Journal of Pediatric Psychology, Vol. 29, No. 1, 2004, pp. 47-52
© 2004 Society of Pediatric Psychology; all rights reserved
2000 SPP Salk Award Address.
Financing Pediatric Psychology Services: Buddy, Can You Spare a Dime?
Department of Educational Psychology, Texas A&M University
All correspondence concerning this article should be addressed to William A. Rae, Department of Educational Psychology, MS 4225, Texas A&M University, College Station, Texas 77843-4225. E-mail: warae{at}tamu.edu.
Key words: managed care; pediatric psychology.
The viability of pediatric psychology has been of concern over the last few years. In a recent survey Brown and Roberts (2000)
anticipated that during the next decade pediatric psychologists will be "concerned with pediatric psychology's ability to demonstrate viability, to integrate psychologists into primary care settings, and to demonstrate need for changes in reimbursement systems within managed care" (p. 5). Pediatric psychology as a recognized field has progressed during the last several decades, but there has been erosion of financial viability for practitioners. In this article, the historical markers of pediatric psychology's financial stability and the value of the services that pediatric psychologists provide will be reviewed. The erosion of confidence in older models of the financial infrastructure and alternative models of financing hospital-based pediatric psychology clinical services will also be discussed.
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The Growth of Pediatric Psychology |
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Pediatric psychology is a relatively young specialty. The Society of Pediatric Psychology (SPP) has been in existence for only 35 years, and during that time the field has undergone substantial changes. During the formative years of the profession, pediatric psychologists provided assessments for patients with developmental disabilities. Much of the early work of pediatric psychology centered on applied research in the area of innovative interventions designed to ameliorate medically related problems. Other foci included assessment, intervention, prevention, and explicative research (Roberts & McNeal, 1995
). Interventions tended to be symptom focused, behavioral, and brief. In the same way, treatment interventions had to be time-efficient, effective, and economical in order to be viable (Peterson & Harbeck, 1988). Early collaborations with pediatricians often reflected the action-oriented, brief interventions with patients typical of a pediatric practice.
Shortly after SPP was founded, Lee Salk (1970) described the role of a psychologist in a pediatric setting. He explained how psychologists aid pediatric staff by providing help in the areas of diagnosis of developmental problems, prompt screening, timely consultation with staff, guidance in child rearing, and sensitizing staff to the emotional needs of children undergoing medical procedures or hospitalization. The early writings of pediatric psychologists also reflected the importance of collaboration and consultation with physicians and other pediatric health care professionals (Drotar, 1995). This trend continues, as evidenced by the fact that several years ago the president of the American Academy of Pediatrics, Robert Hannemann (1997), pronounced that every pediatric patient in the United States should be touched by a pediatric psychologist. Thus, these foci of assessment, collaboration, consultation, empirical research, and intervention are at the core of pediatric psychology and have been the basis of the profession's identity and viability.
From Fee-for-Service to Managed Care Insurance Reimbursement
Prior to 1960 it was rare for psychologists to receive fee-for-service insurance reimbursement for professional services. The movement for psychologists to get fee-for-service insurance reimbursement began in the 1960s and continued through the 1980s. As professional psychology became insurance viable, graduate programs swelled because there was now a strong financial base to support this growing force of practitioners. As psychological practitioners, the field became dependent on fee-for-service reimbursement. This also shifted the focus from a collaboration, consultation, and prevention model to a direct service model, where time spent in clinical contact would be reimbursable by the insurance. The fee-for-service model rewarded the clinical practice in pediatric psychology.
During the 1980s health care costs rose rapidly. In his book The Social Transformation of American Medicine, Paul Starr (1982) was one of the first authors to indicate to the public that the health care system was about to come under siege. During the 1980s, managed care became an economic necessity because of the unprecedented rise in health care costs. Prior to this time, whenever costs rose, fee-for-service practitioners (including psychologists) would in turn charge their patients more for their services. There was little incentive to change this approach prior to the 1980s, since whatever the provider charged was usually fully paid by insurance without protest; insurance companies continued to make a profit, since they passed their higher costs on in the form of higher premiums. Most patients did not pay for health or psychological services directly; business, industry, and government paid the employee-benefit health insurance premiums for the patients. In actuality, many patients were often not aware of the real cost of health care services, as they did not pay for them directly out-of-pocket. Business, industry, and government found that the increasing costs of health care affected their ability to be profitable, efficient, and/or effective. Obviously, sociological factors contributed to greater utilization of services, such as the aging baby-boomer population requiring more expensive health care services and other consumers demanding more frequent and intensive services. (For a more complete overview of managed care and psychology, see Kent & Hersen, 2000.) Unfortunately, managed care has resulted in reduced income for psychologists (Roberts & Hurley, 1997) as well as other medical practitioners (e.g., pediatricians).
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The Value of Pediatric Psychology |
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Similar to our pediatrician colleagues during the last several decades, pediatric psychology practitioners have seen their customary insurance reimbursement eroding. Even with diminished reimbursement, the value of the pediatric psychology profession should be based not only in the monetary reimbursement received, but in how patients are helped. The value of pediatric psychology services to patients can be conceptualized as falling into the three components of cost, quality, and access (Rae, 1998
). First, cost is essentially the price charged for professional services. In the past, practitioners could raise fees without much resistance from insurance carriers or patients. Although pediatric psychologists might believe that they can work smarter and more efficiently, these kinds of professional services are at their core labor-intensive and not easily made cheaper. Second, quality is essentially the judgment that investment of time, energy, and money yields an effective result. This is one of the core concepts in managed care and is at the heart of the latest movement toward empirically supported treatments in pediatric psychology. Managed care may look at patient satisfaction or some other short-term indicator of behavior change but may be hard-pressed to examine more long-term benefits inherent in psychological treatment. Regardless of how quality is operationalized, outcome in pediatric psychology is often difficult to measure. For example, a patient with diabetes may be referred because of lack of adherence to a therapeutic regimen, but even if the adherence problems are not solved, the therapeutic contact with the pediatric psychologist could have improved the quality of life for the patient (e.g., reduced family distress). In the same way, contact with a pediatric psychologist could stimulate emotional growth that the patient will not fully comprehend until much later in life. For example, a perceptive comment and positive emotional support by the pediatric psychologist might resonate with the patient and have an impact for the patient at a later developmental stage.
As scientist-practitioners, pediatric psychologists must pursue empirically supported approaches, but the efficacy of a technique inherent in empirically supported treatments may not adequately reflect the overall effectiveness of the interventions (Seligman, 1995). Treatment outcome is far too complex to be defined solely by a rigidly applied manualized treatment; even manualized approaches must be flexibly implemented (Kendall, 2001). Weisz (2000) has proposed using a clinic-based treatment development model, in order to study potentially effective treatments by developing and testing the treatments in a clinical practice setting, not in a research setting. It is recognized that many of the most effective interventions cannot be quantified, because of the uniqueness and complexity of the transactions with patients and their families. This issue is also exacerbated by the vagaries of the diagnostic criteria of the Diagnostic and Statistical Manual of Mental Disorders, Fourth Edition (DSM-IV) and accompanying treatment outcome criteria. Treatment outcomes (i.e., quality), especially those that are nonbehavioral, are not easily measured.
Finally, access is related to how quickly patients can see a provider. In most pediatric psychology settings, speedy access has always been a problem. This access problem permeates child mental health care. Unfortunately, access is not often solved in hospital-based pediatric psychology programs by hiring more pediatric psychologists; administrators may be reluctant to hire additional personnel who appear to contribute to a negative bottom line. Access is usually improved by increasing the productivity of the existing providers. Pediatric psychologists are often compelled to increase patient volume by generating more patient contact hours. Since cost cannot be modified and quality is difficult to measure, the access issue is frequently dealt with by encouraging psychologists to "see more patients."
When pressure is put on the pediatric psychologist to improve value by increasing access, lowering cost, and improving quality, an insidious situation gets created. Hospital budgets demand that practitioners make a "profit" or "break even," but even "breaking even" is nearly impossible given the current fiscal reality. At the same time, the implicit message is that pediatric psychologists are not producing adequately. Asking administration for what is essentially a "charitable donation" to bail out the pediatric psychology service's financial shortfall is a demeaning process, creating the illusion of fiscal irresponsibility. Not only does this lack of fiscal power mean that needed initiatives for the psychological care and well-being of patients may not get supported, but it also contributes to fatigue already exacerbated by the stress of long hours, difficult patients, and the uncertainty of continued support in the hospital environment. Our value as professional psychologists should not be measured solely by monetary worth, but in our value to our patients, our institution, and our community. Our personal sense of worth and value as pediatric psychologists can be challenged in hospital settings. This perception of powerlessness can exhaust our personal and professional resources, which in turn could render us less effective as clinicians.
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Creating Fiscal Viability for Pediatric Psychology |
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A pediatric psychologist is a viable helping professional, yet frequently encounters challenges in providing services that have the most value to patients. There are several good examples of activities that contribute to child and family mental health but do not appear to be financially viable. One area is the treatment of subclinical DSM-IV disorders in order to prevent serious psychological disorders in the future. In the era of managed care, the pediatric psychologist may feel pressure to be very "flexible" in the interpretation of DSM-IV diagnostic criteria in order for insurance to pay for services. The alternative is to not treat a problem that could lead to negative effects on the child's future well-being and psychological health. The newly authorized current procedural terminology (CPT) codes allowing for pediatric psychologists to treat physically ill patients without using traditional psychotherapy CPT codes is an improvement (Foxhall, 2000
), but it is not clear if this new CPT code will make a substantial change to the fiscal bottom line.
A second area of developing fiscal viability involves those children experiencing the trauma of a serious pediatric illness and/or intrusive medical procedures. It is clear that pediatric patients often have stress and coping challenges (for an overview, see La Greca, Siegel, Wallander, & Walker, 1992). Pediatric psychologists can help children with chronic illnesses reduce risk factors, increase social support, and moderate stress processing, which in turn may contribute to increased resilience (Wallander & Varni, 1992). Unfortunately, it is difficult to find ways to pay for those kinds of indirect services.
Finally, a third area of developing fiscal viability involves the important activity of consulting with medical staff about problems they might encounter with their patients or about the impact of the psychological environment in the hospital. Consulting is a very effective way of impacting on the pediatric population; one of the added benefits of consulting is that of training medical staff in psychological treatment (Drotar, 1995). Because pediatric psychologists see themselves as being an integral part of the health care team, this consultation becomes natural. Again, pediatric psychologists are contributing to the greater good (i.e., promoting positive mental health) but are not financially viable. All of the above examples focus on preventing serious emotional and psychological problems. In addition, these activities are worthwhile endeavors that add value to the pediatric psychology profession even though they are not usually paid for directly by insurance.
Many creative pediatric psychologists have devoted considerable time and energy to trying to solve this dilemma. The old models of fee-for-service reimbursement for pediatric psychology services no longer work; insurance companies are not going to support practitioners as has been done in the distant past. The profession must be open to innovative approaches.
Three general areas of focus in pediatric psychology seem to hold some promise that might eventually lead to financial viability in the profession. First and foremost, pediatric psychology is a market niche that is unique; our profession has few rivals for preeminence. This preeminence is exemplified by the recent series of articles in 1999 and 2000 on empirically supported treatments in the Journal of Pediatric Psychology. Pediatric psychologists have special skills in dealing with issues of chronic illness and behavioral treatment of pediatric health care problems. In addition, primary care pediatrics is also a fertile area of emerging expansion. If Robert Hannemann's 1997 pronouncement of the collaboration between pediatricians and pediatric psychologists is ever fully realized, the viability of the profession will be assured.
A second area of unique activity of pediatric psychologists is in the prevention of illness, injury, or psychological dysfunction through the modality of training and consultation with pediatric health care providers. Although not always actively supported by managed care, prevention is a core tenet of managed care. This situation is not all the fault of managed care. It is caused in part because patients frequently switch their insurance carriers, and thus it is not economically viable for insurance companies to engage in prevention since patients do not remain subscribers long enough to benefit from the intervention. A prevention focus will take us back to our beginnings of treating emerging problems, before pediatric psychologists were financially rewarded to treat only child and family psychopathology. The fee-for service approach to treat pathology is not conducive to prevention activities.
A third area that holds promise for pediatric psychology is that of medical-cost offset, which, if unequivocally proved, would open up areas of support for the profession. In a recent meta-analytic review of the impact of psychological intervention on medical cost on mostly adult patients, overall results implied a substantial medical-cost offset effect. At the same time, the comparison of child versus adult versus elderly effect sizes in this study was only marginally significant, with slightly larger mean effect sizes for child group (Chiles, Lambert, & Hatch, 1999). Unfortunately, this recent article on medical-cost offset is not able to address the efficiency/effectiveness in savings that is required before there is more widespread acceptance (Cummings, 1999). Roberts and Hurley (1997) have reviewed the medical-cost offset literature pertaining to children, and the findings remain mixed. At the same time, if the process of providing good psychological care reduces medical costs, then insurance companies would more vigorously support pediatric psychological services.
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Buddy, Can You Spare a Dime? |
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The field of pediatric psychology can no longer afford a patchwork solution to the reimbursement crisis. A paradigm shift away from fee-for-service has been viable for many hospital-based programs. The focus is not solely insurance driven, although insurance reimbursement could be part of the mix. Pediatric psychologists provide valuable professional service to patients and colleagues that transcend many disciplines in pediatric health care. The fee-for-service mentality makes the unit of intervention the "pathological" patient rather than intervention in the system of pediatric health care and with pediatric patients with subclinical problems, as well as interaction with practitioners within that system.
Instead of using a fee-for-service model for reimbursement, payment could come directly from hospital or clinical service fees; the pediatric psychologist would be covered as an overhead expense. Even though the trend in pediatric hospitals is to eliminate the overhead disciplines (e.g., social service), an argument can be made for continuing to support pediatric psychology. In order to ensure that pediatric psychologists can provide cutting-edge intervention within the health care system, financial resources should be available to support needed psychological intervention. In fact, even now some pediatric psychology programs have been able to develop financial agreements with hospital-based subspecialty clinics (e.g., a scoliosis clinic) in order for pediatric psychologists to be paid for their services. The total fee for the subspecialty clinic visit can include a portion of the psychologist's fee. In the same way, a hospital-based department can transfer funds to the pediatric psychology service for the time the psychologist spent consulting with the physicians or their patients. Unfortunately, these kinds of financial arrangements are still the exception, but they continue to hold some promise. Another innovative financing arrangement involves endowment activities. For example, some hospital-based pediatric psychology programs have obtained charitable contributions and have created an endowment to pay for a salary line.
Regardless of the fiscal approach, pediatric psychologists must be willing to vigorously sell the concept of how pediatric psychology services benefit children and families. Collaboration on advocacy issues with pediatricians and their support of our profession also help immeasurably. This approach not only is designed to bolster our own financial situation, but is intended to actively support and promote innovative approaches to service delivery and research on viable treatments. It is the embodiment of the ethical principle of promoting the best interest and welfare of children and families (APA, 2002) and is clearly the right thing to do for our profession.
The inspiration for the title of this article came from E. Y. Harburg's lyrics to the Depression-era song "Brother, Can You Spare a Dime?" in which the narrator is a dutiful, reliable worker who has plowed the fields, fought in the Great War, and built the monumental buildings of the day. The narrator continues to remain positive about what has been accomplished, even though his reward for building the dreams of the nation is to suffer in the Depression. Like the narrator in that song, pediatric psychologists experience some bewilderment about what happened to their financial support, but continue to have faith in the inherent worth and value of what they have done.
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Acknowledgements |
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A previous version of this article entitled "21st Century in Pediatric Psychology: Buddy, Can You Spare a Dime?" was presented at the American Psychological Association Annual Conference in Washington, D.C., on August 6, 2000.
Received December 30, 2002; revision received February 16, 2003; accepted March 31, 2003
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