Beyond Psychotherapy: Working Outside the Medical Model

Beyond Psychotherapy: Working Outside the Medical Model

by John A. Martin
Dr. Martin shares his reasons for leaving the insurance game.
Filed Under: Practice Management


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"Do you take insurance?" is a question I often get from prospective clients, although less frequently these days.

My answer, in a nutshell, is "I don't." In fact, I resigned from the last of my managed care/preferred provider panels over 15 years ago. This essay explains the reasoning behind my decision, and how my practice as a licensed psychologist has evolved since then.


First, a word on the historical context. In the 1960s, with the advent of state licensing of psychologists, our incentives to formulate DSM-based diagnoses changed radically. Psychologists fought hard for parity with psychiatrists, and eventually won the right to be reimbursed by third parties (insurance companies) for the "medically necessary treatment of mental and nervous disease."

For a while, nearly everyone with insurance that covered psychological services had complete freedom of choice: clients chose a psychiatrist, psychologist or other licensed mental health professional more or less without restriction, and bills submitted for reimbursement were routinely paid, with minimal rigmarole by insurance companies, up to the contract's limits. This was a huge benefit to psychologists like me, although for some of us the cost of this change was also substantial:
In order to participate, psychologists, including those of us who were ill-disposed to do so, were required to start thinking of clients and their problems in terms of psychiatric diagnoses a la the DSM.
In order to participate, psychologists, including those of us who were ill-disposed to do so, were required to start thinking of clients and their problems in terms of psychiatric diagnoses a la the DSM.

Whether or not we ordinarily thought of clients in the context of mental illnesses and disease classifications, participation in the third party reimbursement system demanded that each client be labeled with a diagnosis, which in turn became part of their permanent medical record. The insurance companies were relatively uninvolved in diagnoses and treatment plans. Diagnostic codes were shared with insurers, but details about cases were kept private.

With the advent of managed care in the early 1980s, everything changed. Psychiatrists, psychologists and other providers of psychological services were now under contract with insurers (and/or their representatives and intermediaries, such as managed behavioral health companies), and were compelled by the terms of those contracts to participate in "utilization review." Practically speaking, this typically meant periodically making detailed disclosures of formerly confidential information about the clients to one or more case managers. Based on that information, which usually included diagnosis, history, presenting problems, progress, and treatment plan, case managers were empowered to authorize (or deny) ongoing psychological work. Disagreements between the service providers and case managers were common, and their resolutions often favored the cost-savings perspective of the case managers over those of the mental health professionals.

Since many case managers, at least at that time, had minimal training in psychology and psychotherapy, we therapists frequently complained (at least to one another) that non-professionals were making treatment decisions, sometimes cutting off reimbursement mid-treatment and without warning.
Clients were sometimes horrified to learn that the forms they signed to obtain insurance reimbursement included waivers of their confidentiality rights
Clients were sometimes horrified to learn that the forms they signed to obtain insurance reimbursement included waivers of their confidentiality rights, and that insurers and employees of the insurance companies had access to their confidential treatment information.

Fast-forward to today. Third-party reimbursement methodologies have become increasingly complex, and the system is run by many different business models and multiple layers of bureaucracy that were unheard of in the 1980s. But the basic concept remains the same: Psychologists and other mental health professionals are contracted providers, and as providers, we agree to provide only "medically necessary treatment" as authorized by the insurer. In some cases we are still required to formulate a diagnosis and treatment plan in order to make our case for "medical necessity," and confidential treatment information is utilized by an array of people in order to make decisions about the course of our clients' treatment. To make matters worse, contracted rates have generally been frozen for the past 20 years, so after taking inflation into account, providers' real income has decreased by as much as 50 percent.

Some insurance companies have given up on doing "utilization review," undoubtedly because they have found that the cost of providing such oversight is really not cost-effective. Others periodically try new approaches or recycle old approaches, alternating from telephone-, fax-, email- or web-based treatment reviews. Recently colleagues have reported to me that they have received letters from insurers pointing out that they have been seeing a certain patient for X number of sessions, and they might want to consult with the insurance companies' professional staff. Honestly, I cannot imagine any of my peers voluntarily phoning United Behavioral Health or Value Options or any of the other managed behavioral health companies to gain insights into how to provide more effective treatment! But as long as third parties are involved, the ultimate fate of that confidential information is beyond the control of the professional. Who does and who does not gain access to patient information depends on the policies and procedures of the administrative entity making the decisions about reimbursement, within the limits of current law.

"Diagnosis and treatment" constitutes the core language of the medical model. From the perspective of third party-payers, of course it makes sense to apply this same model to psychological treatment. Health insurance is, after all, intended to pay medical bills when a person becomes sick or injured. So as long as our work is being reimbursed as part of one's medical insurance, psychotherapy will continue to be seen as a treatment for a medical condition. But this isn't the only way to think about our clients and their presenting problems; in fact, it may not even be the most productive way.

In the mid-1990s, I finally resigned from the preferred provider networks I had joined some years before. I realized that in the majority of instances I couldn't, in good conscience, make a case that my clients were psychologically ill:
I too often found myself in the awkward position of agreeing with the insurer that my clients' requests for reimbursement should probably be denied.
I too often found myself in the awkward position of agreeing with the insurer that my clients' requests for reimbursement should probably be denied.

DSM and Psychotherapy

Critiques of the DSM are widespread, widely known and well reasoned on both scientific and philosophical grounds. I am typically in agreement with the perspective that says many of the DSM diagnostic categories represent artificial and poorly justified distinctions constructed between normal dimensions of human functioning. I'm not suggesting that all diagnosis is unjustified: certainly some individuals suffer from significant disturbances such as major depression, schizophrenia, bipolar disorder, or other conditions that can be rightfully considered psychiatric "disorders." However, I have found that I must ask myself again and again: how relevant is the concept of a disorder for most of my private clients? Do I feel confident about applying a DSM-based diagnosis when I recognize that this diagnosis will stay with him or her for life? Do I really believe this client is "mentally ill?"

Personally, I've concluded that not everything that looks like pathology is pathological, nor is every emotional pain, even persistent pain, necessarily a sign that something is broken and needs fixing. For example, while a person stuck in an unhappy marriage may be in considerable distress, defended against certain unwelcome feelings and completely paralyzed about what to do, I ask myself, does this make them somehow psychologically unwell? Or are they just stuck? Ordinary human feelings like frustration, disappointment, sadness and lack of enthusiasm can be mislabeled as depression. Likewise, worry, agitation and fearfulness can sometimes be mislabeled as an anxiety disorder, just as run-of-the-mill shyness can be called a social phobia. We need to recognize that there are vast individual differences among healthy humans and that different doesn't mean disordered. Moreover, most of us believe that some emotional pain is normal, not pathological, and in fact needs to be accepted as part of life. This is certainly a core aspect of the mindfulness-based approaches, which have recently become popular, but this belief runs counter to our efforts to diagnose and treat. And although many practitioners would say that they don't really take the DSM seriously, and they give a diagnosis in order to essentially "play the insurance game" that's required to be reimbursed, I think it is hard not to be at least subtly influenced by the pressures of playing the game, which reinforces the idea of psychopathology.

I have no quarrel with professionals whose psychological world-view is consistent with the DSM, and who are able to utilize the DSM-based diagnostic categories without internal conflict. However, I personally believe that most of the clients I have seen in my private practice are basically healthy and suffering from transient psychological confusion and/or pain. Diagnosis isn't really relevant for them, nor is the DSM.

Adjustment Disorders

The DSM's 309-series codes, "adjustment disorders," are a set of broadly defined categories of normal functioning that include problems-in-living with various emotional sequelae. These codes do in fact seem relevant, although not particularly useful, for the vast majority of clients I've worked with in the past 25 years. Unlike other diagnostic codes, however, the 309-codes don't really describe pathology, although they are characterized by "marked distress that is in excess of what would be expected from exposure to the stressor." But how do we decide what qualifies as "excessive" versus "normal"? Our primary approach of thinking about "normality" is (I hope!) primarily psychological, not statistical. Statistically, "excessive" refers to instances in the tails of some distribution curve. But psychologically, the amount of distress being experienced by any given person will almost certainly turn out to be exactly what would be expected for that person, at that time, under those circumstances. In a way, psychologically speaking, the idea of "excessive" distress is a bit absurd.

Alternatives to Diagnosis

But if we're not treating mental disease, what are we doing? Here's my personal answer, which evolves out of my professional history: I have a PhD from Stanford in developmental psychology. Before getting post-doctoral clinical training, obtaining a license and starting my private practice, I spent more than a decade at Stanford doing research on normal adults and their children. The focus of my research was on the evolution of two-person relationships and on identifying ways that researchers might meaningfully differentiate relationships from one another. I also specialized in research methodology, statistics and the philosophy of science. During my years at Stanford, I therefore learned a lot about normal human development and about normal, even exceptional, high-functioning two-person relationships. Just as importantly, I learned a lot about hypothesis generation, hypothesis testing and the nature of scientific evidence. I learned to question everything, and to require overwhelming evidence before accepting that the conclusions drawn from some study are anything but figments of the researchers' imaginations. I learned that a high degree of well-reasoned skepticism is part of the scientific process.

All this has allowed my professional identity to evolve, so that I now represent myself as a psychologist, but not as a psychotherapist. I think of myself as a consultant, a teacher, a mentor, or a coach who works with normal, healthy people who want to improve their lives. Instead of thinking of my clients as mentally ill and of myself as a healer, I think of my clients as psychologically healthy individuals and couples seeking an unbiased, caring professional with a fresh pair of eyes and a fresh look at their situation.

My post-doctoral training in psychodynamic psychotherapy taught me how to think about the unfolding of interpersonal process and about phenomena like transference and countertransference, projection, and identification as perfectly normal processes, affecting perfectly normal people. My post-doctoral training in cognitive-behavioral therapy taught me to think about how perfectly normal people sometimes conceptualize themselves and their problems in irrational, unhelpful ways, and how acting-without-thinking frequently accompanies irrational thinking. I continue to study approaches to psychotherapy and how people change, and apply what I learn in my work with normal, healthy individuals who are in a transient state of needing some help.
Since the word "therapy" implies healing, and I don't conceptualize my clients as needing to be healed, I don't consider nor market what I do as psychotherapy.
Since the word "therapy" implies healing, and I don't conceptualize my clients as needing to be healed, I don't consider nor market what I do as psychotherapy.

Collaborator not Healer

Of course, this means that my practice is a 100-percent fee-for-service practice. Since I don't do psychotherapy, I accept no reimbursement from insurance companies, and instead bill all fees directly to clients. I generally accept only clients whom I deem to be fundamentally psychologically healthy. What I actually do, however, isn't terribly different from what many psychotherapists do. I'm aware that my therapeutic style continues to have a psychodynamic feel to it, although it has evolved to be much more active and engaged than it used to be. I'm far more likely than I used to be to offer possible interpretations, suggestions, and homework assignments. I teach in the sense that I adopt a didactic stance in order to help clients understand what's happening in their lives. I'm less interested than I once was in insight for the sake of insight or the ideal cure, and am more aimed at helping my clients obtain tangible, measurable results.

Although I maintain written records similar to those that would be required of licensed psychotherapists, these records, since they do not describe treatment, are not medical records and are consequently of no interest to any insurance companies, insurance adjusters or anyone else. They are genuinely confidential records. And although my practice is HIPAA complaint, strictly speaking HIPAA doesn't apply to me either, because mine are not health records. I continue to practice exclusively within the limits of my training, experience and competence. I am very clear to prospective clients about what we can do together, and about what we will not be doing. By rendering the split between the healer and the healed irrelevant, I meet my clients as a collaborator. My client relationships feel stronger than ever, and more interpersonally authentic.

I offer this perspective simply as a way of sharing my journey as a helping professional, not as a prescription of how other therapists should think about or practice their craft. And to reiterate an important point: I do not by any means deny the existence of mental illness. Rather, I notice that it's extremely rare in clients who seek help in a private, fee-for-service practice. I also am aware that by refusing to accept insurance, I am making myself much less available to individuals who would find it economically difficult or even prohibitive to pay for my services. But for me this is the only way of operating my practice that feels congruent with my conceptualization of who my clients are and how they change—and I feel grateful that my DSM-free practice has continued to thrive. More generally, I believe that our training as psychologists makes us well suited to offer a wide range of valuable services to the public, and that psychotherapy is only one of them. We are here to help our clients, and there are many different ways to do that.

My thanks to Victor Yalom for his valuable contributions to this piece.

Copyright © 2010 All rights reserved.
John A. Martin John Martin is a licensed psychologist in San Francisco. He has been practicing for more than 25 years. He received his PhD from Stanford University and spent many years as a teacher and researcher there before turning to full-time independent private practice work. For more information about John or to contact him, please visit his website,