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Changes in HMO Policies

HMOs (health maintenance organizations) are a type of managed care and work by controlling costs. They emphasize preventive care and often restrict access to more expensive treatments and specialists.

Although they have their advantages, physicians often feel as if they prevent them from practicing medicine if the way they would most like to, and instead, they feel restricted to prescribing treatments that the HMO will cover.

Recently, the second largest HMO in the nation, UnitedHealth, changed a major policy by stating that it would allow doctors, instead of HMO administrators, to have the final say in a patient's medical care except in instances of mental health care. This was a tremendous turnover of usual HMO policy, and analysts are predicting the other HMOs will follow suite.

It was noted that each year the HMO spent $100 MILLION contesting doctor recommendations. In 99% of the cases, the doctor's request was approved. Hence, the HMO was paying more money to question the doctor's opinion than it saved by avoiding unnecessary treatment.

This decision will grant more autonomy to physicians and
shift the focus onto health care rather than cost.

Nov. 12 - UnitedHealth Group won wide praise this week when it said it would allow doctors - not HMO administrators - to have the final say in patient care.

It turns out there are exceptions.

The nation's second-largest managed care company said its new policy doesn't include mental health coverage, a decision that has prompted anger from advocates. "MENTAL HEALTH is always the poor stepchild, and this is more evidence of that," said Russell Holstein, a Long Beach, N.J., psychologist. UnitedHealth officials defend the exclusion, noting they have yet to study how the new policy would affect people seeking counseling or psychiatric care.

The company fears that costs would escalate if they loosened the reins on mental health providers because few objective tests exist to determine what type of care, if any, is needed. "Mental health holds a lot more intangibles than medical care in determining what treatment someone needs," said Saul Feldman, chief executive officer of United Behavioral Health, UnitedHealth's subsidiary that manages mental health and substance abuse benefits for 17 million Americans.

Under the new policy, UnitedHealth will still closely monitor its physicians and require doctors to alert the health plan when they order expensive tests or admit patients to the hospital. But if there are disagreements on treatment, the doctor has the final say.

Feldman said new "parity laws" in 27 states require health plans to offer equal coverage for physical ailments as for mental health benefits. He said that will push costs higher unless the company can tightly manage the care - a task that would be made more difficult if the health plan transferred final authority on patient decisions to therapists. "The issue we all have to recognize is there are legitimate differences between mental health care and medical care," said Feldman, a psychologist.

UnitedHealth's decision was disappointing but not surprising, said Karen Shore, president of the National Coalition of Mental Health Professionals and Consumers in Commack, N.Y. "There is a conscious or unconscious mean-spirited bias against mental health which the people in charge (of managed care firms) do not understand," Shore said. UnitedHealth's new policy also excludes substance-abuse providers. Managed care firms usually combine oversight of mental health and substance abuse because treatments are closely linked.

© 1999 Associated Press. All rights reserved.

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