Mentor Research Institute

Healthy Contracts Legislation; Measurement & Value-Based Payment Contracting: Online Screening & Outcome Measurement Software

503 227-2027

What do Healthplans Want from Psychotherapists?


Since the pandemic began, venture capital investors have spent $2.4 billion to buy and build online teletherapy companies. The growth and financial value of these companies have skyrocketed. One start-up company was recently valued at 4.6 billion dollars. These companies profit only when they attract a client to their platform and control the client’s ability to access their therapist. The clinical value of these services is questionable because the venture capital company’s success will require them to manage:

  • The episode of care (i.e. duration).

  • The treatment modality.

  • The use of 90837 and 90839 CPT codes.

  • The frequency of appointments.

  • Patients’ screening, progress, outcome, and satisfaction measures.

The return on venture capital investment will be paid for with money that healthplans arguably should pay psychotherapists. If psychotherapists drop their contract with a Healthplan, and then contract with a venture capital managed company, the Healthplan will save between $700 and $1300 in medical costs after that psychotherapist is paid. A thousand therapists treating 25 patients each can save nearly 20 million dollars. To maximize the savings, the venture capital managed company will need to focus psychotherapist treatment on:

  • The reduction of symptoms that present to physicians in primary care with no physical cause (e.g. somatization, trauma, depression, anxiety, panic, etc.)).

  • Reduce medical and psychiatric hospital visits and admissions for anxiety, depression and panic disorders.

  • Constrain psychotherapy to between 3 and 14 appointment as much as possible focusing on physical symptom reduction.

  • Pressure psychotherapist to provide evidence of medical necessity of care when the episode of care exceed 26 appointments.

Companies with billions of dollars are now competing for the same client as a small private practice.

The integrity and privacy of counseling and psychotherapy practice can compromise venture capital management who are motivated to maximize profit, not induvial patient outcomes.

Marketing to grow venture capital sponsored networks is also being accelerated with marketing strategies which include:

  1. Bait-and-switch recruitment practices.

  2. Bait-and-switch referral of patients.

  3. Seemingly lucrative contract offers.

  4. Promises of administrative support services.

  5. Provider referral of provider bonuses.

  6. Signing bonuses.

  7. Building provider networks and ‘flipping’ those networks to larger companies .

  8. Requiring patients to pay for their services in order to find lower cost providers and to encourage Healthplans to contract with the Venture capital company.

  9. Creation of “ghost” networks created by venture capital companies that can limit access and services in ways that can shield Healthplans from accountability to state health authorities or insurance commissions.

  10. Requiring providers to use specific measurement systems that give visibility into the provider and patients’ health information data base (data that is worth millions to Healthplans).

  11. Creating contracts with part-time providers who are more than 65 (paying $500 signing bonused or more to the new contractor) in order to create the appearance of a referral network so Healthplans will contract with these commercial managed care networks.

  12. More…

For more information see:
Threats to Psychotherapy Practice and Patient Privacy
https://www.AmericanMentalHealth.com/threats-to-practice

Historically, Healthplans have refused to increase reimbursements, often ignoring cost of living and cost to practice increases. Those increases are routinely given to other Healthcare providers, not psychotherapists. Healthplans have been unable and unwilling to elicit or offer alternative payment methods to private practice psychotherapists. But they have offered such contracts to group practices that employ psychotherapists. The unprecedented involvement of venture capital investors and demand for psychotherapy services has persuaded Healthplans to open the doors to start-up companies and keep the doors closed to private practice psychotherapists.

Healthplans are negotiating with and contracting with venture capital companies in order to entice psychotherapists into canceling their existing contracts, Venture capital companies are offering contracts that include…

  1. Trivial benefits such as a signing bonus.

  2. Adding appointments to the psychotherapist’s calendar.

  3. Managing psychotherapist billing and revenue cycle management (depositing payments to providers weekly).

For more information see:
Do Venture-Capital Investors Think Psychotherapists are Dumb?
https://www.IMHPA.org/are-psychotherapists-dumb

Psychotherapists should carefully consider their financial value. That value is not just the millions of dollars they can save in healthcare costs, but also the value of the data psychotherapists would be giving to venture capital investors. That data can be leveraged to create more companies capable of managing psychotherapy and reinforcing adherence to antidepressant medication as the default intervention after 14 sessions.

For more information see:
The Role of Patient Reported Outcome Measures in Mental Health
https://www.mentorresearch.org/the-role-of-patient-reported-outcome-measuress-in-mental-health


The following are 4 propositions that describe briefly what Healthplans are facing and why they are are willing to pay venture capital companies to disrupt private practice psychotherapy..

  1. The demands for mental health services has increased by approximately 30%.

  2. There are not enough psychotherapists to meet the demand. Healthplans that offer low reimbursement for psychotherapy are faced with having to increase fee-for-services in order to complete with Healthplans that pay more.

  3. For every dollar spent on mental health, Healthplans save more than 7 dollars. Healthplans need to improve access to psychotherapy for their members. Employers want value-based purchasing options when contracting with Healthplans. Healthplans cannot create value without paying psychotherapist more.

  4. Patients achieve the greatest benefit from psychotherapy by the 8th session. The improvement from each appointment diminishes significantly by appointment 12. A small number of patients continue therapy beyond 20 sessions and those patient make much smaller gains with each appointment.

  5. Private practice psychotherapists are not aligned and do not coordinate with primary medical care. Physicians cannot find referrals for patients.

For more information see:
Healthplans Want “Integrated Care”:  But Where Are All The psychotherapists?
https://www.IMHPA.org/where-are-the-psychotherapists


Below is a graph that reflects research that has been replicated over several decades. Healthplans and venture capital investors are well aware of psychotherapy treatment benefits and diminishing returns.

Table 1. Patient Utiliation of Service

Table 1 reflects findings that more than 2/3rds of patients have substantially improved and discontinue treatment between session 14 and 25.

Table 2. Dose-Response Improvement Curve

Table 2 data from several clinics in which mental health professionals routinely used the PHQ-9 to obtain patient reported outcomes on depressive symptoms. Without session data it is difficult to compare to the “baseline” data, but the degree of change would appear to reflect outcomes below what might be expected for traditional outpatient therapy. Thus, these data serve as means to explore the interventions and alternative to improve care.

By adopting an outcome informed care (OIC) treatment methodology mental health professionals can come in line with the rest of the health care community in obtaining feedback from patients regarding their symptoms, functioning, well-being, health behaviors and experience of care.  OIC offers both flexibility and the meaningfulness of standardized scales and facilitates communication with other health care professions consistent with their use of patient reported outcome measure (PROM) and outcome informed care (OIC). Psychotherapists will be wise, if they want to remain independent and private, to develop habits of standardized assessment and follow up to improve client satisfaction, clinical outcomes, and communication with other health care professionals.


DISCLAIMER and PURPOSE: This discussion document is intended for training, education, and research purposes only. The information contained herein is based on the data and perspectives available at the time of writing. It is subject to revision as new information and viewpoints emerge.

For more information see: https://www.mentorresearch.org/disclaimer-and-purpose

Key words: Supervisor education, Ethics, COVID Office Air Treatment, Mental Health, Psychotherapy, Counseling, Patient Reported Outcome Measures,