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Why Managed Care Hurts You

HMO Insurance Managed CareWhat’s the big deal about managed care? Try getting psychotherapy services from your HMO or insurance company and you’ll soon realize what the “big deal” is.

There are two major and a whole lot of minor problems with regard to how managed care hurts your ability to access timely and effective treatment. The first problem is that insurance companies, looking out for the bottom line, will seek to limit either the time or type of psychotherapeutic services offered you. The second problem is that these same companies seek to limit your choices in who you can see.

This hurts you because it is the people in little cubicles in the insurance companies and HMOs in the world who dictate to us, the doctors and therapists who have had years of experience and training, what is and is not appropriate treatment for you. It wouldn’t be so bad except that many (if not most) of those people in those little cubicles have no greater experience, education or specialized training than a college degree. Oversight at the companies is at best, minimal. This is not a doomsday or negativistic opinion — these are facts you can check with your own HMO or insurance company.

While you may have little difficulty accessing psychotherapy services (and this varies widely), you will have a very difficult time keeping them once you’ve got them. Many HMOs (especially) require reapproval of the therapy every 3 or 6 sessions. That means the clinician needs to continuously justify the treatment you are receiving. Would such a situation be tenable in a hospital or if it were a medical doctor treating you for a medical problem? Of course not, yet consumers allow the insurance companies and HMOs to dictate to them what appropriate treatment is or is not for their particular emotional difficulty.

Sometimes insurance companies think they know what is “best” for you, the consumer, even when they are wrong. For instance, it is common practice for insurance companies to demand that you not only see a psychiatrist for a major depressive disorder, but that you take an antidepressant medication for it as well as the first-line treatment for this disorder. However, as my recent article on treatment of depression illustrates, medication should really not necessarily always be the treatment of choice, much less the first (and many times, only) treatment. So why do insurance companies do this then? Hmmmm… I wonder. Could it be because they are in a business to make money, and not to look after all of your medical needs? Nah…

That is the bottom line, though. Medication costs less than psychotherapy, even if you need to take it for the rest of your life (long after the insurance company has had to pay for it). They don’t care about long-term effects or goals as they are very business-oriented and short-sighted. While psychotherapy will cost more in the short-term, it is with the understanding that most people do not stay in psychotherapy the rest of their lives for their problems and they do get better. And once a problem is taken care of in psychotherapy, the problem is likely gone, to some extent, for most people for the rest of their lives. But insurance companies ignore this.

But this is getting at the second major problem with managed care — often they do not give you, the consumer, a choice with regards to what doctors you can or cannot see.

We see this problem not only in the medical field, but especially in the mental health field. If your chosen therapist isn’t a part of their “plan,” you get to see one of “their” therapists. In a local HMO, this means that instead of seeing a psychologist, you are forced to see a therapist with no better than a social work degree (this is not meant as a dig against social work recipients). Your decisions are meaningless to this HMO; you see who they tell you to go see, for the prescribed amount of time they will allow you to go see them. (Yes, welcome to America, land of opportunity and freedom!)

Freedom of choice in managed care systems is a moot point. You either play by their rules or pay higher premiums for a different insurance plan (that plays essentially the same game with the same sets of rules for consumers and practitioners alike), which might offer you a bit more flexibility in terms of choices of doctors and length of stay in therapy. Those kind of choices shouldn’t be reserved only for those who can afford them. Those kind of choices are choices every American grew up expecting and, perhaps, taking for granted.

Take them for granted no more. Your freedom to choose your own therapists and doctors is quickly evaporating. I just recently read an article in Time Magazine which outlined the same problem teaching hospitals across the nation are experiencing, also because of managed care. The breakthroughs in medicine (and in psychology) will no longer be possible with penny-pinching companies dictating scientists’ and practitioners’ every move.

I don’t know what consumers can do, individually, to change all of this. One or two voices in the wilderness are generally ignored. A couple of hundred or thousand well-organized voices, though, can generate change. All therapists want is the ability to see patients in psychotherapy for as long as their professional judgment says, without having to justify every session to someone with no knowledge of you, as a person, or the therapist, or the progress you are making in therapy. That generally does not mean years, but rather a few months.

Most HMOs won’t even pay for that, though. Maybe slowly they will begin to understand what they are doing, but I urge you, as a consumer of mental health services, to write or call your insurance company and ask about their mental health benefits. If they don’t allow therapists the freedom that all other doctors and health professions enjoy, voice your concern, not only to them, but to your local Congressmen as well. (Congress will be tackling health care reform sometime again within the next few years.) It may be the only way to help change this awful system.

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Why Managed Care Hurts You

This article has been updated from the original version, which was originally published here on July 21, 1995.

John M. Grohol, Psy.D.

Dr. John Grohol is the founder of Psych Central. He is an author, researcher, and expert in mental health online, and has been writing about online behavior, mental health and psychology issues since 1995. Dr. Grohol has a Master's degree and doctorate in clinical psychology from Nova Southeastern University. Dr. Grohol sits on the editorial board of the journal Computers in Human Behavior and is a founding board member of the Society for Participatory Medicine. You can learn more about Dr. John Grohol here.

APA Reference
Grohol, J. (2019). Why Managed Care Hurts You. Psych Central. Retrieved on September 29, 2020, from
Scientifically Reviewed
Last updated: 15 May 2019 (Originally: 21 Jul 2015)
Last reviewed: By a member of our scientific advisory board on 15 May 2019
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