Assessment and Diagnosis “Under the Gun”

How Does Clients’ Method of Payment Influence Psychologists’

Diagnostic Decisions?

Amy M. Kielbasa, Andrew M. Pomerantz, Emily J. Krohn, and Bryce F. Sullivan Department of Psychology

Southern Illinois University, Edwardsville

To what extent does payment method (managed care vs. out of pocket) influence the likelihood that an independent practitioner will assign a Diagnostic and Statistical Manual of Mental Disorders (American Psychiatric Association, 1994) diagnosis to a client? When a practitioner does diagnose, how does payment method influence the specific choice of a diagnostic category? Independent practitioners responded to a vi- gnette describing a fictitious client with symptoms of depression or anxiety. In half of the vignettes, the fictitious client intended to pay via managed care; in the other half, the fictitious client intended to pay out of pocket. Payment method had a very signifi- cant impact on diagnosis such that relative to out-of-pocket clients, managed care cli- ents were much more likely to receive diagnoses and more likely to receive adjust- ment disorder diagnoses in particular. We discuss implications involving informed consent and other ethical issues.

Keywords: diagnosis, managed care, independent psychotherapy practice, ethics, payment

The effects of managed care and other forms of third-party payment on the inde- pendent practice of psychology have been studied via numerous empirical surveys of practitioners (e.g., Bell, 1999; Murphy, DeBernardo, & Shoemaker, 1998; Phelps, Eisman, & Kohout, 1998; Rothbaum, Bernstein, Haller, Phelps, & Kohout, 1998). Additionally, numerous authors have published nonempirical commentar-

ETHICS & BEHAVIOR, 14(2), 187–195 Copyright © 2004, Lawrence Erlbaum Associates, Inc.

Requests for reprints should be sent to Andrew M. Pomerantz, Southern Illinois University, Edwardsville, Campus Box 1121, Department of Psychology, Edwardsville, IL 62026. E-mail: [email protected]

ies on the impact of managed care on psychotherapy (e.g., Karon, 1995; Miller, 1996). These surveys and commentaries have focused on the effects of managed care on many aspects of the therapy process, including duration, quality of care, confidentiality, and to some extent assessment, but limited attention has been paid to the effect of managed care on specific diagnostic decisions made by clinicians. Thus, our purpose in this study was to examine two specific questions involving the relation between payment method and diagnosis: To what extent does payment method (managed care vs. out of pocket) influence the likelihood that an independ- ent practitioner will assign a Diagnostic and Statistical Manual of Mental Disor- ders (4th ed. [DSM–IV]; American Psychiatric Association, 1994) diagnosis to a client? When a practitioner does assign a DSM–IV diagnosis, how does payment method influence the choice of a specific diagnostic category?

Restrictions imposed by insurance companies and managed care organizations have resulted in a decline in payment for psychodiagnostic testing in recent years (e.g., Butcher, 1997; Cashel, 2002; Piotrowski, Belter, & Keller, 1998), but it is not entirely clear how truncated assessment procedures might influence the likelihood of psychologists assigning diagnoses at all, and if they do, how they influence the choice of a particular diagnostic category. Murphy et al. (1998) found that Division 42 members (Psychologists in Independent Practice) of the American Psychologi- cal Association strongly believed that managed care has led to inadequate or inap- propriate assessment and also that managed care influences psychologists to alter diagnoses to ensure reimbursement and protect patient confidentiality. Danziger and Welfel (2001) similarly found that mental health counselors report problems accurately diagnosing clients in a managed care system. Epstein et al. (2001) found that the probability of a psychiatrist diagnosing a patient with major depres- sion depends on the percentage of patients who pay that psychiatrist via managed care. Beyond these few studies, however, the literature lacks empirical studies ex- ploring the relation between payment method and diagnosis by mental health pro- fessionals. Particularly absent are quasi-experimental studies in which clinicians are presented with descriptions of clients who pay differently but are otherwise identical. This study represents an attempt to fill this void in the literature.

METHOD

Participants

Members of Division 42 of the American Psychological Association were ran- domly selected and surveyed via mail. Of the 750 members who were surveyed, 188 respondents provided usable data, representing a 25.06% return rate. Mean age of participants was 54.81 years (SD = 9.16), and mean number of years in pri- vate practice was 20.21 (SD = 8.41). Respondents were primarily men (65.45%)

188 KIELBASA, POMERANTZ, KROHN, SULLIVAN

and White (97.40%). Most had earned PhD degrees (88.00%) as opposed to EdD (6.80%) or PsyD (5.20%) degrees, and most specialized in clinical psychology (86.50%) as opposed to counseling psychology (12.00%) or other areas (1.50%). Eclectic orientation was most frequently endorsed (45.50%), followed by cognitive (28.30%) and psychodynamic (14.70%). Most (63.40%) worked primarily in solo independent practices, whereas some (29.30%) worked primarily in group inde- pendent practices.

Materials, Design, and Procedure

Each participant received a survey that included two vignettes, one describing a client with depressive symptoms and another describing a client with anxious symptoms. For participants in the managed care condition, both fictional clients were described as paying via managed care. For participants in the out-of-pocket condition, both fictional clients were described as paying out of pocket. The ap- pendix provides an illustration of these vignettes. Participants also received a cover letter and a brief demographic survey.

Each vignette was intended to portray a client with a problem commonly seen by independent practitioners, the severity of which was near the threshold for a DSM–IV diagnosis. Specifically, the anxious client was described as demonstrat- ing just enough symptoms of generalized anxiety disorder to consider the assign- ment of this diagnosis. The depressive client was described as demonstrating sev- eral of the symptoms of a major depressive episode but not quite enough to merit the diagnosis. The description of the depressive client’s symptoms also lacked any mention of symptom duration, which according to DSM–IV, must exceed 2 weeks. The vignettes also included additional (nonsymptomatic) background information about each client (gender, marital status, work, activities, etc.) to “flesh out” the character and make him or her seem more like an actual client rather than an ab- straction or mere list of symptoms. The blend of symptoms with nonsymptomatic background information was intended to match the actual presentation of clients in independent practice.

After reading each vignette (which included presenting problem, symptoms, and some background and demographic information), participants were asked “Would you assign this client a DSM–IV diagnosis?” (“yes” and “no” choices pro- vided), and “If you answered yes to the previous question, what specific diagnosis would you provide?”(blank space rather than specific choices provided).

RESULTS

Tables 1 and 2 display the frequencies of yes and no responses to the item, “Would you assign this client a DSM–IV diagnosis?”As the tables illustrate, assignment of

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a diagnosis was more common for managed care clients than for out-of-pocket cli- ents across both vignettes. The percentage of yes and no responses to the managed care condition were used as comparisons for the out-of-pocket condition in two chi-square tests for goodness of fit (one for each vignette). For example, in the first vignette (anxious client), 77.6% of participants assigned a diagnosis to the man- aged care client, whereas 22.4% of participants did not assign a diagnosis to the managed care client. These percentages were used to calculate an “expected n” for the out-of-pocket condition, which was used in the chi-square test for goodness of fit. For the first vignette, χ2(1, N = 188) = 182.29, p < .001. For the second vignette, χ2(1, N = 188) = 45.96, p < .001. These highly significant chi-square statistics indi- cated that the likelihood of a participant assigning a diagnosis to a client paying via managed care is significantly higher than the likelihood of a participant assigning a diagnosis to the same client paying out of pocket.

The item “If you answered yes to the previous question, what specific diagnosis would you provide?” generated a wide variety of responses from participants. Spe- cifically, 11 distinct diagnoses were offered for the anxious client in the first vi- gnette, and 10 distinct diagnoses were offered for the depressive client in the sec- ond vignette. This wide variety of responses was then divided in a binary manner into “adjustment disorder” and “non-adjustment disorder” categories. The adjust-

190 KIELBASA, POMERANTZ, KROHN, SULLIVAN

TABLE 2 Frequencies of “Yes” and “No” Responses to the Item “Would You Assign

This Client a DSM–IV Diagnosis?” by Payment Method Regarding Vignette 2 (Depressive Client)

Yes No

Payment Method n % n % Total

Managed care 80 88.9 10 11.1 90 Out of pocket 66 67.3 32 32.7 98 Total 146 42 188

TABLE 1 Frequencies of “Yes” and “No” Responses to the Item “Would You Assign

This Client a DSM–IV Diagnosis?” by Payment Method Regarding Vignette 1 (Anxious Client)

Yes No

Payment Method n % n % Total

Managed care 88 97.8 2 2.2 90 Out of pocket 76 77.6 22 22.4 98 Total 164 24 188

ment disorder category included all diagnoses of adjustment disorder regardless of subtypes or specifiers. The non-adjustment disorder category included all other di- agnoses. Tables 3 and 4 display the frequencies of adjustment disorder and non-ad- justment disorder diagnoses regarding both vignettes. As the tables illustrate, as- signment of an adjustment disorder diagnosis was more common for managed care clients than for out-of-pocket clients across both vignettes. The percentage of ad- justment disorder and non-adjustment disorder responses to the managed care con- dition were used as comparisons for the out-of-pocket condition in two chi-square tests for goodness of fit (one for each vignette). For example, in the first vignette (anxious client), 33.0% of participants assigned an adjustment disorder diagnosis to the managed care client, whereas 67.0% of participants assigned a non-adjust- ment disorder diagnosis to the managed care client. These percentages were used to calculate an expected n for the out-of-pocket condition, which was used in the chi-square test for goodness of fit. For the first vignette, χ2(1, N = 164) = 6.07, p = .014. For the second vignette, χ2(1, N = 148) = 6.70, p = .010. These significant chi-square statistics indicated that the likelihood of a participant assigning an ad- justment disorder diagnosis to a client paying via managed care was significantly higher than the likelihood of a participant assigning an adjustment disorder diag- nosis to the same client paying out of pocket.

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TABLE 4 Frequencies of Adjustment Disorder and Non-Adjustment Disorder

Diagnoses Assigned Regarding Vignette 2 (Depressive Client)

Adjustment Disorder Diagnosis

Non-Adjustment Disorder Diagnosis

Payment Method n % n % Total

Managed care 31 38.8 49 61.2 80 Out of pocket 16 23.5 52 76.5 68 Total 47 101 148

TABLE 3 Frequencies of Adjustment Disorder and Non-Adjustment Disorder

Diagnoses Assigned Regarding Vignette 1 (Anxious Client)

Adjustment Disorder Diagnosis

Non-Adjustment Disorder Diagnosis

Payment Method n % n % Total

Managed care 29 33.0 59 67.0 88 Out of pocket 15 19.7 61 80.3 76 Total 44 120 164

DISCUSSION

Results of this study suggest that the method by which a client pays for psychologi- cal services has a very strong influence on the diagnostic decisions of the psychol- ogist providing the services. Specifically, these results indicate that relative to cli- ents who pay out of pocket, clients who pay via managed care are far more likely to be diagnosed with a DSM–IV disorder and are more likely to receive an adjustment disorder diagnosis in particular. This appears to be true across two common types of presenting problems (anxious and depressive symptoms).

The finding that clients paying via managed care are more likely to receive diag- noses than those paying out of pocket is illustrated not only by the significant chi-square statistics reported previously but also by simply comparing the respective percentages of clients who were and were not assigned a diagnosis. Regarding the fictitious client with anxious symptoms, such a comparison revealed that partici- pants were 10 times more likely to choose not to assign a diagnosis when the client paid out of pocket than when the client paid via managed care (22.4% vs. 2.2%). Sim- ilarly, regarding the fictitious client with depressive symptoms, participants were about three times more likely to choose not to assign a diagnosis when the client paid out of pocket than when the client paid via managed care (32.7% vs. 11.1%).

An obvious reason that psychologists would be more likely to assign a diagno- sis to a managed care client than an out-of-pocket client is that managed care com- panies typically require a diagnosis to demonstrate medical necessity and justify payment for treatment (Ackley, 1997; Chambliss, 2000; Kutchins & Kirk, 1997). Less obvious, however, are the consequences of diagnosing clients whose symp- toms may not, in fact, merit a psychiatric diagnosis. For the client, such conse- quences may include an unwarranted view of the self as mentally ill, which could actually exacerbate psychological problems (Ackley, 1997; Caplan, 1995), or the presence of a mental disorder on the client’s medical record, the confidentiality of which is beyond the control of the practitioner and may be uncertain (Kutchins & Kirk, 1997; Murphy et al., 1998). Similarly, when clinicians diagnose clients who may not meet the criteria, it is increasingly likely that the course of therapy will be altered such that the client will undergo a prescriptive form of treatment based on that diagnostic categorization (e.g., Beutler & Harwood, 2000; Nathan & Gorman, 2002). The consequences of diagnosing clients who may not meet DSM–IV criteria extend to clinicians who may be held responsible for unethical (American Psycho- logical Association, 2002) or illegal (i.e., insurance fraud) professional behavior and to society in general, as insurance rates may increase to cover the costs of treat- ing these clients.

A number of factors may contribute to the relatively high proportion of adjust- ment disorder diagnoses for managed care clients (as opposed to out-of-pocket cli- ents). First, adjustment disorders may be perceived by clinicians as less serious, stigmatizing, or potentially damaging than other DSM–IV diagnoses, and as

192 KIELBASA, POMERANTZ, KROHN, SULLIVAN

Murphy et al. (1998) found, clinicians may choose such diagnoses in the best inter- ests of the client. Second, adjustment disorders may in fact represent the diagnostic category that best approximates the presenting problems of clients whose symp- toms are actually subclinical. Horwitz (2002), in fact, argued that numerous DSM diagnoses encompass an exceedingly broad range of behavior and experiences and specifically cited adjustment disorders as a category that “could encompass virtu- ally any problem at all” (p. 73). Third, compared to other DSM–IV disorders, ad- justment disorders are unusually wide ranging in terms of possible symptom inclu- sion. With specifiers that incorporate depressive, anxious, conduct-related, or unspecified symptoms, many presenting problems that could be considered sub- clinical could also be reconceptualized as difficulty adjusting to an identified stressor. Fourth, assignment of an adjustment disorder diagnosis to a client whose symptoms may not merit this diagnosis may represent an example of what Cummings (1998) and others have called “overdiagnosing.” Cummings (1998) ex- plained that in the era of managed care, “[f]orced on many occasions to demon- strate concepts of ‘medical necessity’ … practitioners’ exaggeration of findings on evaluation has become widespread” (p. 61).

The importance of informed consent is a primary ethical implication of the re- sults of this study. The American Psychological Association ethics code (2002) clearly emphasizes the necessity of informed consent for clinical services (e.g., Standards 3.10 [a], 10.01 [a]). The content of managed-care-related information to be included in an adequate informed consent procedure is subject to debate (e.g., Appelbaum, 1993; Newman & Bricklin, 1991; Pope & Vasquez, 1998), but it seems worthy to consider the effect of payment method on diagnosis among the es- sential points to include. In fact, Pomerantz (2000) found that when prospective cli- ents were informed about the impact of managed care on psychologists’ practice and ethics, their attitudes toward clinical services changed significantly. Moreover, the Pomerantz study also demonstrated that prospective clients who had been informed about the impact of managed care felt strongly entitled to such information.

The results and conclusions of this study are subject to numerous limitations. Its methodology involved vignettes with minimal information rather than lengthier, more detailed vignettes or actual clients. The range of clinical issues presented in the vignettes was limited to anxious and depressive symptoms. Also, the response rate was not particularly high. In spite of these and other limitations, the results of this study illustrate the important role that payment method plays in the diagnostic decisions of psychologists in independent practice.

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APPENDIX Sample Vignettes

Vignette 1

A 35-year-old married man is a father of two children. He is satisfied with his mar- riage but worries that he is not a “good father” to his children. This man has worked for the same company for the past 8 years and has moved his way up the ladder to an assistant managerial position. He spends most of his time at work and has few social contacts except for his coworkers. He and his wife typically go out twice a month to dinner and a movie. He has the following symptoms:

• He has been feeling anxious, almost daily, for the past seven months. • His mood is irritable and he feels edgy, which has interfered with his ability

to concentrate at work. This usually occurs when he is worried about reach- ing a deadline.

• He complains of dizziness, sweaty palms, and tense muscles all over his body, almost daily, but only when he feels anxious.

• He has found it difficult to control the worry and anxiety, which has mainly affected his occupation.

• The client does not have any medical conditions.

The client has come to you today because he is worried about these symptoms and intends to pay for therapy [through his managed care plan/out of pocket].

Vignette 2

A 55-year-old woman is married and has no children. She works as the director of human resource department at a large company. She has been married for 28 years and has a number of friends. During the weekday she divides her time between home and work. She frequently takes cooking classes, but has not felt like going to the class in a while. She has the following symptoms:

• She has been feeling a loss of pleasure in the usual activities that she does daily.

• Her ability to concentrate on anything of importance has decreased and she feels little energy to do daily tasks.

• She complains of a dramatic loss in the amount of her sleep.

The client has come to you today because she feels that she needs help. She in- tends to pay for therapy [through her managed care plan/out of pocket].

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