Making insurance relationships work; A California center finds it can maintain the integrity of its mission under changing payment realities

Addiction Professional, July-August, 2008 by Mark Willison

I was hired by the board to help with this evaluation process. Our first discussion pertained to the most important question: Do we remain open? And if that were to be the case, how would we go forward as a business? The next question after that was: Do we continue to accept insurance payments or do we move toward accepting only cash payments?

Our mission statement says, "Beacon House will provide comprehensive and effective treatment to individuals experiencing the disease of chemical dependency at an affordable fee." For years, Beacon House had been providing comprehensive and effective treatment--that much we knew would not change. But we kept coming back to "at an affordable fee." A decision was made there and then: We would provide affordable, as well as effective, treatment. But how?

Negotiating the maze

How does any program deal with the everchanging requirements put forth by managed care? How can one remain treatment-focused while dealing with matters such as application of the American Society of Addiction Medicine's (ASAM's) Patient Placement Criteria, "doc-to-doc" reviews, and "step-downs"? To fulfill our mission, we chose to accept, if not embrace, these challenges.

ASAM's Patient Placement Criteria are a standardized treatment matching tool used since the early 1990s. These criteria are used to evaluate systematically the severity of a patient's need for treatment. ASAM uses a fixed combination of rules to determine which of four levels of care is best suited for the substance-using patient. The levels of care are outpatient treatment (Level 1), intensive outpatient/partial hospitalization (Level 2), medically monitored intensive inpatient treatment (Level 3), and medically managed intensive inpatient treatment (Level 4).

To work within these guidelines, one thing became crystal clear: Beacon House could no longer function solely as a social model program. Its services needed to be expanded and professionalized. My first move was to hire a medical director. I chose John Bennetts, MD, a well-known physician and addictionologist on the Monterey Peninsula. Bennetts already had nearly 15 years of experience in the treatment field, and had worked with me twice before at local treatment hospitals. His hiring gave us a tool we did not have before: a treatment-experienced, ASAM-certified physician.

More needed to be done. Understanding that managed care was designed to reduce treatment mismatches (placing someone in outpatient care when residential is more appropriate, for example), I conducted a comprehensive assessment of our community's needs for new programs. It was obvious that the community had two immediate needs: a cost-effective non-hospital detoxification program, and outpatient treatment at a reasonable fee. By this point, Beacon House had the staffing and structural capacity to accomplish both, and thus we began providing these services.

Besides adding programming and staffing to assist with managed care requirements, we began to seek out relationships with the insurance companies. Our belief was that the more relationships we developed, the more individuals and families would gain access to our program. We consciously set fees that would be manageable for our clients. We incorporated that fact into all of our marketing efforts: on our Web site and in print and broadcast ads. We recognize that we have to have fees at a level that brings in enough revenue to stay in business but also at a level that is reasonable for the demographic we serve. Our mission is to help as many individuals and families as we can, insured or otherwise.