Section 4: Ethics and the Behavioral Health Care Organization

Businesses engaged in the delivery of health care services are not governed by the same ethical precepts as the practitioners who work on their behalf. While such businesses may share in liability, as a practical matter State law assumes that only licensed individuals may engage in the practice of medicine and other clinical specialties. The ethical principles of the professional associations discussed throughout this monograph apply to individuals licensed in those professions and engaging in practice, not to the businesses employing or contracting with them.

At the same time, behavioral health care entities can engage in practices that are unethical and in some cases illegal. Behavioral health care businesses also can enter into contractual arrangements that increase the likelihood that treating practitioners will face ethical conflict. In addition, if the individual heading the behavioral health care organization is a licensed practitioner, he or she continues to have ethical responsibilities flowing from that license that arguably carry over into his or her role as administrator.

This part of the monograph focuses on a number of ethical issues facing the behavioral health care organization, including contractual issues, ensuring that competent staff provide services, the use of financial incentives to attract business, fraud, and marketing and advertising.

Contractual issues

Managed care contracts do not necessarily create ethical issues. However, if business strategies that have nothing to do with clinical values predominate, a contract may result that creates profound ethical conflict for treatment staff. In this particular vignette, Autumn Leaves has deliberately entered a low bid on a contract for strategic reasons. It then makes clear to its clinical staff that the clinical staff bears the burden of ensuring that the company does not lose money, and ties performance evaluations to resource utilization. As the above discussion made clear, clinicians are supposed to exercise professional judgment unclouded by personal financial concerns; a company that expects its clinicians to save it from questionable business decisions invites those clinicians to step into an ethical quagmire.

In such a situation, a clinician first must decide whether he or she can continue to work under such conditions. In addition, clinicians may have an ethical responsibility to make public circumstances that inevitably result in ethical conflicts. Finally, tying performance evaluations to the impact of treatment decisions on resources may become illegal: Texas, for example, responding to the payment of incentives to employees based on creating admissions has outlawed performance standards based on the number of patient admissions resulting from an employee's efforts (chapter 164.005 Texas Codes).

Other contractual provisions can also create ethical dilemmas for treatment staff. For example, explicit limits on utilization of particular types of services may cause a clinician to have to reconsider proposing a treatment that in his or her professional judgment is the appropriate treatment. Contractual limits may also reduce the time available to a patient in a particular case, changing the conversation between clinician and patient in ways that may affect the substance of treatment.

Behavioral health care organizations devoted to retaining competitiveness in a difficult environment also may sign contracts that, because of the financial strain they place on the organization, reduce the possibility that the organization will provide charity or free care to at least some individuals. For-profit health care organizations generally are not required to provide charity care (in contrast to tax-exempt providers, which may have to provide some charity care to retain their tax-exempt status). However, the ethical principles of the various professional associations suggest a commitment to providing care to at least some who are unable to afford it. A behavioral health care organization that effectively contracts away its ability to do that may exacerbate the more general problem of inequitable access to health care.

Finally, a behavioral health care organization that loses clients to another provider because of a managed care contract has an ethical obligation to ensure that the transition in care causes as little harm as possible to the affected clients. Some managed care contracts do cause the disruption of long-standing clinical relationships; therapists must be particularly careful to not let their own anger and other emotions caused by the loss of clients (and business) contaminate the manner in which they end their relationship and transfer the responsibility for care to another organization. If a contract may cause this type of disruption in therapeutic relationships, management should take steps to ensure that the transition of care takes place as smoothly as possible.

Competent treatment staff must be utilized in providing care

Cost-containment efforts may result in incentives to use less credentialed staff for treatment because they cost less. For example, a plan attempting to save money may be inclined to use master's-level rather than doctoral-level psychologists where possible, assuming that there are cost differences based on degree. In addition, a plan may advertise its contractual relationships with a number of well-known, highly competent providers. However, in practice, the plan may rely primarily on less-qualified, less-expensive providers of care, raising questions about the truthfulness of its advertising (a subject discussed in more detail below).

There is nothing intrinsically wrong with using the least expensive qualified staff available, just as there is nothing wrong with using the least expensive effective treatment available. However, each profession has an ethical principle requiring members not to practice beyond the scope of their competence, a principle that the law has ratified as well. Therefore, if in implementing a managed care plan, staff are asked to perform functions that they are not qualified to do, both an ethical and legal issue is created.

This principle also may have ramifications for treatment providers deciding whether to join a managed care plan. If the plan relies on short-term treatment, for example, limiting the number of sessions available, it is incumbent upon the treatment provider to ensure that he or she has both the training and experience necessary to provide adequate treatment within the plan's limits.

The use of financial incentives to attract business

WeCare, a behavioral health care consortium specializing in the treatment of alcohol and substance abuse disorders, wishes to expand its client base. Faced with a highly competitive environment, WeCare decides to pay cash bonuses to physicians, psychologists, and social workers who refer clients to WeCare hospitals. It imposes only one condition on clinicians making referrals: They cannot reveal to the client that WeCare is paying the bonus in exchange for the referral. WeCare's business thrives, and its executives congratulate themselves on a successful business strategy.

In this vignette, WeCare's strategy violates ethical principles on at least two counts. First, paying clinicians to direct clients to a particular business contaminates clinical judgment; a clinician receiving a cash bonus to direct a client to a particular provider will not be making a "neutral" decision regarding the client's needs. For example, the American Psychological Association requires that when a psychologist receives payment from another professional, other than in an employer-employee relationship, "the payment...is based on the services...provided and is not based on the referral itself" (APA Ethical Principles of Psychologists and Code of Conduct, Section 1.27). Second, if clinicians do not reveal the financial relationship with WeCare, the client will not receive all of the information necessary to make an informed decision.

In addition to violating ethical principles, the arrangements discussed in the vignette may violate the law in some States that have outlawed the paying of bonuses and other types of incentives for patient referrals. Such arrangements may also raise questions under Federal fraud and abuse laws, which attempt to ensure that clinical decisionmaking is not motivated by financial self-interest.

Fraud

Estimates of the amount of money lost to private insurance fraud in the health care system run as high as 75 billion dollars per year (Garrett, Klonoski, and Baillie 1993). Fraud is committed both by providers and by patients. Provider fraud is highly varied. For example, providers may bill insurance companies for patients they have never seen. Free health screenings may be advertised; the insurer is then billed for the "free" screenings.

Capitation may eliminate incentives to engage in some types of fraudulent practices, because the provider organization now bears the financial risk. However, if a case rate is paid, where the organization is paid for each client using services rather than for each enrollee (regardless of use), there may be incentives to bill for services never provided by reporting the treatment of "cases" that never occurred. Similarly, in situations where the behavioral health care organization receives additional reimbursement for each individual enrolled, and where the company rather than the payer is responsible for enrollment, some organizations have enrolled individuals in who the provider had good reason to believe would never use the services. This practice increases the amount of money available to the provider with no additional risk, because the new enrollees are never going to use the services.

Ethical issues in advertising and marketing

Health care organizations have a right to present truthful advertising. However, advertising and marketing can quickly become misleading, and, given the fears people have regarding mental illness and substance abuse, they can also easily become exploitative in the behavioral health care field.

For example, advertising may suggest that certain types of behaviors among adolescents (moodiness, alienation from parents) are indicators of possible mental disorders. While in individual cases that might be true, advertising may have the effect of exaggerating the importance of such behaviors and may imply that such behaviors are categorically equivalent to the existence of a mental disorder. In addition, advertising may suggest that the behavioral health care organization will provide a remedy for the "disorder." Such advertising raises ethical questions as much for what it does not reveal: that the behaviors described in the advertisement are often typical of adolescents, that only an individual assessment can reveal the existence of an underlying disorder, and that there may be little if any outcome data on the interventions the behavioral health care provider uses (which themselves are typically not described in marketing and advertising except in the most general terms).

There are also ethical issues to consider in the marketing of services to potential enrollees. Ethical and legal principles assume that individuals have a right to make informed decisions regarding health care choices. Brochures and other materials made available to individuals regarding a managed care plan should describe the chief characteristics of the plan accurately, and should also note significant benefit limitations. As noted earlier, describing the qualifications of providers should also be done so as not to mislead potential enrollees about the availability of those providers under the plan; marketing that emphasizes plan affiliations with providers or practitioners who are generally not available under the plan is misleading. The network relied on by the provider should also be described.

Behavioral health care organizations might also engage in efforts to discourage individuals from enrolling or using services, even when those individuals otherwise qualify for the plan. "Skimming" to avoid responsibility for individuals with significant service needs is something that has become familiar to health care payers and providers. There is an ethical dimension to the practice when it results in the disenfranchisement of individuals who should be obtaining services through the plan.