Mental Health and Substance Use: Employers' Insurance Coverage Maintained or Enhanced Since Parity Act, but Effect of Coverage on Enrollees Varied
Published: 2011-11-30T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) requires that employers who offer health insurance coverage for mental health conditions and substance use disorders (MH/SU) provide coverage that is no more restrictive than that offered for medical and surgical conditions. Employers were required to comply with the law for coverage that began on or after October 3, 2009. The Department of Labor (DOL), the Department of Health and Human Services (HHS), and the Department of the Treasury share oversight for MHPAEA. MHPAEA also requires GAO to examine trends in health insurance coverage of MH/SU. This report describes (1) the extent to which employers cover MH/SU through private health insurance plans, and how this coverage has changed since 2008; and (2) what is known about the effect of health insurance coverage for MH/SU on enrollees' health care expenditures; access to, or use of, MH/SU services; and health status. GAO surveyed a random sample of employers about their MH/SU coverage for the most current plan year and for 2008. GAO received usable responses from 168 employers--a 24 percent response rate. The survey results are not generalizable; rather, they provide information limited to responding employers' MH/SU coverage. GAO reviewed published national employer surveys on health insurance coverage and interviewed officials from DOL, HHS, and other experts. GAO also reviewed studies that evaluated the effect of MH/SU coverage on enrollees' expenditures, access to, or use of, MH/SU services, and health status.
section_title: What GAO Found
paragraphs: Most employers continued to offer coverage of MH/SU since MHPAEA was passed. Of the employers that responded to GAO's survey, 96 percent offered coverage of MH/SU for the current plan year and for 2008, before MHPAEA was passed. Approximately 2 percent of employers reported offering coverage for only mental health conditions but not substance use disorders for the current plan year and for 2008. Conversely, about 2 percent of employers reported discontinuing their coverage of both MH/SU or only substance use disorders in the current plan year. The types of MH/SU diagnoses included and excluded in employers' MH/SU benefits remained consistent between the current plan year and 2008. Of the employers who provided information about diagnoses included in their MH/SU benefits for both the current plan year and 2008, 34 percent reported that their most popular plan in the current plan year excluded at least one MH/SU diagnosis from their benefits, and 39 percent of employers reported excluding at least one MH/SU diagnosis from their benefits for the 2008 plan year. The most common change to MH/SU benefits reported among those who responded to the survey was enhancing benefits through the removal of treatment limitations, such as the number of allowed office visits. Reported use of lifetime dollar limits on MH/SU treatments also declined from 2008 to the current plan year. Among employers who reported information on cost-sharing, copayments and coinsurance amounts for in-network providers generally stayed about the same, fluctuating minimally from 2008 to the current plan year. Published national employer surveys on health insurance coverage also reported results consistent with GAO's survey data. Employers may continue to modify certain nonfinancial requirements--such as changes to the services they cover (the scope of services) and nonquantitative treatment limits--in their MH/SU benefits in response to agencies' issuance of final implementing regulations for MHPAEA. Officials from DOL and HHS reported that the final regulations may provide additional detail on these nonfinancial requirements. Research suggests that coverage for MH/SU has a varied effect on enrollees. Research examining the effect of health insurance coverage for MH/SU on enrollee expenditures generally found that the implementation of parity requirements reduced enrollee expenditures. Studies that examined the effect of health insurance coverage for MH/SU on enrollee access to, and use of, MH/SU services had mixed results, with some studies indicating there was little to no effect and others indicating that there was some effect--such as finding that restricting coverage had a negative effect on use of services. Little research has explored the relationship between health insurance coverage and health status. Of the studies we reviewed, two examined the effect of health insurance coverage for MH/SU on enrollee health status and found different effects. GAO provided a draft of the report to DOL and HHS. Both agencies provided technical comments, which have been incorporated as appropriate.

section_title: Letter
paragraphs: An estimated 26 percent of American adults suffer from some type of  mental health condition each year, with about 6 percent of them suffering  from a severe mental health condition such as schizophrenia or major  depression. An estimated 9 percent of Americans 12 or older were  classified with a substance use disorder in 2010. In 2008, 13 percent of  American adults received mental health treatment services. For those  adults with a severe mental health condition, just over half—59 percent— received mental health treatment services. When mental health  conditions are left untreated, they are more likely to result in  hospitalizations. In 2006, one in five hospitalizations in the United States  included a mental health condition either as a primary or secondary  diagnosis. Similarly, when substance use disorders are inadequately  treated, they can complicate care for costly medical conditions, such as  diabetes.
Historically, employer-sponsored health care coverage offered through  private health insurance plans has typically provided lower levels of  coverage for the treatment of mental health conditions and substance use  disorders (MH/SU) than for the treatment of medical and surgical  conditions (medical/surgical). Consequently, patients with MH/SU may  not have received timely or sufficient treatment, or may have incurred  high out-of-pocket costs. From 2007 to 2010, about 38 percent of  Americans 12 or older who needed treatment for substance use disorders  did not receive treatment because of a lack of coverage, and could not  afford the cost without coverage.
Pub. L. No. 110-343, Div. C, Tit. V, Sub. B, §§ 511-512, 122 Stat. 3765, 3881-3893   (Oct. 3, 2008). MHPAEA, passed as part of the Emergency Economic Stabilization Act of  2008, expands the parity requirements established by the Mental Health Parity Act of  1996 (Pub. L. No. 104-204, Tit. VII, §§ 701-702, 100 Stat. 2874, 2944-2950 (Sept. 26,  1996), the first federal mental health parity law, which required parity in annual and  aggregate lifetime dollar limits. MHPAEA expanded the 1996 federal parity requirements  to include parity more broadly in financial requirements (including cost-sharing  requirements), treatment limitations, and in- and out-of-network covered benefits.  MHPAEA also requires parity for substance use disorder benefits. employers that choose to cover MH/SU, MHPAEA does not require  coverage of specific diagnoses.
MHPAEA also requires us to examine trends in coverage for MH/SU. For  this study, we report on: (1) the extent to which employers cover MH/SU  through private health insurance plans, and how this coverage has  changed since MHPAEA was passed in 2008; and (2) what is known  about the effect of health insurance coverage for MH/SU on enrollees’  health care expenditures; access to, or use of, MH/SU services; and  health status.
To determine the extent to which employers cover MH/SU both currently  and in 2008, we surveyed a stratified random sample of small, medium,  large, and very large employers about their most popular health plans for  the most current plan year—either 2011 or 2010—as well as for 2008. We  conducted a survey of employers because we were unable to identify a  published national employer survey that included specific detailed  information about employers’ MH/SU benefits prior to and following  MHPAEA—namely, information about diagnoses included in or excluded  from coverage. We fielded our web-based survey between May 18, 2011,  and July 1, 2011, to 707 employers, selected from the sampling frame we  developed using the Lexis Nexis corporate database. We received  usable responses from 168 employers, after following up with  nonrespondents to encourage their participation, for a 24 percent  response rate. All 168 employers offered coverage of mental health  conditions, substance use disorders, or both, in either the current plan  year, 2008 plan year, or both plan years. Of the 168 employers that  provided usable survey responses, a subset of employers answered at  least one detailed benefits question for only one plan year—the current  plan year or the 2008 plan year. As a result, the denominator for our  calculations varied depending on the question we analyzed. Given our  overall response rate of 24 percent, our survey results are not  generalizable. Rather, the survey responses provide information limited to  responding employers’ coverage of MH/SU in the current plan year and  2008 plan year. We did not verify the accuracy of the employers’  responses or assess compliance with MHPAEA.
To supplement the data collected from our survey, we reviewed the  results of published national employer surveys from the Kaiser Family  Foundation and Health Research and Educational Trust (Kaiser/HRET)  and Mercer. These surveys provided generalizable information on  employers’ coverage of MH/SU. We also conducted interviews with  agency officials from DOL and HHS who had expertise in MH/SU issues,  as well as with other experts, to learn about the implementation of  MHPAEA and trends in employers’ coverage of MH/SU. We did not  interview Treasury officials because the focus of this engagement did not  relate to that agency’s scope of responsibility. Lastly, we conducted  detailed interviews with a nongeneralizable sample of four employer  survey respondents to obtain more detailed information about the  employers’ coverage of MH/SU, and their reasons for making or not  making changes to coverage after MHPAEA took effect.
To describe what is known about the effect of health insurance coverage  for MH/SU on enrollees’ health care expenditures, access to, or use of,  MH/SU services, and health status, we conducted a literature review of  peer-reviewed journals and other periodicals published between   January 1, 2000, and March 11, 2011. We also included articles in our  literature review that were suggested to us by the experts we interviewed,  as well as studies that were referenced in the articles found during our  initial search. In total, we reviewed 34 studies as part of our literature  review.
Appendix I provides more details about our scope and methodology.  Appendix II provides a list of articles we reviewed as part of our literature  review.
We conducted our work from December 2010 to September 2011 in  accordance with all sections of GAO’s Quality Assurance Framework that  are relevant to our objectives. The framework requires that we plan and  perform the engagement to obtain sufficient and appropriate evidence to  meet our stated objectives and to discuss any limitations in our work. We  believe that the information and data obtained, and the analysis  conducted, provide a reasonable basis for any findings in this product.
subsections: section_title: Background
paragraphs: Most Americans obtain their health insurance coverage through the  workplace. Employers typically offer health insurance coverage for  employees on an annual basis through one or more health plans. Each  plan year, employers can decide how many health plans to offer, whether  to include coverage for MH/SU in the health plans offered, and what type  of benefits those plans can include as part of their coverage.,Additionally, employers may determine if their plans’ MH/SU benefits will  be managed by the same health insurer that manages their  medical/surgical benefits, or if they will be managed by a separate  organization that specializes in MH/SU benefits—known as a managed  behavioral health organization (MBHO).
Within the coverage of MH/SU that employers may offer, the types of MH/SU treatment  services and the settings in which MH/SU treatment services are provided vary widely, so  that a patient may receive care appropriate to the severity of the symptoms. Types of  MH/SU services can include: counseling, case management, partial hospitalization,  inpatient treatment, vocational rehabilitation, and a variety of residential programs. MH/SU  treatment may also include prescription drugs. In addition, patients with acute symptoms  may be treated by personnel in emergency rooms and hospital units, and by MH/SU crisis  and outreach specialists. Patients with more subacute symptoms are treated by personnel  in hospitals, day treatment programs, mental health center programs, and by different  types of individual practitioners. Patients with long-term symptoms are often treated in  mental health centers, residential units, and practitioners’ offices. reimbursing some portion of the remaining charges. The payment is  made after the deductible is met and until the out-of-pocket expense  maximum is reached—that is, the maximum amount that enrollees  have to pay per year for all covered medical expenses.
Coinsurance: A percentage payment made by enrollees after the  deductible is met and until the out-of-pocket expense maximum is  reached.
Prior to the implementation of MHPAEA, private health insurance plans  offered through employers that covered MH/SU typically provided lower  levels of coverage for the treatment of these illnesses than for the  treatment of physical illnesses. Employers often limited the coverage of  MH/SU through the use of plan design features that were more restrictive  for MH/SU benefits than for medical/surgical benefits. Prior to MHPAEA,  MH/SU benefits were commonly subject to higher cost-sharing features  such as deductibles, copayments, or coinsurance; more restrictive  treatment limitations such as the number of covered hospital days or  outpatient office visits; and limited out-of-network providers. Also, there  were concerns that employers would limit the MH/SU treatment enrollees  could receive by excluding specific MH/SU diagnoses, such as eating  disorders, from their benefits.
For example, prior to MHPAEA, an employer’s plan could cover unlimited  hospital days and outpatient office visits and require 20 percent  coinsurance for outpatient office visits for medical/surgical treatment  while, for MH/SU, that same plan could cover only 30 hospital days and  20 outpatient office visits per year and impose 50 percent coinsurance for  outpatient office visits. Additionally, an employer’s plan might limit the  MH/SU diagnoses for which treatment was covered.
Employers provided more limited coverage of MH/SU prior to MHPAEA  primarily because of concerns about the cost of providing coverage for  individuals with MH/SU. Concerns about the high costs associated with  long-term, intensive psychotherapy and extended hospital stays,  particularly for some diagnoses such as schizophrenia or major  depression, could have prompted employers to impose treatment  limitations on outpatient office visits and hospital days, and limits on  annual or lifetime dollar amounts for treatment of MH/SU.
To help address the discrepancies in health care coverage between  mental illnesses and physical illnesses, Congress passed MHPAEA  which strengthened federal parity requirements. coverage terms for MH/SU—when those services are offered—be no  more restrictive than coverage terms for medical/surgical services.
Under MHPAEA, employers are not required to offer MH/SU coverage.  However, those plans that do offer mental health or substance use  disorder coverage were required to comply with MHPAEA’s parity  requirements for their health plan year that began on or after October 3,  2009.
States may also pass laws requiring that mental health coverage sold in the state be  offered on par with medical/surgical, and these requirements may be more stringent than  those required by federal law. According to the National Conference of State Legislatures,  state parity laws regulating mental health coverage have been passed in 49 states and the  District of Columbia as of May 2011. See National Conference of State Legislatures,  “State Laws Mandating or Regulating Mental Health Benefits” (Washington, D.C.: May  2011), accessed June 13, 2011, http://www.ncsl.org/default.aspx?tabid=14352. for coverage of MH/SU, including classifications of benefits and  nonquantitative treatment limitations (NQTL).
The IFR specifies six classifications of benefits within which parity must  be applied: (1) inpatient, in-network; (2) inpatient, out-of-network;   (3) outpatient, in-network; (4) outpatient, out-of-network; (5) emergency  care; and (6) prescription drugs. The IFR further specifies that plans  choosing to cover MH/SU benefits must offer the MH/SU benefits within  any one classification when medical/surgical benefits are offered at that  same classification. Thus, for plans that cover MH/SU benefits, if  medical/surgical services are covered for in-patient, out-of-network care,  the plan must also cover MH/SU services for in-patient, out-of-network  care.
An NQTL is a treatment limitation that is not expressed numerically but  still limits the scope or duration of benefits for treatment under a health  plan. Examples of NQTLs, some of which are noted in the IFR include:  standards for provider admission to participate in a network; plan  methods for determining usual, customary, and reasonable charges; pre- authorization of services; and utilization review. The IFR stipulates that  employers must ensure that NQTLs are comparable across benefit  classifications. Generally, if an NQTL is used for MH/SU services within a  classification, it is to be applied no more stringently than an NQTL for  medical/surgical services within that same classification.
section_title: Employers Continued to Offer Coverage or Enhanced Benefits for Mental Health Conditions and Substance Use Disorders Since the Enactment of MHPAEA
paragraphs: Most employers that responded to our survey continued to offer coverage  of MH/SU through private insurance plans following the implementation of  MHPAEA. The types of diagnoses and treatments included in employers’  MH/SU benefits remained largely unchanged, and some employers  enhanced their MH/SU benefits by removing coverage limits as a result of  MHPAEA requirements. After the issuance of the final regulations  implementing MHPAEA, employers may make additional changes to their  MH/SU benefits.
subsections: section_title: Most Employers Continued to Offer Coverage for Mental Health Conditions and Substance Use Disorders
paragraphs: Most employers that responded to our survey offered coverage of MH/SU  both in their most current plan year—2011 or 2010—and in 2008, before  MHPAEA was passed. Of the employers that responded to our survey  about their coverage of MH/SU for both plan years, about 96 percent  offered coverage for MH/SU for the current plan year and for 2008.
Approximately 2 percent of employers reported that they offered coverage  for only mental health conditions in 2008 but not substance use disorders,  and continued to offer coverage for only mental health conditions in the  current plan year.
Conversely, a small percentage of employers—about 2 percent of those  employers that responded to our survey about their coverage of MH/SU  for both plan years—reported discontinuing their coverage of both MH/SU  or only substance use disorders in the current plan year. One employer  that discontinued offering coverage of mental health reported that it did so  to control health insurance costs. Another employer reported that it  ceased to offer coverage of substance use disorders because it did not  want to cover these disorders without treatment limitations. Under  MHPAEA, if substance use disorders are covered, any treatment  limitations for the substance use benefits must be used on par with those  used in medical/surgical benefits.
Published employer surveys also reported that few employers  discontinued coverage of MH/SU since MHPAEA was passed. According  to Kaiser/HRET’s Employer Health Benefits 2010 Annual Survey, less  than 2 percent of employers reported eliminating coverage for MH/SU as  a result of MHPAEA. Mercer reported in its National Survey of  Employer-Sponsored Health Plans that the percentage of employers  surveyed that reported offering coverage for MH/SU was consistent from  2008 to 2010. Specifically, about 90 percent of employers surveyed in  2008 and 92 percent of employers surveyed in 2010 reported offering  coverage for MH/SU. According to both Mercer’s 2008 survey and 2010  survey, offering coverage of MH/SU was most common among employers  with 500 or more employees, at about 97 percent. Additionally, about   90 percent of employers with fewer than 500 employees surveyed in 2008  and 92 percent of employers with fewer than 500 employees surveyed in  2010 indicated that they offered coverage for MH/SU.
Agency officials also told us that based on their review of trend data and  information on employer’s coverage of MH/SU, employers appeared to  continue to offer coverage of MH/SU since MHPAEA was passed. In  addition, representatives from large insurance companies, a health  benefits consulting firm, and an MBHO told us that most employers with  whom they interact continued to offer coverage of MH/SU since MHPAEA  was passed. According to other health benefits experts, most employers  they knew of generally experienced minimal challenges in complying with  the MHPAEA requirements. Representatives from medium, large, and  very large employers with whom we spoke told us that the process for  making changes to their health plans to comply with MHPAEA was  relatively easy for them because they relied on their insurance brokers or  health benefits consultants to inform them of the requirements and assist  them in making necessary changes.
section_title: Diagnoses and Treatments Included in Benefits Remained Largely Unchanged and Some Employers Enhanced Benefits by Removing Coverage Limits
paragraphs: Employers have not substantially changed the diagnoses and treatments  that are included in their MH/SU benefits. However, fewer employers  reported excluding at least one broad MH/SU diagnosis and more  employers reported excluding a treatment related to MH/SU in the current  plan year than for 2008. Some employers enhanced their MH/SU benefits  by removing coverage limits and modifying cost-sharing for MH/SU in  response to MHPAEA requirements.
The types of MH/SU diagnoses included and excluded from employers’  MH/SU benefits remained consistent between the current plan year and  2008. About 91 percent of employers that responded to the question in  our survey about the diagnoses included in their MH/SU benefits for both  the current plan year and 2008 plan year reported their MH/SU benefits  included the same broad diagnoses in their most popular health plan in  the current plan year and in 2008. The other 9 percent of employers  reported including more broad diagnoses in their MH/SU benefits for the  current plan year than in the 2008 plan year. Most employers that  provided information about diagnoses included in MH/SU benefits for both  years reported that they included all types of broad mental health  diagnoses in their MH/SU benefits for both plan years. Five of these  broad diagnoses were covered by over 90 percent of employers for both  the current plan year and 2008—mental disorders due to a general  medical condition, substance-related disorders, schizophrenia and other  psychotic disorders, mood disorders, and anxiety disorders (see fig. 1).
Of the employers that responded to our survey question about the  diagnoses included in their MH/SU benefits for both the current plan year  and 2008 plan year, 34 percent reported that their most popular plan in  their current plan year excluded at least one broad MH/SU diagnosis from  their benefits, and 39 percent reported this for the 2008 plan year.  Approximately 9 percent of employers that answered detailed benefits  questions in our survey reported that their most popular plan for the  current plan year excluded at least one specific mental health diagnosis  subcategory within a broader mental health diagnosis and 2 percent  excluded at least one specific substance use disorder subcategory.  Similarly, approximately 10 percent reported excluding at least one  specific mental health diagnosis subcategory and 2 percent excluded at  least one specific substance use disorder subcategory for the 2008 plan  year. Examples of specific diagnosis subcategories excluded by our  survey respondents included developmental disorders, learning disorders,  mental retardation, sexual deviation and dysfunction, and relational  disorders, such as marriage or family problems.
Similarly, according to Mercer’s 2010 National Survey of Employer- Sponsored Health Plans, 1 percent of employers with 500 or more  employees and less than 1 percent of employers with fewer than 500  employees reported excluding additional diagnoses from their MH/SU  benefits as a result of MHPAEA. Representatives from a large health  insurer, a health benefits consulting firm, an insurance broker  organization, and an advocacy group also reported that employers with  whom they interact generally included the same number and type of  diagnoses in their MH/SU benefits for the current plan year as they did  prior to MHPAEA’s implementation.
In addition to exclusions of diagnoses, some employers also choose to  exclude specific treatments from their MH/SU benefits. Of the employers  that responded to the question in our survey about excluding a specific  treatment for MH/SU, approximately 41 percent reported excluding a  specific treatment for MH/SU from their most popular health plan in the  current plan year, while 33 percent reported doing so for their most  popular health plan in the 2008 plan year.
According to representatives from an advocacy organization and an  institution that conducts employer-based surveys on health insurance  coverage, some employers choose to exclude specific treatments related  to certain MH/SU diagnoses from their MH/SU benefits than to exclude  the diagnosis itself. For example, representatives from an MBHO, a  health benefits consulting firm, and an institution that conducts employer- based surveys on health insurance coverage told us that employers may  exclude the treatment of “applied behavioral analysis” for autism, citing  concerns about the treatment’s effectiveness, rather than excluding  coverage for autism.
The most common change to MH/SU benefits reported among those that  responded to our survey was enhancing benefits through the removal of  treatment limitations, such as the number of allowed office visits or  inpatient days. About 7 percent of employers that answered detailed  benefits questions in our survey reported limits on the number of allowed  office visits for mental health conditions in the current plan year,  compared to 35 percent in 2008; and 9 percent reported limits on the  number of allowed inpatient days for treatment of mental health  conditions, compared to 29 percent in 2008. Similarly, 8 percent of  employers that answered detailed benefits questions in our survey  reported limits on the number of allowed office visits for substance use  disorders, compared to 33 percent in 2008; and 8 percent reported limits  on the number of allowed inpatient days for treatment of substance use  disorders, compared to 27 percent in 2008 (see fig. 2).
Reported use of lifetime dollar limits on MH/SU treatments also declined  from 2008 to the current plan year.answered detailed benefits questions in our survey reported lifetime dollar   About 5 percent of employers that  limits on treatments for MH/SU for the current plan year, compared to   20 percent in 2008. Employers that reported lifetime dollar limits on  mental health treatments for the current plan year generally told us that  these limits applied to all treatments for MH/SU or that they applied to all  treatments covered by the plan—including both MH/SU and  medical/surgical.
Kaiser/HRET’s Employer Health Benefits 2010 Annual Survey reported  that of the 31 percent of employers surveyed that made changes in their  mental health benefits as a result of MHPAEA, two-thirds of these  employers reported eliminating coverage limits on mental health  treatments, the most common change made by employers. Mercer’s 2010  National Survey of Employer-Sponsored Health Plans also found that the  elimination of treatment limitations and annual or lifetime dollar limits were  common changes made by employers, reporting that 35 percent of  employers with 500 or more employees and 15 percent of employers  surveyed with fewer than 500 employees removed limits on the number of  allowed office visits or dollar limits in response to parity requirements.
Several experts with whom we spoke told us that it was common for  employers to eliminate treatment limitations and annual or lifetime dollar  limits for MH/SU in response to parity requirements.representatives from an insurance broker organization and a trade  association told us that employers with which they interacted removed  limits on the number of allowed office visits for mental health conditions  from their plans. A representative from a large insurance company told us  that the employers with whom they work removed all limits on the number  of allowed inpatient hospital days from plans to which MHPAEA applies,  and a representative from an insurance broker organization also reported  that employers with whom they consulted removed lifetime dollar limits on  substance use disorders from their plans.
Among employers who reported information on cost-sharing, copayments  and coinsurance amounts for office visits with in-network providers  generally stayed about the same, fluctuating minimally from 2008 to the  current plan year, while copayments and coinsurance amounts for  outpatient services with in-network providers decreased slightly from  2008 to the current plan year (see table 1).
Mercer’s 2010 National Survey of Employer-Sponsored Health Plans  found that 3 percent of employers surveyed decreased their cost-sharing  requirements for MH/SU in response to MHPAEA, and larger employers  were more likely to change their cost-sharing requirements than smaller  employers. Specifically, according to Mercer, 20 percent of employers  with 20,000 or more employees and 6 percent of employers with 500 to  999 employees reported decreasing their MH/SU copayments or  coinsurance to comply with MHPAEA.
section_title: Employers May Continue to Modify Benefits as Agencies Refine Parity Requirements
paragraphs: Employers may continue to modify certain nonfinancial requirements— such as changes to the services they cover (the scope of services) and  NQTLs—in their MH/SU benefits in response to agencies’ issuance of  final implementing regulations for MHPAEA. Agency officials reported that  the final regulations may provide additional detail on the required scope of  services and on using NQTLs.
The IFR does not specifically address the scope of services offered within  each classification of benefits, and agency officials recognize that  achieving parity in coverage is complicated by the fact that not all  treatments or treatment settings for MH/SU correspond well to those for  medical/surgical. Some commenters requested clarification about  whether an employer would be required to cover a particular treatment or  treatment setting for a mental health condition or substance use disorder  that is otherwise covered in a plan, if benefits for the treatment or  treatment settings are not provided for medical/surgical conditions—for  example, counseling, an outpatient service used for treatment of MH/SU  but not medical/surgical. As part of its issuance of the IFR, the agencies  requested public comments on whether, and to what extent, the final  regulations should address the scope of services provided by a group  health plan or health insurance coverage. Agency officials from HHS’s  Office of the Assistant Secretary for Planning and Evaluation (ASPE) and  DOL are conducting research on the costs to employers that are  associated with scope of services for MH/SU and intend to use the results  to inform potential final regulations on the issue.
Experts reported that some employers are unclear what types of services  for MH/SU they must offer within the IFR’s six classifications to be in  compliance with MHPAEA and its implementing regulations. These  employers may modify their MH/SU benefits in response to the final  regulations.
As part of the process of developing final regulations, DOL, HHS, and  Treasury are researching NQTLs for MH/SU, including convening a panel  of experts to discuss how health plans use NQTLs—for example, use of  pre-authorization for MH/SU benefits within certain classifications, as  compared to use of pre-authorization for medical/surgical benefits within  the same classification. The agencies may use this research to provide  more detailed guidelines on how NQTLs for MH/SU services can be used  on par with NQTLs used for medical/surgical services. Currently, the IFR  does not specify the steps employers can take to achieve parity with  NQTLs across classifications for coverage of MH/SU and medical/surgical  services. For example, the IFR generally requires that any processes or  other factors used in applying the NQTLs should be “comparable to” and  used “no more stringently” for MH/SU benefits in a certain classification  than they are for medical/surgical benefits at that same classification, but  these qualitative terms may be interpreted or applied inconsistently by  employers.
A representative from an MBHO told us that the IFR requirements for  NQTLs could be interpreted in different ways, and the MBHO has seen  variation in how employers are applying NQTLs in their plans.  Representatives from an advocacy group reported that, in some cases,  employers appear to be applying NQTLs more stringently to MH/SU  benefits than to medical/surgical benefits. For example, according to the  advocacy group, some plans require pre-authorization for inpatient care  for MH/SU services for every 2-day period the care is expected to be  given, but require pre-authorization for inpatient services for  medical/surgical benefits less frequently. will be informed by the agencies’ findings, may result in employers’ further  modification of their use of NQTLs in their benefit packages in order to  comply with any new or modified requirements.
Requiring more frequent pre-authorization can affect use of services. According to a  study on the impact of pre-authorization on the use of mental health services, when an  enrollee must obtain pre-authorization more frequently for outpatient mental health  treatments, they are more likely to terminate treatment earlier. See X. Liu, et al., “The  Impact of Prior Authorization on Outpatient Utilization in Managed Behavioral Health  Plans,” Medical Care Research and Review, vol. 57, no. 2 (2000).
section_title: Research Suggests That Coverage for Mental Health Conditions and Substance Use Disorders Has a Varied Effect on Enrollees
paragraphs: Research indicates that enhanced coverage for MH/SU has generally led  to reduced enrollee expenditures. Research also indicates that health  insurance coverage for MH/SU has had mixed effects on access to, and  use of, MH/SU services. In addition, little research has explored the effect  of health insurance coverage for MH/SU on health status.
subsections: section_title: Research Indicates That Enhanced Health Insurance Coverage for Mental Health Conditions and Substance Use Disorders Reduces Enrollee Expenditures
paragraphs: Of the nine studies we reviewed that focused on the effect of health  insurance coverage for MH/SU on enrollee expenditures, six studies  generally found that the implementation of parity requirements led to  reduced enrollee expenditures. Specifically, four of the nine studies  examined mental health parity requirements in the Federal Employees  Health Benefits Program (FEHBP) and found that implementing parity  resulted in reductions in enrollee out-of-pocket costs. For example, one of  these studies compared specific MH/SU benefits offered in FEHBP plans  before and after the implementation of parity, and found that copayments  and coinsurance for MH/SU services decreased by 50 percent or more  after parity was implemented. Two of the nine studies examined the  impact of state parity laws on expenditures and found that parity generally  reduced enrollee expenditures. For example, one of these studies found  that families with children in need of mental health services in parity  states were more likely to have lower annual out-of-pocket costs than  families with children in need of mental health services in nonparity  states.
Three of the nine studies examined other aspects of how health  insurance coverage for MH/SU may impact enrollee expenditures that  were unique to the scenarios or targeted populations studied. For  example, one study examined differences in out-of-pocket spending  among various populations and found that among individuals who use  mental health services, out-of-pocket expenses were highest for those  who were uninsured or enrolled in Medicare, compared with those who  had private health insurance or were enrolled in Medicaid.
section_title: Research Found Mixed Effects on Access to, and Use of, Services for Mental Health Conditions and Substance Use Disorders
paragraphs: Available research on access to, and use of, MH/SU services, as affected  by health insurance coverage, was mixed. Of the 30 studies we reviewed  on these topics, 17 studies found health insurance coverage for MH/SU— or enhanced insurance coverage through parity requirements—had some  effect on access to, or use of, MH/SU services, whereas 13 studies found  little to no effect.
Of the 17 studies finding some effect of health insurance coverage on  access to, or use of, MH/SU services:
Six studies looked at a specific aspect of health insurance coverage— cost-sharing requirements, pre-authorization requirements, or the way  MH/SU benefits are structured—and found that restricting coverage  had a negative effect on enrollees’ use of services. Specifically, one  study found that as cost-sharing increased among privately insured  patients, the rate of substance use disorder treatment decreased.  Another study found that when health plans increased the number of  treatment sessions approved at a time, patients were less likely to  prematurely terminate treatment. A third study found that as private  health plans increased the use of managed care mechanisms, such  as utilization review and prior authorization, children decreased their  use of MH/SU services.
Five studies indicated that plans with more comprehensive coverage  were associated with a positive effect on access to, or use of, MH/SU  services. For example, one study examined a large U.S.-based  company that reduced copayments and made efforts to destigmatize  mental illness, and found that the benefit design change led to an   18 percent increase in the probability of enrollees initiating mental  health treatment.
Four studies examined the effect of state parity requirements and, as  a group, found a mixed effect on enrollees’ access to, or use of,  MH/SU services. For example, one of these studies examined the  effect of a state parity requirement within the first 3 years following  implementation of parity requirements, and found that the  implementation of parity requirements resulted in increased access to,  and use of, mental health services; however, the implementation of  parity resulted in reduced access to substance use disorder  services.increased access to, or use of, MH/SU services for individuals with  mild to moderate mental health needs, but that state parity   Another study found that state parity requirements  requirements had no effect on access to, or use of, MH/SU services  for individuals with severe mental health needs. The remaining two  studies found that state parity requirements increased access to, or  use of, MH/SU services.
Two studies found that being uninsured or having a certain type of  insurance was associated with lower access to MH/SU services. For  example, one study assessed the extent to which psychiatrists were  accepting new patients with different types of insurance—Medicaid,  Medicare, and private insurance—and with different types of care  plans. This study found that psychiatrists were less likely to accept  new patients in managed care plans and Medicaid than patients in  nonmanaged private insurance plans and Medicare, indicating that  the type of coverage patients have may affect their access to  available providers.
In contrast, 13 of the 30 studies we reviewed found little to no effect:
Three studies examined the effect of mental health parity  requirements in the FEHBP and found that enhanced coverage did  not increase access to, or use of, MH/SU services.
Six studies examined the effect of state mental health parity  requirements on access to, or use of, MH/SU services and found little  to no effect. One of these studies found a difference in the effect of  state mental health parity requirements by employer size. Specifically,  after implementation of state mental health parity requirements,  enrollees from smaller employers—comprised of 50 to 100  employees—increased the use of mental health services after parity,  while there was little or no effect on the use of mental health services  for enrollees from larger employers—comprised of 100 or more  employees.
Four studies focused on the effect of health insurance coverage on  access to, or use of, MH/SU services for a specific population, and  also found that health insurance coverage had little to no effect on  access to, or use of, MH/SU services. For example, two studies  examined the effect of health insurance coverage on specific  populations—children with special mental health service needs living  in a rural area, or low-income, minority groups—and found that having  private health insurance had little to no effect on use of services for  either of these populations.
section_title: Little Research Has Explored the Relationship between Health Insurance Coverage and Health Status
paragraphs: Of the studies we reviewed, two studies examined the effect of health  insurance coverage for MH/SU on health status of the general population.  One study compared suicide rates among states with different parity  requirements and found that state mandates did not have an effect on  suicide rates. The other study found that increasing copayments was  associated with an increased likelihood of the reoccurrence of substance  use treatment. Specifically, each 10 percent increase in copayment was  associated with a 1 percent increase in the probability of returning to  begin a new course of substance use disorder treatment within   180 days.
section_title: Agency Comments
paragraphs: DOL and HHS reviewed a draft of this report and provided technical  comments, which we incorporated as appropriate.
We are sending copies of this report to the Secretaries of the Department  of Labor and the Department of Health and Human Services and  appropriate congressional committees. In addition, the report will be  available at no charge on GAO’s website at http://www.gao.gov.
If you or your staff have any questions regarding this report, please  contact me at (202) 512-7114 or dickenj@gao.gov. Contact points for our  Offices of Congressional Relations and Public Affairs may be found on  the last page of this report. GAO staff who made key contributions to this  report are listed in appendix III.
section_title: Appendix I: Scope and Methodology
paragraphs: To determine the extent to which employers cover mental health  conditions and substance use disorders (MH/SU) both currently and in  2008, we surveyed a stratified random sample of small, medium, large,  and very large employers about the MH/SU covered in their most popular  health plans for the most current plan year—either in 2011 or 2010—as  well as for 2008. We defined most popular health plan as the plan that  covered the greatest number of lives. We fielded a web-based survey  between May 18, 2011, and July 1, 2011, to 707 employers, selected  from a sampling frame we developed using the Lexis Nexis corporate  database.
Our survey was designed to collect information about trends in employer  coverage of MH/SU benefits, and included questions about coverage for  MH/SU in the most current plan year—2011 or 2010—and in 2008. We  conducted a survey of employers because we were unable to identify a  published national employer survey that included specific detailed  information about employers’ MH/SU benefits prior to and following  MHPAEA—namely, information about diagnoses included in or excluded  from coverage. For our survey, employers had the option of either  completing the entire survey, including detailed questions about their  most popular health plans’ cost-sharing requirements, or completing a  portion of the survey and submitting to us their most popular health plans’  summary plan documents (SPD), which included information on the  plans’ cost-sharing requirements.
As part of the survey development process, we asked experts to review a  draft version of the survey and we pretested the survey. We incorporated  feedback from experts and the pretests into the survey.
We selected a stratified random sample of 1,000 employers from our  sampling frame. Our stratification divided employers into groups based on  the number of employees—small employers had 51-199 employees;  medium employers had 200-999 employees; large employers had 1,000- 4,999 employees; and very large employers had 5,000 or more  employees. We obtained working e-mail addresses for 707 employers,  which received the survey on May 18, 2011. The distribution of employer  sizes among the final group of employers was similar to that in the  original sample.
When we closed the survey on July 1, 2011, after following up with  nonrespondents by phone and e-mail to encourage their participation,  168 employers had submitted usable survey responses, for a response  rate of 24 percent. Given the response rate, our survey results are not  generalizable. Rather, the survey responses provide information limited to  responding employers’ coverage of MH/SU in the current plan year and  2008 plan year. Specifically, we received usable survey responses from  91 small employers, 50 medium employers, 19 large employers, and 8  very large employers. All 168 employers offered coverage of mental  health conditions, substance use disorders, or both, in either the current  plan year, 2008 plan year, or both plan years. We expected all employers  to respond to a key set of questions; however, not every employer that  responded to our survey answered the key questions in their entirety. In  addition, our survey included a series of detailed benefits questions which  employers were expected to respond to only if the question applied to  them. percentage of employers that did not respond to a question ranged from  zero to 46 percent, depending on the question. We did not verify the  accuracy of the employers’ responses or assess compliance with  MHPAEA.
The questions in the survey asking about treatment limitations, lifetime dollar limits, and  cost-sharing amounts were open-ended responses. Employers could leave these  questions blank if their most popular plans lacked these features. as the denominator for our calculations for responses to the detailed  benefits questions for the current plan year, and used 123 as the  denominator for our calculations for responses to the detailed benefits  questions for the 2008 plan year. In instances where we analyzed  responses from a smaller number of respondents, we noted this in the  text.
To supplement the data collected from our survey, we reviewed the  results of published national employer surveys from the Kaiser Family  Foundation and Health Research and Educational Trust (Kaiser/HRET)  and Mercer. These surveys provided generalizable information on  employers’ coverage of MH/SU.
Since 1999, Kaiser/HRET has surveyed a sample of employers each year  through telephone interviews with human resource and benefits  managers and published the results in its annual report—Employer  Health Benefits. Kaiser/HRET selects a random sample from a Survey  Sampling International list of private employers and from the Census  Bureau’s Census of Governments list of public employers with three or  more employees. Kaiser/HRET then stratifies the sample by industry and  employer size. It attempts to repeat interviews with employers that  responded in prior years. For the most recently completed annual  survey—conducted from January to May 2010 and published in  September 2010—2,046 employers responded to the full survey, giving  the survey a 47 percent response rate. Using statistical weights,  Kaiser/HRET projected its results nationwide. Kaiser/HRET used the  following definitions for employer size: (1) small—3 to 199 employees— and (2) large—200 and more employees. In some cases, Kaiser/HRET  reported information for additional categories of small and large employer  sizes.
Since 1993, Mercer has surveyed a stratified random sample of  employers each year through mail questionnaires and telephone  interviews and published the results in its annual report—National Survey  of Employer-Sponsored Health Plans. Mercer selects a random sample of  private sector employers from a Dun & Bradstreet database, stratified into  eight categories, and randomly selects public sector employers—state,  county, and local governments—from the Census of Governments. The  random sample of private sector and government employers represents  employers with 10 or more employees. For the 2010 survey, which was  published in 2011, Mercer mailed questionnaires to employers with 500 or  more employees in July 2010 along with instructions for accessing a web- based version of the survey instrument, another option for participation.  Employers with fewer than 500 employees, which historically have been  less likely to respond using a paper questionnaire, were contacted to be  given the option of responding to the survey by phone or by using the  web-based survey. Telephone follow-up was conducted with employers  with 500 or more employees in the random sample and some mail and  web respondents were contacted by phone to clear up inconsistent or  incomplete data. A total of 2,833 employers responded to the survey. By  using statistical weights, Mercer projected its results nationwide and for  four geographic regions. The Mercer survey report contains information  for large employers—500 or more employees—and for categories of large  employers with certain numbers of employees as well as information for  small employers—those with fewer than 500 employees. Mercer used the  same methodology for its 2008 survey, which was published in 2009. A  total of 2,873 employers responded to the survey. According to a Mercer  representative, in any given year, Mercer typically obtains a 25 percent  response rate to its survey.
We conducted interviews with agency officials and experts to learn about  the implementation of MHPAEA and trends in employers’ coverage of  MH/SU benefits. We spoke with agency officials from the Department of  Labor (DOL), Department of Health and Human Services’s (HHS)  Assistant Secretary for Planning and Evaluation (ASPE), and HHS’s  Substance Abuse and Mental Health Services Administration who had  expertise in MH/SU issues. We did not interview Treasury officials  because the focus of this engagement did not relate to that agency’s  scope of responsibility. We spoke with experts who included  representatives from two large managed behavioral health organizations  (MBHO); two large national insurance companies; mental health  advocacy organizations; institutions that field employer-based surveys on  health insurance coverage; a large benefits consulting firm; an insurance  broker organization; and three trade associations. We also interviewed  four employer survey respondents—one in each employer size  category—to obtain more detailed information about the employers’  coverage of MH/SU, and their reasons for making or not making changes  to coverage after the Paul Wellstone and Pete Domenici Mental Health  Parity and Addiction Equity Act of 2008 (MHPAEA) took effect.
For our literature review on the effect of health insurance coverage for  MH/SU on enrollees’ health care expenditures, access to, or use of,  MH/SU services, and health status, we conducted a key word search of  nine databases, such as Medline and EMBASE, that included peer- reviewed journals and other periodicals to capture articles published  between January 1, 2000, and March 11, 2011. We searched these  databases for articles with key words in their title or article subject terms  related to the effect of health insurance on health care expenditures or  health status, using combinations and variations of the words “insurance  coverage,” “mental health,” “substance use,” “health cost,” “health  expenditure,” and “health status.” From these sources, we identified 246  abstracts of research articles, publications, and reports.
After reviewing the abstracts, we included 34 studies that discussed the  effect of health insurance coverage on enrollee expenditures, access to,  or use of, MH/SU services, or health status. We also included articles in  our literature review that were suggested to us by the experts we  interviewed, as well as those that were referenced in the articles found  during our initial search.
section_title: Appendix II: Articles Reviewed on the Effect of Health Insurance Coverage on Enrollees
paragraphs: We conducted a review of published studies between January 2000 and  March 11, 2011, that included an assessment of the effect of health  insurance coverage for mental health conditions and substance use  disorders (MH/SU) on enrollee expenditures, access to, or use of, MH/SU  services, or health status. We identified 34 such studies, 9 of which  addressed the effect of health insurance coverage on enrollee  expenditures, 30 of which discussed access to, or use of, MH/SU  services, and 2 of which discussed health status. Some studies  addressed more than one topic.
Tables 2 through 4 identify the 34 studies included in our review, and  whether we determined them to be relevant to the effect of health  insurance coverage for MH/SU on enrollees’ health care expenditures,  access to, or use of, MH/SU services, or health status.
section_title: Appendix III: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, Jennifer Grover, Assistant  Director; Martha Kelly, Assistant Director; Elizabeth Conklin; Jennifer  DeYoung; Carolyn Fitzgerald; Giao N. Nguyen; Laurie Pachter; Monica  Perez-Nelson; and Rachel Schulman made key contributions to this  report.
section_title: Related GAO Products
paragraphs: Private Health Insurance: Waivers of Restrictions on Annual Limits on  Health Benefits. GAO-11-725R. Washington, D.C.: June 14, 2011.
Private Health Insurance: Access to Individual Market Coverage May Be  Restricted for Applicants with Mental Disorders. GAO-02-339.  Washington, D.C.: February 28, 2002.
Mental Health: Community-Based Care Increases for People with Serious  Mental Illness. GAO-01-224. Washington, D.C.: December 19, 2000.
Mental Health Parity Act: Employers’ Mental Health Benefits Remain  Limited Despite New Federal Standards. GAO/T-HEHS-00-113.  Washington, D.C.: May 18, 2000.
Mental Health Parity Act: Despite New Federal Standards, Mental Health  Benefits Remain Limited. GAO/HEHS-00-95. Washington, D.C.: May 10,  2000.