Three years ago, she became deeply depressed and started planning to commit suicide. So despondent she could hardly get out of bed, Murray felt as though she could not tolerate another day.
"I couldn't figure out how to stop this madness," she says. "I couldn't think of any alternative but to stop living."
Alarmed friends helped to arrange for her admission to a private Boulder mental hospital, where she was diagnosed as bipolar. People with that condition experience dramatic mood swings between soul-crushing depression and manic exultation, and scientists now see it as a biologically based illness triggered by chemical imbalances in the brain.
As Murray struggled to pull herself together, she suddenly was faced with a new problem: Her Prudential insurance policy said it would cover several weeks in a mental hospital, but her insurer refused to authorize her stay. Under managed care, a clerk who had never talked to Murray was denying her claim, ruling that her stay in the hospital wasn't "medically necessary."
"After five days in the hospital, someone came in and said, 'You've been denied. You have to pay cash or find somewhere else to go,'" Murray recalls.
Not knowing what else to do, she put the charges on her credit card. She spent a month in the hospital and was discharged with a bill for $17,000.
"I thought I would get reimbursed," she says.
Ironically, during her stay in the mental hospital, Murray had a firsthand view of the difference in the way mental and physical health claims are treated. She developed a heart murmur and was sent to a regular hospital for treatment. "It was all pre-approved by the managed-care company," she says. "There wasn't a question asked."
Trying to get reimbursed for her stay in the mental ward was another story. "They'd say, 'The claim hasn't been processed,'" she remembers. "The supervisor would never call me back."
Instead, the insurer denied her request for payment, and she began an endless round of appeals. Finally she hired an attorney, and, more than a year after Murray had left the hospital, the insurer agreed to settle the claim for $3,600, leaving her to come up with more than $13,000.
Murray has been able to make good money working in sales and marketing, an ability she attributes to the manic side of her personality. After leaving the hospital, she took a job with a large corporation and found that her insurance was covered under Colorado's "parity" law, which mandates that treatment for biologically based mental illness be covered to the same extent as physical illnesses. She had regular appointments with a psychiatrist that were paid for and found that a combination of medication and talk therapy stabilized her condition and allowed her to function fairly well.
Then she took a new job with an insurance plan that was self-insured and exempt from the state parity law. She soon found out why that mattered.
"Last December, out of nowhere, I was slammed with another depression," she says. "I was so sick. I saw the psychiatrist once a week and the therapist once a week. When I go in to see the psychiatrist, they'll pay 50 percent of ten visits a year. I used that up by the end of February."
No longer able to work, Murray now faces out-of-pocket medical expenses of $1,200 a month.
"It's Jurassic Age treatment to keep people from getting treated for mental illness when it's physiologically based," says Murray. "I've used up all my benefits for the year, and I have no coverage. That's managed care."
Murray's frustration with her mental-health coverage is commonplace.
Local psychologists and psychiatrists have to do constant battle with insurers to get approval for their patients' treatment. Professional Web sites and magazines are filled with angry diatribes against an insurance system many believe has singled out mental health as an easy target for cost-cutting. Several national studies have found that spending on mental-health care by insurance carriers has declined to a far greater degree than spending for general health care over the past decade.
"I think the mental-health profession is an easy target to be exploited because our patient population has special vulnerabilities," says Dr. Doris Gundersen, president of the Colorado Psychiatric Society.
Because there is still a stigma attached to mental illness, Gundersen says patients feel embarrassed by their condition and hesitate to raise a fuss when an insurer denies their claim. "Someone who's trying to get treatment for depression isn't going to go to the press," she says. "These patients can't advocate for themselves the way someone might who has diabetes."
Dr. Harry Corsover, an Evergreen psychologist, agrees. "If [insurance companies] had designed this system to make depressed and anxious people go away, they couldn't have done a better job."
As a result, many mental-health professionals these days engage in a sad new avocation -- exchanging managed-care horror stories. The most tragic cases involve suicidally depressed clients who are denied admission to psychiatric hospitals and then take their own lives.
Boulder psychologist Ivan Miller collects these stories; one recent afternoon, he pulled one out of a file he keeps on his desk.
A Denver-area colleague had written in exasperation. She had been contacted by the friend of a former patient, who feared that Mr. Green (not his real name) was suicidally depressed. The psychotherapist had talked to him for fifteen minutes and concluded that he was suicidal. "I diagnosed [him] as being very lethal and told him that he should be hospitalized immediately as a danger to himself," wrote the therapist.
She then contacted his insurer. "I explained my credentials to this reviewer as well as my prior knowledge and treatment of this patient and assured him that hospitalization was necessary. The reviewer ignored my professional judgment...that the patient sounded worse than I'd ever heard him."
Instead, the reviewer "insisted that the patient call him to 'discuss our options.' I figured that the reviewer was going to try to deal with [Mr. Green's] distress as an outpatient and so registered my strenuous objections to anything less than hospitalization. The reviewer refused to authorize an admission, insisting he talk directly to the patient."
She reluctantly gave the patient the reviewer's name and phone number and explained the situation to Mr. Green. She learned the next day that the man committed suicide through a lethal dose of drugs. "By not responding appropriately to either the patient's distress or the judgment of a qualified and licensed social worker, the managed-care company abetted [him] in his suicide."
The insurance companies' refusal to hospitalize Mr. Green and others like him has had serious ramifications for medical care in Denver. Several private mental hospitals have shut down in Denver, and the number of private psychiatric beds has declined from 1,400 to 300. Just gaining admission to a mental hospital is difficult; being allowed to stay more than a few days is virtually impossible, experts say.
"The idea of a three- or four-month hospital stay for someone who's suicidal is reasonable," says Miller. "Under managed care, a psychiatrist meets them for an hour, gives them a prescription and discharges them two days later. There's no way you can treat them in that period of time."
Kathleen Sylvia of Littleton knows just how hard it can be to get mental-health care under managed care.
Sylvia believes her sixteen-year-old son may suffer from bipolar disorder. He is frequently aggressive and even violent toward his family, he abuses alcohol and drugs, and he disappears for days at a time. The family is covered by a Blue Cross/Blue Shield "preferred provider" plan. Sylvia and her husband even opted to pay extra for a plan that claimed to offer a higher level of mental-health and substance-abuse treatment than the standard plan. She says the plan promised to cover thirty days of inpatient treatment for substance abuse and 24 visits per year to a licensed psychologist or psychiatrist.
After a psychologist told her that her son's problems were so serious he needed to be evaluated by a psychiatrist, she began calling the 25 psychiatrists listed as part of the plan. "I called every single one," she says. "One of them had retired six years ago. Another one hadn't been taking Blue Cross [patients] for three years. Another was just a residence; a lady answered the phone and said, 'This has been going on for years. People call me, and I'm not a psychiatrist.'"
Most of the psychiatrists on the list said they were not taking new patients. The few that were didn't work with adolescents. In exasperation, Sylvia had to arrange for a Wheat Ridge psychiatrist to evaluate her son; she had to pick up the $425 cost herself.
Since all the people who talked to her son recommended that he be placed in a drug and alcohol treatment program, Sylvia also contacted all the inpatient facilities listed by Blue Cross as part of its network. She called 22 different facilities; not one of them had a program that would take her son. Sylvia says when she called Blue Cross, they told her there was nothing they could do to help.
"We found out our insurance is about as effective as using yen to buy groceries at Safeway," she says.
Now the family may have to spend more than $8,000 to place the boy in a 45-day treatment program. "We have no option but to go out of network," says Sylvia. "Most people wouldn't have the option of paying out of pocket. At least for us it's feasible. There's probably a lot of parents out there who know their kids need help but don't know what to do."
A spokesman for Anthem Blue Cross/Blue Shield claims Sylvia's case was mishandled. Like many insurers, Blue Cross subcontracts management of mental-health coverage to a company that specializes in that field, in this case Magellan Behavioral Health, the largest such company in the country.
"There must be something that fell through the cracks," says Don Stengele of Blue Cross. "The Magellan process would be that after three or four attempts, they would be referred instantly to a case manager who would intercede on the patient's behalf. Why that didn't happen, I don't know."
Stengele also acknowledges that there is a shortage of psychiatrists in Colorado, especially those who treat children and adolescents. "There's a lot of competition for psychiatrists," he says.
One of the reasons Sylvia had such a difficult time is that many local psychiatrists -- tired of filling out reams of paperwork and fighting with insurers -- are now refusing to take new managed-care clients.
"There have been a large number of psychiatrists who have dropped out of managed care," says Gundersen. "The administrative burdens have become intolerable."
Just a decade ago, most Americans still had traditional "indemnity" health insurance, which was usually easy to use. Someone got a bill from a doctor, they submitted it to the insurer, and it was paid. However, huge increases in the cost of medical care in the 1980s convinced employers and government officials that this system was unsustainable. For years, medical inflation ran at two to three times the overall inflation rate, and those who were paying the bills demanded that something be done.
"In general, what we found was that people were using up benefits no matter what the situation was," says Pamela Greenberg, executive director of the American Managed Behavioral Healthcare Association, which represents companies that manage mental-health insurance plans. "There was often a 28-day allowance for inpatient hospitalization. That was the magic number. That was what insurance paid for, and that was what people got. There were also lengthy outpatient visits -- the Woody Allen style of treatment, where you go for weekly sessions for years."
Even managed care's sharpest critics agree that there were many abuses of mental-health benefits under the old indemnity system. Expensive inpatient care was especially misused, as patients were often kept in mental hospitals for as long as the insurance would pay, regardless of their condition. "There was a lot of fraud and abuse," concurs Greg Danko, who works with people challenging managed-care denials of treatment as part of the Colorado-based Patient Advocacy Coalition.
As managed care took shape in the last decade, two types of plans emerged: "health maintenance organizations," which closely supervise the medical expenditures of members, and "preferred provider" networks, which steer patients to doctors who have signed contracts with insurers. Today more than 90 percent of Coloradans with private health insurance are covered by some type of managed care.
According to the Surgeon General, one in five Americans has some type of mental disorder in any given year. Fifteen percent of the adult population use some form of mental-health service during the year.
In Colorado, state law mandates a minimum annual mental-health benefit of 45 days for inpatient care for serious conditions and $1,000 for outpatient visits. (However, those minimums apply only to about 50 percent of the health plans in the state. That's because many large companies have self-insured health plans that are regulated by the federal law known as ERISA -- the Employee Retirement Income Security Act. That law does not mandate mental-health coverage.)
But it's up to the managed-care company to decide what treatment is "medically necessary." Even if the state says the plan has to offer six weeks of hospitalization, for example, and a psychiatrist insists that his patient needs that care, the managed-care gatekeeper can deny the treatment.
This infuriates many mental-health providers and their clients, who see the gatekeepers as remote bureaucrats who know nothing of their patients but are able to make potentially life-altering decisions.
Dr. Bert Furmansky is a Denver psychiatrist who feels the impact of managed care every day on his own lap. Furmansky has to take notes on a laptop computer while talking to a patient in order to prove to the managed-care gatekeeper that the client truly needs care. Furmansky says this demand for constant proof of treatment makes it even more difficult to help his patients.
"Taking notes interferes with intimacy with a patient," he says. "It alters trust in the process and trust in a doctor."
And many providers are alarmed that their notes on patients have to be turned over to a faceless bureaucrat who could do just about anything with them.
"For treatment to work, there needs to be an understanding of confidentiality," says Furmansky. "This creates a significant problem in terms of relationships with patients."
"The diagnosis becomes part of the insurance record," adds Corsover. "Who knows who gets access to that. Once you file an insurance claim, you've signed away all that confidentiality."
Greenberg says that the companies she represents don't demand detailed psychological notes. Additionally, the federal government recently issued new regulations to protect patient privacy, and Greenberg says that will help mental-health clients. "You'll see things tightened up with the new regulations," she predicts.
Even more upsetting to Furmansky is that the person making decisions on "medically necessary" treatment may be a clerk in a city hundreds of miles away who has no training in psychiatry.
"How can a person without psychiatric training review psychiatry?" he asks.
Like many of his colleagues, Furmansky is now refusing to take on new managed-care clients.
Corsover shares his frustration with the oversight from managed-care companies. "Somebody in another state who may be a clerk will look at the treatment I'm proposing and make a judgment with so little information that if a professional did it, they would be guilty of unethical practice," he says. "If they deny it, you have to appeal it. There are some cases where I spend as much time on the phone with them as I do treating a client."
Greenberg claims that most managed-care companies have a medical director who supervises the people making decisions on care. "There's always a medical director available, but it may not be the first line of contact they have."
One of the most dramatic impacts from managed care has been the loss of hundreds of private psychiatric hospital beds in the Denver area. Inpatient care is the most expensive type of mental-health treatment, and managed-care companies have aggressively cut back on admissions. Three years ago, Bethesda Behavioral Health Hospital in southeast Denver closed after decades of service, and there has been a wave of closures and downsizing at psychiatric facilities run by HealthONE, University Hospital, Exempla Healthcare and Centura Health.
"It was sad, because Bethesda had such a long history here," says Stan Banaszak, the hospital's last director. "Many payers didn't consider mental health to be the same as a physical illness. In today's market, with managed care, hospitals have to adjust how they're doing things. You won't find mental hospitals that keep people from 30 to 60 days. They keep them for two weeks at the most."
Those who run the remaining inpatient facilities in the metro area feel deluged.
"We have eighty beds, and many times, that unit is full," says Dr. David Munch, medical director of Exempla Lutheran Medical Center, which operates the West Pines psychiatric center. "We have people in our emergency department who need inpatient care, and we can't find any place to send them."
At the same time that private insurance has made it harder for many people to get care, the publicly funded mental-health system has been overwhelmed. The number of beds in the state system of mental hospitals has remained static at 734, even as Colorado's population has grown by more than one million over the past decade. Many local mental-health centers have long waiting lists for treatment, including many people who were denied treatment by their insurance carriers. Even more disturbing, state officials say the mentally ill are increasingly likely to wind up in jail or prison, with the prison system being used as a de facto mental hospital.
"If we had adequate coverage in the private sector, so many people would not be getting pushed into the public sector," says Jeanne Rohner, executive director of the Mental Health Association of Colorado. "If we had adequate treatment in the public sector, people wouldn't be winding up in the criminal justice system. The prison system is now the largest provider of mental-health care in Colorado."
Munch says that local emergency rooms have become the landing spot for people suffering psychological breakdowns, and Lutheran saw a 32 percent increase in emergency psychiatric visits last year. He says many of these people wouldn't wind up in such desperate straits if they had adequate outpatient care.
"We're seeing a lot sicker behavioral patients in society," says Munch. "We're not meeting the needs of this population."
Critics also charge that managed care is diverting huge amounts of money into a private bureaucracy that now supervises most Americans' health care.
The federal government spends about 4 percent of Medicaid and Medicare funds on overhead. But private managed-care companies often have huge expenses for administration, with an estimated 12 to 40 percent of all revenue going into bureaucracy rather than health care. Independent auditor Jim Wrich, of Madison, Wisconsin, who evaluates managed-care plans for businesses, has estimated that at least 40 percent of the revenue collected for mental health go into overhead.
The multiple forms and endless questionnaires that providers must fill out have to be opened, read andprocessed by armies of clerks, supervisors and medical directors. In addition, most managed-care companies have panels of doctors that review appeals of denied care. Many mental-health professionals believe precious health-care dollars are being used to support a Kafkaesque bureaucracy more concerned with saving money and justifying its own existence than with helping people get well.
"They have layer upon layer of administration that's not reported to the public," says psychologist Corsover. "If they've reduced the costs of treatment by 14 percent, they've reduced the amount going to care by 50 percent. I think people are getting ripped off. But they have wonderful marketing departments. Their names always include the words 'choice' and 'options.' It's Orwellian, because they're taking away options and choice. The client and doctor are no longer in charge of treatment."
Because most managed-care insurers are private, for-profit companies, they don't have to disclose their administrative costs. That makes it difficult to ascertain exactly how much is being spent on anything other than health care. But there are several studies that offer clues as to how they split up health-care dollars and exactly what the impact has been on mental health.
A 1999 report by the Surgeon General of the United States notes that "trends indicate that in some segments of the private sector, per capita mental-health expenditures have declined much faster than they have for other conditions."
Also, a 1998 study by the Hay Group, a Washington, D.C., consulting firm, found that spending on general health benefits had declined just 7 percent in the previous decade, while spending on mental health dropped by 54 percent in the same period. As a percentage of total health benefits, mental-health care dropped from 6.2 percent to 3.1 percent.
The federal Substance Abuse and Mental Health Services Administration found a similar pattern in a study released last summer. That report said that total spending to treat mental illness and substance abuse had declined from 8.8 percent of total health care costs in 1987 to 7.8 percent in 1998. Those numbers include both public and private expenditures, and the study said that costs had been shifting from the private sector to the government, with Medicaid and Medicare picking up 56 percent of the total.
Several studies in academic journals back up these figures. Researchers Thomas Wickizer and Daniel Lessler found that requests for days in mental hospitals were approved at a rate of 54 percent, while the approvals for obstetrics were 93 percent, and for surgery, 83 percent. They also found that the average number of hospital days approved for general patients dropped 23 percent after managed care was introduced, while the number of hospital days approved for mentally ill patients declined 47 percent. That study also reported a significantly higher likelihood for readmission to the hospital for patients whose care was terminated by managed care.
At the state level, although the Colorado Division of Insurance tracks complaints against managed-care companies, it doesn't break out the complaints involving mental health, so no one knows how the mental-health records of different insurers in the state compare.
Boulder psychologist Miller believes that many of the cutbacks in mental-health spending are being driven by companies such as Magellan that subcontract with insurers to handle mental-health claims. Cutting expenses can earn them bonuses from the insurance companies.
"These companies have sprung up because it's easy pickings," he says. "They get to keep their savings."
Greenberg, of the American Managed Behavioral Healthcare Association, acknowledges that spending on mental-health care may have declined, but she says managed care is being used as a scapegoat.
"There are studies that show that spending for mental health and substance abuse has declined the last few years, but the leap that's being made is that the reason spending has decreased is because of managed care. We react to the dollars we're able to get from our purchasers. The funds start being eliminated at a higher level. Unfortunately, behavioral health care gets the short end of the stick when it comes to health benefits."
Managed care has brought discipline to out-of-control mental-health costs, insists Greenberg, adding that doctors like Miller simply aren't used to having their judgment questioned.
"We're asking the providers to explain what are your goals for this patient," she says. "You've got more than one set of eyes and ears looking at each case. All right, Pamela is depressed, what can we do to treat that? She can see a therapist for a certain amount of time, and we can give her medication. Before, if people could go for fifty sessions, they would."
By supervising treatment, Greenberg also claims that managed care can find less expensive alternatives to hospitalization. "Part of this is treatment in different kinds of settings," she says. "Not everybody has to be treated in a hospital. With managed care, there are alternate types of treatment that are less expensive."
Greenberg adds that those bashing managed care may be waiting a long time for an alternative.
"We would never say we're perfect and everything's great, but managed care is not going away anytime soon."
Outrage over denials of medical care by insurers has spawned a number of lawsuits around the country, as well as legislation intended to help the mentally ill collect promised benefits. However, people covered by insurance plans under the federal ERISA law -- about half of the policies in Colorado -- have no right to sue for denied care. That's led to the push in Congress for a federal Patient's Bill of Rights, which would allow people to challenge insurers in court.
Insurance companies are among the largest contributors to political campaigns at both the state and federal levels. This financial clout has helped the industry fight off much of the legislation intended to protect consumers. While the Colorado Legislature has resisted giving residents the ability to sue their managed-care companies, legislators have passed laws intended to make it easier for people to appeal denials of care by insurers.
After an intense lobbying effort by mental-health professionals, the state legislature passed a "parity" law in 1997 that is supposed to require insurers to provide coverage to people with six different biologically based mental illnesses -- schizophrenia, schizoaffective disorder, bipolar affective disorder, major depressive disorder, obsessive-compulsive disorder, and panic disorder -- that is no less extensive than the coverage provided for any other physical illness. That law was strengthened this year when the legislature passed a bill mandating that these claims be processed in a similar fashion to claims for physical ailments.
Reviews of the state's parity law are mixed. Some say it has helped people with those conditions get better care, while others believe insurers have found ways to get around the law. "If it's a parity diagnosis and you're assertive about it, they'll honor it," says the Psychiatric Society's Gundersen.
But Greg Danko, of the Patient Advocacy Coalition, says insurers can still claim that they're approving only what's medically necessary and violate the spirit of the law. "They're finding ways to slide around the parity law," he says.
A few states have passed laws mandating parity for all mental-health treatment, but so far, such a proposal hasn't been seriously considered by Colorado's legislature. (The state parity law does not apply to ERISA self-insured policies. Those plans are covered by the much weaker federal parity law.)
Those who work with consumers trying to get insurers to pay for care say that people who are assertive and take their complaints to a supervisor or medical director are more likely to win appeals.
"People get really discouraged by this whole process," says Danko. "We're here to help."
The Patient Advocacy Coalition runs a health-rights help line, with trained counselors who help people navigate the appeals process. The coalition is a nonprofit that tries to mediate disputes between patients and insurers, and it is primarily funded by foundation grants. The coalition typically receives at least one call a day from someone with a complaint about mental-health coverage.
While consumers have some ability to challenge insurer denials, it's still an uphill battle. For one former therapist, that was enough to convince him to give up his career.
Mil Hart believed that psychotherapy was much more than just a job. It was a calling, giving him the opportunity to help troubled people. Because he specialized in working with survivors of childhood sexual abuse, he confronted some of the most horrific life stories imaginable. But he found great joy in watching his clients begin to turn their lives around.
"It's heartbreaking to see the damage that sexual violence to children does to people," says Hart. "But it's so wonderful to see people grow out of that damage."
Hart launched his practice in 1992, shortly after earning a master's degree from the University of Northern Colorado. He spent several years building up a practice in Greeley and Fort Morgan. As the years went by, more and more of his clients with insurance were in managed care, and Hart found himself devoting more time to quarreling with insurers and less time to doing the work that he loved.
He had to start justifying every single hour-long session he spent with a client, no matter how desperate the situation. He vividly recalls fighting with an insurance company over care for a woman who had been raped repeatedly by her father.
"They required approval after every four sessions," says Hart. "We had to set standards for what we were going to do. That took one session. Then we'd have two more sessions, then we'd spend the next session talking about what we were going to tell the insurance company. Then we'd have to talk about what the insurance company said. One day I walked into my office, and a voicemail [from the insurer] said, 'We've revoked the four sessions.' It was a bunch of crap."
Meanwhile, Hart's patient worried about whether she would get any treatment at all.
"They were making this poor woman even more crazy. We weren't helping her with her problems," he says.
Most of Hart's clients didn't have enough money to pay for care without insurance. He soon found that one-fourth of his practice was made up of people who couldn't pay at all.
"The most severely damaged people I worked with, I worked with pro bono," he says. "I couldn't turn them away. But to do that, I had to get paid somehow. I'm not talking about getting rich. I'm talking about making a living. I had to take care of my family."
Like other local therapists, Hart spent hours on the telephone with managed-care gatekeepers. Just getting the okay to treat someone was often a struggle, but Hart then found he had to fight to get payments he had already been promised.
"I'd call them, and they'd say they coded it wrong on the computer: In six to eight weeks, you'll get a check.' Then I'd call them six weeks later and get the same story."
A year ago, Hart made a sorrowful decision to give up his practice. He now works in the computer industry.
"It's been a real personal loss not to be doing this anymore, but I had to accept the reality," he says. "If it hadn't been for managed care, I'd still be doing it."
