How Do You Save A Trillion Dollars?

by Julie Nelson

Imagine that a patient with psychosis is given nutrients. She improves her quality of life to such a degree that she no longer needs yearly hospitalizations, which, along with other expenses, amounted to $500,000 of medical and disability costs over a fiveyear period.

Dr. Bonnie Kaplan, Professor Emerita in the Cumming School of Medicine at the University of Calgary, and expert in the field of nutritional mental health, says this type of prevention might save lives and money. Kaplan publishes widely on the biological basis of developmental disorders and mental health – particularly, the contribution of nutrition to brain development and brain function. She will speak to Louisiana psychologists this November.

In her “Hospitalization cost of conventional psychiatric care compared to broad-spectrum micronutrient treatment,” in International Journal of Mental Health Systems, Kaplan points to dramatic savings for those patients that respond to nutritional interventions.

Nutrition is one of the innovations in illness prevention that has been neglected for decades. Other neglected approaches include behavioral treatments for lifestyle based illnesses, equally as cost-effective.

Prevention requires tools that are often unfamiliar because educational, behavioral, and social interventions, not usually considered to be part of medicine, may be most effective for many diseases,” said Hamilton Moses and co-authors in, “The Anatomy of Health Care in the United States,” in an article of the Journal of the American Medical Association.

While medical costs are driven by chronic disease, these costs are not due to an aging population, even though age is often cited as the cause. Moses shows that about 80 percent of the total health care cost is accounted for by individuals under 65, and relate to psychological, social and behavioral factors. The CDC estimates that three lifestyle factors––poor diet, inactivity, and smoking––account for 80 percent of heart disease and stroke, 80 percent of type 2 diabetes, and 40 percent of cancer.

“Behavioral intervention is the foundation for lifestyle medicine,” writes Dr. John Caccavale, author of Medical Psychology Practice and Policy Perspectives. “Of the top four classes of medical problems in America–– metabolic disorders, respiratory disease, cardiovascular disease, and mental disorders––physicians will have great difficulty demonstrating that they are improving patient health by utilizing medications as a first-line treatment for these classes of disorders,” writes Caccavale.

“I think wellness/prevention are areas where there is tremendous need in primary care,” said primary care psychologist Dr. Michelle Larzalere. But, rarely is this need addressed.

“For both physical and mental health, the need to work on active problems is often so high that wellness/prevention get shorted on attention,” Larzalere said.

“The health habits that most reduce the preventable component of the most prominent causes of morbidity and mortality in the US––for example, refraining from smoking, eating a healthy diet, getting regular exercise, and limiting alcohol consumption––are behaviors that psychologists can really impact positively. Unfortunately, at least in my experience, other needs are so great that it is hard to make time for wellness/prevention initiatives unless there is a specific plan put in place.”

Author of Health Psychology, Dr. Linda Brannon said, “The division of health into mental and physical health is a false dichotomy that we need to get over. I think that many providers address the presenting problem to the extent that they do not look beyond it.”

For decades now, psychological scientists have known that behavior is the key to costs. Larzelere explained that psychological scientists have repeatedly shown that resulting savings by including prevention behaviors can produce savings between 30 and 60 percent in medical use costs.

To put this in perspective, a 10 percent reduction in medical/surgery costs nationwide––by treating the mental or behavioral component––would exceed the entire current national mental health budget, she explained.

She is correct. According to federal agency, The National Health Expenditure Accounts, healthcare spending reached $3.5 trillion in 2017, for both public and private sources. This is $10,739 per person, and accounts for 17.9 percent of the Gross Domestic Product.

A 10% savings, as Larzelere suggests, would result in a savings of $350 billion. The U.S. Department of Health and Human Services Substance Abuse and Mental Health Services Administration estimates treatment spending from all public and private sources to total $280.5 billion in 2020.

Estimating at the low end of the range of expected savings, a conservation goal of 30%, would come to $1 trillion.

Gains in quality of life and productivity would be added on top of that.

Some Current Problems

Is all this spending doing anyone any good?

A pattern of poor health outcomes and high costs reflects the country as a whole. The United States ranks 50th out of 55 industrialized countries in a measure of life expectancy and medical care spending, according to Bloomberg, who concluded the U.S. is the “least-efficient” health-care system in the world.

Louisiana typically falls at the bottom of the states in health ranking. In the most recent report from America’s Health Rankings, an annual analysis of the United Health Foundation, Louisiana ranked No. 50. The state ranked last in both behaviors and community & environment categories, No. 47 in clinical care, and No. 48 in health outcomes.

Louisiana has its challenges. Nearly 21% of the population of the state is at the poverty level or below, when only 12-1/2% of the citizens nationwide fall at this level. Over 41% of the citizens in Louisiana fall at 200% of the poverty level or below, compared to 29.75% nationwide.

Health is woven into a complex set of social and psychological behaviors, not a single cause. “Socioeconomic status is one of the most powerful predictors of all cause mortality,” says Dr. Chris Leonhard, health psychologist and Professor at the Chicago Professional School at Xavier. “New Orleans is a startling example of this,” Leonhard said. “Life expectancy at birth in the Tremé where the average household income in 2010 was about $26,000 is 55 years, while in Lakeview, the average 2010 household income was $75,000, and life expectancy at birth is 80 years.”

But money is flowing. The state paid $10.7 billion on behalf of about 1.9 million Medicaid recipients, according to the Louisiana Department of Health. During the fiscal year 2017– 2018, about 39.6 percent of Louisiana’s citizens were enrolled in the Medicaid program and payments were made on behalf of 1,876,908 recipients.

Using other federal data, this time from Medicare, a concerning picture emerges. According to an analysis by Blake Kruger and Jeremiah Brown, Louisiana spends the most on Medicare beneficiaries per capita than any other state. At the same time, Louisiana reports greater disparities in health status and death rates than other states.

Kruger and Brown investigated the associations between healthcare intensity, healthcare spending, and mortality in Louisiana Medicare beneficiaries. They defined healthcare intensity to be synonymous with the hospital care intensity index, a combination of inpatient days and physicians’ services.

The researchers found no association between healthcare intensity and spending. Nor did they find any association between spending and mortality.

“We also observed no association between health-care spending and age, sex, and race-adjusted mortality,” the researchers wrote. And, when they compared healthcare intensity to age, sex, and race-adjusted mortality, they could find no meaningful associations. Nor did they find that more spending made any difference in survival when adjust for smoking, inactivity, or obesity.

While the lack of an association between healthcare intensity and spending could indicate that outpatient care in Louisiana is becoming more highly utilized, the findings could also reflect that spending more on healthcare in Louisiana does not improve rates of survival or health outcomes for Louisianans.

Healthcare: Designed for You by Special Interests

The sheer size and complexity of the healthcare industry would suggest that innovations like nutrition or lifestyle therapy would be challenging, and new treatments even more unlikely because of the political power yielded by the industry giants. Over the last years the pharmaceutical industry, Blue Cross/Blue Shield, the American Hospital Association, and the American Medical Association were the some of the highest contributors to Congress.

Psychology and other groups have not been able to garner a place at the medical table to push for new methods. California Attorney David Ries of Human Capital Specialists tried to persuade federal Rule makers to include psychologists in the bonus plan for Accountable Care Organizations (ACOs) but failed. He told the Times that the final Rules were very disappointing, and said, “The broad recognition of the importance of behavioral health to overall wellness indicates that ACOs are unlikely to achieve their treatment objectives …”.

These special interests exert themselves not only through direct lobbying, but the medical-pharmaceutical-hospital-insurance industrial complex has a firm hold on the prices and services in this country, through the “CPT Codes” and the “Relative Value Scale Update Committee” or RUC. These groups decide what services are allowed and how much they are reimbursed.

The CPT codes, short for Current Procedural Terminology, control what services are allowed and reimbursed. The codes are created by three hundred “Advisors and Experts,” primarily from the American Medical Association’s House of Delegates, representing medical specialties, who work to influence an “Editorial Panel,” composed of representatives from medical societies, insurance companies and government. This panel conducts secret meetings to decide on which healthcare services are paid for, and which are not.

Dr. Tony Puente, Past-President of APA, was one of the two outsiders allowed to participate in the CPT process. “Essentially,” he said, “the CPT tries to divvy it up in a way that is theoretically and empirically, and diplomatically and politically, correct.” Participants must sign a strict AMA (American Medical Association) confidentiality agreement declaring, “I will not disclose, distribute or publish confidential Information to any party in any manner whatsoever.”

The CPT system is dominated by organized medicine. “Every seat at the table has a vested interest, mostly not supporting your proposed code,” said Dr. Travis Thompson, professor, psychologist, and leader in the Association for Behavior Analysis International. It took him and colleagues three years to muscle through codes for the treatment of autism.

While the CPT approval is a first leg of a long journey, another element of this behindthe-scenes influence is the panel known as AMA/ Specialty Relative Value Scale Update Committee, or RUC. Since 1991 members of the RUC establish the value or price for the CPT codes. Somehow this is not considered price-fixing.

To decide on reimbursement, 28 voting members of the RUC, representing medicine specialties such as anesthesiology, cardiology, neurology, neurosurgery, obstetrics, oncology, psychiatry, and so on, meet and decide how much each service is worth, and how much will be paid.

Control of the CPT and RUC have helped shaped health care toward high technology and high prices, less primary care, and no prevention.

A dramatic example of flawed decisions in the medical/pharma industrial complex is the opioid crisis. Twenty years after a marketing blitz convincing physicians that opioids were safe and effective, now one of the deadliest medical mistakes of modern times.

Despite the flood of legal opioids into the society, the CDC reported no change in pain that would meaningfully have ever driven the prescribing: “…there had not been an overall change in the amount of pain that Americans reported.”

The CDC did find that psychological and physical treatments for pain were beneficial, but these non-medical approaches are rarely integrated into treatment programs. Behavioral approaches were often the more appropriate treatment. “It is now widely accepted that pain is a biopsychosocial phenomenon,” clinical health psychologist and Past-President of the Southern Pain Society, Dr. Geralyn Datz said, and that must be treated as such.

Louisiana Follows the Leaders

Louisiana may have the most to gain from prevention and innovations, but there is a long way to go from where the state is currently.

In the most recent Louisiana Medicaid Annual Report, the top 10 provider types, ranked by payment, were first, hospitals, at $1.3 billion, and second, pharmacy, at $726 million. Dentists were third at $162 million, then mental health rehabilitation at $140 million, nurse practitioners at $115 million, and behavioral health rehabilitation agencies at $114 million. Distinct psychiatric hospitals were next at $76 million and freestanding mental health hospitals at $69.7 million.

In comparison, all other providers, which include chiropractic, personal care attendants, physical and occupational therapy, psychology, social work, and other services, totaled only $917,000.

In a 2018-2019 Combined Behavioral Health Block Grant Plan, published in late 2017, the state noted that the number of persons being served was only 3.29% of the estimated prevalence. The estimated number of children/youth with serious emotional disorders was 38,803 and only 1,370 had been served. The prevalence estimate for adults with serious mental illness was 192,019 and only 7,590 had been served.

Access to care and rates have been a problem nationally, with nearly half of all providers not offering services to Medicaid patients. Nationwide, Medicaid fees are about 72 percent of Medicare, which is about 80 percent of private pay. And this amount comes to an even smaller portion of what some practitioners charge in a fee-for-service setting.

In a list of “Specialized Behavioral Health Services CPT Code” and reimbursements, effective last year, the fee structures provide little in the way of reimbursement for health and behavior, or any clear mechanism for integrated services. The “health and behavior” services pay between $12 and $15 and are only listed for a psychiatrist, nurse/physician’s assistant, medical psychologist, or a psychologist. None were listed for clinical social workers or counselors.

Some codes and fees are listed for psychotherapy. Individual psychotherapy is reimbursed at $69.76 for psychiatrists for 45 minutes, $55.81 for nurse practitioners and physician assistants, $55.81 for psychologists, and $48.83 for social workers, counselors, and marriage and family therapists. And group therapy, a valuable therapy mode for many issues, is paid at only $23.23 to $18.58 and there is no reimbursement for the social worker or counselor listed on the current fee schedule. The low pay may account for why only about 130 psychologists are listed as providers on the current Medicaid rolls, and many of these are agency staff.

These misaligned incentives seem likely to impact those who have the least options to find better care in the private sector.

Finally, physician researcher Dr. Martin Makary has shown that medical error, unrelated to the illness or injury, is the third cause of death nationwide, following only heart disease and cancer deaths.

To conclude, Louisiana spends more than other states while there is no positive relationship between the money spent and health outcomes. Nationwide, the costs are staggering, while many chronic diseases are on the rise. Overall, the system looks to be more like a money-laundering scheme than a set of effective health services.

States like Louisiana with a high percentage of citizens at or near the poverty level, would benefit most from prevention and new, inventive treatments. “A bright new future of understanding, preventing, and treating mental disorders awaits us,” writes Bonnie Kaplan.

But just how long is that wait going to be?

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