By Jenny Gold
August 3, 2015
When it passed in 2008, the federal mental health parity law was supposed to be a major achievement for Americans with mental illnesses.
Historically, people seeking mental health care often faced higher copayments and deductibles and more limited access to treatment than those with other conditions. The parity law was intended to fix that, ensuring they could get the treatment they needed with the same ease as patients with cancer, diabetes, or any other ailment. Though some states already had their own parity laws on the books, there were serious gaps in the protections they offered.
At the time, Sen. Edward Kennedy (D-MA) called the law "historic," and praised his colleagues for finally ending "the senseless discrimination in health insurance coverage that plagues persons living with mental illness."
But seven years after the federal law passed, many families say it has fallen far short of expectations. Researchers, attorneys, and other critics say patients with mental illnesses continue to face discrimination — largely because insurers have continued to limit treatment through strategies that are subtle and difficult to track.
Enforcement of parity law, meanwhile, has been relatively lax. So far, the US government has not taken a single public enforcement action against an insurer or employer for violating the federal law. And only a handful of states have dug into whether insurers are complying with their parity laws.
Henry Harbin, Maryland's former mental health director who now consults on the issue, said insurers are taking advantage of the minimal oversight.
"They can micromanage care down to almost nothing," he says. "The enforcement in this area is a joke."
Some who worked on the law feel similarly, saying the Obama administration has been soft on enforcement to avoid angering health insurance plans, a group that helped pass the Affordable Care Act in the first place.
"Insurance companies were part of the coalition that helped bring the ACA to life, and the administration feels an enormous debt of gratitude," says Patrick Kennedy, the former congressman from Rhode Island who helped pass the parity law. "It's a challenge politically to then step on the toes of those that brought them to the dance."
Health insurers disagree. Clare Krusing, a spokesperson for America's Health Insurance Plans, the industry's main trade group, said it is "a misperception" that enforcement has been weak. Insurers are working closely with federal and state governments, she said, and "have taken tremendous steps to implement these changes and requirements in a way that is affordable to patients."
Still, ensuring that mental health and other medical treatments are exactly on par has been a challenge for the industry — largely because they often demand different courses of treatment.
"A treatment plan for diabetes or a chronic heart disease is very different from a treatment plan for a patient that's seeking care for depression or another mental illness," she said. "It's not a math formula."
More than 43 million Americans ages 18 or older — about one-sixth of all adults — reported having a mental illness in 2013, not including substance abuse disorders, according to survey data by the Substance Abuse and Mental Health Services Administration (SAMHSA). Of those, the agency found that fewer than half received any treatment, citing cost as the biggest barrier.
Before the parity law passed, insurers frequently limited mental health treatment by making patients pay a greater share of costs than for other types of care, and by putting hard limits on the number of visits a patient could have annually. In 2002, for example,just 12 percent of covered workers received unlimited coverage for outpatient mental health visits.
By requiring equal coverage, the federal parity law went a long way toward eliminating such obvious, quantifiable discrepancies.
Research shows, for instance, that most insurers have dropped annual limits on the therapy visits they will cover. Higher copayments and separate mental health deductibles have become less of a problem. In 2011, a survey by Aon Hewitt found that just 6.5 percent of employer-sponsored plans still had outpatient visit limits for mental health and substance abuse treatment, a marked contrast to 2002.
But research also points to continuing inequities when it comes to less hard-and-fast decisions about coverage.
Data compiled on health plans in 2010, the first year of the national parity law's implementation, found that insurers frequently reviewed mental health treatment more strictly than other care. For instance, they more often required "preauthorization" for doctor visits or made patients "fail first" at one level of care before getting approval for another.
A study this year from the Johns Hopkins Bloomberg School of Public Health found that a quarter of the plans sold on two state Obamacare exchanges appeared to violate the federal parity law in various ways, including requiring higher cost sharing for mental health. The states, one large and one small, were not named.
Among the murkier areas of insurer compliance is "medical necessity" review — in which insurers decide whether a patient requires a certain treatment and at what frequency. Ina 2015 survey by the National Alliance on Mental Illness, an advocacy group for mentally ill people and their families, patients said they were denied payment because treatment was deemed "not medically necessary" twice as often for mental health as for other medical conditions. "'Medical necessity' is the insurers' last hurrah," said Meiram Bendat, an attorney and psychotherapist who runs a law firm in Los Angeles focusing on mental health cases and has filed several cases alleging violations of parity law. "Insurers have become much more crafty at coming up with protocols that are not expressed numerically, that are more difficult to spot."
One of Bendat's clients is Michael Kamins, who sued his insurer in a dispute over the coverage provided to his young adult son who has bipolar disorder.
His son, then 20, had been hospitalized twice after a recent suicide attempt, Kamins said. At first, the insurer paid for visits with the psychiatrist several times each week. But a few months after the second hospitalization, the insurer explained it would no longer cover such regular visits. Instead, the company claimed it was only "medically necessary" for him to see a psychiatrist twice a month.
"There was steam coming out of my ears," Kamins recalled, his face reddening at the memory. "This is my kid's life!"
With limited treatment, Kamins says his son again became suicidal and violent. Eight months later, he ended up in a psychiatric hospital again.
Kamins filed the suit in New York state court in June 2014, becoming one of just a small group of people around the country to sue alleging federal or state parity laws were violated when patients with mental illness were held to a stricter standard than those with other medical conditions.
Bendat, who is seeking class-action status in the Kamins case and has filed other parity suits in New York, Illinois, and California, said attorneys are acting because the government hasn't.
The federal government does not have one specific agency overseeing the implementation of mental health parity. Instead, a complex web of agencies shares jurisdiction. This includes the departments of Labor, Health and Human Services, and Treasury, as well as state insurance commissioners.
Most consumers don't know they have new rights, advocates say, and those who do often don't know where to turn for redress.
"It gets very complicated for the average person," said Carol McDaid, who runs the Parity Implementation Coalition, an advocacy group created to make sure parity laws are properly enforced.
"They're already in a [mental health] crisis, looking for help, and they don't know if they should write and complain to their state insurance commissioner, the Department of Labor, the health department. It gets very difficult."
The Department of Labor, which is responsible for monitoring employer-sponsored coverage, set up a complaint line for consumers. But since 2010, just 867 of the 1.5 million total health insurance inquiries made to the Department of Labor had to do with the parity law, most of which were not complaints, a spokesperson for the department said in May.
Of those, a total of 140 alleged parity law violations were found. All were resolved through "voluntary compliance," in which the employer agreed to pay for the patient's services, the spokesperson said. He said that the investigators also requested that the insurers change their broader policies when they appeared to violate parity law.
Separately, officials at Health and Human Services found 196 possible violations of parity law by insurers from September 2013 through September 2014, a spokesperson said. In each case, she said, plans voluntarily made changes or told the agency they believed their plan was in compliance with the law.
No federal agency has taken any public action such as filing a lawsuit or levying a fine. Mental health advocates say the confidential agreements in individual cases were not subject to wider scrutiny and set no broader standard for insurers.
"Our problem is that these investigations are all kept secret," McDaid said. They have no effect on what other employers or insurers do, and consumers don't learn what to look out for, she said.
Without strong government enforcement, patients and families say they are largely left to their own devices. But demonstrating that an insurer has violated parity rules requires a detailed analysis of a plan's mental health and medical benefits. And though the law requires that insurers disclose that information, critics say they often do not comply.
The Parity Implementation Coalition in Washington, DC, has received hundreds of consumer complaints to its helpline, McDaid said. But she said virtually no insurers will release documents that would allow a detailed comparison of how coverage determinations are made in mental health versus other health cases.
Krusing of the insurers' association insisted that such documents are being made available to patients and providers upon request. "Plans are committed to being transparent about their coverage decisions," she said. Decisions to deny treatment, she said, are based on ensuring that patients receive care based on the best medical evidence.
"We are still at a point in the health system where patients face wide variation in the type of care they're receiving," she said. "Oftentimes we see tests and procedures done that are costly and unnecessary for the type of care that they're seeking or even help or benefit their condition."
The federal government is considering whether to tighten disclosure rules for insurers. In the meantime, some consumers, including the Kamins, are turning to the courts.
Kamins's son had always been a star, according to his father, who holds his power of attorney and asked that the young man's first name be withheld for privacy reasons.
A few months after heading to an Ivy League college, however, he started experiencing symptoms of depression, his father said. His grades slipped. He stopped eating, going to class, or getting out of bed. He began experimenting with drugs, including cocaine. Then, in the spring of 2011, he tried to kill himself in his dorm room, according to Kamins and his lawsuit.
His parents brought him home to Los Angeles, where the family lives while the elder Kamins commute back and forth to New York for his work. The family had a robust insurance policy through Kamins's job, so Kamins called the top-rated residential psychiatric programs in the area.
But Kamins alleged that his insurer, OptumHealth Behavioral Solutions, would not cover inpatient care before his son had tried an outpatient program that focused on drug addiction.
That marked the first of several violations of parity law, Kamins's lawsuit argues. By requiring the young man to "fail first" at a lower level of care before paying for more expensive residential treatment, Optum, a subsidiary of UnitedHealth Group, had created an unfair and illegal obstacle to mental health treatment, the lawsuit alleges.
"Imagine someone going to a hospital and being told you can't get open-heart surgery in the midst of a heart attack because you haven't tried aspirin or nitroglycerine first. That's the absurdity of it," said Bendat, the Kaminses' lawyer. "It's just a way to discourage higher levels of care that we would never tolerate in the non-psychiatric context."
In a written statement on the current case, Optum officials said they "take the mental health needs of each of our members very seriously, and we are committed to helping them get care that has shown to be most effective in helping people overcome and live better with mental and emotional challenges."
The lawsuit contends Optum made it much more difficult for Kamins's son to get mental health treatment than it would for other conditions.
When Optum wouldn't cover his son's regular psychiatry visits, Kamins tapped into his retirement funds to cover the costs. But his son spiraled downward and landed back in a psychiatric hospital.
That's when Kamins decided to sue.
"The irony in all this is that Optum fights tooth and nail to dole out care for my son. But had they allowed him upfront to get the care he needed, he might not have ended up back in the hospital, which they had to pay for," he said.
Added his attorney, Bendat: "They're businesses, and they operate to make a profit. When they wake up and realize it doesn't make good financial sense for them to skirt parity, then we might get some traction."
As for Kamins's son, he returned to college in the fall of 2013. The next year, his father's employer contracted with a new insurer, which Kamins said gave the young man greater access to care and helped him stabilize.
Now 23, he is scheduled to graduate next year.