Category Archives: Mental Health

Some health plans dropping mental health coverage?

The Wall Street Journal reports that some health plans are responding to the Mental Health Parity and Addiction Equity Act by cutting mental health benefits. Does this make long-term sense? Here is an excerpt from the article:

Mental-health and addiction advocates say the relatively small number of plans opting out reinforces projections by the Congressional Budget Office that the law would have a minimal impact on insurance premiums. The CBO estimated premiums for group health insurance would increase by an average of 0.4%.

Steve Melek, a behavioral health-care expert for the consulting and actuarial firm Milliman Inc., said there is “ample” evidence suggesting that not providing benefits for mental health and addiction leads to higher costs down the road.

In coming years, plans that drop coverage might pick it back up because of the federal health overhaul. That law requires that plans selling insurance through online marketplaces known as health exchanges meet a certain minimum level of benefits. Regulations detailing what those are haven’t been written, but likely will include some form of mental-health coverage.

For more on this long-term cost question, click here and here. For the full library of Steve Melek’s mental health analysis, click here.

Implementing parity: Investing in behavioral health

More than a year after the enactment of the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA), the Departments of Labor, Health and Human Services, and Treasury issued interim final rules (IFR) prohibiting group health plans and insurance from applying more restrictions on mental health or substance use disorder benefits than they do for medical/surgical benefits. In the absence of formal guidance until the publication of the IFR and with the MHPAEA requiring compliance for plan years starting on or after October 3, 2009, many group health plans have been operating under a good-faith compliance standard. The IFR from the federal agencies provides significant guidance in some areas, and several of the requirements will necessitate additional steps to ensure compliance. Understanding how the IFR may affect the business of behavioral healthcare and the decisions that follow will be of great importance to all interested parties, including health insurance companies, health plans, employers, providers, and consumers of behavioral healthcare. This new health reform briefing paper by Steve Melek explores these implications.

What role will EAPs play in a mental health parity environment?

The Wall Street Journal today offers a look at the cost of mental health parity and the role that employee assistance plans (EAPs) may play. These plans are in some cases being optimized to work alongside mental healthcare, with particular focus on the transition from one to the other. Note this excerpt from a recent case study:

…the employer also determined that many employees were not taking full advantage of the resources available to them, due to a lack of integration between the two vendors. In this case, the EAP was responsible for the first seven days of mental health care, with the health plan covering services after that. The employer had the two vendors develop detailed transition plans to ensure that employees would continue to have assistance when the EAP’s services ceased and the health plan’s responsibility began.

Employers are trying to mimimize any cost impact from parity. Here is an excerpt from the WSJ article:

It’s unclear just how costly mental-health parity will be for companies to provide. A 2007 actuarial analysis conducted by consulting firm Milliman Inc. suggested that costs under parity for employers may increase 0.6%, or $2.40 a month for each employee in 2008 dollars. A 2007 Congressional Budget Office study estimated that premiums would rise by an average of 0.4%.

For more insight on this topic, read the latest white paper by Steve Melek about preparing for mental health parity. Here is Melek’s Congressional testimony, which includes the 2007 results.

Preparing for Parity

May is Mental Health Awareness Month, and earlier this month Milliman Principal Steve Melek released a new white paper, “Preparing for Parity,” which addresses some of the key issues for insurers as they look to implement the new mental health parity requirement. The requirement could have cost and business benefits for employers:

Isn’t this a great opportunity to change for the better? An investment in more effective behavioral healthcare treatment is an opportunity to improve not only mental health but also physical health in our insured populations. Such health improvements can lead not only to lower healthcare costs, but improved productivity among employees.

-Steve Melek

Mental health and the ER

A report out of Texas indicates that nine patients in the Austin area accounted for 2678 emergency room visits at a cost of $3 million during the past six years. The causes were not always certain, though seven of the nine have a mental health diagnosis. One doctor at least thinks these diagnoses explain some of the ER visits.

Dr. Christopher Ziebell of University Medical Center at Brackenridge sees many people in the ER who aren’t having emergencies. With mental illness, he said, ‘a lot of anxiety manifests as chest pain.’

We know that mental health, when not treated properly, can be quite expensive. Mental health parity expert Steve Melek has testified before Congress and conducted research on how mental health can pair with other chronic conditions in highly-expensive comorbidities. The recent passage of mental health parity legislation may help mend fractures in care among the insured. But confronting this problem among the uninsured remains a thorny issue.