The Impact of the Affordable Care Act on Mental Health Private Practices

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The Impact of the Affordable Care Act on Mental Health Private Practices

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Ever since the Affordable Care Act (aka ACA or Obamacare) was passed in 2010, people have been speculating as to how it would impact mental health providers in private practice. With almost all of the provisions of that law now in place, we’re beginning to see the actual effects on our practices. Since I provide consulting services to mental health clinicians across the country, I’ve been able to gauge some of the ways that the Affordable Care Act has impacted different practices. While this is hardly scientific evidence, these are things I’m hearing consistently enough to believe they are wide-spread.

Two Significant Factors

There are two, significant things affecting those in private practice that are a result of the ACA . Keep in mind that, I’m speaking generally here. There can be significant differences observed between states that accepted the Medicaid expansion versus those that did not, for example. Another factor are the states that provide for telehealth reimbursement versus those that don’t (opening up new opportunities!). Obviously demographic and socioeconomic factors in the geographic vicinity of a practice matter as well.

  • More people have insurance – The ACA mandated that people have health insurance. This has resulted in more people having it and more people wanting to use it. Many practices have observed this trend whether people had insurance previously or not. Whether it’s because of increased financial pressures, wanting to use something they hadn’t had previously or both, more people seem to be insisting on using their health insurance benefits.
  • More people have high deductible plans – Not only are more employers moving to high deductible plans, but the majority of plans on the ACA Exchange are high deductible plans. This presents a potential opportunity for fee for service and other out of network providers, as many people with high deductible plans may be willing to go out of network, especially if they are typically healthy and have few medical costs throughout the year. While exclusively private pay practices may be hurt by more people having insurance with worse out-of-network benefits, they have an opportunity to work with those who have high deductible plans. Those who are in network with some insurance companies, but not others, also have this opportunity. Practitioners will need a solid strategy and marketing plan in order to take advantage of the changing market.

In my experience in talking with a variety of practitioners, there has not been a significant, widespread negative impact on existing practices that can be directly related to the ACA. Starting a practice fresh while not taking insurance has always been a significant challenge, however, and the increased number of people taking insurance, I believe, does add to that challenge. Again, due to the multitude of other factors involved in starting a practice, it doesn’t render it impossible; just potentially more difficult.

I’m very interested to hear from anyone who’s experience has differed! One potential future impact of the ACA is the move toward integrative care. Already practices across the country are adopting a model where behavioral health care is handled under the same roof as primary care. In a future article, I’ll talk about how that might affect current practices, as well as the opportunities it presents.

UPDATE – The most recent effect of the Affordable Care Act and related, subsequent actions is the creation of Health Information Exchanges (HIEs). Reach about those here.

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About the Author

Rob has been covering technology and business news for mental health professionals since 2011. His extensive experience in IT, business, and private practice allow him to synthesize information in a friendly, digestible manner. He also enjoys time with his family, ultimate frisbee, and board gaming.

Rob Reinhardt

CEO, Tame Your Practice

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