Benefit Limits for Behavioral Health Care in Private US Health Plans

Rationale: In the US, most private health plans cover treatment for mental health and substance abuse, but they have traditionally imposed special limits on that coverage. These include annual and/or lifetime limits on visits, episodes or dollars, separate from any limits applied to medical care. In 1997 the federal government banned dollar limits on mental health care that differed from medical limits. In addition various states have passed parity laws constraining insurers' use of limits, although many large employers are exempt. Some analysts have argued that health plans may in any case have less need to use limits now than previously, as the spread of managed care has provided them with other tools with which to constrain utilization, such as gatekeeping, provider incentives and preauthorization. Objectives: (1) Describe the prevalence of benefits limits for behavioral health care in private health plan coverage. (2) Compute the out-of-pocket exposure facing high users of behavioral health care in different products, as a function of copayments and limits. (3) Examine how the use and stringency of limits relates to other plan practices, such as gatekeeping and the number of visits allowed before the provider must seek reauthorization from the plan. Data: Our 2003 Survey on Alcohol, Drug Abuse and Mental Health Services collected detailed data on administrative and clinical aspects of behavioral health care delivery from 368 commercial health plans in 60 US market areas, yielding national estimates of plan features (83% response rate). This paper relies on respondents' answers to questions about benefits in their three most commonly purchased packages within each insurance product. Methods: Out-of-pocket exposure for a high user is computed as the amount a consumer would pay for 30 outpatient visits in a year, assuming that providers charge $100 per visit. Bivariate tests are used to verify the significance of associations between use of special limits and other plan features. We also estimate multivariate models to predict the extent of out-of-pocket exposure across plans, as a function of utilization management approaches and various plan characteristics. Results: 86% of plans had special annual limits for outpatient mental health care, mostly limits on visits (mode: 20 visits). 80% of plans had had special annual limits for inpatient mental health care, mostly limits on days (mode: 30 days). One-third of plans had a separate annual limit for outpatient substance abuse care (typically limiting visits), and these included some plans that did not limit mental health care. Lifetime limits were much less common than annual limits. Among the plans studied, the mean out-of-pocket cost for 30 visits would be $951 (median: $900). However, in 35% of plans the cost would only be $450. Preliminary analyses indicate that the projected out-of-pocket cost is highest in preferred provider organizations (PPOs). Plans whose benefits imposed more out-of-pocket costs tended to also authorize fewer sessions initially through their utilization review process (correlation= -0.63). Conclusions: Despite the universality of managed care, most US health plans continue to maintain benefit limits introduced in the pre-managed era. For high users of behavioral health care, these limits could result in substantial financial burden.