What does the Patient Protection & Affordable Care Act (ACA) mean for mental health services?

As a consumer, there are several things you need to know about “minimum essential benefits,” mental health parity, deductibles, and preexisting conditions.

The catchphrase “Minimum Essential Benefits” refers to the ACA mandate that, moving forward, health insurance policies cover basic health care services that were previously optional.  The ACA is clear that  mental health care, including substance abuse treatment, is a minimum essential benefit.  So what are the implications of this provision?

• As of mid-November, 2013, it remains unclear whether this mandate will be delayed for a year or more.  Why?  Many individual and small business health insurance policies are being cancelled because they are “catastrophic,” i.e., bare minimum, and do not meet the “minimum essential benefits” criteria.  However, problems remain with signing up for coverage on www.healthcare.gov, so millions of people are left in the lurch–they are losing their current health insurance policy, but are having trouble signing up for insurance on the healthcare exchanges.  To try to address this problem, President Obama has asked health insurance companies to extend their catastrophic policies so no one loses coverage.  However, many health insurance companies say they can’t make this change so late in the game.  Additionally, some states have enacted laws that won’t allow the continuance of catastrophic policies.  So, right now, no one really knows if catastrophic policies will become a thing of the past.

• If you have a health insurance policy through your employer, and your employer’s policy is “grandfathered,” i.e., no changes to the policy have been enacted since the 2010 signing of the ACA, “You may not get some rights and protections that other plans offer,” according to healthcare.gov’s post on grandfathered plans.  Are minimum essential benefits such as mental health care one of the “rights and protections” that may not be available?  Perhaps.  I searched healthcare.gov exhaustively for specific information about grandfathered plans and mental health care, and couldn’t find a direct answer.  So, my guess is that if the issue is not specifically mandated, then insurance companies and employers may not fully cover mental health benefits in grandfathered plans, in the interest of cost containment.

• If your employer is “self insured,” then your employer can opt out of certain “minimum essential benefits” such as mental health care.  Here’s the reference on healthcare.gov.

“Mental Health Parity” was originally enacted in 1998 and was intended to ensure mental health services were covered by insurance companies similarly to medical issues.  There were many exceptions & exclusions to the law, and it was not diligently enforced.  The second round of “Mental Health Parity” became law in 2008, but once again, exceptions and work-arounds rendered it ineffective.

In November, 2013, Health & Human Services Secretary Kathleen Sebelius announced new regulations that once again seek to provide coverage for mental health services at the same level as coverage for medical issues.

• Theoretically, this should eliminate separate deductibles, out of pocket limits, and  limitations on coverage for mental health services.  The specifics of the mental health regulations are spelled out here–206 pages! However, it remains to be seen whether there are loopholes or whether the regulations will be evenly enforced.  A provision of the ACA that limited annual out of pocket limits has already allowed exceptions through 2014 for policies that use “more than one benefits administrator,” which often applies to pharmacy and mental health benefits.  Mental health benefits should be excluded from these exceptions on out of pocket limits, but we’ll have to wait and see how the regulations are enforced. 

• Exclusions to mental health parity (verbatim from healthcare.gov) include:  
  • Plans offered by small employers that are self-insured (these are plans that don’t buy insurance from an insurance company, but pay for employees’ health care costs themselves; they may use a health insurance company to manage claims and payments)
  • Plans offered by employers that can show the federal government that the parity requirements have caused such a significant increase in plan costs that they qualify for a one-year exemption
  • Plans offered by state and local government employers that are self-insured and choose not to apply the parity requirements, as long as they properly notify the federal government
  • Plans that are grandfathered (generally those that have not changed their plan terms since March 2010)
  • Retiree-only plans

• If catastrophic policies remain in effect (see above), then mental health benefits are unlikely to be covered at all in these policies.

To underscore the uncertainty regarding mental health parity, I quote healthcare.gov:  “Do job based plans include mental health parity protections?  Some of them do.”  

A key provision of Obamacare (ACA) is that individuals with preexisting conditions, physical or mental, cannot be denied the opportunity to purchase health insurance.  Further, those with preexisting conditions cannot be required to pay higher premiums and policies cannot be cancelled.

• This is good news for individuals who previously sought mental health care and were subsequently denied the opportunity to purchase health insurance because of their “preexisting condition.”  You can no longer be denied the opportunity to purchase health insurance!  And your marketplace health insurance policies can’t raise premiums or cancel policies if you decide to use your mental health benefits or become seriously ill, which was a risk with individual policies in the past.

One final relevant point about Obamacare and mental health coverage:  To quote healthcare.gov:  “Can I keep my current mental health provider?  Possibly.”  

• If you’ve ever invested time, money, and energy into mental health care, then you know that “providers” are not interchangeable!  The therapist or psychologist you’ve been working with knows you, your history, challenges, and strengths.  Starting over is not a small thing.  As insurance companies are managing costs, they are “containing” their networks, i.e., fewer providers are included in-network.  This does not mean that you can’t see a therapist or psychologist that is “out-of-network,” but you may pay more out of pocket than with in-network providers.  And in-network providers often agree to accept lower reimbursement, which may dilute the quality of care.

In summary, Obamacare is intended to make mental health care affordable and accessible to every American citizen.  However, such an ambitious goal is going to have bumps along the way and soundbites don’t accurately describe the reality.  If you have comments, questions, or additional insights, please share!