On March 23, President Obama signed into law the Patient Protection and Affordable Care Act (PPACA), Pub. L. 111-148 (H.R. 3590). One week later, he signed the Health Care and Education Reconciliation Act (H.R. 4872). These two bills comprise the most sweeping health reform legislation ever enacted in the United States. When fully implemented, 34 million formerly uninsured Americans will have health-care insurance.
This will likely translate into the implementation of much more stringent managed care reviews, reviews that are now being extended to out-of-network providers.
Naturally, this will have an impact on the economy. In 2009, the deficit was $1.4 trillion and was the largest as a share of GDP since the end of World War II. For 2010, the deficit is projected to be $1.3 trillion, representing the second largest. President Obama has said that he plans to reduce record deficits by reducing health-care spending by $143 billion over the next 10 years. He hopes to do this by cutting projected payments to Medicare providers and reducing payments to Medicare Advantage programs.
Despite the administration's plan to cut spending, it is expected that Congress will not allow a scheduled 21 percent cut in physicians' fees under the Medicare sustainable growth rate (SGR) formula to go into effect. The Congressional Budget Office (CBO) has conceded that some of the planned reductions in Medicare spending “might be difficult to sustain over a long period of time,” suggesting that physicians and other practitioners might opt out. If Congress prevails over the administration in eliminating cuts, then $210 to $360 billion will be added to the costs of Medicare, increasing, rather than decreasing, the deficit.
The Centers for Medicare and Medicaid Services (CMS) Office of the Actuary on April 22 alerted the administration that health-care costs might rise for the following reasons:
34 million additional patients will become insured under Medicare and private insurance.
I nsurance companies are required to fund free preventive, screening, and wellness services.
The increased demand for health-care services could drive up health-care prices.
Planned reductions in payment updates for Medicare providers based on increased productivity are unlikely, because they may encourage providers to opt out.
The Community Living Assistance Services and Supports (CLASS) long-term insurance program, which is counted on for $38 billion in savings over 10 years in the CBO estimate, will probably become unsustainable as a result of adverse selection by sicker higher-cost patients beyond 10 years.
There is a wide consensus that healthcare reform must reduce spending growth under Medicare, Medicaid, and private insurance. Private insurance companies will be prohibited from denying coverage for preexisting conditions, imposing lifetime or unreasonable annual limits on total payments, determining premium rates based on health status, and rescinding coverage for enrollees. Further, all qualified health insurance plans must contain an essential benefits package that must include coverage of “mental health and substance use disorder services, including behavioral health treatment,” and under the parity law, coverage for mental health services must be comparable to that for physical health services.
The net effect of these requirements will increase the cost of doing business for insurance companies. As a consequence, insurance companies are predicted to become far more concerned about per capita health-care spending. This will likely translate into the implementation of much more stringent managed care reviews, reviews that are now being extended to out-of-network providers. Additionally, insurers are likely to adopt the use of review companies that are paid a percentage of the claims that they deny. Some insurers are already experimenting with plans that permit access only to the lowest cost physicians. (See “Insurers Push Plans Limiting Patient Choice of Doctors,” The New York Times, July 17, 2010). Regardless of method, the aim will be to reduce expenditures.
Graham L. Spruiell M.D., and Fredric T. Perlman Ph.D., are co-chairs of the Committee on Government Relations and Insurance.
To address the arbitrary denial of claims, the health reform law requires private insurers to have both an internal and external appeals process which allows an enrollee to present evidence, while receiving continued coverage pending the outcome of the appeal. The external appeal process must include consumer protections set forth in the Uniform External Review Model Act promulgated by the National Association of Insurance Commissioners.
As with patients, there is also an appeal process for psychoanalysts, as providers. The Parity Act states the review process cannot be more stringent for mental health-care claims than for other types of insurance claims. If members of APsaA become concerned that reviews have been wrongfully conducted, or that there may have been a violation of the Parity Act, those members are encouraged to document the incident and forward this information to .
CGRI will carefully review these incidents and establish a Web-based catalog that will become a resource for members. If a violation in the review process or of the Parity Act is strongly suspected, this information will be forwarded for legal advice. Recommendations might include contacting the individual insurer and/or HHS. Naturally, becoming familiar with the new regulations is the best defense in the review process.
In the many “thou shalts” in health-care reform legislation that psychoanalysts are expected to follow, there remains one exception. The secretary of HHS is expressly prohibited from promulgating any regulation that violates the principles of informed consent and the ethical standards of health-care professionals. In addition to the possibilities of wrongfully conducted reviews and violations of parity, violations of professional ethics may also be a basis for appeal.
For more information on these topics, please see the CGRI newsletter. We are also in the process of developing a Web site, which will be coming out soon.
Editor's Note: To facilitate the Association's efforts toward transparency in the certification process, TAP will publish statistics and demographics annually. Questions and comments can be addressed to Paul Holinger at .