Mental Health Reimbursement and Med Changes

Mental Health Service Reimbursement

How have changes in reimbursement and medications been a major driver in these policy and treatment changes?

As a Chief Nursing Officer, one must be at once informed of the practical, day-to-day challenges of nursing in the field and of the administrative realities shaping the occupation. With respect to the latter, it is important to understand the implications of insurance, Medicare and coverage terms and conditions. These frequently complex terms will have a direct impact on the experience of providing treatment. This is well demonstrated in a discussion on coverage vagaries relating to mental health treatment reimbursement. Especially with so many changes now taking place in the healthcare field, there is practical value in understanding the emergent conditions of mental health coverage.

The most immediate and impactful change in mental health coverage relates to the historical limitations placed on the scope of treatment reimbursement. Insurance companies first and, consequently, Medicare and Medicaid, placed caps on the amount of coverage that could be received for extended treatment on individual conditions This model persisted well into the 1990s and was an extension of the fee for service approach driving the healthcare reimbursement system on the whole. (Williams & Torrens, p. 9)

A troubling consequence of this system was the burden placed on individual system users, who would be required to pay high deductibles, co-payments and other cost-containment-based fees. A major transition would come with the adoption of managed healthcare, where more individualized plans would allow for a broader array of coverage options for patients. For those of us in the nursing profession, this change would result in a great deal more latitude in prescribing mental health treatment options. This is because the managed care approach relies on an interconnected network of healthcare providers and services. This allows us to refer patients to a host of post-discharge treatment options, whether working in an inpatient or outpatient treatment setting.

With respect to the former, managed care would promote the value of connecting with service providers external to the immediate healthcare facility. The use of referrals would drive the designation of services for which reimbursement could be gained.

Under the terms of Medicare, coverage limits for the mental health are largely determined by the plan that one carries. For instance, with Medicare Part A, limitation to coverage will be at least partially dependent on nature of the facility in question. If one is admitted for hospital service relating to depression, Medicare will cover all aspects of the hospitalization without limitation. By contrast, if one is admitted to a psychiatric facility, Part A covers treatment only up to 190 for inpatient treatment. (CMS, p. 1)

Such complexities are actually being gradually diminished though with the emergence of Bundled coverage options. This strategy will ultimately help to fold mental health service coverage into a more malleable way of requesting coverage. Here, a lump sum will be provided for coverage of an individual health plan with sums distributed to treatment providers as called for.