Mental Health and Obamacare

The Affordable Care Act counts mental health and substance abuse coverage among essential benefits.

Mental health parity has finally arrived, and hopefully it’s here to stay. Under the Affordable Care Act, all exchange plans, individual and group, must provide mental health and substance abuse coverage, which is one of the 10 “essential benefits.”

A few weeks ago, the federal government issued its final rules for the Mental Health Parity and Addiction Equity Act, passed in 2008. The act requires insurers to use the same financial requirements (such as co-pays) and treatment limitations (such as limits on office visits) for mental health and substance abuse coverage as they do for medical and surgical coverage.

Prior to this ruling, the definition of mental health and substance abuse parity was unclear. According to Dr. John Bartlett, senior project advisor for the Primary Care Initiative of the Mental Health program at the Carter Center, the ruling corrected two fundamental problems with the 2008 parity act: The act didn’t require insurers to provide mental health and substance abuse coverage, and it didn’t clearly define what parity meant in the “operational sense.”

The final ruling does just that. According to the Health and Human Services press release, the final rules mandate insurers follow certain regulations:

  • Ensure that parity applies to intermediate levels of care received in residential treatment or intensive outpatient settings.
  • Clarify the scope of the transparency required by health plans, including the disclosure rights of plan participants, to ensure compliance with the law.
  • Clarify that parity applies to all plan standards, including geographic limits, facility-type limits, and network adequacy.
  • Eliminate the provision that allowed insurance companies to make an exception to parity requirements for certain benefits based on “clinically appropriate standards of care,” which clinical experts advised was not necessary and which is confusing and open to potential abuse.

It may sound like a maze of verbiage, but it’s much better than before. These new standards guarantee that each state will be subject to the same parity requirements. This is crucial because the federal  government had allowed each state to determine its own definition of  parity for mental health and substance abuse coverage. Without federal standardization, each state would have likely had different, probably inadequate, mental health and substance abuse benefits.

Now, the states have a federal standard they must meet. As Dr. Bartlett said about the final rule, “It operationalized the concept of parity very specifically. We now have a standard with which to evaluate plans to see if they comply with the parity standard.”

Because of this, if you purchase an ACA-compliant plan, your insurer should cover your mental and physical health benefits equally: That includes co-pays,  co-insurance, limits on hospital stays, and limits on the number of outpatient visits your plan will cover.

If your insurer uses a third-party provider (Magellan, for example) to provide mental health coverage, they must follow the same parity requirements. If your plan offers out-of-network medical and surgical benefits, then the plan must also offer out-of-network mental health and substance abuse benefits. Most exchange plans don’t offer out-of-network coverage, but there are a few that do. In fact, I found one on the Washington D.C. exchange and purchased it.

Of course, grandfathered and other ACA-exempt plans don’t have to follow these parity requirements. In fact, they don’t have to provide mental health or substance abuse coverage  at all. If they do provide coverage, they can limit inpatient and outpatient services. My previous health plan is a case in point. If I had needed inpatient psychiatric treatment, Aetna would only have covered up to 60 days of treatment. If I had needed inpatient substance abuse treatment, they would only have covered 12 days of treatment. (For the record, I didn’t need either.)

So if you want to keep your current health plan, examine its mental health/substance abuse benefits closely before selecting it. Of course,  your current plan may offer comparable or better mental health coverage than the exchange plans. As I often say, if you are unsure of which plan to choose, err on the side of caution, and choose an ACA-compliant plan. If you do so, you will definitely receive comprehensive psychiatric care along with the other “essential benefits.”

It’s hard to overstate the importance of these new rules. It is, undboutedly, a game-changer for all Americans, especially those who provide and receive psychiatric care. Of course, we have to wait until the rubber meets the road before we celebrate a victory.  As Dr. Richard Summers, co-director of the psychiatric residency program at the University of Pennsylvania Perelman School of Medicine, told me: “There is an attitude of cautious optimism that this may be helpful, but what’s going to be interesting is to see how this rule will be interpreted and implemented.” Let’s keep our fingers crossed that this rule, unlike previous ACA rules, is here to stay.

Speaking of rule changes, if you want coverage beginning January 1, you now have until December 23 to sign up. The previous deadline of December 15 was moved. When other Obamacare changes occur, I’ll tweet the news.

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