I have had the pleasure of working in the healthcare industry for the past 11 years and have seen many changes throughout my career – some good, some bad. These changes, often driven by Medicaid funding, may dictate how much your insurance provider pays for drug and alcohol treatment.
I started in the industry at a durable medical equipment company back in 2008. My role there was to get clients set up with oxygen, nebulizers, and CPAP machines to improve their health. Unfortunately, I entered the DME industry during the greatest economic downturn since the Great Depression. Not only was this a financially challenging year for our country, but the Medicare reimbursement rates for oxygen-delivery equipment were cut by a whopping 32%. To say that 2008 was a bad time to get into the industry would be an understatement.
Then, in 2014, I entered the field of chemical dependency treatment after completing my Masters in Counseling and found my calling. But as much as I loved the therapeutic side of helping our clients overcome their drug and alcohol addictions, I quickly learned about the business behind rehab. And that business is primarily driven by commercial insurance coverage.
There are many tough, financial questions our clients must face prior to admission: How much does treatment cost? How much will my insurance cover? What happens if my insurance cuts off?
Nowadays, rehab can be extremely pricey. With the goal of providing top-notch medical care, hiring highly-experienced clinicians, and offering comfortable amenities, most centers are shelling out a lot of money to provide for their clients’ wellbeing. Rehab isn’t something to be taken lightly. Yes, it’s an investment, but it’s an investment to save your life – something I’m fully behind.
But in order to operate effectively and keep their doors open, most treatment centers rely heavily upon reimbursements from insurance providers. However, recently, these insurance providers are starting to withhold payments, limit the amount of time a client spends in treatment, and, frankly, pay as little as they can. Unfortunately, this mindset often leaves our patients footing the bill.
Early on, I don’t recall it being difficult to get insurance companies to cover our client’s stay in treatment. However, in 2016 I started to notice a drastic change. Insurance companies soon began scaling back on the number of authorized days per client. In other words, instead of covering one’s stay at our 90-day Program, insurances began to only cover 1/3rd of that – a move that put a lot of strain on treatment centers as well as on families looking for long-term behavioral change.
But to fully explain the strain that this cutback had on the clients and family members, one would first have to understand the different levels of care authorized by an insurance company. For instance, insurance companies usually authorize four separate levels of care: RTC, PHP, IOP, and GOP. These levels of care, and their corresponding guidelines, are dictated by the American Society of Addiction Medicine (ASAM). Almost every insurance company uses the ASAM standard to either approve coverage, deny coverage, or decrease coverage.
Residential Treatment Center (RTC)
RTC stands for Residential Treatment Center and is one of the highest levels of authorized care. Here, clients take part in a range of rehabilitation services that are staffed by addiction treatment professionals in a 24-hour setting. This is typically what people associate with the word, “rehab.” This level of care serves individuals in need of a safe and stable living environment in order to develop the recovery skills necessary to prevent an immediate relapse.
These individuals typically have unsupportive or toxic relationships, criminal justice histories, and co-occurring mental disorders like anxiety or depression. The reason round-the-clock staffing is necessary at this level is because these clients haven’t developed adequate coping skills that will keep them clean or dissuade addictive behaviors.
The goals at the RTC level, much like others, are to promote abstinence from drugs and alcohol and to improve the underlying emotional, behavioral, and cognitive conditions through strict monitoring to prevent any immediate danger. Residential Treatment provides you ample amount of time to focus on yourself, dive deep into your recovery, and integrate seamlessly into the community.
Insurances typically approve RTC coverage for individuals who are just now coming off drugs and alcohol. This is because they tend experiencing negative physical side-effects like poor appetite, difficulty sleeping, and drug cravings and require inpatient monitoring. As our client’s physiological symptoms abate, they are guided into daily programming.
But, don’t wait too long to seek treatment! The longer the gap between your last use and your date of admission, the more likely insurance companies are to deny you coverage at this level, which could ultimately increase your out-of-pocket expense. Their reasoning: medical necessity.
Furthermore, Residential Treatment facilities must adopt an interdisciplinary approach and staff their team with credentialed individuals like licensed professional counselors (LPC), licensed clinical social workers (LCSW), or addiction counselors. At Stonegate Center, we abide by all ASAM and JCAHO criteria and do just that.
Programming-wise, daily clinical services must encourage prosocial behaviors, stabilize addiction symptoms, and offer other evidence-based therapies like Cognitive Behavioral Therapy (CBT), Family Programming, and Motivational Interviewing. These therapies are important to ensure a healthy recovery.
As you progress through your treatment and improve mentally and physically, insurances typically step you down to the PHP level.
Partial Hospitalization Treatment Program (PHP)
PHP stands for Partial Hospitalization Treatment Program and is the second highest level of care. This level of care is often referred to as “day treatment.” Here, individuals are required to attend a full day of structured treatment but can sleep at home. This allows individuals to pair their recovery plan with real life.
Partial Hospitalization services feature at least 20 hours of clinical programming per week. These hours can be spent in individual or group counseling, family therapy, recreational therapy like equine therapy, or complimentary educational groups.
Individuals at the PHP level have met the most essential treatment objectives at the RTC level, are not an immediate risk to themselves or others. As such, they are able to safely handle less-intensive monitoring.
Typically, those engaged in Partial Hospitalization Programs are a month removed from the negative effects of chronic drug and alcohol abuse and are actively engaged in their treatment plan. They have improved emotional, behavioral, and cognitive function, but more importantly, they are not at risk for acute intoxication or withdrawal potential. Therefore, they do not need 24-hour monitoring.
This level of care is not to be taken lightly as less-intensive monitoring increases the chances of relapse – that is why Stonegate Center believes in long-term residential treatment. And, our outcome studies support that notion. Long-term care, in a structured environment, yields a higher success rate than short-term stints at less-intensive facilities.
However, in order to practice your newly-acquired recovery skills, Partial Hospitalization Programs are an important step in your journey towards life-long sobriety.
To meet PHP criteria, individuals must not be burdened by biomedical conditions like unstable hypertension or chronic back pain as these issues can detract from the treatment process. As well, individuals must have adequate support from friends and family, exhibit a true motivation to change, and surround themselves with a recovery-oriented living environment.
Intensive Outpatient Program (IOP)
IOP stands for Intensive Outpatient Program and is one of the lowest levels of care. To be clear, “lowest level” refers to the amount insurance will pay as well as the amount of supervision necessary. Thus, IOP is one of the cheaper, less-intensive levels of care that an insurance provider will pay for.
Intensive Outpatient services can be delivered in a variety of settings and at various times of the day, which make them a versatile option for highly-motivated patients. For instance, some facilities offer morning, afternoon, or night programs to adapt to real-world responsibilities like work or school.
These IOP programs are required to provide 9-19 hours of clinical programming, which consist primarily of counseling and education. Individuals can even be simultaneously enrolled in a Sober Living while attending.
In my experience, insurance companies tend to step down to IOP as quickly as possible, sometimes even skipping the PHP level entirely. From a cost-savings perspective this makes sense, as residential treatment is expensive to cover especially for a chronic relapser. Unfortunately, some insurance providers require a failure at the IOP level in order to justify a stay at Residential Treatment level – a point of conflict among many treatment providers.
Fortunately, we work with a great billing company and will fight for every day possible at the highest level of care (based on medical necessity). Our goal is to provide you and your family the maximum amount of coverage in order to make treatment more affordable.
The last level of care is GOP which stands for General Outpatient Program. This level of care has the least amount of requirements and is usually highlighted by individual counseling sessions at periodic intervals.
Utilization Review at Stonegate Center
A goal of any clinician working in a residential setting is to provide the most detailed, and descriptive clinical progress notes in order to allow for the best quality of care for the client. This is done for purposes of Utilization Review, an act where treatment centers pitch their case to insurance providers to attain daily coverage.
At Stonegate Center, we pride ourselves on our ability to accurately describe the client’s progress and level of risk while in treatment in order to justify that coverage.
However, even while maintaining the highest level of standards, there is no guarantee of authorization for any of the levels of care mentioned above. Therefore, every time we take on a new client, we also take on a level of risk and liability because the insurance company may or may not authorize any days of treatment.
While each insurance company has different standards of medical necessity for inpatient residential treatment, nothing is guaranteed.
Even in my early years as a customer service agent at a DME, I recognized the fact that healthcare isn’t free – a sad truth. I can vividly recall our CEO repeating this on a daily basis during our morning meetings.
Obviously, health insurance costs money and is not afforded to anyone as a right within the U.S. As treatment providers who work closely with insurance providers we must weigh the cost effectiveness of programs, the outcomes, any overhead or expenses, and labor involved in providing medical services. As such, we can sadly conclude that healthcare is expensive.
While working for the DME company, I interacted with geriatric patients dependent upon Medicare or Medicaid. I can recall countless conversations with elderly patients in which they would break into tears over the fact that they were not able to afford the out-of-pocket cost of their oxygen concentrator.
Keep in mind, we are not talking about an elective surgery, but rather something that a patient cannot live without. Most patients were even homebound due to the fact that they would run out of oxygen if they were to spend more than 2 to 4 hours away from home.
Just like the DME industry, I can see a similar shift in the addiction treatment industry. This is evidenced by the decrease in authorized days for rehab. Although insurance companies utilize certain criteria to make coverage decisions, we have found some discrepancies between similar patients, which highlights a glaring issue in the utilization review process.
Coverage determinations can be based on a myriad of different factors including living environment, medical conditions, psychiatric diagnoses, cravings, triggers, biomedical conditions, readiness to change, and much more. These variables, vast in number, all contribute to whether or not our patients get coverage.
I’m a firm believer in long-term treatment, therefore, each step-down or denial of coverage hurts me personally. My clinical team and I work diligently to vouch for each of our clients and have spent countless hours speaking with insurance case managers to do so. Although I understand the cost-effectiveness argument that insurances use, I have to witness, first-hand, the financial burden that these denials have on our clients’ families.
Lawsuit Against Major Health Insurance Company
Over the course of the last five years I’ve seen many changes within the field of chemical dependency treatment. At times, I have even become jaded at the prospect of my clients not getting the care they need. Just recently, a ray of hope entered into my life in the form of a New York Times article entitled “Mental Health Treatment Denied to Customers by Giant Insurer’s Policies, Judge Rules.”
The article references a landmark decision made by federal judge Joseph C. Spero in Northern California. The judge ruled that a unit of UnitedHealth Group discriminated against those suffering from drug and alcohol addiction in order to increase profits.
He attributed the insurance company of putting in place policies and guidelines that ignore “the effective treatment of members’ underlying conditions.” He described the experts defending the utilization review policies as “deceptive” and “evasive,” stating that coverage was denied as soon as patients were deemed stable.
These decisions, made by the insurance provider’s case managers, could happen after weeks or even just days of treatment. Imagine that: being kicked out of treatment days after admission due to your insurance cutting off. As Judge Spero alludes to in his decision, this is “an abuse of discretion,” which ultimately “restricts [a patient’s] access to care.”
As seen, denying coverage to those suffering from substance abuse disorders for financial reasons is not only negligent but also deadly. This undermines the documented benefit of long-term treatment in lieu of meeting financial incentives. Insurance companies are supposed to work with addiction treatment services, not against them.
In fact, these actions not only prevent treatment providers from offering world-class services, they directly shift a majority of the financial burden to the patients.
In the United Behavioral Health case, plaintiffs filed a class-action lawsuit that alleged that healthcare benefits were denied to clients in critical and life-threatening situations. The article references a mother that lost her son after he had been booted out of treatment due to the fact that his symptoms did not meet the previously determined acute criteria. Sadly, he died of a drug overdose nearly a week after being refused coverage by the insurance company.
This is a great read, and I encourage you to take a look at it. For a recent update on the case, read Landmark Decision: UnitedHealthcare Used Defective Criteria to Reject Coverage for Mental Health and Addiction Treatment Services, Federal Court Finds.
The Future of Healthcare
While this travesty is a representation of utter negligence, I am hopeful that this is the beginning of a conversation about what needs to change within the healthcare industry. If the primary focus is profit, patients and clients will most likely suffer.
My colleagues and I have recognized this problem over the course of the last five years, but we have also recognized our own inability to change any aspect of these devastating situations. The old saying “you can’t fight city hall” resonates in my head on a daily basis when I think about the prospect of taking on major insurance companies.
Regardless, I am encouraged that changes within the healthcare industry are on the horizon. Clients and their family members alike are standing up for what is right. While others are even abandoning the very idea of standard health insurance as a whole and choosing a different route.
When exploring our options within the market, my wife and I chose a new insurance and on the first day, one of the representatives from the company even called me personally and prayed with me over the phone after explaining the details of my family’s benefits. This was so unique and shows that change is occurring since I can’t recall a time in which any insurance company has ever done something like that for me.
Change is inevitable, and the free market within the U.S. often makes decisions about what stays and what goes. Insurance companies have been doing an excellent job of providing care for patients and clients since the very beginning. My concern is that the motive for profit is starting to taint the very purpose of insurance and coverage for those seeking treatment for drug and alcohol addiction.
While legislation continues to develop regarding who gets what in terms of insurance providers, several people are beginning to trust the common good of man once again. Instead of paying outrageous deductibles and costly premiums, subscribers are turning to cost-sharing programs to meet the healthcare needs of their family.
My advice to anyone attempting to get health insurance is to please do your research! Understand that just because you pay your premiums monthly, there is no guarantee of benefits for you or your family should a health-related incident arise. I pray that you will seek wise counsel regarding what is right for your family with regard to your health care needs.
I am encouraged that some have had the confidence to stand up in the face of injustice and deceptive practices. Without this bravery, change cannot occur.
If you or a loved one is suffering from drug and alcohol addiction, please reach out to us. We are more than happy to help you attain long-term sobriety. Our Admissions team can be reached by email at admissions@stonegatecenter.com or by phone at (817) 993-9733. For more information, check out the list of insurances we accept at Stonegate Center.
