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The Effects of the Affordable Care Act on the Practice of Psychiatry

Michael H. Ebert, MD; Robert L. Findling, MD, MBA; Alan J. Gelenberg, MD; John M. Kane, MD; Andrew A. Nierenberg, MD;  and Pierre N.Tariot, MD

Published: April 15, 2013

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The Journal of Clinical Psychiatry
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The Affordable Care Act (ACA), which became law on March 23, 2010, and was upheld by the Supreme Court on June 28, 2012,1 is a health care law intended to improve access to health care coverage in the United States and introduce protections for people who have health insurance.2 The ACA affects providers, patients, insurance companies, and government entities, and parts of the law have already gone into effect (Table 1).3

Table 1

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Of particular importance to mental health care, a few of the policies already implemented by the ACA include prohibiting insurance companies from placing dollar limits on lifetime coverage benefits, allowing young adults to stay on their parent’s health care plan up to age 26 years, providing free preventive care such as depression treatment, and prohibiting insurance companies from denying coverage to children and adults with preexisting conditions, including mental illnesses and substance use disorders.4 The ACA also supports establishing national centers of excellence to treat depressive disorders, funding for community mental health centers, and providing preventive care for other conditions. The ACA will have a direct impact on the mentally ill as more Americans gain access to psychiatric treatment.5

Michael Ebert, MD, chaired a discussion among an expert panel of psychiatrists regarding how the ACA will change the practice of psychiatry and psychiatric research.

How Will the Affordable Care Act Change the Practice of Psychiatry?

clinical points
  • The ACA’s expanded coverage will create an influx of new patients.
  • Psychiatry practice is shifting toward patient-centered medical homes and collaborative treatment teams.
  • New technologies will expand access to and increase efficiency of health care.

Integrated Care

Dr Ebert: Mental health care can be improved through the ACA’s proposed or reinforced care delivery systems, such as community mental health centers with integrated primary and specialty care.5 Insurers have the option to set up collaborations between primary care and mental health care.

Although the Department of Veterans Affairs (VA) is not directly impacted by the ACA, the VA has shown how the patient-centered medical home (PCMH) model can improve access to care and how chronic disease management can be facilitated through the coordinated efforts of patient-aligned care teams (PACTs; Table 2).6 For example, a patient with posttraumatic stress disorder, chronic pain, and diabetes can receive care from a psychiatrist, a pain specialist, a rehabilitation therapist, and a primary care physician without having to coordinate the visits himself.7

Table 2

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A VA clinic, using the PCMH model and PACTs, was able to shorten wait time for appointments so that 25% of the schedule was available for same-day visits. This approach diminished inappropriate emergency department visits from 52% to 12% and improved the care of patients with poorly-controlled diabetes.6 Issues to address when applying the PCMH model at the national level, outside of the VA, include flexibility in meeting training needs for different employees, the need for funding, and the recognition that training and implementation take longer than expected, meaning that long-term support for the teams is needed.6

Dr Tariot: The VA medical home model for integrated care is based on the examples of several care delivery systems, including that of the nonprofit health care organization Kaiser Permanente.6 Kaiser developed a cost-effective system with primary, secondary, and tertiary clinicians sharing the budget and responsibility for all care.8 Kaiser’s multispecialty health centers enable primary care doctors, nurses, specialists, and pharmacists to coordinate care, focus on prevention, and minimize hospital visits.

Severe Mental Illness

Dr Gelenberg: The ACA could hurt psychiatric care in some ways, particularly in caring for the chronically mentally ill, because many services that have been previously paid for by states are not regulated or paid for under the new legislation.9

Dr Tariot: Centers for Medicare & Medicaid Services (CMS) is interested in following research from the National Institute of Mental Health because CMS needs some models to ensure that people with illnesses like schizophrenia receive evidence-based care. Although the ACA plans to reimburse certain institutions for emergency inpatient psychiatric care for Medicaid patients,5 other evidence-based practices for treating severe and persistent mental disorders are not usually covered by health insurance.9

Solo Practices

Dr Ebert: Someone who practices psychotherapy in an urban area can probably maintain a solo practice with direct payment outside the insurance system, but anything beyond that will be hard to maintain under the new legislation.

Dr Tariot: Psychiatrists who do not take insurance will likely keep practicing.

Dr Ebert: Although there will always be practitioners providing services for those who can pay out of pocket, solo practitioners will be rare in the new, integrated organizational structure if they want to be involved with an insurance network. Concierge practices increased 30% from 2011 to 2012.10

Dr Nierenberg: The future with the ACA is no more fee for service; by 2015, physicians will be paid by value rather than volume. Virtually all physicians are going to be employed. Specialists, like psychiatrists, will function more in a team setting, supervising less expensive personnel to take care of most of the health problems, similar to the community mental health center model.

Dr Kane: I agree. A number of people of all ages will get insurance who did not have insurance before, including those who are mentally ill. The same number of physicians will soon serve more patients, making team care crucial. Specialists are going to move into consultative roles and stop keeping a stable of patients.

Use of Technology

Dr Kane: To be able to help a larger number of patients, psychiatrists will need to make use not only of the integrated team approach but also of new technologies.11 Technology is going to create more efficiencies and better access through the use of smart phones with apps for disease management and Web-based interventions and psychoeducation. In many places in the country, patients with schizophrenia cannot find someone to give cognitive-behavioral therapy, but if they could go online for a well-developed program, it would be a huge advantage.

Similarly, telemedicine gives clinicians the ability to communicate with patients via 2-way, in-home video, which reduces office visits. There are far fewer reasons for patients to go to a clinic or hospital these days, even with primary care, because physicians do not necessarily have to see them face to face.10 Telemedicine is less expensive and more convenient than office visits.

Dr Tariot: Telemedicine does not appear to have caught on yet in many residency programs, but it is going to happen.

Dr Gelenberg: Payment for telemedicine sessions is complicated. The telepsychiatry program in the VA is growing fast, but everybody is on salary.

Dr Nierenberg: At Massachusetts General Hospital (MGH), a health information technology system provides support for treatment teams via electronic health records (EHR), patient tracking, and monitoring from home. An experiment between MGH and CMS was designed to improve the coordination of services for high-cost Medicare patients. The project demonstrated reduced costs and improved care in areas including fewer emergency department visits, decreased annual mortality rates, and lower hospitalization rates (Table 3).12

Table 3

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Dr Tariot: There are revenue advantages for using electronic medical records, such as the Medicare and Medicaid EHR incentive programs for eligible professionals and hospitals.13

Dr Nierenberg: The ACA is going to have a huge effect on practice, and current medical school students will not practice like we have in the past.

Dr Kane: Access to care and delivery of care are both big areas of change. Medical students will have different training and practicing methods than we did. It is going to be a different world.

Dr Gelenberg: However, psychiatry is taking an optimistic turn as it explores public health questions and works in tandem with primary care doctors.

How Will Psychiatric Research Change?

Dr Tariot: We will certainly have greater opportunities to do effectiveness research, outcomes research, and cost-effectiveness research because we will have larger pools of patients.

Dr Gelenberg: There may be a broader balance of payers for research besides the pharmaceutical companies, such as other agencies and the federal government.

Dr Nierenberg: Studying interventions for high-risk patients remains a problem.

Dr Findling: Getting an at-risk intervention protocol through an institutional review board review has been one of the most difficult things I have ever done. For some people, it is anathema to treat someone who does not yet have an illness; conversely, others cannot understand why you would want to do a controlled study in people who are at risk for developing a condition that could be prevented.

Dr Nierenberg: The kind of research that is going to be done will have endless resources available. As a result of the ACA and other legislation, the CMS Center for Innovation is investing heavily in the development and testing of new service delivery and payment models to find better, more cost-effective ways to take care of people.14

I think that pharmaceutical companies may conduct fewer drug studies and get involved in more partnerships with systems that are studying the effectiveness of care.

Dr Kane: Yes, I think we will have more focus on delivery systems, experiments in innovation, and partnering. New technology, like a chip in a pill to time-stamp when a patient swallows it, will facilitate monitoring. Companies are going to be linking their drug studies to these and other opportunities.

Dr Ebert: Companies are going to be thinking past the traditional “swallow a pill” model to more creative therapeutic concepts like new devices and nanotechnology. There will be tremendous pressure on drug pricing, which is already happening in Germany and other western European countries.15 The efficacy must justify the cost or else a new product will be assigned a generic cost.

Dr Nierenberg: Cost-effectiveness requirements will make the payers (ie, insurers) the larger determiners of what comes from pharmaceutical companies.15

Dr Ebert: There will be tension in government regulation as the US health care system evolves.

Dr Tariot: Occasionally, an agency will fund research, but it is hard to do studies in nonpharmacologic research, which leads to a lot of missed opportunities.


The ACA will affect several areas of psychiatry and the care of patients with mental health disorders as more Americans have access to health insurance. Patients with mental illnesses should be able to receive better care because they cannot be denied coverage based on their preexisting condition. As health care shifts to community-based models, specialists and primary care physicians will work together in a collaborative environment to provide comprehensive treatment in a coordinated care setting. Advances in technology and better care coordination will enable specialists to consult with other clinicians, caregivers, and patients in remote locations, bypassing face-to-face visits when possible. Research into care delivery systems and preventive medicine will continue to advance. Clinicians face many decisions as the ACA continues to be implemented, but understanding the upcoming changes will help them prepare for the future.

Disclosure of off-label usage: Dr Ebert has determined that, to the best of his knowledge, no investigational information about pharmaceutical agents that is outside US Food and Drug Administration-approved labeling has been presented in this activity.

Financial disclosure: Dr Ebert has received honoraria and royalties from McGraw Hill and Cambridge University Press. Dr Findling is a consultant for Alexza, Bracket, Bristol-Myers Squibb, the Cognition Group, GlaxoSmithKline, Guilford Press, KemPharm, Lundbeck, Merck, Novartis, Otsuka, Pfizer, Roche, Shire, Sunovion, Supernus, Transcept, Validus, and WebMD; has received grant/research support from AstraZeneca, Bristol-Myers Squibb, Forest, GlaxoSmithKline, Johnson & Johnson, Eli Lilly, Lundbeck, Merck, National Institutes of Health, Novartis, Otsuka, Pfizer, Rhodes, Shionogi, Shire, Stanley Medical Research Institute, and Supernus; is a member of the speakers bureaus for Shire; and has received royalties from American Psychiatric Press, Johns Hopkins University Press, and Sage. Dr Gelenberg is a consultant for Allergan and Forest, has received grant/research support from Pfizer, and is a stock shareholder in Healthcare Technology Systems. Dr Kane is a consultant for Amgen, Alkermes, Bristol-Myers Squibb, Azur, Eli Lilly, Lundbeck, Merck, Novartis, Otsuka, Johnson & Johnson, Janssen, Roche, Shire, Sunovion, Targacept, Jazz, Intracellular Therapeutics, and Forest and is a member of the speakers/advisory boards for Otsuka, Merck, Janssen, Bristol-Myers Squibb, and Novartis. Dr Nierenberg has served as a consultant to Appliance Computing (Mindsite), Medergy, Brain Cells, Johnson & Johnson, Labopharm, Merck, PGx Health, Ridge Diagnostics, Targacept, and Takeda/Lundbeck; has received grant/research support from the Agency for Healthcare Research and Quality, National Institute of Mental Health (NIMH), Pamlab, Pfizer, Shire, and Wyss Institute; has received honoraria from American Society for Clinical Psychopharmacology, American Professional Society of ADHD and Related Disorders, Belvior Publishing, Canadian Psychiatric Association, CNS Spectrums, Dartmouth Medical School, Johns Hopkins Medical School, MBL Publishing, Montreal McGill Douglas Hospital, Northeast Counseling Center Directors, Pamlab, SciMed, Slack Med, University of Florida, WebMD, and Wolters Klower Publishing; is on the advisory boards of Appliance Computing, Brain Cells, InfoMedic, Johnson & Johnson, Takeda/Lundbeck, and Targacept; owns stock options in Appliance Computing and Brain Cells; holds copyrights through Massachusetts General Hospital (MGH) for the Clinical Positive Affect Scale and the MGH Structured Clinical Interview for the Montgomery Asberg Depression Scale; and is a presenter for the MGH Psychiatry Academy, which has held educational programs supported by independent medical educational grants from AstraZeneca. Dr Tariot has received consulting fees only from Abbott, AC Immune, Adamas, Avanir, Boehringer-Ingelheim, Chase, Chiesi, Eisai, Elan, MedAvante, Merz, Neuroptix, Otsuka, and Sanofi-Aventis; has received consulting fees and research support from AstraZeneca, Avid, Bristol-Myers Squibb, Genentech, GlaxoSmithKline, Janssen, Eli Lilly, Medivation, Merck, Pfizer, Roche, and Toyama; has received research support only from Baxter Healthcare, Functional Neuromodulation, GE, Targacept, National Institute on Aging, NIMH, Alzheimer’s Association, and Arizona Department of Health Services; holds stock options in Adamas (previously MedAvante); and is a contributor to a patent for “Biomarkers of Alzheimer’s Disease.”


1. US Department of Health & Human Services. The health care law and you: read the law. Updated 2013. Accessed March 12, 2013.

2. American Psychiatric Association. Health Care Reform: A Primer for Psychiatrists: The Patient Protection and Affordable Care Act: Analysis and Commentary from APA Publications and the APA Department of Government Relations. Arlington, VA: American Psychiatric Association; 2012. Accessed March 12, 2013.

3. US Department of Health & Human Services. Key features of the Affordable Care Act, by year. Updated 2013. Accessed March 12, 2013.

4. American Psychiatric Association. Summary of the Patient Protection and Affordable Care Act and impact on psychiatry and patients. Published June 29, 2012. Accessed March 12, 2013.

5. Moran M. Affordable Care Act has benefits for people with psychiatric illness. Psychiatr News. 2012;47(15):1a-27. Accessed January 23, 2013.

6. Klein S. The Veterans Health Administration: implementing patient-centered medical homes in the nation’s largest integrated delivery system. Published September 13, 2011. Accessed March 12, 2013.

7. Khanal Y. In the VA system, the future of primary health care. Washington Post. November 30, 2012. Accessed March 12, 2013.

8. Light D, Dixon M. Making the NHS more like Kaiser Permanente. BMJ. 2004;328(7442):763-765. PubMed doi:10.1136/bmj.328.7442.763

9. Goldman HH. Will health insurance reform in the United States help people with schizophrenia? Schizophr Bull. 2010;36(5):893-894. PubMed doi:10.1093/schbul/sbq082

10. Leonard D. Is concierge medicine the future of health care? Business Week. November 29, 2012. Accessed March 12, 2013.

11. Rubin EH, Zorumski CF. Perspective: upcoming paradigm shifts for psychiatry in clinical care, research, and education. Acad Med. 2012;87(3):261-265. PubMed doi:10.1097/ACM.0b013e3182441697

12. Massachusetts General Hospital. Fact sheet-phase one: MGH Medicare demonstration project for high-cost beneficiaries. Accessed January 23, 2013.

13. Centers for Medicare & Medicaid Services. EHR incentive programs. Modified August 27, 2012. Accessed March 12, 2013.

14. Centers for Medicare & Medicaid Services. Innovation models. Accessed March 12, 2013.

15. Stafford N. New drug pricing rules in Germany. Published November 18, 2010. Accessed March 12, 2013.

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