Skip to content
  • About
  • Contact
  • Contribute
  • Book
  • Careers
  • Podcast
  • Recommended
  • Speaking
  • All
  • Physician
  • Practice
  • Policy
  • Finance
  • Conditions
  • .edu
  • Patient
  • Meds
  • Tech
  • Social
  • Video
    • All
    • Physician
    • Practice
    • Policy
    • Finance
    • Conditions
    • .edu
    • Patient
    • Meds
    • Tech
    • Social
    • Video
    • About
    • Contact
    • Contribute
    • Book
    • Careers
    • Podcast
    • Recommended
    • Speaking

Improve mental health by improving how we finance health care

Steven Siegel, MD, PhD
Policy
February 3, 2020
Share
Tweet
Share

It takes an average of 10 years between symptom onset for mental health conditions to be accurately diagnosed and therefore treated. In addition to general misunderstandings about mental health, the nationwide shortage of mental health providers is one unignorable cause for this devastating delay. But why is there a shortage? Well, the bottom line is … the bottom line.

In simple terms, insurance companies do not pay enough for mental health services. The majority of commercial insurance companies only pay one-half to two-thirds of the cost of care, so many private practitioners cannot cover their own salary and expenses based on the abysmal payments from insurance.

This means that too many Americans don’t have adequate access to mental health care through their health insurance plans. This is largely attributable to low payment scales that limit the number of practitioners able to take insurance, forcing patients to pay cash or out-of-network rates.

To understand why this happens, one must understand the two sets of fees paid by insurance companies. The first, professional fees, are the payment to the doctor for her or his services. These fees include processes (e.g., interviewing, diagnosing, treatment plan) and procedures (e.g., surgery, radiation, catheterization). The second set of fees is hospital charges and facility fees. These are the payments for the use of structures and/or equipment (e.g., inpatient stays, outpatient MRI, radiology).

Money flows to these different aspects of care in a disproportionate manner, causing relatively high payments for facility fees and procedures, with lower payments for processes. Since they don’t usually perform procedures, mental health providers are paid only for professional fees.

Furthermore, mental health providers do not generally refer patients to use the aspects of medicine that generate procedures. Many health care systems would prefer to employ a robust staff of primary care providers and specialists — like neurologists — who generate more procedures, thus generating more revenue. This is an additional loss for mental health providers, who don’t have the ability to underwrite employee salaries from a health system based on referrals.

So why don’t health systems increase mental health professional fees? The answer is frighteningly simple: The people making decisions about how value is set are the same people who reap these high fees.

Specifically, most insurance companies base their payment scales on standards set by Medicare through the Centers for Medicare and Medicaid Services (CMS). In turn, CMS bases Medicare rates on recommendations from the American Medical Association’s Relative Value Scale Update Committee (RUC), largely comprised of surgeons and procedure-based specialties.

The RUC sets a large proportion of the rate based on time reported, and a multiplier for complexity of each case. Thus, it calculates that an hour of procedure time is worth three-to-five times that of a psychiatrist and six-to-ten times that of a psychologist. For some aspects of medicine, that ratio can be staggeringly higher.

While it would be naïve to assume these values are set to cause a mental health workforce shortage intentionally, one must recognize the devastating consequences that the devaluation of mental health services causes for patients and providers alike.

The RUC has a powerful opportunity to help right this situation. By revising how they value mental health services, the RUC can help set a precedent for higher provider reimbursement rates. In turn, CMS can also reform how they reimburse for mental health services, which would set the stage for other insurance companies to follow suit.

Policymakers have an important part to play in helping to reform these archaic financing measures. In ongoing conversations about health care pricing, surprise medical billing, and other topics, our legislators must invest resources that strengthen and grow the mental health workforce.

At the end of the day, people are hurting and need access to care. Reimbursement rates directly impede patients’ ability to get care because mental health providers simply cannot afford to treat them.

ADVERTISEMENT

Steven Siegel is a professor, Department of Psychiatry and Behavioral Health Sciences, Keck School of Medicine of the University of Southern California, Los Angeles, CA.

Image credit: Shutterstock.com

Prev

Sharing medical records won't work

February 3, 2020 Kevin 0
…
Next

The doctor who avoids answering your questions

February 3, 2020 Kevin 0
…

Tagged as: Psychiatry, Public Health & Policy

Post navigation

< Previous Post
Sharing medical records won't work
Next Post >
The doctor who avoids answering your questions

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

Related Posts

  • Sharing mental health issues on social media

    Tarena Lofton
  • How social media can help or hurt your health care career

    Health eCareers
  • Turn physicians into powerful health care influencers

    Kevin Pho, MD
  • A step forward: a way to advance the mental health of health care professionals

    Mattie Renn, Thomas Pak, and Corey Feist, JD, MBA
  • A specific way to improve our health care delivery system

    Lea Lefkowitz
  • The promise and challenge of integrating primary care into community-based mental health centers

    Betty Rabinowitz, MD

More in Policy

  • The lab behind the lens: Equity begins with diagnosis

    Michael Misialek, MD
  • Conflicts of interest are eroding trust in U.S. health agencies

    Martha Rosenberg
  • When America sneezes, the world catches a cold: Trump’s freeze on HIV/AIDS funding

    Koketso Masenya
  • A surgeon’s late-night crisis reveals the cost confusion in health care

    Christine Ward, MD
  • The school cafeteria could save American medicine

    Scarlett Saitta
  • Native communities deserve better: the truth about Pine Ridge health care

    Kaitlin E. Kelly
  • Most Popular

  • Past Week

    • What’s driving medical students away from primary care?

      ​​Vineeth Amba, MPH, Archita Goyal, and Wayne Altman, MD | Education
    • A faster path to becoming a doctor is possible—here’s how

      Ankit Jain | Education
    • Make cognitive testing as routine as a blood pressure check

      Joshua Baker and James Jackson, PsyD | Conditions
    • The dreaded question: Do you have boys or girls?

      Pamela Adelstein, MD | Physician
    • A world without antidepressants: What could possibly go wrong?

      Tomi Mitchell, MD | Meds
    • Rethinking patient payments: Why billing is the new frontline of patient care [PODCAST]

      The Podcast by KevinMD | Podcast
  • Past 6 Months

    • What’s driving medical students away from primary care?

      ​​Vineeth Amba, MPH, Archita Goyal, and Wayne Altman, MD | Education
    • The silent crisis hurting pain patients and their doctors

      Kayvan Haddadan, MD | Physician
    • Internal Medicine 2025: inspiration at the annual meeting

      American College of Physicians | Physician
    • What happened to real care in health care?

      Christopher H. Foster, PhD, MPA | Policy
    • Are quotas a solution to physician shortages?

      Jacob Murphy | Education
    • The hidden bias in how we treat chronic pain

      Richard A. Lawhern, PhD | Meds
  • Recent Posts

    • What prostate cancer taught this physician about being a patient

      Francisco M. Torres, MD | Conditions
    • Why fearing AI is really about fearing ourselves

      Bhargav Raman, MD, MBA | Tech
    • The broken health care system doesn’t have to break you

      Jessie Mahoney, MD | Physician
    • Why great patient outcomes don’t protect female doctors from burnout [PODCAST]

      The Podcast by KevinMD | Podcast
    • Why ADHD in women is finally getting the attention it deserves

      Arti Lal, MD | Conditions
    • How a $75 million jet brought down America’s boldest doctor

      Arthur Lazarus, MD, MBA | Physician

Subscribe to KevinMD and never miss a story!

Get free updates delivered free to your inbox.


Find jobs at
Careers by KevinMD.com

Search thousands of physician, PA, NP, and CRNA jobs now.

Learn more

View 3 Comments >

Founded in 2004 by Kevin Pho, MD, KevinMD.com is the web’s leading platform where physicians, advanced practitioners, nurses, medical students, and patients share their insight and tell their stories.

Social

  • Like on Facebook
  • Follow on Twitter
  • Connect on Linkedin
  • Subscribe on Youtube
  • Instagram

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

  • Most Popular

  • Past Week

    • What’s driving medical students away from primary care?

      ​​Vineeth Amba, MPH, Archita Goyal, and Wayne Altman, MD | Education
    • A faster path to becoming a doctor is possible—here’s how

      Ankit Jain | Education
    • Make cognitive testing as routine as a blood pressure check

      Joshua Baker and James Jackson, PsyD | Conditions
    • The dreaded question: Do you have boys or girls?

      Pamela Adelstein, MD | Physician
    • A world without antidepressants: What could possibly go wrong?

      Tomi Mitchell, MD | Meds
    • Rethinking patient payments: Why billing is the new frontline of patient care [PODCAST]

      The Podcast by KevinMD | Podcast
  • Past 6 Months

    • What’s driving medical students away from primary care?

      ​​Vineeth Amba, MPH, Archita Goyal, and Wayne Altman, MD | Education
    • The silent crisis hurting pain patients and their doctors

      Kayvan Haddadan, MD | Physician
    • Internal Medicine 2025: inspiration at the annual meeting

      American College of Physicians | Physician
    • What happened to real care in health care?

      Christopher H. Foster, PhD, MPA | Policy
    • Are quotas a solution to physician shortages?

      Jacob Murphy | Education
    • The hidden bias in how we treat chronic pain

      Richard A. Lawhern, PhD | Meds
  • Recent Posts

    • What prostate cancer taught this physician about being a patient

      Francisco M. Torres, MD | Conditions
    • Why fearing AI is really about fearing ourselves

      Bhargav Raman, MD, MBA | Tech
    • The broken health care system doesn’t have to break you

      Jessie Mahoney, MD | Physician
    • Why great patient outcomes don’t protect female doctors from burnout [PODCAST]

      The Podcast by KevinMD | Podcast
    • Why ADHD in women is finally getting the attention it deserves

      Arti Lal, MD | Conditions
    • How a $75 million jet brought down America’s boldest doctor

      Arthur Lazarus, MD, MBA | Physician

MedPage Today Professional

An Everyday Health Property Medpage Today
  • Terms of Use | Disclaimer
  • Privacy Policy
  • DMCA Policy
All Content © KevinMD, LLC
Site by Outthink Group

Improve mental health by improving how we finance health care
3 comments

Comments are moderated before they are published. Please read the comment policy.

Loading Comments...