Low insurance payments hurting access to addiction, mental health services, study finds

Dec 04 2017

Low insurance payments hurting access to addiction, mental health services, study finds

Low reimbursement payments to mental health and addiction treatment providers is preventing fair access to those services for many patients, according to a new report from Milliman, Inc., a Seattle-based, actuarial consulting firm. As a result, more patients are being forced into expensive, out-of-network care, the report says.

The report calls on health insurers to do more to ensure affordable access to addiction treatment and mental health services, as required by law.

The report cites research showing that physical healthcare providers are receiving significantly higher payments from insurers than addiction and mental health providers for the same types of services, in violation of the Mental Health Parity and Addiction Equity Act of 2008.

The report was supported by a coalition of advocacy groups, all of whom have been working to ensure the kind of parity mandated in the law. They include the Parity Implementation Coalition, Mental Health America, National Alliance on Mental Illness, The Kennedy Forum, National Association of Addiction Treatment Providers, American Foundation for Suicide Prevention, The Treatment Advocacy Center, National Association of Psychiatric Health Systems, the Legal Action Center and the American Psychiatric Association,

In the Milliman report, commissioned by the Bowman Family Foundation, researchers found that along with payment disparities, which occur in 46 out of 50 states, out-of-network use of addiction and mental health treatment providers by consumers is “extremely high” when compared to physical health care providers.

Milliman researchers used three years of insurer claims data from 2013 to 2015 covering 42 million Americans, and looked at inpatient and outpatient services, primary care office visits, and specialist office visits, comparing in-network and out-of-network claims in all 50 states and D.C.

One of the most striking disparities identified in the report is the low reimbursements paid to behavioral health providers when compared to physical health providers – which limits network access and overall practitioner in-network availability. The researchers found that physical healthcare providers were paid, on average, about 20 percent higher rates than behavioral health providers for the same office visits billed under identical or similar codes. In many states, the disparities in payment rates were two to three times greater

While payments to mental health and addiction providers were lower in comparison to physical healthcare providers from 2013 – 2015, out-of-network visits for inpatient and outpatient behavioral health services were dramatically increasing. Nationally, Milliman researchers found that in 2015, on average:

  • 31.6 percent of outpatient facility behavioral health care was accessed out-of-network, while only 5.5 percent of outpatient facility medical/surgical care was accessed out-of-network.
  • 18.7 percent of behavioral health office visits were accessed out-of-network, while only 3.7 percent of primary medical/surgical office visits were accessed out-of-network.
  • 16.7 percent of inpatient facility behavioral health care was accessed out-of-network, while only 4 percent of inpatient facility medical/surgical care was accessed out-of-network.

Paul Gionfriddo, president and CEO of Mental Health America, says his organization and other advocacy groups want to work with insurers to “uphold the letter and spirit of parity. Plans have a crucial role to play in eliminating the disparities hurting so many American families from all walks of life.”

Other highlights from the report:

  • As of 2015, out-of-network use of behavioral health inpatient care – as compared to medical care – was approximately 800 percent higher in California, New York, and Rhode Island, and over 1000 percent higher in Connecticut, Florida, New Jersey, Pennsylvania, and New Hampshire.
  • In 2015, there were 24 states with reimbursement disparities ranging from 30 percent to 69 percent.

Based on the report, the coalition calls for the following actions:

  • Federal regulators should issue more specific guidance on medical management practices with examples of compliant analyses and, based on the report’s findings, should immediately initiate audits of major insurers.
  • Employers should retain independent companies to conduct parity compliance audits of the insurance plans provided to their employees, in order to measure reimbursements, out-of-network use, denial rates, and other key variables restricting access to benefits.
  • State-level agencies should conduct routine annual parity compliance market audits of all insurers in their state, for both commercial and Medicaid-managed care companies.