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Resource Based
Relative Value Scale:
not a panacea
(August/September
2006 Issue)
By Nan Shnitzler
In the struggle for fair payment from health insurance companies,
the Medicare reimbursement formula known as Resource Based Relative
Value Scale (RBRVS) is seen as a reasonable option. It computes
payment based on the cost, effort, risk and expense involved in
providing care and seeks to provide parity between physical and
mental health care.
Mental health advocates in Vermont, New Hampshire and Rhode Island
are finding that RBRVS as a fair payment scale might not necessarily
be the end as much as a means to an end.
In Vermont, a new bill to address unacceptably low managed care
reimbursements expands an anti-trust waiver that would allow providers
as a group to negotiate fees with insurers, says Alexandra Forbes,
M.A., legislative chairman of the Vermont Psychological Association.
In discussions with legislators, Forbes says, advocates offered
RBRVS as a stable and widely accepted fee formula to use in negotiations
with insurers.
"We need a fair fee when we're at the mercy of managed care institutions,"
Forbes says.
While Vermont was one of the first states to adopt a parity law
requiring insurers to provide equivalent coverage for mental and
physical health, loopholes remain such as coverage carve-outs and
higher co-pays for mental health care. Legislation is afoot to banish
such discriminatory practices.
"If you look at the percentage of mental health dollars as a proportion
of the larger health care dollar, even though there's parity, fewer
resources are going to mental health than 10 to 15 years ago," Forbes
says.
Five years of loss ratio data (the portion of a premium spent directly
on care) show managed care companies managed to reduce mental health
and substance abuse care and increase profits in Vermont, Forbes
says. No insurer had a loss ratio over 55 percent while medical
insurers had loss ratios in the 75 to 90 percent range, according
to a 2006 audit commissioned by the Vermont Psychological Association,
Vermont Psychiatric Association and other advocacy groups.
"[The decline] is borne on the backs of clinicians with reduced
access to consumers who are suffering because of discounted fees,"
Forbes says. "Legislators are outraged by this."
The New Hampshire Psychological Association last December touted
provider payment reform in the shape of RBRVS as a goal for 2006,
but the issue has languished, says legislative liaison William J.
Jamieson, Ph.D. No legislation has been filed but the legislative
committee plans to tackle the issue via direct talks with state
insurance commissioners and managed care providers to point out
the benefits of adopting RBRVS, Jamieson says.
New Hampshire liaisons have been communicating with Rhode Island
Psychological Association legislative liaison Peter Oppenheimer,
Ph.D. whose advocacy has been moderately successful at reducing
worst practices such as session caps, excessive pre-treatment authorizations
and delayed payments.
While an RBRVS bill did not pass the legislature, one of Rhode
Island's two main health insurance companies, Blue Cross Blue Shield,
chose to adopt RBRVS as the minimum reimbursement rate for all health
care services. The other, United Healthcare of New England, uses
RBRVS for medical services but not behavioral health.
Rhode Island legislative efforts have spawned the Health Care Fairness
Act, which, as in Vermont, authorizes health care providers to negotiate
with insurers and a bill to provide reimbursement parity between
medical and mental health services.
But advocates have pulled back from re-introducing RBRVS legislation,
Oppenheimer says, because, due to budget cuts, Congress has been
"finagling the formula." While RBRVS has been the closest thing
to a reasonable payment system, it's not immune to political forces,
he says.
"We didn't want to get locked into a system being bastardized for
political purposes," Oppenheimer says.
The point is, he says, to build a health care system where mental
health providers can be compensated for high quality service so
they can stay in business helping people live more productive and
satisfying lives.
"No one is looking to make big bucks from insurance reimbursement,"
Oppenheimer says. "We simply want adequate pay for the work we do."
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