Sterling Winthrop: using patient comparisons to cut mental health costs

The effectiveness of therapy and counseling treatments for mental illness and substance abuse is difficult to assess. Often it is difficult to decide whether the patient is progressing and when the treatment should end. Since mental health and substance abuse care makes up around 10% of health costs and has increased 57% in five years, companies with these coverages in their health plans are concerned about controlling these costs. A number of companies have gone to structured methods for assessing patient progress and deciding on the therapy plan.

Sterling Winthrop, a chemical company owned by Eastman Kodak, went to this type of approach when they expanded their health care coverage in a new contract for their 4,200 employees. At Sterling Winthrop this system led to a reduction in average patient visits per episode from 5.5 to 3.5. Expenses that had increased 15% in 1990 and 17% in 1992 dropped 47% in 1993 after introducing a managed care model of the following type.

In a typical situation a new patient feeling depressed or extremely anxious fills out a questionnaire covering symptoms, family relationships, and ability to function. These answers and a therapist's initial appraisal are fed into a computer system that compares the patient's behavior and feelings with those of hundreds of other patients and people functioning normally. This information is used to set up a plan that may include a combination of therapy and medication. The plan is based on achieving outcomes that can be related to those achieved by other patients. An external case reviewer may confer with the therapist before the plan is approved. If a therapist disagrees with a model under some circumstances, such as when the powerful anti-depressant drug Prozac is recommended, the health care organization may ask for another therapist's opinion. Continuing to disagree may reduce the likelihood the initial therapist will be retained by the health care network. Progress relative to the outcome measures is reviewed periodically in a similar way.

This type of system generates emotional debates among members of the medical community. On the one hand, there is the need to control spiraling medical costs. On the other, many therapists say this approach relies more on a mathematical model than on the judgment of professionals assessing the situations they confront..

Questions:

1. Use the WCA framework to organize your understanding of this case and to identify important topics that are not mentioned.

2. What ethical issues does this system raise?

3. Describe how well this system seems to operate and explain why you believe this type of system is or is not appropriate.

Source: Freudenheim, Milt. "Business Using Therapy Data to Lower Costs." New York Times, Apr. 12, 1994, p. A1.

Back to Useful Cases from Previous Editions

Main Page About the Book Student Resources Instructor Resources Contact Us