A recent survey of 70 Fortune 500 employers that offer mental health benefits found that none of the companies eliminated their mental health or substance abuse coverage because of the 2008 Mental Health Parity Act.
According to the Hewitt Associates survey, all of the respondents eliminated their annual and lifetime maximums for mental health benefits as the law requires.
In January, three federal agencies issued joint MHPA regulations that take effect for plan years beginning on July 1, 2010. Under the rules, EAP cannot be used as a gatekeeper — where members are required to use the EAP before accessing mental health/substance abuse benefits — unless a similar program is required for medical/surgical benefits.
Many experts assumed that some employers would drop mental health benefits to avoid complying with the regulations, notes Kathleen Mahieu, Hewitt's national leader for behavioral health care consulting services. "However, as companies increasingly focus on the overall health and productivity of their workforce, they realize that mental health and substance abuse coverage are a valuable part of ensuring that employees are at their best mentally and physically. We believe employers are willing to make the investment to keep these benefits for their workers."
According to Hewitt, 20% of the firms have modified their mental health/substance abuse precertification requirements or adjusted the diagnoses and services covered under the plan, such as eliminating or adding coverage for specific services or adding out-of-network coverage.
In addition, 98% of the respondents have maintained their current administrative arrangement with their mental health/substance abuse vendors. While most companies have stayed with a model in which mental health/substance abuse benefits are administered by a specialty behavioral health vendor (i.e., a carve-out plan), Hewitt believes that in the future more companies will switch to a plan in which benefits are administered by the medical benefits vendor (i.e., a carve-in plan).
"Many employers, particularly those with carve-out programs, have already established separate deductibles and out-of-pocket maximums for mental health/substance abuse benefits that were no more restrictive than the medical provisions," added Mahieu. "These employers will need to reevaluate their plan design to ensure compliance with the regulations, and may even consider reevaluating their carve-out arrangement in order to ease the administrative burden of tracking co-pays, co-insurance and account money."
Hewitt recommends that employers conduct an in-depth comparison of their mental health/substance abuse and medical/surgical benefits to ensure compliance with the regulations, including:
- A thorough cost analysis to ensure that mental health/substance abuse and medical benefits comply with the rules and to assess the financial impact of any changes.
- A review of plan documentation, medical management standards, financial requirements, and treatment limitations to determine compliance.
- A detailed review of the conditions and treatment settings currently covered under the plan.
- An evaluation of the organization's overall behavioral health strategy, including ways to use an EAP to help offset some of the cost of design changes; methods for monitoring program utilization and vendor effectiveness after implementing plan changes; ensuring mental health benefits vendors are doing all they can to provide appropriate treatment while ensuring that employees are getting the care they need; and assessing strategies that focus on encouraging employees to take an active role in their own health care.
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7 Comment(s)
Posted by: Kumara | November 29, 2011 7:43 PM
As I've been discussing with a New Orleans injury lawyer, an employer mustn't and cannot offer health insurances to his employees without thinking about their mental state first of all. There may be solutions for a tummy ache, for a hurt pinkie, but a damaged brain can seriously affect the productivity of a company.
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Posted by: Lisha | November 29, 2011 1:32 PM
This should really be a fundamental issue for us, because we can't work as human beings if our brain is damaged. I most certainly wouldn't want to end up in one of the Washington drug rehab centers because my mental health and substance abuse coverage wasn't taken care of. Honestly, we always forget what matters most.
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Posted by: dh1 | March 17, 2010 10:19 AM
http://www.msnbc.msn.com/id/35891871/ns/us_news-crime_and_courts/
Speaking of robbing Peter to pay Paul! The cost of a monthly prescrption of Zyperexa, for example, which treats schizophrinia, is $700/month. Eli Lily is the company that manufactures the drug.
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Posted by: dh1 | March 17, 2010 9:54 AM
To ohforfunny I know it is difficult to empathize for someone who does not have personal experience with someone who suffers from mental illness. I would point those people to the following book, which is a thorough investigation of the state of mental health care in our country. It is available from Amazon. We're either going to pay for it on the front end or on the back end. We have a choice to pay for treatment, yes with public dollars. Right now as I write this comment, I'm paying for it and so is everyone. It's called the CRIMINAL JUSTICE SYSTEM where we cram mentally ill people in jails. This is a shameful situation for a proud nation like us. In my state you can get public assistance if you are on the street with absolutely no one providing you support. If that is the case and you suffer from severe mental illness, you do not even have the wherewithal to seek public assistance. You would be hiding in fear under bridges and on highways. I am not proud of that system of public assistance. http://www.amazon.com/Crazy-Fathers-Through-Americas-Madness/dp/0425213897/ref
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Posted by: Leonard1 | March 17, 2010 9:19 AM
To dh1 and others:
My state and most others already have "public option" plans for those with catastrophic conditions who don't have or cannot get coverage elsewhere. There is no need for the feds to offer yet another. The federal proposal for health care reform will only cause the premiums for those who have insurance to increase. The only people who get reduced costs are those who don't have coverage now -- get it? It's another case of "robbing Peter to pay Paul", or "spreading the wealth". A.K.A.: a socialist approach to health insurance in America.
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Posted by: dh1 | March 17, 2010 9:10 AM
I agree that the Mental Health Parity Act came up really short. It is not fair to burden an employer, be it small, mid-sized or large with shouldering the cost of catastrophic type chronic conditions. It is difficult not to harbor animosity and resentment towards an employee who incurs high medical costs for himself or his dependent. Whether it's a severe mental health condisiton such as schizophrenia or a physical one such as lupus or diabetes is irrelevant. All can be very debilitating diseases. That is why we need a public plan option where an individual is assured coverage for a condition that they did not choose to have. If you have ever looked into purchasing individual medical coverage you would find out pretty soon that there is a $5,000 lifetime limit for mental health and that prescriptions are not covered. This is a pitiful situation. An individual is left with no options but clinging to an employer plan to cover a dependant. As a civilized nation we must take care of our citizens, even those with mental health conditions. Maybe then we could reduce the number of homeless and the incidence of tragic crimes. We cannot continue to ignore the mentally ill who need and want to be treated. Someone has to pay for it and the current system is just not working even with the implementation of MHPA. There are too many loopholes and the bottom line is that critical treatment is very difficult and sometimes impossible to get.
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Posted by: Fall2009 | March 17, 2010 8:15 AM
The large employers have more employees to spread the risk of inpatient mental and substance abuse claim with no day or maximum limits (other than maybe lifetime). The smaller or midsize companies are not so lucky because if one person has a dependent that is inpatient for 6 months the bill could be $102,000 (avg about $17,000 for this area for mental health). That is not small change to small/midsize employers. I know several companies under 500 that are removing both mental and substance abuse because they have dependents on the plan that would well exceed the limits they have in place currently. I wish this act excluded plans under 500 employees. It is usually not the employees that have the high mental health and substance abuse claims from my professional opinion, it is often the dependents (don't forget about the grandparent employees who have legal guardianship thier grand children or people who have legal guardianship over a family member with schizophrenia).
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