Health Insurers Still Don’t Adequately Cover Mental Health Treatment

The 2008 Mental Health Parity and Addiction Equity Act, Affordable Care Act, and state mental health parity laws require certain health care plans to provide mental and physical health benefits equally. And yet, insurers are still not covering mental health care the way they should. Below are two of the main reasons why, and how individuals are fighting back.

Inadequate Provider Networks

Parity laws mean nothing without “network adequacy;” that is, whether a plan has enough in-network providers to meet the needs of the plan’s members in a geographic area. When health insurance companies have an inadequate network of professionals to provide mental health care in a given area, they effectively discriminate against people needing that care. An inadequate network forces plan members to:

• Wait for long periods of time before getting treatment
• Travel great distances to see an in-network provider
• ​See a professional outside of their network at a high out-of-pocket cost

Studies show that network adequacy for mental health treatment is a real issue. A 2019 report found that a behavioral health office visit is over five times more likely to be out-of-network than a primary care appointment. A 2016 NAMI report also found that people had more difficulty finding in-network providers and facilities for mental health care compared to general or specialty medical care. Often, going out of network was the only option for treatment. And individuals reported difficulty finding correct information about the in-network providers for their health plans.

Why do so many plans lack in-network providers for mental health and substance use care? A couple of reasons: One, there are shortages of mental health professionals in general, and particularly in certain parts of the country. Two, many mental health and substance use providers do not accept insurance because they do not get paid enough by insurance companies for their services.

There is some hope to address network adequacy issues. Under the Affordable Care Act, qualified health plans have to meet network adequacy standards and “maintain a provider network that is ‘sufficient in numbers and types of providers, including providers that specialize in mental health and substance abuse services, to assure that all services will be accessible without unreasonable delay.’”

In 2018, a class action lawsuit was brought against companies that sold Ambetter health plans for an inadequate provider network. The lawsuit alleged that fewer doctors or hospitals actually participated in Ambetter’s networks than the companies claimed, people had trouble finding providers who would accept Ambetter insurance and lists of Ambetter’s in-network providers were inaccurate. The lawsuit currently alleges breach of contract claims and violations of the Washington State Consumer Protection Act.

Unreasonable Criteria to Qualify for Coverage

In addition to inadequate mental health provider networks, health insurance companies also sometimes use restrictive standards to limit coverage for mental health care. These standards often include criteria that plan members must meet in order to qualify for coverage or treatment. Often, these standards make it extremely difficult to get treatment covered unless a plan member is very ill.

Another class action lawsuit brought in California has successfully challenged the use of such guidelines in making coverage decisions. In Wit v. United Behavioral Health, individuals sued a plan benefits administrator because they were denied care for outpatient, intensive outpatient, or residential treatment for mental health or substance use. These denials were all based on the plan members’ failure to meet criteria in level of care or coverage determination guidelines.

The court found that the guidelines used by United Behavioral Health strayed greatly from the generally accepted standards of care for mental health and substance use treatment.  For example, the guidelines:

• Focused excessively on treating and addressing acute symptoms and stabilizing crises while ignoring effective treatment of underlying conditions
• Failed to provide for effective treatment of co-occurring conditions
• Actively sought to move patients to the least restrictive levels of care even if it might be less effective
• ​Did not meaningfully address different standards that should apply to children and adolescents when treating mental health and substance use

The court further concluded that the process for developing these coverage guidelines was influenced by the company’s financial interests. It ruled that United Behavioral Health breached its duties of loyalty, due care, and duty to comply with plan terms. The court also found that United Behavioral Health’s denial of benefits was arbitrary and capricious.

Barriers to health insurance coverage for mental health and substance use treatment still exist despite parity laws. But plan members are fighting back in court. If you feel you’ve been unfairly denied coverage for mental health or substance use treatment by your insurance company, you’re not alone. There are resources available to help you appeal coverage denials. And when all else fails, consider calling your friendly neighborhood health insurance coverage lawyer for advice.

Guin Becker Bogusz is an attorney at Gordon Tilden Thomas & Cordell LLP in Seattle, Washington. You can learn more about her practice here.