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Psychotherapy and the Affordable Care Act

By Tori Rodriguez and Kathleen Smith

Throughout the fall, news about the landmark Affordable Care Act (ACA), designed to extend healthcare coverage to millions of the country’s currently uninsured, has been overshadowed by the egregious technical glitches that plagued its website after its launch. But now that the worst computer issues have been addressed, more attention has begun to turn to ACA’s impact on the delivery of healthcare, including the mental health services that payers must cover under the act. ACA’s expansion of the benefits of the Mental Health Parity and Addictions Equity Act of 2008 means that millions more people will receive mental health benefits, with the mandate that they must be reimbursed at the same level as coverage for physical illnesses. At first glance, that huge growth in the potential insured client pool would appear to be a boon for therapists in private practice, but ACA’s practical impact may not be as favorable as many clinicians expect.

In the interest of efficiency, increased oversight, and cost control, ACA will effect fundamental changes in the ways that healthcare is monitored and delivered. According to Katherine Nordal, American Psychological Association’s (APA) executive director for professional practice, ACA will move insurance companies away from fee-for-service models (paying one provider for one session) toward a global payment model, in which mental health services are “bundled” with fees for other healthcare services relevant to the patient’s condition. To decrease healthcare spending, the ACA emphasizes an increased focus on three areas: accountability for patient outcomes, with more responsibility placed on the provider to demonstrate effectiveness; greater reliance on outcome measures in evaluating treatment, such as patient satisfaction and symptom reduction; and value-based care models, designed to reduce the cost growth of healthcare. The increased demand for demonstrating positive outcomes will require more collaboration and technical infrastructure, including the increasing use of sophisticated (and expensive) electronic medical records systems.

Many believe that the result will be a trend in which insurance companies contract with large medical systems to form accountable care organizations (ACOs) that will provide all healthcare services (medical, mental health, pharmacy, and lab services) for all a plan’s members in certain geographic areas. ACOs offer providers financial incentives for positive patient outcomes, and they’ll probably embrace the model of a patient-centered medical home, in which all care is funneled through a patient’s primary care physician. Therapists will need to be on staff to provide mental health triage and treatment in these collaborative settings, but they’ll enjoy far less of the autonomy embodied in the current private practice model. Clinicians working in these more collaborative and medicalized settings will need a different kind of training to enable them to see more patients in shorter sessions and adapt to increased interaction with physicians and other healthcare providers. With more centralized and coordinated oversight of treatment decisions, the emphasis on providers using evidence-based treatment approaches will likely continue to accelerate.

Some observers believe that these changes in the healthcare system will transform the landscape of private practice in the years to come. According to Nick Cummings, a former president of the APA noted for his prescience in anticipating the advent of managed care and other practice trends, “It won’t happen right away, but private practice will essentially be a thing of the past, as 95 percent of practitioners will be on salary, either working in government-sponsored systems or large healthcare companies.” He says the remaining private practitioners will probably be based within concierge plans, which are typically expensive and accessible only to high-income patients. He believes that because of the glut of psychotherapists—about 700,000 therapists in the United States alone, twice as many as needed, he says—the prospects for therapists’ incomes aren’t bright.

In addition, psychotherapy will likely continue to take a back seat to psychiatry from the perspective of payers. “Under the ACA, mental health services will continue to be mostly psychotropic-prescribing psychiatry,” Cummings says. “Most psychotherapy that is referred will be secondary to medication—which is unfortunate because, in most cases, psychotherapy is less effective when used secondary to meds.” He says another unfortunate effect of ACA will be that “the psychotherapy that is done will be the vapid, less effective, cognitive-behavioral therapy, while active, deep, and incisive therapy that incorporates psychodynamics will all but disappear.”

Not everyone agrees with Cum­mings’s grim prognosis. According to Nordal, “the settings and ways in which treatment is delivered are certainly evolving, but I don’t think private practitioners are doomed; however, they’ll need to get smarter about how they do business.” She maintains that those who survive will need more marketing savvy than ever before to demonstrate their value and skill sets. There will still be a need for specialists, so within the healthcare system, therapists who have niche practices—like those with expertise in treating children and adolescents—will have a significant advantage. But insurers will be looking for more proof, such as certifications and records of continuing education, that therapists have the expertise they claim, especially if it involves evidence-based treatments like prolonged exposure therapy for post-traumatic stress disorder.

“I do think the future is limited for ‘plain vanilla’ private practitioners who only treat ‘generic’ problems like depression and anxiety,” Nordal says. “Especially where the economy is weak and there are lots of other therapists, these clinicians will face economic challenges before others do.” She recommends that practitioners consider joining forces—since group practice models will probably be a preferred model—to form integrative mental health practices with soup-to-nuts treatment offerings, like psychotherapy, medication management, and behavioral training.

This model offers the benefit of reduced overhead and ease of collaboration, and insurers have data proving that those in group practices tend to show better outcomes more quickly (and insurers like the simplicity of having to deal with only one tax ID number). Nordal points toward another emerging model: the independent provider association, in which several different providers or groups of providers join together to negotiate collectively as a group but maintain their individual practices.

“I don’t think the ACA is a death knell for private practices, except for those who won’t be innovative or find someone to do it with them,” says Nordal. “We can’t just want to sit and wait for people to come in—but when has that ever worked anyway? We need to redouble our efforts to achieve what our goal has always been: to get and keep clients.”

— Tori Rodriguez

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