The Medicare Behavioral Health Failure

Despite growing need for elder behavioral health, Medicare doesn't make it easy

Posted Oct 07, 2015

There's been lots of recent attention to the broken, fragmented behavioral health system in our country. One area which hasn't been often discussed lies in the policies and procedures of one of the nation's largest funders of healthcare services, and one which almost every citizen in our country will one day rely upon, if they live long enough. For a great many Baby Boomers (as many as 76 million in the US), Medicare coverage is a significant part of their healthcare, either today, or in the future. Unfortunately, while Medicare provides coverage for their physical health issues, their mental and behavioral needs are sorely neglected by the Medicare system. This is not a small or insignificant issue. Mental illness and suicide rates are, well booming, in this population. Boomers currently have one of the highest suicide rates of any demographic in the country.
Protect Medicare coverage - but reform it

First, Medicare limits mental health coverage to a few restricted services. Outpatient psychotherapy and psychiatric services, and inpatient psychiatric hospitalization (including partial hospitalization) are often the extent of mental health services covered under the Medicare fee schedule. Psychiatric hospitalization is limited to a lifetime of 190 days inpatient, and Medicare prohibits payments to psychiatric hospitals with more than 16 beds. Both of these are issues addressed in a bill introduced by Pennsylvania Representative Tim Murphy.

These limited services simply aren’t enough, particularly when we are talking about people with chronic mental illnesses. Intensive community-based services such as Assertive Community Treatment, Case Management, Intensive Outpatient Psychotherapy, Day Treatment, Psychosocial Rehabilitation and many other evidence based services are unfunded by Medicare. Group homes and residential treatment for those with severe mental illness are not covered benefits. Unfortunately, such residential services are often paid for by the patient themselves, out of their Social Security, and the service they receive is marginal, if not downright abysmal. These are critical services that help those with mental illness remain in the community, and out of hospitals.

Secondly, a dramatic limitation by Medicare prevents many mental health clinicians from being able to serve the Medicare population. In most states, only psychologists, psychiatrists and advanced social workers may bill Medicare for mental health services. Throughout the country, counselors, one of the largest, growing groups of mental health clinicians, are unable to treat Medicare patients. Some agencies have used strategies such as “incident-to” billing, providing services by counselors, billed under a treating physician or psychologist. Unfortunately, these strategies may hold substantial liability and risk for the provider, as they exist in a grey zone of legality. As a result, many people on Medicare struggle to find a provider who can treat their behavioral health needs. Some states with restricted access to psychiatrists have opened up the ability of clinical psychologists to prescribe psychiatric medications. Unfortunately, Medicare refuses to allow these providers to bill for medication services, and as a result, Medicare patients cannot access these providers.

Thirdly, Medicare often does not cover services billed under a primary substance use disorder diagnosis, does not reimburse services provided by LADACs and substance use counselors, and does not pay for critical services such as psychosocial detox, case management, recovery coaching, peer support services, Intensive Outpatient Psychotherapy, Integrated Dual Diagnosis Treatment (IDDT) or residential treatment for substance use disorders. This is despite the fact that the Mental Health Parity and Addiction Equity Act and the parity aspects of the Affordable Care Act both demand that such restrictions end. Sadly, Medicare is only very slowly beginning to acknowledge these substance use needs, with no quick resolutions in sight. The Baby Boomer generation used drugs throughout much of their lives, and substance use problems in this generation continue to bring them into treatment. In my home city of Albuquerque, the City has a fund to pay for substance use treatment for people who cannot get services. Unfortunately, in many cases, these limited funds are paying for services to Medicare recipients, simply because the patients cannot access critical services due to Medicare's limitations.

Psychotherapy icoverage under Medicare is NOT enough
Source: "Psychotherapy" by Jty33 - Own work. Licensed under CC BY-SA 3.0 via Wikimedia Commons -

Many Medicare services are provided within primary care. This is appropriate, given the high levels of comorbid physical health issues in the Medicare population. Unfortunately, the (largely CMS-led) movement towards effective integration of physical and behavioral health is still only in early stages. Thus far, most such integration efforts have focused on basic mental health services, screening and brief interventions. Such strategies are effective with some, but fall far short of the intense needs of those with chronic mental illness and severe substance use disorders. Intensive and specialty services to such populations and needs are difficult to integrate within primary care settings or systems. 

Finally, and most significantly, Medicare coverage is very challenging from which to seek reimbursement, especially for behavioral health agencies and smaller providers. Medicare rates aren’t great, even if you have clinicians who can provide services under Medicare restrictions. Co-pays are high, often still higher for mental health services than for physical health, though this is an issue that’s been addressed somewhat in recent years. Unfortunately, equalizing co-pays is only the tip of the billing iceberg.

Patients with Medicare often enter treatment with their Medicare card showing coverage, but when the provider bills, we find out there are additional insurance companies involved, providing Advantage and Part B coverage. In numerous cases, my agency has been unable to get reimbursement from these companies, who we didn’t even know were involved in a patient’s coverage. Unfortunately, many patients have trouble keeping track of these companies. We’ve been denied payment for services rendered because we’re not contracted with the company, or because we didn’t get prior authorization before providing services (such as a basic intake and psychotherapy), or a variety of varied other reasons. Remember, the provider may often not know these insurance companies are involved until a claim is submitted, after services havebeen rendered. When there is dual-eligibility with Medicaid, or with other insurance companies, the complexities of contracting, credentialing, authorization and billing are all magnified many-fold. When dealing with these never-ending issues for weekly, low-fee basic psychotherapy services, the administrative burdens often outstrip the reimbursement. Further, both Medicare and various managed care organizations involved in Medicare reimbursement can, and do, deny services retroactively. I’ve literally had payment for services denied after the fact, where my clinicians were providing multiple therapy sessions in a week to an intensely suicidal patient, and Medicare later decided that multiple sessions weren’t really indicated (the fact that the patient was still alive as a result seemingly wasn’t a convincing argument).

Medicare providers are now required to submit regular quality and outcome information to Medicare, or face reductions in their reimbursement. Medicare providers are also required to be using, or moving towards, use of an electronic health record. While all of these requirements are good things, improving quality, they also pose substantial administrative and regulatory burdens on behavioral health providers, already overwhelmed by all of the above issues. As a result, behavioral health providers are increasingly choosing not to accept Medicare.  

Now, I’m speaking from my own professional experiences, and those of my colleagues, with Medicare services and payments, across multiple states. I’m hopeful that there are some systems where they have many more social workers and psychologists and people on Medicare have an easier time accessing services. Maybe some robust, clever systems have fouind ways to slice through these Gordian knots, and offer care to those who need them, without going bankrupt in the process. If you know of such a program, please let me know. I'd love to hear that people at high levels are talking about plans to fix these problems. But as far as I've seen, there's minimal attention to the severity and gross inequity of Medicare's response to behavioral health needs.

Perhaps CMS can learn from those systems how to reduce these countless layers of bureaucratic and administrative obstacles. I know that many Medicare Advantage plans cover some services that Medicare might not, and that there are things on the books that Medicare says are covered. But the cold, hard reality on the ground, is that many of these things exist in writing only, and are not widely or easily available to Medicare patients, because providers are increasingly frustrated by Medicare's adminstrative burdens. There needs to be immediate, strategic and solution-focused dialogue around these issues, and the need to begin addressing these obstacles. Unfortunately, changes to these systems move at a snail’s pace. In stark contrast, the behavioral health needs of our aging population are increasing at lightning rates. It is only through an effective, aggressive plan that identifies and addresses this maze of problems and obstacles, will the behavioral health needs of our parents be appropriately and effectively met.

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