As Congress gears up for another health reform fight and Connecticut lawmakers contemplate state-level reforms, a group of consumer and mental health advocates is trying to draw attention to a less-noticed federal law they say stands to benefit many state residents.
The Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 was largely overshadowed by federal health reform, but it provides what Victoria Veltri, general counsel for the state Office of the Healthcare Advocate, described as “probably the most consumer-oriented regulations I’ve ever seen.”
Victoria Veltri
At its core, the law prohibits insurance plans from placing limits or costs on mental health and substance abuse services that are more restrictive than those imposed on medical and surgical services.
That means an end to a common restriction, limits on the number of outpatient therapy sessions a patient can receive. Under the law, a health plan can only impose those limits if it puts the same restrictions on “substantially all” outpatient medical and surgical benefits.
Similarly, limits on the number of days a person can receive inpatient behavioral health treatment are likely to be eliminated since most plans do not impose such strict limits on most inpatient medical and surgical care.
The law will also require changes to the “non-quantitative” limitations many insurance plans impose on mental health and substance abuse treatment, things one psychiatrist dubbed “the hassle factor.” Patients cannot be required to get prior authorization for behavioral health services if the same is not required for medical services, for example. And the behavioral health benefits cannot be administered more stringently than medical or surgical benefits.
The law, whch passed with the backing of the insurance industry, took effect for many health plans last Jan. 1, although the regulations associated with it were not issued until February, and for some plans, did not take effect until the start of this year.
Consumer advocates say the changes have not gotten the attention they should.
“Without the fanfare, without the notification, without the consumer information, our sense was that most persons were unaware that they had these benefits,” said Domenique Thornton, general counsel for the Mental Health Association of Connecticut. “People may not have been aware of [the changes] and so they may have been reluctant to avail themselves of the benefits they now have.”
Connecticut already has a mental health parity law, which prohibits insurance plans from placing a “greater financial burden” on people accessing service for mental health than for medical, surgical or other physical health conditions.
The federal law goes further, requiring equal treatment in multiple areas, including coverage of out-of-network services and copayment costs.
It also applies to more plans. State law covers only about half of insured Connecticut residents because plans that are self-insured, which is common among large companies, are not subject to state regulation.
The federal law covers self-insured plans as well as those already covered by the Connecticut parity law, but does not apply employers with fewer than 50 employees. It does not require health plans to cover mental health or substance abuse services; it just applies to those that do.
Thornton, Veltri and other advocates are also seeking to amend state law to allow the Connecticut Insurance Department to enforce the federal law’s requirements.
Veltri said her office has found what appear to be violations of the federal parity law while investigating consumers’ complaints.
In one case, an insurer required the patient to get prior authorization for mental health visits, but didn’t require it for most medical services. The insurer argued that the mental health requirement was allowed under the parity law because patients are also required to get prior authorization to receive physical therapy. But Veltri said having a restriction on select medical services is not enough to justify similar restrictions for mental health. Instead, the restrictions must apply to “substantially all”–two-thirds–of outpatient medical benefits to be allowed for outpatient mental health services.
Another case hinged on the level of documentation an insurer required before agreeing to cover treatment for a patient’s eating disorder, which Veltri said was higher than what would be required to get the patient into a nursing home for medical issues. If the process to get approved for treatment is harder for mental health care than for physical health care, Veltri said, it violates the parity law.
Nationally, the law has already prompted changes to many health plans. According to a 2010 survey by the Kaiser Family Foundation and the Health Research & Educational Trust, 31 percent of employers with more than 50 employees changed their mental health benefits as a result of the law. Two-thirds of them eliminated limits on coverage. Five percent dropped mental health coverage, which would keep them from having to comply with the new requirements.
Large employers can request an exemption from the law if complying with it raises claims cost by 2 percent or more in the first year.
Dr. Mark Friedlander, chief medical officer for Aetna Behavioral Health, said it’s too early to see the effects of the major changes under the law, the removal of limits on outpatient therapy sessions and inpatient days.
But Friedlander, a psychiatrist, predicted that in the long run, provider behavior will change.
“Many providers are just not used to operating in an environment where there are no limits on behavioral health, particularly outpatient sessions,” he said. “I think many of them have kind of been more sparing than they needed to have been. I think that that mindset will disappear.”
And Friedlander predicted that patients will have better access to mental health care.
“Certainly for the serious and persistently mentally ill folks, folks with some of the very serious mental illnesses like schizophrenia who’ve been forced to miss out on optimal care, I think the changes are going to be incredibly positive,” he said. “They will have greater access to the types of services they need that overall will keep them functioning as well as they possibly can.”
The federal parity law passed with the support of Aetna and America’s Health Insurance Plans, which lobbies for the industry. Friedlander noted that properly treating mental illness can improve a person’s physical health, while ignoring it can make physical illness–and the associated costs–worse.
“There is substantial scientific literature showing that if you treat both, the overall total costs are lower than if you treat one but not the other,” he said.