Week of October 18, 1999
As the program begins, host Dr. Fred Goodwin, a psychiatrist and former director of the National Institute of Mental Health, reviews the history of managed care in America. He talks about how insurance benefits grew out of wage caps and tax code changes in the World War II era. Managed care, he says, was a "top down" solution to the increases in health care spending that occurred as consumers and doctors worked under the assumption that they were "spending someone else's money." He suggests that the need for economy has, however, distorted the scene: "Third parties with no knowledge of the individual patient or doctor are making critical decisions about care; the very best doctors are compensated at the same level as the most marginal; doctors confront daily ethical dilemmas when the interest of their payor diverge from the interests of their patient. No wonder doctors and patients are both upset."
Next, The Infinite Mind's June Peoples reports on the story of Blake Hansen, a young man with schizoaffective disorder whose experience with the Kansas mental health managed care system resulted in a lawsuit and subsequent jury verdict. Blake, who had attempted suicide on a number of occasions, kept requesting long-term hospitalization in the Topeka State Hospital. But he was repeatedly "diverted" by his county's mental health program, which got money back from the state for keeping people out of the state hospital. Eventually, Blake died by suicide. His mother, Connie Masters, who is interviewed, successfully sued the local hospital and mental health program and won a jury verdict of $275,000 and several out-of-court settlements. Ms. Masters recently testified before the Kansas state Legislature about Blake's death.
Connie Master's lawyer, Bryant Welch, joins Dr. Goodwin next to discuss that case and managed care's handling of mental health in general. Welch is both a lawyer and a psychologist. He graduated from Harvard College and Harvard Law School before receiving his PhD in clinical psychology. Welch taught psychology and worked in private practice for 10 years. In 1993, he started his own national law firm specializing in managed care malpractice, and he's currently in litigation with most of the managed care companies across the country. Welch says that mental health has not fared well under managed care: the amount of money spent on mental health has slipped from 8 percent of the healthcare dollar to a little less than 3 percent today. Welch blames, in part, the fact that managed care companies most often "carve-out" mental health services, subcontracting them to a behavioral care insurance company. When such firms are paid on the same per capita basis for covering well people as sick people, it becomes a disincentive to provide service, Welch says.
In the next segment, Goodwin talks with two guests about managed care, and takes two calls. With him is medical economist and author J.D. Kleinke and clinical social worker and therapist Erma Globerman. Globerman practices psychotherapy in New York City and Long Island, and teaches at the New York University School of Social Work. Kleinke, who now works in the health 
information technology field, formerly worked at Sheppard Pratt in Baltimore, the largest private psychiatric hospital in the U.S. At Sheppard Pratt, Kleinke developed a managed care system for psychiatric conditions that was physician-based, cutting insurance companies out of the picture. Globerman talks about her own experiences with the managed care authorization system, including one experience in which she found it impossible to get authorization for therapy for a severely ill schizophrenic child and his family. Goodwin takes a call from Becky, in Alaska, who observes that her depression medication is prescribed by her family doctor. Her insurance reimburses her at a higher rate for her family doctor than it would if she was seeing a psychiatrist, she says. The second call is from Peg, in Washington, D.C., who talks about her difficulty in getting insurance to pay for the hospitalization of her son with mental illness. She wonders: Shouldn't there be some kind of independent review of such cases, and shouldn't patients be allowed to stay in the hospital until such appeals are decided? Kleinke agrees, and says that appeals procedures do exist, even though most managed care companies do not publicize them. He calls managed care a "war of attrition," suggesting that managed care companies bank on the fact that people will just give up if care is too hard to get. More information about Kleinke's book, Bleeding Edge: The Business of Health Care in the Next Century, which looks at the future of health care in America, is available.
For the industry perspective on all this, Goodwin goes next to Dr. Jerome Vaccaro. Vaccaro is president and corporate medical director of Pacificare Behavioral Health, a California-based managed psychiatric care company, and chairman of the American Managed Behavioral Care Association. A psychiatrist, he is also associate clinical professor of psychiatry at UCLA's School of Medicine. Vaccaro acknowledges that market pressures place tough demands on mental health managed care, and suggests that how well companies handle those demands, in part, divides good care from bad. Dr. Goodwin asks him whether he is troubled by the emergence of two large firms as dominant forces in managed behavioral care. Vaccaro says that there are many markets in which medium- and moderate-size regional companies provide an option. Magellan and Value-Options are currently handling about 80 million of the 180 million people in managed behavioral care, he says - a little less than half. Vaccaro also acknowledges that non-clinicians are handling authorization requests at some firms, and agrees that is a bad idea. He suggests that better firms are starting to place mental health clinicians in those roles more and more often.
Next, we hear a report from The Infinite Mind's Mary Stucky on a Minnesota health care system that has bypassed insurance companies. Formed two years ago by some of the Twin Cities' largest employers, the Buyers Health Action Group contracts directly with doctors. The plan allows patients to choose their own physicians as long as the doctor agrees to participate in BHCAG's evaluation, which includes cost and quality assessments. You may visit their Web site for further information.
Finally, John Hockenberry offers his commentary, suggesting that "Managed Care" is a temporary phenomenon with contradictory first and last names.
For more information about managed care and mental illness, you can contact the National Alliance for the Mentally Ill at 800 -950-6264 or visit NAMI's Web site.
