Why insurers should cover mental health care to lower costs

Insurers still find ways to deny mental health coverage.

The latest trend among adolescents is deadly. 

The suicide rate for people ages 10 to 14 tripled from 2007 to 2017, according to a recent report from the Centers for Disease Control. And in 2017, suicide was the second leading cause of death for Americans ages 10 to 24.

Doctors like me have long stressed that similar to any physical illness, mental illness can lead to harmful consequences. When left untreated, mental illness can potentiate physical conditions like heart disease, resulting in even more expensive treatment needs. And depressed patients have an increased risk of other major chronic illnesses—like diabetes and stroke.

But all this often goes unacknowledged by the insurance industry. Even in the midst of a youth suicide epidemic, in an effort to cut costs, many payers erect barriers to treatment for common mental illnesses by neglecting legal requirements and setting low reimbursement rates for mental health professionals.

This is more than irresponsible—it’s also counterproductive. If insurers really wanted to keep costs down, they’d expand coverage for mental health services—not limit patient access to care or make it difficult for mental health professionals to accept insurance.

The recent spike in youth suicide is part of a broader public health crisis. According to the National Institute of Mental Health, 17.3 million Americans had at least one major depressive episode in 2017. The nation’s suicide rate has jumped 33% since 1999. And the rate of death from drug overdose rose by nearly 10% between 2016 and 2017.

In one case, a Minnesota resident lost his life after his insurance wouldn’t cover more mental health treatment, according to Bloomberg. He spent a few weeks at a treatment center dealing with a heroin addiction, but his insurance wouldn’t cover a longer stay. Soon after he was brought home, he died of an overdose.

The rise in suicides and drug overdoses have contributed to a three-year decline in U.S. life expectancy—the longest decline in a century. 

Many insurers don’t cover mental health services at all. However, a 2008 law requires those that do offer mental health services to make those benefits “comparable” to physical health coverage, according to the American Psychological Association. This federal parity law applies to a number of different insurance plans, including some employer-sponsored coverage and plans purchased through the Affordable Care Act exchanges. 

While this law is meant to eliminate the disparities between physical and mental health coverage, insurers have found ways to circumvent that requirement. Health plans have the ability to exclude certain categories from their coverage, according to The Atlantic. For instance, insurers often refuse to cover treatments, ranging from therapy to antidepressants, on the grounds that they aren’t considered of medical necessity.

Consider this report from NPR: A woman in New Mexico struggled with an eating disorder, only consuming about 100 calories daily. She tried entering an inpatient treatment program in 2017, but even after losing 60% of her original body weight, she wasn’t eligible for Medicaid coverage unless she lost another 10 pounds, or entered a psychiatric unit. (She eventually enrolled in another plan, but “it was still an arduous process getting the services approved,” says NPR.)

Insurers also make it hard for patients to find in-network mental health professionals. According to a 2017 survey by the National Alliance on Mental Health, about one-third of respondents said they had difficulty finding a therapist who took their insurance. Meanwhile, just 9% had trouble finding an in-network primary care doctor.

This disparity exists because insurance companies typically pay mental health professionals less than they pay other providers. In 2017, primary care reimbursements were about 24% higher than behavioral reimbursements. And, in 2014, private insurers paid mental health providers 13% to 14% less than what Medicare paid for the same services. 

Many mental health professionals simply can’t afford to accept insurance—they’d be forced to close their offices. A 2014 JAMA Psychiatry study found that few mental health professionals accept insurance. And for many who do, they often struggle to offer quality care. A thorough mental health workup can take hours. But due to low reimbursements, some psychiatrists have to pack their schedules to make ends meet—that means spending less time with each patient.

Consequently, many patients are forced to visit providers who don’t accept their insurance, which often means facing prohibitive out-of-pocket costs. According to a recent report from JAMA Network Open that reviewed claims from 2012 to 2017, patients with drug-use disorders paid around $1,200 more on average for out-of-network care annually than patients with diabetes.

Refusing to cover mental health care during a suicide epidemic is absurd. It’s also not economically cost effective: In 2016 alone, treating chronic diseases cost $3.7 trillion in the U.S, according to a Milken Institute report. If insurers invested more on mental health care and expanded coverage, it may actually slash spending on chronic diseases over time. And more importantly, it might save lives.

Liat Jarkon, D.O., M.P.H., is director of the Center for Behavioral Health and Assistant Professor of Family Medicine at NYIT College of Osteopathic Medicine.

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