By Isabel Present, CEVR Student Intern
One out of five Americans who lost their job during the COVID-19 pandemic is now uninsured.
This has come at a time of increased need for health care, and in particular, mental health services. In mid-July, 53 percent of Americans believed that the pandemic negatively impacted their mental health, a twenty-one-point increase from March. Use of the federal emotional distress hotline increased by 1000 percent in April, with significant increases in suicides, substance abuse, and overdose deaths. This rising need for mental health services will soon exceed the capacity of psychiatric services in America.
Yet even for those with insurance, coverage for mental health services has historically been limited at best despite legislation requiring mental health parity. Parity is intended to compel insurance companies to provide the same benefits—such as the number of fully covered visits and maximum out-of-pocket deductibles—for mental health services as they do for physical health procedures.
The first major step toward parity was taken with the 1996 Mental Health Parity Act. This law restricted insurance companies from imposing higher annual and lifetime limits on patient out-of-pocket spending for mental health than physical health. The law, however, only applied to employer-sponsored plans at workplaces with more than 50 employees. Additionally, insurance companies could wave the parity requirement if they could prove that their costs increased by greater than one percent.
In 2010, the Mental Health Parity and Addiction Equity Act (MHPAEA) attempted to remedy some of the earlier act’s limitations. Passed as part of the Affordable Care Act, the MHPAEA required almost all plans to provide equitable physical and mental health coverage regardless of the number of employees a company has. The MHPAEA still does not require parity in reimbursement rates and allows insurance companies to refuse to cover out-of-network mental health care. The bill also does not apply to Medicare, the Veterans Administration, and some state Medicaid programs; these three programs provide coverage for 41 percent of insured Americans.
Regulations requiring equal reimbursement rates for telemedicine and in-person visits are even further behind mental health parity. Only 29 states and Washington, DC enforce telehealth parity, allowing insurance companies in other states to reduce the amount they are willing to pay for virtual services compared to traditional in-person medical visits. Due to a lack of federal guidelines, insurance companies in non-telehealth parity law states can also change their willingness to cover virtual care depending on the specific policy and benefit plan. Telemedicine is largely regulated on a state-by-state basis, creating disjointed messages around payment, privacy, and quality of care requirements.
The COVID-19 pandemic has exacerbated the need for mental health services. A partial outcome of the “stay at home” policy response to the pandemic is the growing acceptability of telemedicine, showing us that despite some inconsistency and implementation challenges, we can expand healthcare access through a virtual system. As we begin to imagine a post-pandemic world, we must place both physical and mental health parity within our legislative priorities in order to create a more equitable, accessible, and affordable future health care system.