Mental Health Insurance Parity: A View from the States

David L. Shern, Ph.D.

President/CEO Mental Health America

Academy Health Policy Conference

February 5, 2008

Washington, D.C.

Overview of the Presentation

Importance of Insurance Coverage for Mental Health and Substance Use Conditions

Enactment of State Parity Laws Relative to the 1996 Federal Act

Characteristics of State Laws Relationships to

Utilization Outcomes

U.S. Has Highest Rates of Mental Illness

U.S. has the highest prevalence rates (26%) in the world in a comparison of 14 developing and developed countries. (JAMA, 2004)

Mental Illness in Teens Mental Illness in Children and Adolescents Very

Common Anxiety Disorders – 13.0% (Median age of onset 11) Mood Disorders – 6.2% (Median age of onset 30) Disruptive Disorder – 10.3% (Median age of onset 11) Substance Use – 2.0% (Median age of onset 20) Any Disorder – 20.9% (Median age of onset 14)

Substantial Delays in Receiving Treatment Mood Disorders – 6 to 8 year latency Anxiety Disorder – 9 – 23 year latency

(PHS, 1999; Kessler et al, 2005, Wang et al 2005)

5

The Impact of Behavioral Disorders Illustrated:Suicide is the Leading Cause of Violent Deaths Worldwide

(World Health Organization, 2002)

S u i c i d e HomicideWar-related deaths

Homicide War

Suicide

6

In the United States

A Person takes His/Her Life Approximately Every 16

Minutes

70% 4% 8% 12

%16% 20% 24%

All Other Causes of Disability

Migraine

Diabetes

Cancer (Malignant neoplasms)

Communicable Diseases

Digestive Diseases

Injuries (Disabling)

Sense Organ Diseases

Cardiovascular Diseases

Respiratory Diseases

Musculoskeletal Diseases

Alzheimer’s Disease /Dementias

Alcohol/Drug Use Disorders

Mental Illnesses

The Impact of Behavioral Disorders Illustrated:The Disability Impact of Mental Illness

Illness Related Disability--United States, Canada, and Western Europe, 2000 (World Health Organization, 2001)

27%

45%

40%

40%

52%

Diabetes

Asthma

Stroke

MI

Chronic Pain

Pincus HA. J Clin Psychiatry. 2001;62 Suppl 6:5-9; Schatzberg AF. J Clin Psychiatry. 2004;65 Suppl 12;3-4.

Me

dic

al C

on

dit

ion

Percent With Depression

Prevalence of Depression in Medical Illness

Impact of Depression: Comorbitities

Condition

Annual Medical Costs per Patient

Without Depression ($)

Annual Medical Costs per Patient

With Depression ($)

Heart failure 2.56 6.74

Allergic rhinitis 3.27 8.46

Asthma 3.73 10.56

Migraine 3.82 15.47

Back pain 11.61 33.25

Diabetes 13.06 27.28

Hypertension 13.38 27.16

Heart Disease 62.40 110.94

Actual annual medical costs per patient based on claims data for 229,776 patients, 1995-1998.SOURCE: OCI 2001

Impact of Depression on Medical Cost

State Parity Laws

38 States/DC Have Enacted Some Form of Parity Law 5 Full or Best Parity 7 Good Parity 26 Limited Parity Laws13 Mandate Coverage of MH Services 2 No Mandates or Parity

State Parity Laws by Year

0

2

4

6

8

10

12

Year

Nu

mb

er

of

Sta

te L

aw

s

State Laws

Variations in Parity Laws

Best Parity Laws (5) Applies to All Mental Health and Substance Use

Condition No exemptions for Small Employers or Cost

Increases Same Benefits as General Health Conditions

Co-pays Limits

Good Parity Laws (7) Often Exclude Substance Use Conditions Include Some Exemptions

Variations in Parity Laws (cont)

Limited Parity Laws (26 States)Apply to Select Groups

Often Persons with Serious Mental Health Diagnoses (Schizophrenia, Bi-Polar Illness, etc.)

Includes Exemptions Often Excludes Substance Use Conditions

No Parity but Mandates MH Services (13) No Parity or Mandates (2)

Variable Estimates of Effect on Service Utilization in States Earlier Analyses by Sturm and Colleagues

(2000, 2004, 2004)Showed Limited to No Effect on Utilization Importance of Covering the ERISA Population Effects of Managed Care

More Recent Analyses by Harris et al. (2006) Increase Utilization of Mental Health Services Particularly for Individuals with Mild to Moderate

Disorders Perhaps Indicative of Greater Penetration of Parity

Laws in more Recent Years

Mental Health America Ranking Study – Depression and Suicide Integrated Data from Several National

Data Sets to Examine Relationships between System Characteristics, Depression and Suicide RatesNSDUH, BRFSS, CDC Suicide RatesMHA Parity Ratings for States

MHA State Ranking Study (cont.)

Found Significant Difference between States Parity Rating and Mental Health Service Rates. Best or Good Parity Law = 15.8% Limited or No Parity Law = 13.4%

Significant Negative Correlation between Mental Health Service Rate and Suicide Rate

Significant Positive Correlation between Rates of Depression and Service Use

Several Other Indicators or System Capacity Related to Decreased Rates of Suicide and Depression

Conclusions

MHSU Conditions Prevalent, Disabling and Expensive

State Parity Laws appear to have Increased Rates of Mental Health Service Use

Utilization of Services may be Linked to Positive Health and Behavioral Health Status in the Population.