Social Work Services and Third Party Payments

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Why it is important for Social Workers Services to be covered by Third Party Payments
Over the past decade, the underfunding of social and health service/programs by all levels of governments has made it increasingly difficult for members of the public to access much needed social work counselling services. Ironically, this has occurred at a time when a conservative estimate places the burden of mental health problems in Canada at $14 billion annually. 1 While the vital need for a comprehensive array of publicly funded programs cannot be overstated, it is important to recognize that coverage of social work counselling services under private health plans, offers an important option to members of the public who otherwise would face long waiting lists or go without services. This article will attempt to shed light on significant issues related to the profession’s quest for inclusion of social work counselling services under private health plans.

The term, “third party payment” simply refers to a benefit or service that is paid by a third party, typically an individual insurance plan or a group benefits plan (also known as an employee benefits plan). Counselling services covered under group benefits plans may either provide access to an employee assistance program (EAP) or to a monetary amount per counseling visit, over a pre-determined timeframe. The nature of this benefit necessitates that the services offered will be short-term, aimed at mobilizing strengths in order to improve or restore problem-solving skills and coping capacities.

Insurance companies point out that they will cost-out and provide any benefit that people are prepared to pay for, counselling services included. This rings true as work-related benefits plans increasingly list counselling services provided by social workers. Nonetheless, national insurance companies, with the exception of Great-West Life, continue to resist formally recognizing the services of our profession, despite the fact that many insurers informally pay for social work fees under clauses such as “Psychological Services” or “Pychotherapy Services”. In other words, the public and the private practitioners providing the service cannot count on reimbursement of social work fees under many individual insurance plans as coverage is based on the discretion of the insurer. It is noteworthy that a number of regional insurance companies, such as Liberty Health in Ontario, now formally recognize social work services in some, or all, of their plans. This is promising news and reflects growing pressure on the insurance industry at the local level to provide more options to the public.

There appear to be a number of reasons for the insurance sectors reluctance to include social work services in private health plans. These relate to: lack of information about social work qualifications and skill sets; confusion about the regulatory status of social workers across the country; restrictions within the Income Tax Act, which prevent social work clients from deducting, as a “medical” expense, counselling fees on their income tax forms; and concern within the insurance sector that formally recognizing social workers has the potential to increase usage of plans, thereby impacting negatively on their “bottom-line”.

In May 2001, a National Initiative on Third Party Payment was launched, spearheaded by Ontario, to forward the interests of the profession in seeking inclusion of social work services under private health plans. A Steering Committee was struck represented by the Executive Directors from the provincial social work associations in New Brunswick, Ontario, Saskatchewan, Alberta and British Columbia. This initiative is supported by all the provinces, although funding, which initially came from the five provinces represented on the Steering Committee, now comes from Ontario, Alberta and B.C., with CASW providing $1,000 for start-up and more recently providing a “one-time only” grant of $5,000.

The National Initiative has employed a multi-pronged strategy related to this issue. In February 2002, a “business case” was developed by a consultant, under the direction of the Steering Committee entitled, “ Registered Social Workers: Good Therapy for Business”. The “business case” provides information about who social workers are, what we do and why covering our services makes economic sense to both employers and insurers. It also highlights ways in which stress, depression and other mental health problems impact on the work place, frequently resulting in low productivity, absenteeism, poor morale, as well as increased usage of drug and long-term disability plans. In addition, the “business case” directly links social work skills and the treatment of mental health problems. The “business case”, along with a marketing letter has been used as an advocacy tool to encourage major insurers, unions and large non-unionized employers to list social workers under individual and group benefits plans.

Although attitudes are slow to change and movement is likely to be incremental within the insurance sector, this is not true of work settings where employers seem increasingly open to listing social work counselling services in their group benefits plans. A quick sampling of national companies that now include social work counselling as a group benefit reveal corporations such as Canadian Pacific Railways, the Canadian Auto Workers “Big Three” automakers plants, Air Canada, the Bank of Canada, etc. The number of employees, plus family members covered under these programs/plans, is significant and highlights the value of such initiatives as a way to promote the profession with the public.

Joan MacKenzie Davies, MSW, Res.Dip.S.W.,RSW, Executive Director of the Ontario Association of Social Workers and Coordinator of the National Initiative on Third Party Payment
1 Stephens, T, Jouberts, N (2001). The Economic Burden of Mental Health Problems In Canada. Chronic Diseases in Canada 22 (1).

Executive Summary
The burden of mental health problems in Canada is staggering – a conservative estimate places the cost at $14 billion annually. But dollars are only part of the picture – the human cost is expressed in stress, conflict, increased incidence of anxiety and depression, and a host of other physical illnesses that accompany a breakdown in mental function. In the workplace, mental disorders are primarily measured in terms of lost productivity – high rates of absence, disability, the cost of finding and training replacement labour, and poor quality product and service outputs. The high human and financial cost is why mental health is a topic of increasing interest to many employers and insurers.

Depression and other mental disorders affect up to 3,000,000 Canadians, only a small number of whom are adequately treated. Employers see the costs in increased utilization of drug and disability plans – mental disorders are the most frequent and highest cost illness covered by Long Term Disability plans.

Much of this cost is the result of unmanaged stress driven by workplace trends towards higher workload, fewer workers, more emphasis on technology, and inadequate training and skills development. Research proves organizations play a key, if largely unrecognised, role in creating the conditions for either good or bad health. Knowing this, workplaces need to create a climate, culture and image that attracts, retains, and sustains its employees. Imagination, entrepreneurship and relationship management skills are crucial attributes for today’s employees, but they cannot blossom in a work environment characterized by stress, conflict, unattainable demands, and inadequate rewards. Employers can take steps to encourage supportive cultures at work as an effective and sustainable solution to stress, depression, and other mental health problems.

Social Workers are a part of this support network, and a key resource in the provision of mental health services. They are regulated professionals in each province of Canada. By virtue of their accessibility in both large and small communities across Canada, they are seeing more and more employees and their families with mental health issues. Employee Assistance Plans have for many years turned to Social Workers to effectively and efficiently resolve these matters. Very often, Social Workers are the only professional a person will consult to help them through their issues. Research shows high levels of client satisfaction with Social Workers counselling. Treatment is more effective because Social Workers also bring a unique psycho-social perspective to these issues – dealing not only with the person but the social context in which people live and work. Social Workers also work as part of a mental health team, including physicians, hospitals, and community agencies. Their scope of practice includes work-related problems, alcohol, drug and substance abuse, marital and family issues, and behavioural and emotional disturbances.

Unfortunately, most group insurance plans do not reimburse Social Worker services, even though counselling and treatment is provided at a very competitive cost relative to other professionals whose services are being paid by group health plans. However, while virtually all insurers have some clients that do provide coverage for Social Workers, the Income Tax Act does not deem Social Worker counselling to be a medical service even though some provinces regulate them as health professionals. This has created an unnecessary barrier to wider use of Social Worker services, and efforts are underway to bring the interpretation of the Act by the Canada Customs and Revenue Agency in line with current treatment standards and practices.

Social Workers are accountable, competent, accessible, and affordable to employers, workers, and their families. They are part of a comprehensive solution for employers and insurers to address mental health issues in the workplace.

While workplaces should continue to offer today’s mental health programs, employers and unions must also invest in longer-term solutions that improve the fundamental work environment. Social Workers can assist individuals in managing their stress, their work and family environments, and be part of a team that assists organizations to effectively manage the drivers of so many avoidable illnesses and injuries.

Discussion Paper developed for the National Social Worker Initiative by H3 Consulting, Toronto

Individuals interested in receiving the document in its entirety should contact the social work organizations in their province or territory.