If chemical dependency treatment does not have a population of worried well individuals, who would seek treatment when it is not needed or is inappropriate, then caps on benefits serve only to deny adequate care to those who need the most treatment. Other States, particularly those looking to managed-care contracts for their current publicly funded populations, need to decide on the scope of their covered population in advance of any actuarial studies. The State must also decide whether everyone will be covered at the same time or whether the plan will add new groups to the covered population over time, as Washington did. If the covered population is to grow, the schedule for including each new group is important. Any assumptions regarding the schedule could have a great impact on the PMPM estimate as cost shifting is reduced or eliminated.
Community rating has the advantage of impartiality and predictability.
If coverage is voluntary, however, those with relatively low expected costs may consider purchasing coverage to be a waste of money and may not buy the plan. Furthermore, if the plan is a complete health care plan that includes chemical dependency treatment benefits, young adults are the group most likely to opt out of the plan. Young adults, unfortunately, are the ones who most heavily utilize substance abuse treatment. For these reasons, community rating is rarely used, except where coverage is mandated. Qualifications Washington State wanted a lead actuary who was a specialist in health care, who understood the basic services included in the proposed benefit package and who could at least consult with a staff actuary experienced in dealing with chemical dependency treatment issues.