Credit: (AP Photo/Susan Walsh)Nonprofit leaders, healthcare professionals and state lawmakers across New Jersey welcomed a change in federal regulations to improve access to mental health and substance use care for 175 million people across the country with private health insurance.
The final rule, announced earlier this month by the Biden administration, seeks to strengthen a 2008 federal law that requires group health plans and health insurance companies to cover mental health or substance use disorder services the same way they cover physical health care services. Despite the Mental Health Parity and Addiction Equity Act being in place for over 15 years, too many people across the country still struggle to find and afford the care they need, according to the White House.
“I’m happy to see this rule with a little bit more detail and putting more responsibility on the health plans to ensure parity between physical and mental health,” said Brigitte D. Johnson, the president and chief executive officer of CarePlus NJ which provides behavioral health services, medical care and social services in northern New Jersey.
Across the country, 15.4 million adults in 2022 had a serious mental illness in the previous year, and about one-third of these did not receive mental health treatment within that same period, according to a 2023 report from the federal Substance Abuse and Mental Health Services Administration. Additionally, nearly 70% of children who seek care for mental health or substance use issues cannot get it, in part because insurers too often make it difficult to access mental health treatment, according to the Biden administration. This causes millions of consumers to have high out-of-pocket costs because they go out of network or defer care altogether.
Access has been impeded
Former state officials, including Dawn Apgar of Seton Hall University, say that the federal rule is a “step in the right direction” as it clarifies some ambiguities and closes some loopholes in the existing law.
“Time has showed us that the reasons [people are still not getting parity] are that some of the language is not clear, the processes are not clear and the burden placed on the insurance companies to deny coverage is maybe not stringent or hard enough,” said Apgar, an associate professor of social work and a former deputy commissioner at the state Department of Human Services.
“What this is really doing is making it more difficult for insurers to deny that needed coverage,” Apgar said.
The new requirements under the federal rule aim to ensure that health plans evaluate how much they pay out-of-network providers and how often they require — and deny — prior authorizations, among other measures. Prior authorization, sometimes called precertification, requires a patient to wait for their health insurer’s review of medical treatments before the company decides to cover them. It’s a tool that health insurance companies say reins in costs and protects patients from unnecessary or ineffective medical treatment.
‘I would say that this new parity rule really engages both providers and payers, and mostly consumers, to start to define what is it that we really want.’ — Patrick Kennedy, Healthsperien health care policy consulting firm
These evaluations will show insurance companies where they are failing to meet the law’s requirements, the Biden administration says, and where they will need to make changes to come into compliance, like adding more mental health and substance use professionals to their networks or reducing red tape for providers to deliver care.
In just the last year, Kennedy said he has been called by a former colleague who is a sitting member of Congress, a news anchor at a major network and a senior executive at Goldman Sachs to help them or their family members get access to mental health treatment.
“If you’re a personality on television that everyone can recognize, if you’re a member of Congress, if you’re at the elite level of financial services and you need to call Patrick Kennedy to help you or your family get access to treatment, something’s seriously wrong,” said Kennedy, who now leads the national mental health and addiction policy practice at Healthsperien, LLC, a Washington, D.C.-based health care policy consulting firm.
“And that’s taking aside all of my neighbors who are trying to look for something timely for their family member that’s in their network,” Kennedy said in an interview with NJ Spotlight News.
Curbing prior authorizations
Under the new federal rule, health plans cannot use more restrictive prior authorization, or other medical management techniques, or “narrower networks” to make it harder for people to access mental health and substance use disorder benefits than their medical benefits. Health plans would also have to use similar factors in setting out-of-network payment rates for mental health and substance use disorder providers as they do for medical providers, according to the Biden administration.
‘What this is really doing is making it more difficult for insurers to deny that needed coverage.’ — Dawn Apgar, associate professor of social work, Seton Hall University
Health care professionals, including Dr. Frank Ghinassi of Rutgers University, said they are hopeful that the new rule ensures precertification requirements are no more onerous for behavioral health than they are for physical health and that the co-pays for psychological disorders are no higher than they are for physical health disorders.
“I hope that they pay a living wage for behavioral health services such that most, if not all, behavioral health providers are willing to accept insurance payment as payment in full, driving up access,” said Ghinassi, the president and chief executive officer of Rutgers University Behavioral Health Care.
“But that means that what’s paid per hour per session by insurance companies is going to be enough to convince behavioral health providers that they can make a respectable living on that,” said Ghinassi, who also serves as the senior vice president of the behavioral health and addictions service line at RWJBarnabas Health.
NJ law
In 2019, Gov. Phil Murphy signed a law mandating health insurers provide coverage for mental health conditions and substance use disorders under the same terms and conditions as provided for any other sickness and to meet the requirements of the 2008 federal law.
The new federal rule also aims to close a loophole in the 2008 law that did not require nonfederal governmental health plans, like those offered to state and local government employees, to comply with its requirements. The new rule will require more than 200 additional health plans to comply with the Mental Health Parity and Addiction Equity Act with the aim of providing protections to 120,000 consumers, according to the Biden administration.
While the federal regulation is an “important and necessary” first step in closing loopholes and clarifying language, Apgar of Seton Hall University is still concerned the new rule allows insurance companies and providers to monitor themselves, which may not be adequate to ensuring parity for those in need of critical mental health and substance use services, she said.
“This is positive. However, the degree to which it actually translates into people receiving comparable care for mental health and substance use is still to be seen,” said Apgar. “It’s good, but we’ve had this legislation since 2008… We’re still fighting for parity 16 years later.”
