New Jersey is moving closer to adopting legislation designed to ensure that insurance companies cover behavioral-health treatments at the same level as physical care, thanks to amendments to a bill touted by supporters as a model for dozens of other states.
The Senate Commerce committee adopted the measure Thursday, following several hours of testimony that included passionate pleas from parents who said their children were unfairly denied care. The bill, which also has the support of hospitals, several labor unions, and a wide array of healthcare-provider groups, seeks better enforcement of a decade-old federal law that required mental-health “parity” within health insurance plans.
The legislation, which would amend several existing laws, focuses primarily on new reporting requirements in an attempt to ensure insurance companies are indeed living up to the spirit of the law. It would also modernize the definition of behavioral-care services to clearly include addictions, obsessive-compulsive disorders, autism and developmental disorders, among other conditions.
While it passed the state Assembly in October with near-unanimous support, the legislation has since undergone some changes to encourage support from the insurance industry, whose representatives have raised concerns about the impact of new reporting requirements and how the state law could conflict with federal regulations on the matter.
Industry looking for further changes
Insurance carriers would like to see several additional tweaks, including language that allows some flexibility if there are federal changes. But Sarah Lynn Geiger, vice president of the New Jersey Association of Health Plans, which represents nine companies doing business here, told the committee, “we believe we are very, very close” to an agreement.
Senators have signaled they are open to some additional changes (including amendments to ensure autism care is fully protected, among others) before it is presented for a final vote, possibly later this month.
The legislation — which was first introduced in January 2017, and passed the Assembly later that year, but failed to advance in the Senate — builds on the federal 2008 Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act, which banned insurance companies from creating additional barriers for access to behavioral-health treatments, beyond those that existed for physical care. This requirement was also reiterated in the 2010 Affordable Care Act, or Obamacare, which significantly expanded what health plans must cover.
Patient advocates said investigations show insurance companies do not always fully comply with federal law, and on Thursday some policyholders described epic battles to access mental-health benefits or obtain refunds for care they funded out-of-pocket.
An appeal process allows consumers to challenge decisions within the company, and through the state’s Department of Banking and Insurance, but additional oversight is needed, the advocates said.
“A complaint-driven system doesn’t really capture the problem and it’s not an enforcement mechanism that is going to work with this law,” explained Ellen Weber, a vice president at the Legal Action Center, a policy and advocacy organization. The problem is especially acute for families in the midst of a crisis, who may not have the capacity to file and track a lengthy appeal, she said.
“There’s no parity here,” despite the federal law, said Patricia Roos, a Rutgers University professor who lost her son to addiction in 2015 and said she spent several years battling Horizon Blue Cross Blue Shield on claims, including what became a failed effort to recover more than $26,000 the family had spent to support his care. “Federal parity cannot achieve its promise without enforcement and accountability at the state level,” she said.
A nationwide problem
New Jersey is certainly not alone. In fact, it is among 32 states that received a failing grade on a recent report card produced by advocates for mental-health parity laws, in part because New Jersey has limited mechanisms to enforce the federal law. But the issue has become increasingly important as the opioid epidemic has grown, prompting the need for additional treatment.
The measure moving in New Jersey (A-2301) — led by Assembly Speaker Craig Coughlin (D-Middlesex), Assemblywoman Valerie Vainieri Huttle (D-Bergen), along with dozens of other sponsors and co-sponsors from both parties — would require insurance companies to file annual reports to state regulators detailing how they assess and ensure that their behavioral-health coverage is on par with how and what they pay for physical care. Some information would also need to be posted online.
For insurance providers, the difficulty is in defining the parameters of “non-quantitative treatment limitations,” which include decision-making processes, strategies or standards that are used to determine what treatment is appropriate. A company can clearly state it will cover a certain number of provider visits, for example, but it uses more nuanced methods for things like determining medical necessity, designing prescription formularies, and deciding what providers are eligible to be included in a network.
Looking for more flexibility
While a number of the industry’s concerns have been addressed, the insurers’ association would like additional amendments to ensure the legislation applies only to commercial consumers — not Medicaid and Medicare plans, on which companies do not control premiums — and to give the industry more time to start filing reports. In addition, the organization would like to ensure that the law is flexible enough to bend if federal guidance evolves further, something the industry leaders are convinced will occur.
Advocates for the bill, though, suggested these further changes are not needed. Public plans are clearly exempt from the measure, the first filing deadline wouldn’t come before March 2020, and tying the state’s system to federal regulations could prove to be a “dangerous precedent” that could “handcuff the state” in the future, warned Tim Clement, a regional director for the American Psychiatric Association who has worked to expand mental-health parity laws nationwide.
“The insurance industry is by no means intentionally violating the (federal) law. It’s a very complicated law,” Clement told the Senate committee. But the Garden State legislation is a model bill, among the first to be introduced nationwide and now under consideration in many other states, he said, noting that even the federal government has endorsed the state’s approach.
“New Jersey is very much a leader in this,” he said, urging lawmakers to continue pressing forward with the measure as is.