Managed care, parity, third party pay, and the counselor
Feature Articles - Professional Ethics
Saturday, 30 November 2002

The situation is nothing short of ironic. Managed care organizations (MCOs) will reimburse chemical dependency counselors through hospital-based treatment programs, but refuse to include these same counselors when they provide coverage outside of the hospital environment. Numerous state and national hospital programs (many of which are no longer in operation) employed both NAADAC and state-certified counselors to run their inpatient chemical dependency programs, detoxification centers, and intensive outpatient programs. NAADAC counselors were employed as program directors, staff counselors, and therapists. They were either salaried or paid an hourly wage to treat clients admitted to hospitals for chemical dependency treatment covered under insurance policies.

Multidisciplinary services were provided to these clients while the chemical dependency counselor played a central role in patient care. Following a decade of managed care's involvement in all areas of medical and mental health services, providers in every discipline have been impacted to some degree, and as a result they have learned to adapt by providing a more streamlined approach when delivering services. The visible impact on the mental health field (chemical dependency in particular) has resulted in fewer inpatient hospitalization days, detoxification-only benefits, or in many cases no chemical dependency treatment benefits at all. Unfortunately, the impact of managed care over the past 10 years has left coverage for long-term residential or social learning models practically nonexistent. Research has indicated the longer an individual remains in a sober treatment environment the better their prognosis (Simpson, 1993; Simpson et al., 1997; Hubbard et al., 1997). Failure to include this vital segment of care for individuals not only prolongs their recovery, but condemns them to repeat shorter term levels of care that are ineffective. In the long run, this is not cost effective for insurance companies.

Legislative process

For many years NAADAC and state drug and alcohol certifying boards have been involved in the process to have both state and national levels of government pass laws that would make certification or licensure a requirement for drug and alcohol counselors. The purpose being substance abuse counselors would meet certain educational criteria, experience internship training, and pass qualifying exams. As a result, this process would allow them to become licensed individuals and thereby eligible for third party pay and insurance reimbursement. For many states this has been an excruciating process that has yielded little in the way of real progress towards the goals of licensure. Certain states including Minnesota, Louisiana, and Texas have been granted licensure providing counselors meet master's level criteria and other standards of a state's certifying board. Consequently, counselors in these states receive the same insurance benefits as other mental health professionals.

In addition, recent advancements by the California Association of Alcoholism and Drug Abuse Counselors (CAADAC) and Senate Bill 537 suggest state licensure in California may be closer than ever (Daley, 2001). Senate Bill 537 is the first bill being considered by the House and Senate in California that recognizes CAADAC/NAADAC counselors. Bill 537 requires that both the Department of Alcohol and Drug Programs and the Department of Consumer Affairs conduct studies concerning the threshold of competencies and staffing requirements of public programs and report back to the legislature by early Spring 2002. Additionally, the bill requires the licensure be enacted by January 1, 2003. Currently, the Department of Consumer Affairs is estimating the study will take a minimum of 18 months to complete, and there has been no indication by the Governor whether he will sign the bill. CAADAC has countered with a suggestion of a provisional license for CAADAC/NAADAC certified counselors that sunsets in three years. For up-to-date positions on this bill, visit www.Leginfo.ca.gov/SB537.

Since their inception, MCOs often have received negative reviews from both patients and providers, primarily for their unwillingness to provide authorization for inpatient hospitalization and long-term residential services (for alcohol or drug dependence). The MCOs' goal has been to provide the client with the appropriate level of care needed under prearranged contract coverage, and ensure that the distribution of benefits and services is rendered accordingly. Given this MCO objective, the new millennium holds much promise for the certified counselors.

For at least a decade, the state and national alcohol and drug certifying boards have been focusing the majority of their efforts on state and national legislative boards in an attempt to be acknowledged as licensed providers. The hope is that licensure would be sufficient criteria, as it is with other mental health disciplines, for insurance companies to cover counselors with third party pay. This may be useful for state and government employees working in the substance abuse field, however, obtaining this licensure may prove to be inconsequential to the individual provider.

MCOs alone decide who they reimburse, how much, how often, and for what services. Each managed care company sets their own standards concerning which professionals they choose to reimburse (licensed or not) and under what conditions. They have the right and the power to review and change any of their current policies.

Parity laws

Currently, parity laws for HMOs have been created to ensure that individuals who are covered under various employee benefit plans are allowed access to mental health services. Specifically, AB88 affects individuals who have mental health benefits attached to a HMO medical plan. AB88 is legislation that allows insured participants covered under HMOs and other MCOs to receive proper mental health benefits.

The word "parity" is derived from "par" (an equality of status, level, or value), or being "on par" with other medical disciplines. If an individual breaks his leg and requires medical attention, the parity law allows that individual to be treated according to what his medical needs are, not a preset, limited number of doctor visits. This same parity is now extended to the most commonly diagnosed psychiatric conditions, allowing therapists or psychiatrists to treat according to patient needs and not a "20 visit" limit. The parity diagnosis for mental health coverage is limited to mainstream mental illness problems, including psychotic disorders and affective disorders, and does not yet include substance abuse or dependence problems.

The trend in Southern California, based on current outpatient psychiatric practices, appears to be that major HMOs will continually distribute their mental health benefits to licensed providers, allowing the employee/insured to use their insurance benefit where they choose. It is highly probable that the parity laws will soon begin to include substance abuse and dependence as primary and dual-diagnosis disorders. It is also likely that given this trend, based on outpatient psychiatric practices and the increase in reimbursed non-hospital-based chemical dependency programs, certified NAADAC counselors providing substance abuse treatment (that meet the guidelines and standards set forth by these insurance providers) may become eligible for reimbursement with or without state or national licensure.

For the certified counselor waiting for legislation to be passed, this may continue to be unproductive time - time that could be better spent creating a solid working relationship with MCOs and going to the source of third party payment. This has been the pursuit of PsyCare Medical Corporation in San Diego, Calif., for the past five years. PsyCare Medical Corporation is a psychiatric and behavioral management group with 12 offices, 10 psychiatrists, over 50 PhDs, LCSWs, MFCCs, and three certified NAADAC/CAADAC substance abuse counselors. Along with various services and groups for all areas of mental health, PsyCare Medical Corporation also has an adult and adolescent Intensive Outpatient Program (IOP) for chemical dependency. At present, five different MCOs cover this program. Additional MCOs are prepared to cover these non-hospital-based programs as soon as State of California Department of Alcohol and Drug certification is obtained.

The certified counselors are reimbursed for outpatient treatment as well as individual therapy - the same as all other mental health professionals who provide treatment for depression, anxiety, and other mental disorders. This is possible due to a system that has been developed aimed at providing clients the services they need, in a cost-effective environment, delivered by certified counselors, and monitored by MCOs and PsyCare Medical staff. Since overhead costs are much lower for a non-hospital affiliated outpatient program, MCOs have embraced these programs.

Psychiatric/psychological group affiliation

Participation with psychiatric and psychological groups is the key to receiving third party reimbursement. First, working together with other disciplines increases treatment benefits for the client and allows for the treatment-team approach that has traditionally been utilized in the hospital-based program. Second, these groups already have ongoing managed care accounts, many of which would like to have outpatient substance abuse treatment provided instead of having clients being referred to other organizations. Third, some psychiatrists and other therapists prefer not to work with an addictive population, preferring to work only with the mainstream psychiatric disorders. Lastly, being part of a psychiatric group allows for more supervision, professional support to colleagues, and a professional practice representation to clients.

Field specialization

In my opinion (based on my experience in hospital chemical dependency programs and psychiatric based non-hospital programs), MCOs are extremely receptive to the idea of directing clients to the professional who can most appropriately, accurately, and expediently provide the services they need. Certified counselors who specialize with these populations as well as those who provide testing, research, program development, and court-mandated monitoring, are uniquely qualified to efficaciously deliver these services. The result is a client-focused approach to treatment where the specific needs of the individual are consistently met on all levels in a cost-effective manner.

Outcome monitoring

The tracking and outcome monitoring of clients has been extremely important at larger treatment facilities, including Hazelden. The effectiveness of substance abuse treatment was a key issue in the formation of managed care services in the first place. Non-hospital-based IOP programs that provide tracking on recidivism, length of abstention, referral to higher level of care, and other demographic variables provide valuable research to the field, and satisfy the MCOs' concerns regarding the effectiveness and quality of services provided.

Future directions

The NAADAC counselor, as well as the state certified drug and alcohol abuse counselor, is encouraged to take an active role in connecting with MCOs, and work to establish a relationship that informs them of our training procedures, competencies, specializations, ethics, and standards. Each state certifying board should enlist a managed care/third party pay committee to establish a working dialogue with MCOs and begin to find out what they expect in order to provide reimbursement to a certified drug and alcohol counselor, a non-hospital-based chemical dependency IOP service, or residential recovery home.

Furthering matters is Ron Israel MA, CADC, third party pay chair for CAADAC. He has created a survey (located at www.caadac.org) to be sent to every MCO and HMO in the state of California offering information on NAADAC/CAADAC counselors. The survey also requests information from these companies on what requirements they expect from NAADAC/CAADAC in order to include substance abuse counselors in their future contracts (for copies of the survey contact CAADAC at (916) 368-9412). Israel's logical and rational initiative to create a dialogue with major California HMOs and MCOs could be adopted by each state's drug and alcohol certifying board and, subsequently, third party pay committees. It would be highly beneficial for NAADAC and state certifying drug and alcohol boards to keep a record of those MCOs and HMOs who are currently reimbursing NAADAC counselors, and establish the criterion that will allow for other insurance companies to follow.

The American Psychological Association, American Psychiatric Association, Licensed Clinical Social Workers Association, and the American Marriage and Family Therapist Association all have an ethics committee that works in unison with legislative boards as well as a policy and procedures committee for receiving third party pay. This monitoring has acted as a safeguard protecting professionals from fraudulent billing practices, especially for government-funded reimbursements such as Medicare. NAADAC and state certified counselors do not need to re-invent the wheel. Our ethics committee should also work with legislative boards and our third party pay committees to create the same representation of professional accountability if we are to be included as covered practitioners in the future.

To date NAADAC certified counselors have received limited licensure or direct compensation in third party reimbursements. As previously mentioned, in California a legislation bill promoting licensure has finally been introduced in the Senate and is awaiting approval. In the interim, a non-hospital-based chemical dependency outpatient program for adults and adolescents managed by NAADAC/CAADAC counselors is receiving third party pay from major MCOs and HMOs following guidelines acceptable to these managed care companies. This trend can continue for other NAADAC counselors regardless of state or national licensure, provided we are accountable in the programs we manage and how we ethically monitor ourselves through our certifying boards.

Sean O’Hara, PsyD In-tern, CADC, is program director in addictive disease/adolescent program for PsyCare Medical Corporation in San Diego, California, in program development and research for PsyCare, and is currently serving as chairperson on the NAADAC board for the Third Party Pay committee. He can be reached at (858) 279-1223, ext. 471.

References

Daley, S. (Ed.). (2001). Freedom Newsletter, 9, (2), January-February; www.leginfo.ca.gov
Daley, S. (Ed.). (2001). Freedom Newsletter, 9, (3), March-April.
Hubbard, R. L., Craddock, S. G., Flynn, P. M., Anderson, J., Etheridge, R. M. (1997). Overview of 1-year follow-up outcomes in the drug abuse treat-ment outcome study (DATOS). Psychology of Addictive Behaviors,11, (4), 261-278.
O'Hara, S. J. (1997). Finding your niche in specialization. Professional Counselor, 15, (6), 39-40.
Simpson, D. D. (1993). Drug treatment evaluation research in the United States. Psychology of Addictive Behaviors, 7, (2), 120-128.
Simpson, D. D., Joe, G. W., Brown, B. S. (1997). Treatment retention and follow-up outcomes in the drug abuse treatment outcome study (DATOS). Psychology of Addictive Behaviors, 11, (4), 294-307.

For any questions, e-mail Sean O’Hara at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
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