After a brief hospitalization precipitated by a suicide attempt, Steve Smith (not his real name) returned to his position in security. Because of his erratic behavior, however, his supervisor sensed Smith was still having problems with depression and substance abuse. The supervisor, who feared for Smith’s safety as well as public safety, contacted Ceridian LifeWorks, an employee assistance program (EAP).

LifeWorks determined Smith needed a psychological workup called a “fitness for duty evaluation” (FFDE), and referred the case to PsyBar, an Edina-based privately owned company that provides independent medical exams (IME) and FFDEs. PsyBar’s niche is determining whether an employee is psychologically healthy enough to do the job he or she was hired to do. Their specialty is forensic psychology, psychiatry and neuropsychology, which applies these specialties to answer legal questions.

The vast majority of FFDEs are not done because an employer suspects an employee will suddenly pull out a gun. Many are done out of loyalty to long-term employees who need help, but who haven’t admitted it or are unaware that their psychological and/or cognitive health is creating a safety risk at work.

When an employer requests an evaluation of an employee’s mental health, it requests an FFDE. When an insurance company calls PsyBar, it requests an IME to determine whether a disability claim based on mental health grounds is valid. In other words, is the person too depressed or otherwise mentally unstable to return to work?

While these cases rarely lead to violence, when they do, they receive a lot of media attention and can result in severe consequences for a company. In late March, a German co-pilot intentionally crashed a commercial aircraft into the French Alps, killing 150 people, even though Lufthansa, his employer, allegedly was aware he had depression in 2012. In Minneapolis in 2013, hours after being terminated from work, Andrew Engeldinger shot and killed five people at Accent Signage Systems, including the company’s founder, before killing himself.

While these types of high-profile killings are extreme—and rare—examples, they illustrate the need for employers, especially in safety- sensitive industries—those that require employees to carry guns, transportation companies, or any industry that deals with hazardous chemicals or highly sensitive data, for example—to intervene when it becomes apparent that employees could pose a risk to themselves and others.

Employers concerned about whether an employee is a safety risk in the workplace can request that the employee consent to an FFDE. Sharon O’Brien, vice president of EAP/WorkLife Operations for Ceridian LifeWorks, says that of the 40,000 calls Ceridian LifeWorks received in first-quarter 2015 about an employee in need of some type of assistance, only about 5 percent were from managers concerned about one of their staff, and only about 1 percent of those were referred to a company such as PsyBar.

“We help employers and government agencies determine whether people are mentally able to do the work they do and whether they are mentally safe to be at work. FFDEs are the fastest-growing segment of our business,” says Lori Seviola, PsyBar’s CEO. “The thing I love about PsyBar is we help people restore their lives, whether they can or cannot work. Once you answer the question of whether they can or cannot work, you can address other questions. Do they qualify for Social Security disability? Can they do another job?”

In the C-suite “there’s a lot of substance abuse,” notes Seviola. “A company that has put a lot of time and money into one of these [executives] will do what it can to salvage the employee.” A typical concern in blue-collar settings is skill-set deterioration. She uses the example of the 30-year employee who operates a forklift but who is starting to have cognitive issues because of age. You don’t want to let that person continue to operate the equipment if it is starting to create a safety issue for the driver or others working in the area.

Able for duty?

The largest segment of PsyBar’s business is the FFDE, and 26 percent of these are conducted for government agencies and organizations. Of PsyBar’s private sector clients, one-third are Fortune 500 companies; its current customer base includes 160 Fortune 500 and 90 Fortune 200 firms.

Only about one-fourth of PsyBar’s FFDE cases are violent or at risk of becoming violent, while about half are linked to substance abuse or focused on depression, anxiety or any of the more general psychiatric problems such as schizophrenia, says Dr. David Fisher, PsyBar co-founder. Another fourth (there is overlap among categories) are the result of cognitive impairment, which falls into the realm of neuropsychology. These cases are growing because baby boomers are remaining in the workforce longer and seeing skill sets atrophy.

When an employee’s behavior creates unsafe conditions at work, the issue for a company is whether to fire the employee or get him or her the appropriate service, which sometimes involves signing a consent form and submitting to an FFDE. All carry risks, says Penny Phillips, an attorney with Minneapolis-based law firm Felhaber Larson who has worked in employment law for 26 years.

“Most employers will seek confirmation that the FFDE they are thinking of requiring is lawful or at least a good idea,” she says, noting that a patchwork of federal, state and local legislation covers this area. “Employers need to be careful that they are not violating laws that protect employees.”

These cautions notwithstanding, employers that do not take control of the situation can find themselves in a critical, sometimes dangerous, situation.

“When there is an immediate threat, you don’t always have the luxury of time. If someone has a gun and is threatening others with it, you want to get them out of the building and get the police involved,” says Phillips. “More often what employers will see is that someone is acting bizarrely, they are not doing their job or they are telling you that they are hearing voices.”

So, while some employers might prefer to ignore the situation when it seems less acute, there are even greater risks to that approach.

“I think employers are becoming more sensitive to these issues. Violent examples of this are happening every couple of weeks in the U.S.,” says Phillips. “Families of victims who are killed or injured are suing employers who do nothing to prevent these situations.”

PsyBar’s price for a psychological FFDE is about $2,900, and the cost of a psychiatric or neuropsychological evaluation runs about $3,800. Phillips says it’s a small cost to pay given the potential risks.

A wide-open competitive landscape

PsyBar is one of the only, if not the only, third-party evaluator in the U.S. that works solely in behavioral health. Other companies, such as EvaluMed, offer third-party evaluations for more than one specialty, including purely physical conditions. Many of these small third-party evaluators are regional or local. And at least one firm, ExamWorks, has been purchasing smaller third-party evaluators, offering evaluations over a wide variety of specialties.

As with any type of medical care, the quality of psychological assessments is highly variable. “When a person goes in to be assessed for mental health, the care he or she receives is as variable as what he or she would receive from a medical doctor,” says Dr. Deniz Ones, faculty member in the University of Minnesota psychology department.

Factors that can determine how good a mental health assessment is include which tests are given and the depth of the evaluation. Basically the evaluation is as good as the doctor giving it, Ones says. “It’s the human factor.”

Fisher compares PsyBar to Five Guys Burgers and his competition to McDonald’s. Competing firms generally do evaluations for every known malady including dental, vision, and orthopedic, while PsyBar’s business model was built on a goal to improve the quality of third-party psychological, neuropsychological, and psychiatric evaluations.

“We have in-house psychologists who work closely with our doctor panel,” says Fisher. To have the same level of specialization and expertise in a company with a more generalized focus, “our competition would have to have an orthopedist on staff, a dentist on staff, an ophthalmologist on staff.” Moreover, he notes, some of these providers see these exams “as commodities, and it hurts hundreds of thousands of people in the United States each year.” By focusing on volume, Fisher suggests competitors can’t provide the same high-quality evaluations that PsyBar offers; as a result, people lose their jobs or don’t receive the disability insurance they are entitled to.

Before founding PsyBar, Fisher and Dr. Sheridan Fenwick worked as psychologists at Abbott Northwestern Hospital, and in 1994, a group of attorneys approached them to evaluate a large number of litigants in a Minnesota groundwater pollution case. Fisher and Fenwick faced the challenge of arranging for assessments using a small group of psychologists and ensuring that each used reliable and valid assessment procedures in their evaluations.

Fisher and Fenwick devised a standardized interview and selected the psychological tests to be used. Not only did this approach add uniformity and strength to each evaluation, but the assessments were more legally defensible than those provided by other evaluating doctors in the lawsuit, according to Fisher, who is PsyBar’s chairman of the board.

After Fenwick left Abbott, she and Fisher met in 1995 to talk about her idea for a forensic assessment service applying the same practices they used in the groundwater pollution case. She proposed building a national network of doctors to do forensic psychological and psychiatric evaluations, using the same consistent assessment methodology. A few months later, they started the company.

To date, PsyBar has vetted 2,000 psychiatrists, psychologists and neuropsychologists from across the country to draw on for evaluations, and its current network includes close to 1,700 doctors. Fisher also has been recognized by the American Psychological Association for his innovations in forensic assessment.

When they started PsyBar, the quality of forensic work at large “was extremely touch-and-go,” Fisher says. “There was no regulatory or supervising group to oversee the profession.” There still is none, so the company spends “hundreds of thousands of dollars having our staff psychologists do quality assurance with our [outside network of] doctors.”

Searching for reliable outcomes

Fenwick and Fisher were equal partners in PsyBar until Fenwick sold her interest in the firm in 2013. But years before that, Fisher knew he needed someone else to take over the business side.

“I realized as a psychologist I could only take the company so far,” says Fisher. “I needed someone with a greater business vision. The company was getting to a size that was difficult to manage. I wanted to focus more on improving the quality of the product and less on the business aspect.”

In 2010, when Fisher called Rick Fox, an executive search consultant with Captive Search, he was admittedly burned out. At that time PsyBar had revenue of about $5 million and six full-time employees. Fox suggested Fisher call Seviola, who had worked in the IME industry for 15 years and had a good track record starting and growing companies.

I turned out to be a good fit. After purchasing Fenwick’s half of the business a couple years ago, Fisher gave Seviola 10 percent ownership in PsyBar as a reward for her performance. Today the company has 18 full-time employees, including one full-time psychologist and two part-time psychologists, as well as close to $10 million in annual revenue.

PsyBar recently launched a new service called ValidityCheck, which Fisher and Seviola say will revolutionize the IME. When claimants file for disability insurance on the grounds that they are too depressed or mentally unstable to return to work, they typically undergo a battery of neuropsychological tests. Fairly evaluating whether a claimant is putting forth full effort during one of these evaluations has been a longstanding industry issue. While most people are honest, some seek disability payments under false pretenses. Thus, neuropsychologists also test whether the evaluation results are valid.

Over the years, staff psychologists at PsyBar have noticed several problems in how validity assessment is typically done. Neuropsychologists sometimes base their opinions on poor or outdated research and don’t always factor in sufficient evaluative data, says Fisher. And, he suggests, “psychologists often don’t know how to skillfully combine information that is often contradictory.”

PsyBar’s ValidityCheck is designed to help neuropsychologists combine information from multiple validity tests using a well-established mathematical process for more objective results. PsyBar’s network of IME neuropsychologists still give the tests of their choice, then PsyBar’s independent validity consultant, Dr. Richard Frederick, a Missouri-based psychologist, produces a mathematical analysis from the relevant test data to come up with a probability that a claimant’s test scores are valid.

“PsyBar is almost certainly the only company in the U.S. offering this groundbreaking data analysis,” says Fisher. “We believe it greatly adds to the strength of doctors’ opinions, and helps our clients feel far more secure that they are making the right decisions.” He adds that PsyBar will offer a validity check on every neuropsychological evaluation it does. “It shows our huge commitment to uniformity, fairness and objectivity,” he adds. “We really believe that it is going to help our industry to write better reports that are more fair for employers and employees.”

Fran Howard, a St. Paul-based freelance writer, specializes in business, science and medical writing, and is a frequent contributor to Twin Cities Business.