care because we believe that consumers will be best prepared if they are well informed about the numerous problems of managed care.

The impact of managed care does not affect each consumer equally. Even before managed care, there was a saying that the difficult or troublesome patient lives longer. Busy professionals are more likely to overlook the patient who is cooperative and routine, and focus more time and energy on the patient who is difficult. As a result of the extra effort, these difficult or troublesome patients receive better care and live longer. Under managed care, there are even greater time pressures and financial incentives that encourage taking short-cuts with patients. These pressures can lead to neglecting the non-assertive patient who is being rushed through the system. The system still devotes more resources to patients who are either assertive or difficult enough to cause time-consuming problems if they are ignored. Although being assertive and questioning is uncomfortable for most patients, in today's world of managed care, the truth is that the assertive patient will receive better health care.

We strongly encourage consumers to use advocates and to obtain second opinions. People who seek mental health services are often under stress and may not be able to use their best judgment. This stressful time is a good time for an advocate - a friend, relative, or professional - to help out. Likewise, second opinions can be very helpful. Poor quality treatment in managed mental health care is often cloaked in professional jargon and rationalizations. A second opinion from a professional who is working for only the consumer, not the HMO or insurance company, is the best way to cut through professional jargon and rationalizations.

We regret that this manual must focus on the negative aspects of mental health care. Quality mental health services can benefit many people. Mental health services can help patients overcome or control many illnesses, be more productive, solve relationship problems, achieve higher levels of physical health, and deal with difficult life situations. Most mental health professionals are highly dedicated and care very much about providing the best possible services. We hope that our frank discussion of problems with managed mental health care does not discourage patients from finding and using mental health services. On the contrary, our goal is to help consumers obtain the benefits of quality treatment.

We plan to continuously revise this manual to make it as useful as possible and invite suggestions for improving the manual. We encourage consumers, consumer advocates and professionals to send anecdotes, information, your stories of problems with managed care, how you solved problems, and how this Manual was useful to you. We will keep your information confidential. If people suffer in silence and are quiet about how they have been mistreated, the problems in the managed care system will continue. It is only when people come forward and report the problems in managed mental health care that we can use these collected reports to build a better mental health care system.

Ivan J. Miller, Ph.D., Executive Director
National Coalition of Mental Health Professionals and Consumers, Inc.

Top of Page

The Best Strategy for Winning Your Appeal

Elements of a strategy for winning your appeal

Small appeals and clear mistakes are easier to win.
Some appeals are won because the company is willing to reconsider treatment decisions in order to please a dissatisfied customer, or because the appeals officer sees a clear mistake. The chance of winning this kind of appeal is greatest when the cost to the company is small, or when the contract between the employer and the managed care company indicates that treatment should be authorized in a liberal manner.

Show the company a way it will save money by granting the appeal.
It is helpful to present evidence that treatment will be the least expensive option even in the short run. One strategy is to give evidence that treatment denial may result in a much more expensive need for treatment within a few months. This emphasis on costs is necessary because appeals officers in managed care companies report that they are under tremendous pressure to cut expenses by denying treatment. Appeals officers need this financial information to defend their decisions.

Don't be abusive, threatening or vengeful.
Be assertive, persistent, and firm, but don't be abusive or angry in a way that discredits you. The managed care company will be concerned about how to defend itself against complaints, and one possible defense is discrediting the patient. If the patient is disrespectful, uses foul language or behaves irrationally, the company may escape responsibility by blaming the patient.

It is also important not to use force or threats. You may tell the company that it is mistreating you, and that you will protect yourself through legal channels, but do not say or imply that you will cause harm if you don't get your way. Remember, you have a right to high quality health care that the company promised when you enrolled, and you are just insisting on your rights.

Don't be too reasonable.
Consistent reports from consumers indicate that the loudest complainers are the ones who win their appeals. While you should not be abusive or discredit yourself by venting excessive anger, the reality is that these companies are much more responsive if they fear that you might cause them trouble in some way. The administrators of managed care companies fear patients who may tell their stories to the press, who may complain to the insurance commissioner, or who may pursue a lawsuit.

Think like a consumer, not a patient.
Many consumers find it easier to solve problems with managed care if they think of their relationship with the managed care company as similar to being a customer in a business. If you are not satisfied with a service or product, you should ask the business to make it right. Reputable stores correct the situation immediately. If the person that you are talking with cannot solve the problem, go to the supervisor. You may find it helpful to explain to the managed care company that you see it as a business, and when there is a problem, you expect someone to be able to fix the problem right away.

Document everything.
The managed care company will be documenting only the information that it needs to defend itself, and this documentation may not be available to the consumer. Make sure that every attempt to contact the company is documented (including times the line is busy and calls are not returned). In the absence of documentation, the presumption is that the company did nothing wrong; however, with documentation, whenever the company was negligent, it can be brought to light.

Conversations may be documented either by specific notes or by tape recording them. It is always legal to record a conversation if both parties know. The only explanation necessary is that it is being recorded to provide an accurate record, and the other person should be told that the conversation is being recorded at the very beginning. Inexpensive devices for connecting tape recorders to phones are available at stores like Radio Shack.

Hold the individuals from managed care personally responsible.
Managed care companies usually shield the identities of their personnel from policy holders so that the personnel can implement company policy without feeling any personal responsibility to the patient. To counter this evasion of personal responsibility, patients can explain that they have a right to know the name, title and credentials of each person who is involved in their health care decisions. Therefore, each person who is involved in transferring information or making decisions (this includes secretaries and receptionists) should be asked to fully identify themselves.

If a managed care employee does not treat you respectfully, you may ask to deal with another employee. Some consumers have reported that particular employees acted offensively and made their appeals more difficult. When they were assigned to another employee, these consumers felt more satisfied.

Ask for a copy of your file.
Ask the managed care company to send you a complete copy of your file and computer records. In many states, you have a legal right to see these records.

Make the company aware that they are dealing with a human being.
The managed care companies have maximized their profits by developing languages and systems that dehumanize patients and turn them into symbols for losing money. For example, insurance companies call money spent treating a sick person a "health care loss." The term "loss" means that the company loses money by paying for a sick person's treatment in this kind of system. Normal feelings of concern and humanity are missing.

In Boston, one bold consumer became upset when his two children were told that they could no longer see the therapist who had been helping them overcome a severe trauma. When the case manager was unwilling to change his mind about the two children, the father told the case manager that he was going to mail the case manager a life size poster of the children so that he would know that he was dealing with human beings. The idea of receiving the poster was so disturbing that the case was transferred to an office in another state. The father then called the new office and told them that he was going to fly his children to that city, bring them to the office, and introduce them to everyone in the office so that the managed care company could see that it was dealing with human beings. A couple of days later, the case manager called the father and said that the company would pay for his children's continued treatment with the therapist of their choice.

Document as much supporting medical or mental health reasoning as possible.
While winning an appeal depends a great deal on the strategy, it also depends on the substance of the appeal. If the case is conducted in front of a thirdparty and independent arbitrator, this objective evidence should be the major focus. The following questions should be addressed:

• Is there a medical or mental health condition that requires treatment?
• Does the policy or the promotional material indicate that this condition will be treated?
• Is the proposed treatment one that is generally offered by a significant portion of the medical or mental health community?
• Has the company denied the treatment or any substantial part of the treatment?
• If the company claims that the treatment does not meet their standards of cost effectiveness or medical necessity, then the company should be able to produce: (a) the standards that determine the treatment is unnecessary, (b) the evidence that they used for their conclusion that the treatment did not meet their standards, (c) evidence that their standards fit with good medical or mental health practice, and (d) evidence that the treatment that is allowed by their company has passed the same standards that the treatment in question has failed.

In most cases, you should note that the company did not provide adequate information about how it determines cost effectiveness and medical necessity for an adequate appeal. This statement will keep the door open for a potential legal case later on, and also puts the company on notice that you are a consumer who may hold them accountable in the future. Part of a successful strategy is convincing the managed care company that your particular case could be won in court.

In the case in which an independent arbitrator hears an appeal, the emphasis should be on the medical evidence. Unfortunately, not all arbitrators are as independent as they would appear. The arbitrator may have a strong incentive to please the managed care company in order to be selected in the future.

Go up the supervisory ladder quickly.
The people on the front lines are often authorized only to say "no." Many times, a person must go to a higher level to find someone who has the authority to say "yes." If you are not satisfied with the responsiveness of the person with whom you are dealing, ask for the supervisor. And again, if that person is not satisfactory, ask for the next level supervisor.

One activist reports that whenever he runs into an impasse, can't reach the person to whom he was referred or does not get a satisfactory response to a real problem, he calls the president of the company. He also does this with the governor when there is a problem with state agencies being responsive. He firmly reports that he is a customer or citizen, that no one in the company can resolve the simple problem, that they are not responding to phone calls, or that the supervisory ladder is not working properly. Therefore, he is calling someone who should have the authority to solve the problem and make the broken system work. If these top level people refer him elsewhere, he is agreeable but calls back if the referral does not solve the problem quickly. Although it is usually the secretary that takes these calls, the secretary also makes sure that someone solves the problem so the president or governor will not be bothered. As he describes this tactic, these top level people are uncomfortable dealing with the people who are harmed by the system or dissatisfied with the service. These leaders often find a way to make the system respond to the customer.

This activist does caution that people shouldn't try this technique unless they can be cool, collected and clear thinking. The key is to stick to clear and logical consumers' rights issues because some of these company officers can get angry or overly defensive.

Don't let them give you the run-around.
The employees of many managed care companies only assume responsibility for their small piece of the system. Instead of responding to a complaint, the employees commonly suggest that the caller has contacted the wrong person. After making 36 calls, one consumer realized that no one in the company wanted to take responsibility. In other words, some companies act as if it is the consumer's job to locate someone who will assume responsibility. It is not the consume's job, it is the company's job.

If you get caught in this run-around, locate the person who you think is the most central and explain that this is not the consumer's job. If you have called the number given on the policy, then it is the company's job to take responsibility and find someone who can respond to your situation. If the employee does not respond, go up the supervisory ladder quickly and don't hesitate to call the Insurance Commission for help.

Keep the door open.
Most people cannot think of everything that they want to say in any one meeting. In addition, the responses of the managed care company in the appeal process may throw the consumer or consumer advocate off balance. It is a good idea to ask for a chance for additional written or verbal comments at a later date, and to ask for additional documentation from the managed care company when it is relevant.

The steps to making an appeal

First, get information.
The first part of an appeal process is information gathering. If there is any indication that your managed care company will deny treatment, call the managed care company and the utilization review person. Firmly ask for information and begin documenting your contacts. The utilization review per son may try to avoid talking with you, but you may insist, because you have a right to talk with anyone who is involved in your personal health care.

If there is a problem, find out as much as you can in your initial contact. Ask about the appeals process, how many levels of appeal there are, and if there are time limits or time delays. After you have gathered this initial information, take some time to think about what you want to do. This is a good time to get advice or talk with your mental health professional

The levels of appeal.
Most managed care appeal processes have two or more levels. If you lose an appeal at one level, you can try again at the next. Some companies deny many claims and appeals in the early stages to see which ones will go away. In these cases, a patient cannot win until they move on to a higher level.

What about a settlement offer?
Many times a managed care company will offer a settlement in exchange for the agreement that the patient will not pursue the complaint. Each settlement offer needs to be considered individually, and it may be wise to consult with an attorney to see if the settlement is a good idea.

Don't drop your guard until the bills are paid.
Consumers and professionals frequently report that a managed care company will promise to provide a service or solve a problem, but not follow through or pay the bill. You should continue your documentation and keep channels of communication open until the treatment is over and all bills are paid.

Warning
Many consumers have reported that the strategies reported here have been successful. However, some companies may become more defensive when they are challenged. At times, these companies may react by trying to discredit the patient. In being assertive with managed care companies, there is always the possibility that the company will react in a negative manner.

Top of Page

Eight Incorrect Rationales for Denying Treatment

Many in the managed care industry have developed and used the following incorrect rationales for denying mental health services. These rationales may sound reasonable and convincing, but when analyzed, they are not correct and do not fairly justify the denials of treatment services. Consumers who are forewarned about these rationales are better prepared to advocate for themselves.

1. "You should have read your policy and manual more carefully to see the reasons that treatment can be denied."
As a rule, manuals and policies are not only difficult for consumers to understand, but often don't contain the relevant information. Even experts cannot get adequate information to compare the mental health benefits of companies. Insurance and managed care companies should not be allowed to use legalistic policies to get away with misleading advertising. Consumers can argue that if the advertising implies comprehensive treatment, then the managed care company should provide comprehensive treatment.

2. "Treatment is time limited because people get better faster when they know how many sessions they have."
Managed care has subscribed to the belief that time limits make patients improve faster. Research shows that this is not true. Good therapy is a combination of hard work and taking time to look at oneself carefully. Time limits are a way to keep therapy short. Generally, therapy should last until patients accomplish their goals.

3. "Most of the possible change occurs in the first few sessions and, therefore, extended therapy is not helpful."
In the first few sessions, simple problems are solved and much relief occurs. The same thing happens in physical medicine, most patients get over their illnesses with one visit to the doctor. However, when problems are long standing, when a person has trouble with many relationships or issues, or when problems are severe, longer treatment is usually more helpful than brief therapy.

4. "Patients who are motivated will get over their problems in just a few sessions."
A common managed care technique is to tell patients that their progress in brief therapy depends on their motivation and how hard they work. As a result, when therapy is ended, patients often feel that it is their own fault if they have not overcome their problems. In reality, most patients are highly motivated to become healthy. There are many legitimate reasons why psychotherapy or healing may take time. Good therapists understand this and allow the process and stages of therapy to unfold as quickly as they can. It should always be kept in mind that big problems and major changes take time.

5. "If a patient cannot prove steady progress, treatment should be stopped."
Many managed care companies require that mental health patients prove that they are getting better by showing steady progress in a way that is behavioral, measurable and observable. This is a method for discouraging psychotherapy because most mental health problems result from what goes on in a person's mind, and peoples' minds are not behavioral, measurable, or observable. Some patients spend months thinking about problems, trying out new ideas, learning how they work inside, and exploring their emotions before they can make big changes. Patients and their mental health professionals are in the right position to decide if there is adequate progress, and they should not have to prove this with observable behavior.

6. "If a patient cannot be cured, therapy does not make sense."
Surprisingly, managed care companies often recommend telling patients that there is no cure for mental health problems so the patient has to accept living with the problem. While it is true that there are health problems that cannot be cured, frequently the purpose of treatment is to control or lessen the negative effects. The same is true for physical illnesses: while diabetes cannot be cured, it can be controlled, and while many types of heart disease cannot be cured, rehabilitation can improve a patient's functioning and quality of life. The lack of a complete cure is no reason to withhold the treatments that will improve a patient's condition.

7. "The purpose therapy is to restore a person to the usual level functioning."
This is an absurd statement that actually means that chronic problems are not treated because the chronic problem is part of a person's usual level of functioning. Most mental health patients have some long term issues that should be the focus of treatment along with the acute problem. In all of health care, long term problems are treated as well as emergencies and exacerbation's of chronic problems. Unless an insurance plan advertises that it covers only mental health crises and emergencies, it is obligated to treat the entire mental health condition.

8. "The treatment was not supported by scientifically based guidelines."
In mental health, most managed care companies make their own decisions about the amount of scientific data needed to support a treatment. Their decisions are heavily influenced by cost. The true guidelines and the scientific backing for these guidelines are almost never presented for any kind of public objective scientific review. Companies which claim that treatment has not passed their scientific standards should reveal those standards and the scientific basis for the treatments that both passed and failed those standards. If these were publicly available, independent scientists could evaluate them.

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