“The interim regulations were good, but the language was not tight enough and opened the door to non-compliance by health insurers,” said Dan Meara, spokesman for the New Jersey affiliate of the National Council on Alcoholism and Drug Dependence, or NCADD-NJ. The final rules addressed some of the problem areas, but there may still be more, he said.
The interim rules, for instance, did not address some common practices insurers use to restrict coverage, such as “medical management,” where they restrict treatment geographically or put limits on the scope or duration of treatment, Meara said. Insurers historically applied these restrictions more harshly on treatment for mental health than on treatment for physical ailments, or what’s often referred to as medical/surgical, Meara said. Insurers also applied the prior authorization rule more frequently on the mental health side. Under the parity law, insurers can no longer do that, Meara said.
The final parity rule also addressed what is known as “fail first” practices, where insurers require individuals to first exhaust low-level services and fail before being covered for more intensive, costly services, like inpatient care. Again, it was a policy applied far more frequently on the mental health side than on the medical/surgical side.
“Insurance companies are going to try to find ways around everything there,” Meara said. “Some won’t, but some will absolutely try to minimize coverage.”
It’s also unclear who will enforce the law if insurance companies fail to comply, Meara notes. What if an assessment finds someone needs in-house treatment, but their insurance company will only cover outpatient treatment? There needs to be a remedy for patients to turn to, if their insurance company isn’t playing fairly, Meara said.
The problem with addicts, in particular, experts say, is that they only reach out for treatment when they’ve reached a crisis point and have a moment of clarity, but those don’t last too long If they’re forced to fight for coverage, they may be back in the throes of their addiction by the time they win their claim.
“Clearly, some progress has been made. But it will take years to see how it’s working, what’s not working, and what health insurers are going to do to frustrate patients,” Meara said.
Dr. Louis E. Baxter, executive medical director of the West Windsor-based Professional Assistance Program of New Jersey and immediate past president of the American Society of Addiction Medicine, said that so far he’s not been impressed with the way the insurance industry is dealing with mental health and addiction parity.
Baxter, an addiction expert who sat on a presidential advisory panel for the Office of National Drug Control Policy, whose recommendations were used to create the ACA, said when insurers were forced to provide the same level of coverage for both physical and mental health, instead of bringing their mental health benefits up to par, they cut back on coverage on the medical/surgical side. Some insurers simply dropped their mental health and addiction coverage altogether, while others dropped clients who had pre-existing condition of mental illness or substance abuse, he said.
“Rather than be found disobeying the law, they elected not to provide addiction coverage,” Baxter said.
Horizon Blue Cross Blue Shield of New Jersey, AmeriHealth and Magellan Health Services were asked to comment for this story and either declined or did not respond.
Addiction specialists say insurance companies aren’t the only impediment to addicts getting treatment. The treatment industry, itself, has to answer for the major expense that some treatment programs cost, said Greenagel, who sat on the Governor’s Council for Alcoholism and Drug Abuse. Only the wealthy can afford treatment if insurance doesn’t cover it, he said.
“There are rehabs around the country that now charge about $30,000, $40,000, $50,000 a month, and some make you write a check before they take you. That may work for the upper middle class but not for the lower classes. So what happens is the only people who are really getting treatment are the rich,” Greenagel said, noting that Medicaid only reimburses treatment providers at a rate of $16 an hour. “At that rate, you’ll have a hard time getting treatment.”