Building on Behavioral Health Parity: State Options to Strengthen Access to Care

The United States has a growing need for behavioral health services, particularly since the pandemic, which worsened the longstanding gap between demand for services and available treatment. In 2021, 57.8 million adults had a mental illness and 46.3 million people 12 and older had a substance use disorder. The consequences of untreated illness are myriad, ranging from economic costs to premature and preventable deaths.

Since 2008, the federal Mental Health Parity and Addiction Equity Act (MHPAEA) has sought to make it easier for people to obtain treatment for mental health and substance use disorders by requiring health plans that cover these conditions to do so on par with other health needs. For example, the law prohibits health plans from charging higher copayments, separate deductibles, and/or imposing stricter requirements (e.g., preauthorization or medical necessity reviews) for these services than they do for other covered treatments.

While states have made strides in ensuring individual and group health insurance coverage complies with MHPAEA, challenges remain, particularly for barriers to treatment that aren’t easily measured. States’ efforts are helped by new federal funding for state enforcement and a 2021 federal law requiring insurers to share with regulators their internal documents that show how they designed and applied treatment limits so that mental health and substance use disorder benefits aren’t subject to stricter limits than are other types of medical care.

Stricter Oversight of Insurers’ Actions

Many people seeking behavioral health care can’t find an in-network provider and, if they can find one, recommended treatments are often not approved for payment. Barriers like these present distinct challenges for regulators because they’re not quantitative in nature (i.e., they don’t involve visit limits or copayments). Some states are taking steps to ensure these coverage limits aren’t being misused.

For example, states including New Hampshire, Massachusetts, and Maryland have scrutinized insurers’ approaches to setting reimbursement rates for mental health providers. Studies have found that reimbursement rates for mental health providers have lagged those paid to other providers, contributing to inadequate behavioral health networks. Insurers’ reimbursement approaches that result in lower payments to behavioral health care providers compared with other providers may violate parity rules.

New York, working in tandem with the U.S. Department of Labor, took action against UnitedHealthcare for using more restrictive standards for provider reimbursement and utilization review for mental health services than for other services, resulting in more denials and higher costs for mental health care. Other states, including Connecticut, Delaware, and Illinois have taken similar actions.

Raising Standards for Behavioral Health Coverage

In addition to stronger oversight, states can set stronger standards for coverage of mental health and substance use treatment. Several states require insurers to meet clear standards for claim review practices that can make it more difficult for behavioral health treatments to be approved. For example, Delaware and Illinois limit the use of prior authorization for substance use disorder treatment and for prescription drugs that treat substance use disorders. Delaware limits the use of concurrent review for substance use treatment. Beginning in 2024, New Mexico will restrict the use of prior authorization for substance use treatment, including prescription drugs, and for certain types of treatment for acute or chronic mental illness.

Some states have defined the coverage of mental health benefits in statute by requiring coverage of all the conditions listed in the comprehensive Diagnostic and Statistical Manual of Mental Disorders (DSM). In addition, some states have established medical-necessity standards that require insurers to use “generally accepted standards” developed by clinical experts for evaluating coverage decisions, rather than allowing insurers to develop those standards internally and be guided primarily by financial considerations. Several states, including California, New Mexico, and Oregon, reference the DSM and require the use of generally accepted standards. Connecticut, Delaware, Illinois, and Oregon are among the states that require the use of specific expert standards such as those developed by the American Society of Addiction Medicine, which define the services and levels of care that are recommended for the treatment of specific types of mental health and substance use disorders.

Behavioral health provider networks are woefully inadequate to meet need. One study found consumers were far more likely to obtain care out of network for behavioral health conditions than for other care. In addition to setting strong network adequacy standards, states can bolster access to behavioral health providers in other ways. Beginning in 2024, New Mexico regulators must review insurers’ approaches to determining reimbursement rates when reviewing plans for network adequacy. In Oregon, insurers must annually report data on nonquantitative limits to coverage, including reporting how the reimbursement rates for behavioral health providers compare with those for other providers.

Looking Ahead

Ensuring access to behavioral health services will require a comprehensive set of policies to combat workforce shortages and other systemic problems. But enforcing the mental health parity law is an essential step, and federal policymakers have recognized that with $10 million for states to review insurers’ approaches to nonquantitative treatment limits.

States have an opportunity to enhance behavioral health benefits by adopting standards that eliminate opportunities for treatment limitations to occur, making it easier to enforce mental health parity. Setting standards for access to care, in addition to stronger parity enforcement, can ensure behavioral health services are covered on par with other health needs.