Bernadette Fuqua, LCSW was pleased when ACME Healthcare accepted her application to join its provider panel. ACME had a large client base and offered a better than average mental health benefit to its clients. However, Bernadette was taken aback by the restrictive language in the contract she was offered. Were all managed care contracts like this?
Many therapists maintain a private practice and participate in some managed care arrangement also. Sometimes therapists will join as many panels as possible without fully realizing the implications and the differences in the managed care contracts being offered. Since managed care contracts are designed to influence provider behavior, this lack of in-depth review and close scrutiny may have serious consequences for the therapist.
The "hold harmless" clause is a common provision. It obligates the therapist to reimburse the managed care organization (MCO), if the company becomes a defendant in a lawsuit or must pay damages for the negligent or fraudulent acts of the therapist. Practically speaking, it is questionable if a hold harmless agreement would shift liability when an action by the MCO (e.g. not authorizing additional visits) contributes to the allegations of provider negligence. While it may be impossible to strike a hold harmless agreement from a contract, many MCOs accept a mutual arrangement, which also indemnifies the therapist for mistakes made by the company.
Referral restrictions require that a client be referred back to the MCO or another member of its panel. A social worker may have an ethical and legal duty to refer a client to the best possible providers for alternative care if it is not available through the MCO. Try to negotiate for the right to refer to a provider outside the panel. Remember that referring outside the panel does not obligate the MCO to pay for the treatment. The client and MCO would negotiate for services outside the provider panel.
All MCOs require some access to and review of clinical records. Understand the types of reviews, which can be made, and the rules governing them. Social workers have an ethical duty not to disclose confidential information to third party payers without their client’s consent. Be sure your clients under-stand the scope of information you may have to release in a review by their MCO.
1. Verify that your professional liability insurance policy covers the contractual liability you may incur under a managed care contract. The NASW Insurance Trust’s policy provides this valuable protection, but other policies may not.
2. Obtain legal advice prior to signing any managed care contract. A lawyer should be able to identify problematic contractual language and provide alternatives. A little proactive review before you sign can save grief and litigation in the future.