Mental Health

How could we be so heartless?

I believe the NCPA is the only organization that has held a Congressional briefing challenging the idea of mental health parity.  We may also be the only organization that has produced (not one, but three) publications opposing the idea.

As both houses of Congress stand poised to legislate, a bipartisan effort is being led by Senators Ted Kennedy (D-MA) and Pete Domenici (R-NM) and backed by the mental health industry, one of the strongest lobbies found anywhere.  Employer and insurance groups have caved.  President Bush is also on board.  So increasingly we are alone, as the only ones with any apparent pity for the poor souls this grand coalition is out to "help."

Here's the issue: Health insurers would not be required to cover mental health at all.  But if they did, they would have to apply the same deductibles and co-payments that apply to other services. To The New York Times, the law will be a "boon to the millions of Americans who suffer" from addiction, depression and even "stress."  Yet anyone who has taken economics 101 will recall that raising the cost of something usually means fewer people will acquire it.

Here's the question:  Would you want to pay higher premiums for an insurance plan that had the same deductible and co-payment for every procedure?  Need time to think about that?  Then try this: Does it make sense to have the same deductibles and co-payments for chiropractic therapy as for setting a broken leg?  Or from the mental health field, should the payment terms that cover bipolar disorder be the same as those that apply to marriage counseling (required coverage in some states)?  Should pastoral counseling (also required in some places) be reimbursed the same way as coverage for schizophrenia?  If you have any sense, the answers are: No, No, No and No.

One way to keep insurance costs down is through incentives.  Patients should pay more of their bill when they exercise discretion and especially where patient discretion is appropriate.  In mental health, this principle applies in spades because:

  1. the illness is often experienced subjectively,
  2. there are often no objective standards for diagnosis or treatment,
  3. doctors often exercise enormous discretion,
  4. patients also exercise a lot of discretion and
  5. patient cooperation is often crucial to any cure. 

Unlike fixing a broken leg, these are precisely the conditions that make patient cost sharing highly desirable.

If I haven't convinced you so far, consider this National Bureau of Economic Research study finding: 38 percent of all mental health patients – representing 28 percent of all treatment visits – are people who do not have any mental health disorder.

No matter how bad the new law is, the proponents wish it were worse – and they won't be satisfied.  If the history of other mandates is a guide, the advocates will be back for another round in the not too distant future.

Comments (9)

Trackback URL | Comments RSS Feed

  1. And just how well is fighting the tide working for you?

    To create a check and balance to the ever increasing mandates on insurance, one needs to offer a different paradigm which offers an clear and simple option to over bundled mandated prepaid care (insurance) that everyone can understand. The problem with fighting ‘progress’ against higher insurance mandates is arguments opposing this progress are always couched in terms that it’s discriminatory against some minority not to allow adding this or that new mandate to the pie. Besides, people aren’t paying their insurance bills, employers are, so who cares?

    To get a grip on health care one must address the issue from the easily understood perspective how it’s discriminatory to prepaid (employer based) care gets tax deductibility, while post paid care gets no tax deductibility. Post paid care is defined as care paid out of pocket at the time of treatment or via loans of one fashion or another. The political reality is the unfair tax treatment of prepaid versus postpaid care is the largest ongoing form discrimination in the United States. It goes far beyond any racial, creed, or generational boundaries.

    In other words, to win the battle over health care financing, one needs to take a stand that all essential care, regardless of how it is paid, should be tax deductible, in both principle and interest.

    With such a modest change, if someone with or without insurance needs mental care that requires a lot of copays or out of pocket expenses, fine. They can go to the marketplace and take out a long term tax deductible loan to pay for that care. If after finding that living without insurance isn’t a good idea, perhaps they might also find their way to getting insurance, perhaps through the same group offering them long term health care loans. Since they are paying the bill, it’s also likely they will take a bigger role in seeing that the care provided is successful than when someone else is footing the bill. Those without insurance wouldn’t be without tax deductibility health care financing options. Sure, there would still be a fair number of folks who need assistance in paying for their care, that needs to be addressed as a welfare issue as this problem exists with or without tax deductible equality in health care payments.

    Basically, get on the pity pot and stop whining about losing another argument for more mandated prepaid care. It’s a losing attitude that will never get any traction with anyone but other losers. Frame your issue in terms that can easily be explained in terms that are understandable and that relate to the greatest number of people.

    The political reality is everyone, regardless of whether they have insurance, pays some portion of their essential care out of pocket. Why should paying for this care out of pocket not get the same tax treatment as prepaid (insurance) care? Once that bridge has been crossed, the push for adding more and more mandates on prepaid insurance become increasingly moot as all essential care would be tax deductible no matter if it is prepaid with insurance, or post paid out of pocket or via long term loans.

  2. heidwrite says:

    Who is paying for this right wing dribble? What this propaganda does not take into account is the savings in medical costs and productivity that would result if mental health was covered. Check out the recent Newsweek and the billions cited in lost productivity due to depression in men, not to mention broken lives and families and all kinds of addictions and self destructive behavior that costs us all. The 38 percent cited as an indication of how people would waste this coverage appears to assume that all these people would simply continue to get treatment. It disregard the reality that mental health professionals who struggle to get reimbursed by insurers now even for legitimate claims most likely see such patients once and tell them they are fine. It’s a meaningless statistic. Why John Goodman would be writing about a subject he knows so little about is interesting but typical of the blanket of right wing faux arguments that litter our media and now emails when any chance at bettering the life of the average American gets any play at all. Your mother must be very proud of you adding so much to the common good, John.

  3. Bob Hopper says:

    Hi John,
    Thanks for being out there on the front fighting for common sense.

    As an agent who works with clients every day, I can attest to the fact people in my area want affordable insurance to protect people from the large and unexpected medical costs.

    Over the past four months, almost all of our our major insurance carriers have raised their premiums about 15%! We get the joyful task of calling them to explain why rates rise every year at a similar rate. Needless to say people are angry.

    Almost without exception, affordability is the issue. After premiums have doubled and redoubled over the past 10 years, they are sick and tired of rate increases. The last thing they want is a new policy with mandates that increase the cost.

    If the big problem is uninsured Americans, then the number one goal should be creating affordable policies that will enable people to afford coverage.

    Finally, if we are going to be stuck with mandates, allow insurance companies to offer some plans that are mandate free. Given an option between plans with mandates and plans without mandates, the market will decide: people will buy the plans that are most affordable. I could sell mandate-free insurance all day long.

  4. Ronald E. Bachman FSA, MAAA says:

    Mental Health Parity – A Key Part of Healthcare Consumerism

    The National Center for Policy Analysis (NCPA) has been a leading advocate for a transformation of our current system to Healthcare Consumerism that involves individual ownership, personal responsibility, self-help, transparency, and portability. But, NCPA is missing the inclusion of mental health as a key part of healthcare consumerism. There have been medication breakthroughs, improved cognitive treatments, recognized mind-body co-morbidities, integrated disease management programs, and a realization of the impact of untreated mental illness on business’ bottom line. The ignorance, stigma, and discrimination against those with mental illnesses is lifting as new research demonstrates that chemical imbalances in the brain can be treated effectively with medication and cognitive therapy.

    This not a partisan issue. Republicans and Democrats alike support the legislation to remove the financial barriers to care and limitations to medically necessary treatments. This is not a conservative or liberal issue, Senators Domenici (R-NM) and Kennedy (D-MA) are co-sponsors. In the past, similar legislation passed a Republican controlled Senate with an ample majority. The barrier to final passage of mental health parity has always been the U.S. House. There were more bi-partisan House co-sponsors than were needed to pass the bill, but the House leadership rule was that no bill would come to a floor vote unless a majority of Republicans were in favor of it. Thus, the will of the bi-partisan majority in Congress was blocked by a procedural manoeuvre.

    Lacking a federal bill, mental health concerns were taken to the state political process. It is speaking anonymously and privately through elected state legislators where the consumer voices for mental health have been heard. Over the past 15 years, thirty seven states have passed some form of mental health parity. For group plans with more than 50 employees, the proposed federal legislation would take the myriad of different mandated state parity laws and create a unified voluntary approach to mental health benefits. State insurance laws do not affect the 60% of employees covered under self-insured plans governed by federal ERISA laws. Only a federal bill can create a standard definition of parity and cover both insured and self-insured plans.

    The federal non-mandated proposal allows insurers and employers to defined mental health benefits, but once defined those benefits must be paid as any other illness. If costs prove too high, there is an opt out provision. The Senate bill is a carefully crafted compromise between insurers, providers, and mental health advocacy groups. Support is broad-based. The proposal is not a mandate. It is more of a truth in marketing bill. That is, many do not realize that coverage for mental illnesses are limited under their insurance plans. Only when the condition surfaces do they find limitations, exclusions, and arbitrary decisions on what is medically necessary and clinically appropriate.

    A leading advocate for health transformation, former Speaker of the House Newt Gingrich states, “As we move into a 21st Century Intelligent Health System, we need to recognize the four aspects of human existence: physical, mental, social, and spiritual. It is one of the outrages of our current system that it fails to integrate the mental, spiritual, and physical aspects of health. An intelligent health system cannot ignore mental health. Treatment of mental illness would be an important part of the system, resulting in quicker recovery and reduction of harm. Without treatment, the consequences of mental illness include unnecessary disability, unemployment, substance abuse, homelessness, inappropriate incarceration, and suicide.”

    The cost debate is over. The Congressional Budget Office (CBO) estimates the cost of the Senate proposed federal mental health parity bill is 0.4% with a net increase in insurance costs of 0.16%. Much has been distorted about the cost of mental health coverage. With years of actual experience, we no longer need to rely on actuarial and economic estimates. Thirty seven states have implemented mental health parity over the past 15 years. Actual cost impacts have ranged from a reduction in total mental health costs (the impact of managed care providing more outpatient care and less expensive inpatient care) to negligible cost increases. The largest example is the inclusion of parity in the insurance programs offered by the Federal Employees Health Benefit Plans (FEHBP). A detailed 2005 study showed no recognized increase in cost due to mental health and substance abuse parity that was implemented in 2001 for all federal employees. There is no state or federal example that generated the cost explosions and the moral hazard of expanding access and coverage for mental illnesses that some feared.

    Many fighting mental health parity are really fighting against government mandates. Most mandates include new providers and new services not previously covered by insurance. Mental health parity is a mandate of a different sort. With the proposed parity bill, there are no new providers or services recognized under the proposal. In fact, the proposed bill does not require any mental health benefits. It does state that if mental health benefits are provided, they must be provided at parity. The proposal is really “financial parity” that requires equal reimbursement for already recognized medically necessary services provided by certified and already recognized providers.

    Many good arguments have been raised regarding the benefits of allowing employers to purchase only the benefits they want. Employers may want choices, but with employer-based insurance employees have no voice and no choice. The theory of risk-sharing, on which insurance is based, only works if the risk is spread among a large number of people. Individuals impacted by mental health have been left out of the risk pool and are essentially uninsured or underinsured for a treatable illness. The current limitations and exclusions of mental illnesses segments the risk-pool, raises overall employment costs, and hinders adequate mental health coverage for employees.

    Opponents of mental health parity insist that the marketplace will work and that employers will choose to provide needed mental health benefits for their employees. Unfortunately, the marketplace has not historically worked in this regard. The effects of mental health coverage on companies are rarely studied. Because of the nature of the illness, the stigma and historical discrimination attached to mental health, and the desire for privacy, few employees raise the issue of needing better mental health coverage to their employer.

    A November 2005 study by Dow Chemical Company in conjunction with Cornell University and the University of Pennsylvania developed an approach that models the financial impact of investing in a worker’s health. By nearly 2 to 1 over the next rated condition, clinically diagnosed depression topped the list of corporate costs. Clinical depression was not the highest direct healthcare cost, but it was by far the highest corporate costs per worker (direct and indirect costs). 4.3% of workers suffered from clinical depression, with a cost of over $25,000 per worker, more than double the $12,000 corporate per worker cost of diabetes.

    Let’s throw away the numbers for a moment and look at the lives of real people. Let me tell you about a young man, age 30, who suffered multiple inherited physical problems (a blood disorder, clotting concerns, pulmonary hypertension, and other unfathomable sources of pain and suffering). Combined with depression and the stigma of an emotional disorder, this young man was frequently non-compliant with medical care and treatment. Unlike other physical illnesses, depression typically causes a patient to avoid care, to push away the very help that is needed, to push away family support and friends that care. The stigma of a mental illness…. No young strapping 6’5” 260 pound young man wants his forehead stamped with the stigma of mental illness. He was not going to be classified as “crazy”, see a “shrink”, or go to a “nut house” for care. No, he was a high school basketball star with the athletic promise of the few boys his size. In his mind, he didn’t need care, he was who he was. He didn’t accept or understand chemical imbalances. Real men were strong enough.

    On April 29, 2005 the years of depression and physical decline took its toll. Lots of expensive medical care was provided but little attention was given to the mental illness. The death certificate read pulmonary hypertension. But, I can tell you the real cause of my step-son’s death was stigma and major depression that prevented this young adult from seeking or accepting the medical and life supporting mental health care that he needed.

    Let’s provide all the numbers people want. Let’s get it all on the table. But never forget, this is not about numbers. It’s about people and saving lives. It’s about young men and women who need medical care for co-morbid conditions like clinical depression and diabetes, cancer patients, heart patients, and others. You can’t treat the other medical conditions if personal responsibility and compliance are blocked with a mental illness.

    Transformation is underway. Healthcare Consumerism with products like Health Savings Account eligible plans and Health Reimbursement Arrangements will only work if they solve our country’s most difficult health and healthcare problems (e.g. uninsured, Medicaid, Medicare). We need a system that is inclusive of medically needed care. Surely, in that world an individual using their own account balance for mental health services should have those dollars count towards the plan deductible and maximum out of pocket costs. But, such is not the case….yet.

  5. Lee H. Beecher, MD says:

    Concerning mental health parity, I see no reason why psychiatric care should be considered any less coverable than any other primary care or specialty care. Arguments to cover the "biologically based" diagnoses or dug treatments v. psychotherapy are ill advised because the medical paradigm of "bio-psycho-social" (George Engle) applies to all medical conditions. The real issue is the fallacy of mandating a one-size-fits-all approach to the "basic" insurance benefits based on diagnoses. Rather, we do need (true) insurance coverage owned by patients that protects them against the costs of unforeseen and expensive care. I would not mandate coverage of (preventive) outpatient services including mental health. What to cover is subjective and political; and, except arguably for immunizations and hospital sanitation, is not truly a public health issue. By mandating certain diagnoses rather than designing insurance as a financial protection, we reduce the opportunity for providers to respond to the needs and preferences of patients with differing diagnoses, combinations of conditions, priorities, language and culture. Clearly we in organized medicine need to make epidemiolological research easily availble to all patients, their representatives, and advocates. Everyone in America should have a a catastophic insurance benefit which covers hospital care and expensive outpatient services. Public policy should be directed to subsidizing the insurance for those generating no or low income, and offering a limited tax deductibility for catastophic protection for the rest of us. Concerning preventive care, I'd recommend patient discretion in deciding on what this should be spent (informed consent). Patients will see the advantages of "evidence-based" preventive screening and interventions when they have a stake in paying for it. Market competition will bring down the costs of tests and imaging when prices are transparent to patients and providers. We need to fight restrictive insurance provider networks based on low-balling provider fees or insurance contracting with big clinics who employ their poviders. What patients spend their HSAs on is best left to the patients. If they choose to buy an HMO, government mandates may be necesary to protect the patients from the HMOs (cutting care access in Minnesota) as long as there is no true compettition among the HMOs for patient allegiance. Lee H. Beecher, MD

  6. Lee H. Beecher, MD says:

    George Engel's Biopsychosocial Model

  7. […] explained previously here, here, here and here, mental health services frequently have the very characteristics which make […]

  8. What's Really Broken? says:

    All I know is this: had I not received mental health care (individual and group therapy over a period of 4 years) AND had I not followed that excruciating but rewarding/enlightening treatment with an antidepressant/anti-anxiety medication, I would not have been able to hold down a job for more than a year. I have a B.S. Biology (barely earned due to depression); I had two young children at the time; I soon left an alcoholic husband and destroyed marriage. Within a short time, I not only secured the best job I’d ever had (for 5 years), I also doubled my income within 4 years. I was able to provide for my girls, and I was able to enjoy life quite a bit more. One more comment: The 4 years of therapy were hell. I went up and down the rollercoaster of depression, and was always anxious. When I finally hit the lowest point of depression, I told my therapist that I must get on a medication. Within two or three days I felt “normal” – the first time (since I was a child?). I was angry: it appeared that my brain was simply an organ simply needing more help! So why had I gone through that hell of therapy? Well, all I can say is that there’s some serious unlearning some of us must do; had I not felt the emotional pain (i.e., had I been restored to “normal” by Rx), I most likely would have foregone the therapy. And I can honestly tell you that both were critical to my mental health and well-being. Sometimes, even with Rx, I can get into a hellish internal emotional state (if I were speaking with a therapist on a regular basis, I could probably deal properly with it, in very short order). By the way, before I got into therapy I was running 2-3 miles a day, doing 1/2 to 1 hour of yoga a day, all before my family awakened, through all seasons, winter, too. It was hard work! It was the only way I could seem to both calm down the anxiety as well as lift my mood. But the interesting thing was this: I wasn’t correcting my erroneous thinking (I didn’t go to church, which is where, in my mind, a lot of us get our recommended allowance of sanity and correction). I was still sick. I eventually was injured, by yoga, no less, and the down-hill slide began.

  9. What's Really Broken? says:

    It occurs to me, a conservative, that if mental health care is offered to those who seriously need it, at a very reduced rate if need be, then we’d be doing the individual AND society a great deal of good.

    But there is this one Reality, and it is CRUCIAL: a person can only benefit from mental health care if s/he WANTS it, and seeks TRUTH. We cannot force people to want it/to be truthful, anymore than we can force people to want to quit drugs. (I suppose a very grand, consistent, constant advertising campaign might work to make people want it?)

    Of course this all relates to the breakdown of our society: God on the back burner, families destroyed.