Proposed Department of Labor rules would require ERISA plans processing disability claims to provide certain procedural protections similar to ACA standards for non-grandfathered group health plans. The new rules would treat coverage rescissions like benefit denials, require more detailed denial notices written in a "culturally and linguistically appropriate manner," and expand claimants' response rights. Unlike the ACA, however, the proposal does not call for external reviews. The changes would affect employers, insurers, and third-party administrators handling claims that call for a disability determination under ERISA welfare (and pension) plans.
On Capitol Hill, the Senate could vote as early as this week on a Republican budget reconciliation bill to repeal or gut major portions of the ACA, including employer play-or-pay requirements, the individual mandate, Medicaid expansion, exchange subsidies, and the “Cadillac” tax. The House has passed a similar, though narrower measure. While a Senate bill could not be filibustered and may pass with just 51 votes, the President has vowed to veto any attempt to harm the law. Still, Republicans view the reconciliation exercise as a powerful campaign messaging tool and a dry run for what they might be able to accomplish if a Republican is elected president next year.
In a review of claims data for almost 100 Mercer employer clients, representing approximately 2.5 million members, we found that the Mental Health and Substance Abuse per member per year cost trend (for allowed charges) rose nearly 11%, in stark contrast to overall medical PMPY trend of 3.5%. And while MH/SA claims represent a small percentage of the overall medical claim costs (4%), a spike in the cost may be a symptom of a larger issue – and an opportunity for employers to get out in front. What’s driving this trend?
- More people – 3.4% increase in the MH/SA unique claimants.
- More claims per person – 7.5% increase in MH/SA claims per claimant.
- Fewer claimants are using out of network (OON) MH/SA providers but the total OON visits are increasing by 7.5% -- and the average allowable amount per visit is twice as high for OON providers ($2,097) than for in-network ($1,019).
One factor behind the increase in OON utilization may be adult dependents added under the ACA, who tend to live outside the primary member’s area and use OON services at a higher rate.
But the biggest driver of increased OON utilization may simply be limited access. Mental Health Parity has increased both visibility and pressure to increase access. We are seeing members access care more than ever before. And more employers are recognizing the importance of behavioral health in the benefit offering; they are increasing the number of EAP visits allowed and adding onsite counselors. Some specialty areas in particular experience access issues, such as psychiatry – both adult and child/adolescent.
The shortage of providers has led a growing number to choose not to join networks -- because they don’t have to. With access to in-network providers limited not just in rural markets but also in busy urban areas, more plan members may be making a choice to use out-of-network providers, albeit at a lower benefit level.
What are the possible interventions?
- If the underlying cause is access, collaborate with your networks about their strategy for contracting with providers; promote and leverage the EAP; and explore mental health resources available through telemedicine vendors.
- If the underlying cause is literacy, focus on member education, particularly if there are patterns by region or for covered adult dependents where in-network providers may not be evident or readily available. Also promote EAP and other resources that may be available to support members with mental health, substance abuse and/or stress related needs.
- Engage care management and advocacy support vendors in promoting in network and EAP resources; also validate their attention to the co-morbidities of mental health in their engagement contacts.
But before you start down any of these paths, look at your data to find out:
- Is your MHSA spend increasing?
- Is it MH or SA or both driving the increase in trend?
- Is it unit cost, number of claimants and/or number of claims per claimant?
- Are there patterns by location, job type or relationship to the covered employee?
- Are current resources such as the EAP being optimized?
- Are there employee surveys that suggest high rates of stress?
The more answers you have, the better equipped you will be to develop an approach that strikes the right balance between what people need and how the plan meets those needs.