Enforcement of Mental Health Care Coverage Lacking

This article was originally published at Stateline, an initiative of The Pew Charitable Trusts, and was written by Michael Ollove.

It has been eight years since Congress passed a law requiring health insurers to provide Americans suffering from mental illness or substance abuse disorders with coverage for treatment that’s comparable to what they would get if they were physically sick.

So far, that promise has largely not been met, many mental health advocates say. And, at a time the nation is facing an addiction epidemic, millions of people who suffer from mental illness or addiction are not getting the treatment they need as a result.

“Most people with drug and alcohol addiction and mental health illnesses are still having problems with getting treatment, and if they get treatment, it is often out-of-pocket,” said Alice Dembner, project director for substance use disorders at Community Catalyst, a national nonprofit that promotes access to health care for all. “Frankly, it’s appalling.”

There are many reasons why group health plans, health insurance companies and even state-run Medicaid programs are not complying with the Mental Health Parity and Addiction Equity Act of 2008, not the least of which is many states aren’t enforcing parity in coverage and treatment.

Many state insurance commissioners and Medicaid agencies have been overburdened in implementing the Affordable Care Act over the last few years and have not focused on enforcing parity, advocates such as Dembner say.

But the federal government shares in the blame, too. Washington didn’t implement rules on parity for private insurers until January 2014. Only in March 2016 did it release rules for federal- and state-funded Medicaid plans, which cover about 72 million low-income Americans.

As a result, Dembner and other mental health advocates say, Medicaid agencies have done a poor job in ensuring recipients are getting care for their mental illnesses and addictions. And that could continue.

“The new [federal] regulations don’t go into effect for another 18 months, so unfortunately Medicaid enrollees with substance use disorders and mental illness are likely to continue to suffer from discriminatory practices for far too long,” Dembner said.

As many as 22 million people have some kind of substance use disorder, but only one in 10 goes to a treatment center, according to the most recent survey by the U.S. Substance Abuse and Mental Health Services Administration. And the nation’s opioid and heroin epidemic continues to worsen. Every day, more than 70 Americans die from overdoses.

In 2014, 43.6 million American adults had a mental illness, according to SAMHSA; fewer than half received mental health care.

The public is largely uninformed about its rights as patients to receive benefits, such as equal copayments, deductibles and office visits, for the treatment of mental illness and addiction comparable to what their health insurance provides for physical illness.

Recognizing the problems, President Barack Obama in March announced creation of a federal task force to investigate what is stalling parity and how to fix it so that the law is “actually enforced, that the concept is not just a phrase — an empty phrase.”

Bright Spots

Not every state is failing to enforce the parity law. Several are taking steps to ensure private insurance carriers comply, and taking action if they don’t.

In California, for example, the Department of Managed Health Care levied a $4 million fine against Kaiser Foundation Health Plan in part for parity violations in 2013. The following year, it fined Health Net of California $300,000, also for parity.

In New York, Attorney General Eric Schneiderman, a Democrat, has gone after a handful of insurers for parity violations; he has achieved several high-profile settlements that included fines and orders of restitution. Vermont also has imposed fines, and classified certain behavioral health and drug treatments as “primary mental health care” rather than specialized care, which means lower copayments for patients.

In New Hampshire, the Department of Insurance announced in November that it was undertaking a review of how carriers handle claims related to substance abuse to determine if they complied with parity requirements.

Louisiana, Oregon and Washington state have issued guidelines to carriers on how to comply with the parity law. And in 2014, to ensure parity compliance, Connecticut began random audits of how carriers handle the claims, according to the state insurance commissioner, Katharine Wade.

Making Comparisons

The goal of the parity law is simple: to ensure mental health benefits are on par with physical health benefits, which has not been the case with most health insurance coverage.

And ensuring patients who receive mental health or substance abuse treatment are charged the same out-of-pocket copays and deductibles as those who receive medical or surgical services is fairly straightforward.

Tim Clement, a policy director at Parity Track, an organization that follows enforcement, said most health plans have done a good job of achieving parity by those measures.

But Clement and other mental health advocates say that enforcing other aspects of parity are more complex, particularly for state insurance regulators overwhelmed with implementing the Affordable Care Act.

For example, he said, do mental health patients encounter more requirements for prior authorizations —approvals from an insurer for certain treatment or medication — than non-mental-health patients?

And do insurance carriers require more “medical necessity reviews” for continuing care, such as residential treatment, for mental health patients?

Mental health patients face more of these types of requirements and restrictions, Clement says.

Insurers also are required to have an adequate number of providers in their networks for patients with behavioral health care needs, just as they have providers available to treat physical ailments.

But many insurers list mental health providers in their networks who have moved away, dropped out of the network or retired, according to Sita Diehl, director of state policy and advocacy for the National Alliance on Mental Illness. These are often called “ghost” or “phantom” networks.

In its defense, the insurance industry points out that there is a national shortage of mental health care providers; the industry also says that many refuse to join network plans.

But Diehl said insurers don’t help matters by keeping reimbursements to mental health providers low and imposing red tape, such as frequent justifications for their treatment.

Not a ‘Math Formula’

Regulators, advocates and the insurance industry agree that another problem in enforcing parity is the difficulty in comparing services offered in behavioral health with those in physical health.

How, for example, can you compare the treatment of chronic mental illnesses, such as schizophrenia or bipolar disorder, with physical diseases such as diabetes or high blood pressure?

Clare Krusing, a spokeswoman for America’s Health Insurance Plans, the trade group that represents health insurance carriers, said parity should not be measured by trying to identify and provide comparable, but often mismatched services.

Instead, parity should offer “the right care in the right setting and at the right time,” whether patients need mental or physical health services, she said.

For example, a patient with diabetes and one with depression have different treatment plans and clinical goals, she said; their outcomes cannot be measured in the same ways.

“When you’re comparing two treatment plans for two drastically different conditions, that’s comparing apples and oranges,” Krusing said. “That’s why parity can’t come down to a simple math formula.”

Going to court to demand parity coverage, as people have in 16 states, can be a tough case for an individual to make. To prevail, a plaintiff must know not only how his or her insurance claim was handled by the insurer, but how that carrier dealt with other claims in both behavioral and physical health.

That’s why advocates insist that state regulators are best equipped to determine if carriers are complying with parity.

To do so, regulators should demand detailed information from carriers on claims practices and policies and reasons for denials, said Demian Fontanella, general counsel in the state of Connecticut’s Office of the Healthcare Advocate, which helps consumers with health care and insurance complaints.

But most states aren’t aggressively pursuing that data, said Gabrielle de la Guéronnière, director of policy for the Legal Action Center, a law and policy nonprofit that targets discrimination against those with addiction, HIV/AIDS and criminal records.

“The federal parity law does require that level of transparency and disclosure, but we find that disclosure isn’t happening the way it is required to,” de la Guéronnière said.

Parity will not succeed if regulators do not aggressively monitor insurers to ensure compliance, Fontanella said. “We all need to remain vigilant. And the work on this will never be done.”