In 1990 Western Medical Review, a utilization review company for Blue Cross of Southern California, wanted to halt payment for further inpatient hospitalization of a man who had been diagnosed with depression, anorexia, and drug dependency. The man’s psychiatrist disagreed with the company’s verdict, but accepted it, and he was discharged from the hospital. Three weeks later he committed suicide.

While not all such cases end in tragedy, the danger is clearly imminent when insurance companies and psychiatrists lock horns over when a high-risk patient should be discharged from the hospital—especially in this day of impassioned efforts by managed care to keep a tight rein on costs. For instance, of the some 250 calls that the APA Managed Care Help Line gets each month, about 30 are managed care complaints, and of these 30 complaints, one or two have to do with such disputes. (Most callers to the help line are seeking specific information.)

So what should a psychiatrist do if a carveout wants to stop paying for a patient’s stay in the hospital, yet he or she believes that such a dismissal would prove dangerous either for the patient or for others? A number of things, experts suggest.

First off, before psychiatrists sign a contract with a carveout, they should read its practitioner handbook and other materials to make sure that they understand its authorization and appeals processes for inpatient services, urged Cynthia Barrow, a social worker and former clinical manager at one carveout, Merit Behavioral Care Corporation in Raleigh, N.C.

Most carveouts have similar internal structures, she said, so it shouldn’t be too time consuming to master the information. For instance, she pointed out, utilization review of inpatient admissions is usually especially intensive when an admission reaches what is known as the "average length of stay." Additional time after that period is usually approved in smaller chunks, largely based on risk factors.

Some states also have laws governing the appeals process, reported Sam Muzynski, a lawyer and director of APA’s Office of Healthcare Systems and Financing. Thus, psychiatrists should be familiar with such laws in their states, he advised.

If a carveout sets a discharge date for a patient, the psychiatrist should not be intimidated by it. The psychiatrist is both ethically and legally responsible for the patient’s welfare. The case cited above illustrates this point: a court found not only the utilization review company but also the psychiatrist liable for the patient’s fate.

Explained Jacqueline Melonas, a nurse, lawyer, and assistant vice president of risk management for Professional Risk Management Services (PRMS) in Arlington, Va., "From a professional liability perspective, the courts have been very clear that the doctor is still responsible for the clinical needs of the patient. In other words, if you think the patient shouldn’t be discharged because of his clinical situation and you go ahead and discharge him anyway, saying, ‘I can’t do anything because the HMO won’t pay for it,’ and the patient is injured in some way because of that, then that is a bad situation." PRMS is the administrator of APA’s professional liability insurance program.

Heather Whyte, manager of the APA Managed Care Help Line, agreed. Whenever staff get calls from psychiatrists protesting a carveout’s desire to discharge a high-risk patient, they stress to them that they are duty-bound to protect their patients’ interests regardless of insurance issues. Thus, psychiatrists should advocate for their patients, which includes challenging the carveout’s decision.

While the procedure for challenging such decisions may vary from company to company and state to state, the process generally goes like this: First, the psychiatrist must appeal in writing and document why the patient needs to stay longer in the hospital, Whyte advised. If the psychiatrist has any standardized rating-scale results for the patient, say for depression, include them, she added. A New York psychiatrist recently took this route, she recalled. A carveout had wanted to deny his hospitalized patient two more days of care, so the psychiatrist wrote a letter and provided documentation that he believed met the carveout’s criteria for an extension.

If the carveout case manager, who may be a nurse or a mental health professional, grants the psychiatrist’s request, great, but if not, the psychiatrist should ask for a doctor-to-doctor review. Most psychiatrists know to take this step, but not always, Whyte said.

Obtaining contact with a physician on staff with a carveout is easier in some circumstances than in others, Melonas reported. Some carveouts have few administrative barriers, whereas others have a lot. In any event, Melonas said, the psychiatrist needs to be persistent, and one tactic some have used with success is to state right at the start, "This is very complicated. I need to speak with the psychiatrist who makes the utilization review decisions."

Whyte suggested another strategy: The psychiatrist should ask for a review by a colleague with credentials similar to his or her own. For instance, a child psychiatrist should ask for a review by another child psychiatrist, not by an adult one.

While negotiating, the psychiatrist should ask on what basis was the denial for a more lengthy hospital stay based. This advice came from Allen Daniels, Ed.D., chief executive officer of Alliance Behavioral Care and chair of the American Managed Behavioral Healthcare Association in Washington, D.C., the umbrella association for HMO mental health carveouts throughout the United States. Under the association’s code of conduct, Daniels explained, all of its members must make public the criteria by which they arrive at medical decisions. In fact, some states require the divulgence of such information, pointed out Katherine Becker, a lawyer and deputy director for state affairs in APA’s Division of Government Relations. Although certain psychiatrists are adept at appealing, others could improve their finesse, Melonas contended. Whyte agreed and cited a case from last fall to illustrate it:

Behavioral Health Systems turned down an Alabama psychiatrist’s request to extend coverage for a patient whom he believed was suicidal. The psychiatrist felt he was being forced into discharging the patient and believed there weren’t any other options. He had his staff call the hospital utilization department in the hope that it could change Behavioral Health Systems’ position. No luck. He then had his staff call the APA Managed Care Help Line for assistance. Whyte then contacted Behavioral Health Systems and spoke with the vice president for medical services. As it turned out, there had been a communications breakdown between the psychiatrist and the company. The psychiatrist thought in error that partial hospitalization was not an option. "I’m sorry that this doctor didn’t feel like he could call me directly to work this out," said BHS’s vice president.

"Communication is critical," agreed Jerome Vaccaro, M.D., vice president and corporate medical director of one of the nation’s biggest carveouts, PacifiCare Behavioral Health in Van Nuys, Calif. "If you don’t have open lines of communication, you don’t resolve these kinds of disagreements."

And psychiatrists should not view carveouts’ authorization and appeals processes for inpatient services as an enemy, but rather as a dynamic process by which they and the carveout arrive together at the best possible treatment for the patient. So advised Vaccaro, a psychiatrist and APA member.

"Our members need to understand better and accept that whether it is managed care or back in the old days of indemnity insurance companies, or whatever evolves in the future, medicine and psychiatry do not exist in a vacuum," he contended. "Medical training brings us to believe that we are always right, and that is simply not the case.

"I think it is healthy for a physician in a managed care organization to be challenging a treating physician to provide data about a patient’s status. And in the. . .process, what we are trying to do is really promote best practices, which means operating according to rigorous treatment guidelines."

Thus, whenever a psychiatrist disagrees with a carveout over a high-risk patient, there are a number of steps that he or she can take to look out for the patient’s best interests. Yes, it can be complicated, and yes, there are different points of view on the subject, but appropriate actions may save a life.