Mental health and addiction care are poorly covered by insurance networks

More than 70,000 Americans died of overdoses in 2017, yet insurers spent only 1% of their total health care dollars on treatment for substance use disorders — a decrease from two years earlier.

This alarming statistic is just one of many in a new report released by Milliman, an independent actuarial firm. The report confirms that insurers have failed to adequately cover lifesaving care even as U.S. life expectancy declined over the past three years, primarily due to overdoses and suicides.

Milliman researchers analyzed five years of insurer claims data from 2013 to 2017 covering 37 million U.S. employees and family members who receive health insurance from their employers. They looked at four categories of treatment — inpatient and outpatient facility services, primary care office visits, and specialist office visits — and compared the level of out-of-network use for behavioral health versus physical health.

They also examined reimbursement rates for in-network office visits, aggregate spending on behavioral health (mental health and substance use care) as a percentage of total health care spending, and separate disparity details for substance use disorders, children versus adults, and various types of inpatient facilities.

Since most people depend on their insurance to cover health care expenses — which can include mental health and addiction treatment — the disparities uncovered by Milliman are cause for great concern. Insufficient networks of qualified providers and long wait times for in-network care are forcing people to seek out-of-network care, which equates to higher out-of-pocket expenses. Families across the country are depleting savings and retirement accounts, taking out second mortgages on their homes, and just hoping for the best when the money runs out. This lack of parity is inexcusable.

Consider that in Delaware, a state with one of the highest drug overdose rates in 2017, inpatient mental health and substance use disorder treatment was approximately 29 times more likely to be out-of-network than inpatient medical or surgical care. Pennsylvania and Maine — also in the top 10 states with the highest rates of overdose deaths in 2017 — had high disparities as well.

Nationwide, patients receiving treatment for addiction were more than 10 times more likely to use out-of-network facilities than patients were to use out-of-network medical or surgical facilities. And out-of-network behavioral health facilities were five times more likely to be used than out-of-network medical or surgical facilities — an increase of 85% over five years.

The in-network/out-of-network disparities were even worse for children. In 2017, children’s behavioral health office visits were 10 times more likely to take place with out-of-network providers than in-network providers, more than twice the disparity among adults.

At the root of the problem is the simple fact that, when regulators look for problems, they repeatedly find that insurers are not adhering to the Mental Health Parity and Addiction Equity Act of 2008, also known as the Federal Parity Law. It requires insurers to cover treatment for mental health and substance use disorders no more restrictively than treatment for illnesses of the body, such as diabetes and cancer. We, as a nation, are not doing enough to hold insurers accountable.

Where are the regulators demanding to see proof of compliance? The Department of Labor is responsible for enforcing parity among employer-sponsored health plans, but currently has only one investigator for every 12,500 plans.

Where are the employers who purchase these health plans for their employees? Companies across the nation tout their focus on mental health, but few are actually holding their health plans accountable for covering mental health and addiction treatment services on par with other services.

In an effort to shine a spotlight on this issue, The Kennedy Forum, along with Rep. Jim Ramstad (R-Minn.) and the heads of the National Alliance on Mental Illness and Mental Health America, recently submitted a letter to Chairman Frank Pallone of the House Energy and Commerce Committee and Chairman Bobby Scott of the House Education and Labor Committee calling for congressional hearings on mental health parity. The letter urged these committees to prioritize policy solutions and address implications of the Wit v. United Behavioral Health ruling, which found that United Behavioral Health (the largest managed behavioral health care company in the country), developed medical necessity review criteria that were inconsistent with generally accepted standards of care as well as wrongly influenced by financial incentives to suppress costs.

Sadly, United is not alone in these practices. Without oversight and enforcement at the federal level, wrongful denials of coverage for addiction and other types of behavioral health care will continue.

The Federal Parity Law does not now apply to Medicare, which currently covers more than 40 million Americans, and TRICARE, which covers most of our men and women in uniform. When you consider that 1 in 5 Americans has a mental health or substance use disorder, it is difficult to fathom why these essential programs lack parity protections. That needs to change.

People must be able to access adequate treatment services using their health insurance. This must be a top priority for our elected leaders, not just advocates. It is time for families across the nation to stand up and demand change.

Patrick J. Kennedy is the founder of The Kennedy Forum and Don’t Deny Me, chair of Mental Health for US, a former U.S. representative (D-R.I.) and former member of the President‘s Commission on Combating Drug Addiction and the Opioid Crisis, and author of “A Common Struggle: A Personal Journey Through the Past and Future of Mental Illness and Addiction“ (Penguin Random House 2016).