What mental health services can teach us about a consumer health-care model

Health-care roles in America have been changing. Individuals pay approximately $1 trillion a year on health care and coverage costs out of pocket. Nearly 44 percent of privately insured adults have deductibles of $1,300 or more, yet many do not realize it until a bill arrives, sometimes months after the always confusing “This is Not a Bill.” Not everyone can absorb the surprise; more than half of Americans have less than $1,000 in savings.

Then why don’t Americans shop for health care the way we do everything else? Despite bearing financial burdens for more of our health-care expenses, many people do not feel or function as true health-care customers, with a sense of entitlement to get a health-care system that works for them.

But in mental health care, patients are already consumers and customers, often out of necessity. Only 55 percent of psychiatrists accept insurance, so many consumers who need care must pay out of pocket. This financial burden can make needed mental health care inaccessible for many. Yet operating outside the insurance system means that those who can afford it may get better, more personalized care.

“It is like having a dictator from outside the room, orchestrating your treatments, which to me is orchestrating a relationship,” another therapist — a licensed mental health counselor — described her view of health insurers. “That just doesn’t seem like good medicine to me.” She deliberately chose not to take insurance when she opened her private practice. “I very specifically decided no one was going to tell me how to do my job. I wasn’t going to give people 200-question assessments on the hello and diagnose them before the second session. That’s outside my belief system and what’s good for people and why people engage in treatment.”

The silver lining of consumer financial burden is that insurance rules and restrictions often do not apply. If the consumer can and wants to pay, they can, without insurance bureaucracy in the middle. The therapist and patient agree on terms — rates, frequency and duration of services.

Mental health, in many ways, is a free market. And it works both ways.

On the other side of the equation, psychiatrists and psychologists are often as thoughtful and intentional about the business of mental health as they are about their therapeutic methods.

“I don’t like sticker shock any more than they do,” one private-practice psychiatrist told me, explaining his screening process to make sure he is an appropriate therapist for the prospective patients who call for appointments. “Upfront, I typically will say to patients, ‘Just so you’re aware, I have a specialty practice. I’m not in network with any insurance plan. My fee is expensive. You and I get to decide how long we’ll meet, not a third party. We plan that in advance.’” If someone expresses concern about the cost, this psychiatrist typically refers them to other clinicians who might charge lower rates or accept insurance. “Health care should never be a hardship.”

A psychologist in private practice shared the same philosophy. “I want to be helpful. And it’s very hard for me emotionally to say “no” just because of money. But I’ve told myself to do that and so at this point, if people have a significant problem with my fee, then I just give them other options.”

This psychologist emphasizes up-front conversations about the cost of his services and seeking certainty that he can add value. “There’s a process upfront where when people inquire to the practice, we gather some information from the patient about whether or not it’s going to work from a financial perspective. …The most important thing is that it happens before any relationship is established.”

While these conversations were uncomfortable earlier in his career, he explained, “As I am more confident in the value of my skills for people and that I’m really giving them something that will be transformative in their lives, I feel more comfortable talking with them about the money because I think they will get something really worthwhile.”

Ironically, the part of the U.S. health care that often reflects dysfunction may show a way forward to improve the rest of the health-care system. Though many consumers can tell horror stories about surprise medical bills and fights with health insurance companies for colonoscopies or surgeries, these frustrations are exceedingly rare in mental health. “Do you ever get a surprise bill from them?” I asked dozens of consumers who referenced accessing psychotherapy. “Of course not!” they would chide me. Their therapists had proactively discussed the cost of their services up front, before the first visit.

The therapists I interviewed confirmed this is no mistake. Psychotherapists were clear: financial hardship does not make for a healthy therapeutic relationship for anyone involved. To avoid such challenges, psychotherapists learn to discuss costs up front and as needed, such as if someone’s financial situation changes in the midst of treatment.

Psychotherapy provides an opportunity to observe market forces, however imperfect, at work in health care. Therapists and patients interact transactionally even as they build deep clinical relationships. Pricing and billing are simpler, in large part due to the relatively small set of services available, but also because of choices therapists make to establish prices, disclose them and set clear expectations up front. Consumers know exactly what therapy is worth to them because they often pay for the services directly, out-of-pocket, at the time of the visit. If they question the value, they can negotiate, or stop going.

If the broader health-care system resembled the best of mental health care, it would set clear and rational fees, based on the value of providers’ time and service. Open, authentic, proactive communication about cost would be the norm. And consumers would know their place: in control of their choices and entitled to care that works for them.

Deb Gordon is a senior fellow at Harvard Kennedy School’s Center for Business and Government, researches health-care consumerism and writes about consumers at the intersection of policy and practice.