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The Affordable Care Act’s effect on Mental Health Practitioners – By Ali Beheshti, J.D.
Recently, while helping my sister establish an Intensive Outpatient Program for addiction treatment, I have spoken with a number of Mental Health Professionals and have noticed that many of them are concerned about what the implementation of the Affordable Care Act (ACA) means for their practices. Some have heard that the changes in the law are going to be good for their practices, while others have heard it will have a negative effect. Undoubtedly when these discussions arise I’m the only person in the room with a Law Degree and my opinion on the topic is sought. After a few embarrassing incidents in which I had to admit I had no idea whether the law was going to have a positive or negative impact on mental health practices, I decided to do some research on the topic. After extensively looking into the matter I realized the answer was not as simple as “yes the law will have a positive impact on your practice,” or “no your practice will be hurt by the law.” The truth is that that the ACA’s effect on your practice is up to you. What I mean by this is that, just like any other industry, the professionals that adapt to an evolving marketplace flourish, while those that stay attached to old systems tend to perish (e.g. Netflix vs. Blockbuster, Amazon vs. Borders).
For mental health practitioners to adapt they need to first understand the changes their industry is headed towards. As many practitioners know, in 2008 Congress passed the Mental Health Parity and Addiction Equity Act (MHPAEA), which essentially required insurers to extended policies to cover treatment for mental health and addiction disorders in the same way they cover all other medical benefits (i.e. co-pays, deductibles, and so forth). The problem with the MHPAEA is that its implementation and enforcement, up until quite recently, have been nearly non-existent. However, with the implementation of the ACA, which extends and enforces the provisions of the MHPAEA, the industry is in for some large scale changes. Obviously there is going to be a large influx of newly insured individuals and even more importantly for mental health practitioners, all insurance policies will have to meet the minimum requirements set forth in the ACA, which includes coverage for mental health treatment. As people realize that their insurance policies cover these treatments it is highly likely more will seek out mental health and addiction treatment programs, which of course is beneficial to the mental health industry as a whole. However, these new individuals, as well as those already seeing mental health professionals, will have new expectations. The most important of which is that they will expect their physiatrists and therapists to take insurance. Therefore, those that don’t take insurance will begin to notice a decline in new patients and even the departure of some of their less loyal patients. While those that do take insurance will see an upswing in patients. Of course it is not all that simple to deal with the giant bureaucratic maze that is the insurance industry and billing services can charge anywhere from 5% to 15% of billings to do it for you. Additionally, insurers rarely pay individual practitioners their full hourly rates. The prospect of dealing with these substantial hurdles will certainly frighten most solo practitioners and those in small private practices (which most physiatrists and therapists are). However, these individuals are in luck because their colleagues in the general medical field that have private practices have faced the same challenges for some time now and have come up with a highly effective solution in the form of Independent Practitioner Associations (IPA).
Mental Health professionals have the benefit of learning from the experience of their colleagues in the medical profession on how to handle the vast changes about to take place in the structure of their own profession. When private practioners in the medical field began to deal with insurers they realized that their negotiating power was quite week on an individual level but that when they banded together through Independent Practitioner Associations their leverage during negotiations grew exponentially. They were able to get more insurers to cover their services and pay the rates that they expected to receive. They also found the power to hold insurers accountable to the laws that govern their highly regulated industry. With all the changes taking place in the insurance industry in regards to coverage of mental health care, there will be measures in place to make sure that insurers are meeting their new obligations under the law. Of course individual practioners do not have either the time or resources to deal with such large tasks and that why it is so important that they learn from their counterparts in the rest of the medical field and begin forming Independent Practitioner Associations as soon as possible.
These associations can be very beneficial to their members in a number of respects. As mentioned earlier, billing services charge anywhere from 5 to 15 percent for their services and individual practioners don’t have much leverage when negotiating with these services on their rates. If, however, practitioners are members of an IPA, then billing services will actually seek out the IPA and offer favorable rates to its’ members in exchange for the fact that they will receive such a large influx of new business. Insurers will follow suit for the same reason. Of course there is some downside to forming an IPA as well. For one, you have to contribute a portion of your earnings to the IPA to receive the benefits afforded to you by it. However, this cost can easily be offset by the lower rates you will to pay for billing services. Another serious downfall of these associations, that was learned the hard way by those in the rest of the medical profession, is that when theses associations grow in power the line between rate negotiation and price fixing, which can lead to antitrust litigation, gets very thin. That is why it is important to make sure you have trustworthy management of your IPA, which should most likely include an attorney that understands antitrust laws. These problems are far outweighed by the benefits of forming an IPA. The sooner the mental health professionals form such associations, the less likely they are to fall behind their colleagues and competitors.
If you have any questions on how to form an Independent Practitioner Association feel free to email me at [email protected] with your questions.
Ali Beheshti, J.D.