Mental Health Groups Taking Parity Fight to States

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By Alex Ruoff

Oct. 31 — Advocates for people with mental health disorders in coming months plan to pressure state insurance commissioners and attorneys general to investigate whether insurers are following federal mental health parity laws, mental health groups told Bloomberg BNA recently.

An Obama administration task force recommended Oct. 27 that federal regulators step up their oversight of group health plans’ compliance with laws requiring insurers to cover mental health services to the same extent physical health services are covered. Mental health advocates told Bloomberg BNA they’ll work in individual states to ensure compliance with the laws.

This effort got a boost by the White House task force, which promised $9.3 million to states to help enforce parity protections and establish a website to assist consumers with parity complaints.

Mental health groups, led by former House member Patrick Kennedy (D-R.I.), are helping people around the country appeal claims denials by their insurers for mental health services and file complaints about those denials with their respective state attorney general and insurance commission.

With enough complaints, top cops around the country will be forced to take action and investigate insurers’ compliance with the law, Kennedy, who founded an umbrella group for mental health advocates in 2013, told Bloomberg BNA.

“We have to get these complaints filed to show there might be a pattern and practice of discrimination,” he said.

Insurance companies deny claims for mental health care at roughly twice the rate of general, physical medical care, raising concerns that current mental health parity laws aren’t working as intended, mental health advocates have said. However, there’s little hard evidence that most insurers aren’t following federal parity laws.

In response, federal lawmakers have pushed for legislation to require insurers to explain why they’re denying claims for mental health services. The hope is that more transparency will bring light to why mental health claims are so often denied.

The House in July passed a bill (H.R. 2646) that would create an office within the Department of Health and Human Services to make public all federal investigations into compliance with federal mental health parity laws. However, House Democrats said that bill doesn’t go far enough to help those with mental illness.

Issues With Parity

Two federal laws, both in effect since 2008, have required health insurance companies to cover mental health and substance abuse services with the same lifetime limits, treatment limitations, financial requirements (including copays) and covered benefits as medical and surgical services.

The Affordable Care Act also required plans sold on the exchanges to meet these standards.

Despite the laws, treatments for substance use disorders, eating disorders and other mental health services are denied at much higher rates than medical and surgical procedures, Kennedy said. That’s because many insurers have complicated rules for beneficiaries seeking treatment for these disorders that don’t exist for other chronic disorders, such as diabetes.

Insurers often have “fail-first” requirements for mental health and substance use disorder services that require beneficiaries to first seek cheaper, often less-effective, treatments before they’re authorized other treatments, Kennedy said. For example, many beneficiaries must first undergo mandatory counseling alone before they can receive drugs used to treat opioid addiction, like buprenorphine.

Some insurers also have prior authorization requirements—where doctors must obtain approval from the insurer to prescribe a certain medication—for drugs like buprenorphine but not for drugs considered to pose similar safety risks or have similar risk for misuse, according to the White House report.

For beneficiaries, these are time-consuming barriers to treatment, Kennedy said. For regulators, he said, it is difficult to compare these rules to those for treatment of physical disorders.

“Everyone in the addiction space knows there are these onerous requirements, but there’s no way to verify that they’re breaking the law short of litigation,” he said.

However, it is difficult to compare coverage of mental health and addiction services to that for other health services, such as surgeries for cancer treatment, Rebecca Farley, director of policy and advocacy for the National Council for Behavioral Health in Washington, told Bloomberg BNA.

Often the same policies, like prior authorization, can have a widely different effect on access to certain services, she said.

“Complying with these laws isn’t easy or always straightforward,” Farley said. “Just because mental health claims are getting denied at higher rates doesn’t necessarily mean there’s not parity.”

States Need Complaints

The majority of states have a “hands-off” approach to regulating health plans and mental health parity rules, Tim Clement, policy director for the Washington-based Parity Track, which collects data on mental health parity laws around the country, told Bloomberg BNA.

Only California has a system for approving health plans’ compliance with parity laws, he said.

New York Attorney General Eric T. Schneiderman (D) has led the way on enforcing mental health parity laws through the courts.

Insurer Cigna agreed to remove its prior authorization requirements for naloxone and other medications used to treat opioid addiction nationwide under an agreement with Schneiderman’s office announced Oct. 21. That agreement came two months after Schneiderman’s office announced that insurer HealthNow New York would pay its members $1.6 million for mental health claims that were previously denied, in alleged violation of the state’s parity law.

Many mental health and addiction advocates believe more states will be motivated to take a more active role in enforcing parity laws if they receive consumer complaints, Clement said. Otherwise, insurance commissioners and state attorneys general have little grounds for inquiry, he said.

“If you ask an insurer if they’re in compliance with the law they’ll tell you they are,” Clement said. “If you have complaints in hand, you have a stronger place to start.”

The process for appealing a denial of coverage for mental health services can be complicated and not all denials are a sign that an insurer has violated parity laws, Kennedy said.

So, groups like the Kennedy Forum and local chapters of the National Council for Behavioral Health are working with physicians’ groups and patient advocates to see how the complaint process works, Kennedy said.

The groups want to make it easier for those denied coverage for mental health services to file complaints, he said. These groups also want to aggregate these complaints to flag hot spots where claims are being denied at high rates, possibly revealing insurers that aren’t following parity laws.

To contact the reporter on this story: Alex Ruoff in Washington at aruoff@bna.com

To contact the editor responsible for this story: Kendra Casey Plank at KCasey@bna.com

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