Most experts, think tanks, consumers, and even representatives from elected governments concede that not enough has been done to promote the importance of mental health and its effects on personal finance and global economy.
However, we shall talk only about the benefits that health insurers provide for mental or behavioral illnesses, and regulatory frameworks that aim to address the lack of parity between mental and physical health plans that exist across countries.
Even across highly matured markets such as the U.S., despite enacted laws like the Mental Health Parity Act (MHPA) (1996), the Mental Health Parity and Addiction Equity Act (MHPAEA) (2010), and the Affordable Care Act (2010), many insurance providers still offer better deals on physical health coverage than mental health coverage.
Are Laws Enacted to Address the Issue of Health Insurance Disparity in the U.S. Effective?
Before the MHPAEA had been legislated, many of the insurers would charge higher co-pays and deductibles, and even impose caps on the number of hospital visits allowed under a policy for mental health patients. The MHPAEA and similar laws try to prevent insurers from discriminating against financial and non-financial benefits offered under physical health and mental health plans.
However, insurers still have the right to implement limits based on medical needs, as determined by them.
The Affordable Care Act also mandates that mental health be included as one of the 10 benefits in a health insurance plan.
But an APA survey conducted in 2014 had shown that almost 90 percent of Americans aren’t aware of the legislation related to mental and physical health insurance parity. A survey conducted by Milliman had established that out-of-network settlements for treatments of mental illnesses were significantly higher than other medical or surgical treatments.
It was also shown that insurers offered a 20 percent higher amount of reimbursement to primary care providers in physical healthcare category than in the behavioral category, thereby increasing the proportion of out-of-network payments.
Some of the areas that MHPAEA has had an impact on are:
- Group health insurance offered by companies employing at least 50 workers.
- Most Medicaid programs.
- Health insurance plans for children.
- Plans bought through health insurance exchanges, created under the Obamacare framework.
Despite the impact that this law has had, it still offers a lot of wiggle room to insurers. Hence, many of the common mental conditions are excluded from plans.
Despite the law saying that insurers can’t impose a cap on the number of psychiatric sessions that would be covered, it has left the insurers the right to decide the number of visits after which the insurer can take up the case for review and decide whether further visits were medically necessary or not.
Hence, a lot more would have to be done to ensure better and cheaper coverage for mental patients.
Laws in Singapore and India in This Regard
While no law in Singapore and India directly questions the lack of parity in health insurance coverage, rising awareness has led to enactment of laws that tend to subsidize insurance policies for mental health patients and make their treatments more affordable.
The government in Singapore now allows you to use Medisave to pay for outpatient costs after 15 percent of the bill has been paid upfront in cash. Up to 10 Medisave accounts of immediate family members can be used to take care of your yearly costs. Up to S$400, per account, per year, can be used for your outpatient treatment expenses.
For inpatient treatments, a cap of S$5,000 per year has been set on the use of Medisave monies. You can also use up to S$150 per day. With Medishield Life, you can use S$100 per day on inpatient mental illness treatments.
However, the cost of a single therapy at a private clinic could go up to S$200. When other costs get added, the government-sponsored insurance policy may seem inadequate. Private insurance plans can take care of the shortfall – the number and degree of cover may be woefully short compared to what is available for physical health ailments.
As for India, public health spending is not adequate to begin with. An IRDA estimate in 2014 had revealed that only 17% of the population was covered by health insurance. The penetration was far less when it came to mental health treatments.
However, to ensure that behavioral and mental health patients received insurance coverage, the government enacted the Mental Healthcare Act in April 2017. It will come into effect in July 2018, and aims to ensure that mental conditions, as defined in accordance with internationally accepted medical definitions and conventions, be covered by insurance providers.
General Covers and Exclusions Pertaining to Insurance for Mental Health
Some of the common covers include:
- Psychiatric or psychotherapeutic treatment.
- Inpatient treatment at a registered hospital.
- Services offered by a registered caregiver.
- Prescription drugs.
- Visits to a registered clinical psychologist.
- Diagnostic tests ordered by a registered physician.
Some of the common exclusions may be:
- Psychiatric treatment/care before and/or after inpatient treatment at a hospital.
- Psychological and emotional development disorders such as hyperactivity disorder and attention deficit disorder.
- Outpatient treatments for certain mental conditions.
- Impulse-control disorders.
- Mental retardation and stunted development.
- Treatments for stress.
Why Greater Coverage for Mental Health Ailments Is Necessary
The extent of coverage available varies widely across nations. While the government provides or mandates equal coverage for mental and physical health conditions in some countries, there are others where there is still no legislation to support the inclusion of mental disorders in health covers.
In countries where there is little awareness about mental ailments, the following changes would help:
- Greater accessibility: Making healthcare insurance for mental ailments more affordable and comprehensive can improve the accessibility of high-quality care for patients. This would encourage people to seek help from registered and qualified professionals rather than turning to charlatans for help, a problem that is extensive in underdeveloped and developing countries.
- De-stigmatization: In many cultures, mental health conditions aren’t openly talked about and seeking professional help is looked down upon. By increasing awareness about these, people would come to accept mental health conditions and their treatment as being “normal”.
- Improvement in infrastructure and services: With more patients willing to reach out to professionals and pay for their services, the field will get a shot in the arm. More money will be available for research and development of the necessary infrastructure and training of caregivers.
- Increased collaboration between the various stakeholders: With formalization, patients, healthcare bodies, the government, and insurance providers will come together to identify and eradicate the problems.
Lack of mental acuity and soundness can not only affect one’s well being and lifestyle but also blow out the promise of any meaningful contribution that the person could have made to the country’s economy.
Mental health conditions, if untreated, lead to incremental losses. Hence, health insurers need to provide better cover for mental conditions, too.
Khirad Hussain Shah is a student of Medical & Health Science at Rush University, Chicago pursuing a master’s degree in Health System Management and working at Northwest Community Healthcare (NCH).