Payers Do Not Enforce Behavioral Healthcare Payment Parity

November 22, 2019 - Primary care services were reimbursed 23.8 percent more than behavioral healthcare in 2017, which indicates that among commercial payers the payment parity issue between physical and behavioral healthcare reimbursement is increasing over time, a recent Bowman Family Foundation study conducted by Milliman found.

The study dove into the surrounding context and outlined meaningful steps that healthcare payers can take in response to this information. Nonetheless, experts were chagrined.

“The study’s findings are beyond disappointing and disturbing,” said Henry Harbin, MD, a psychiatrist, former CEO of Magellan Health Services, and advisor to The Bowman Family Foundation. “With the extensive efforts by multiple stakeholders, over the last several years, we were expecting to see significant improvements. Instead, we are going backwards.”

The healthcare industry has been working to address payment parity between behavioral health and other areas of healthcare in an effort to promote the importance of behavioral healthcare. Ideally, creating payment parity would make it more lucrative for a provider to specialize in behavioral health and ultimately improve patient access to behavioral healthcare.

But that isn’t the picture, the report authors said.

In 2015, there was a 20.8 percent gap between primary care reimbursements and behavioral healthcare reimbursements. In two years, that number rose three percentage points.

The study showed that for mental healthcare needs and substance use disorder in-network office visits, the reimbursements was under the Medicare-allowed levels between 2013 and 2017. The rate has been improving over time for mental healthcare but worsening for substance use disorder visits.

Meanwhile, in-network primary care physicians and specialists received ten to twenty percent above the Medicare-allowed amount for office visits.

Beneficiaries were also 5.2 times more likely to visit an out-of-network hospital for behavioral healthcare needs than they were to visit an out-of-network inpatient provider for medical or surgical care. That statistic spiked 85 percent from 2013.

Since both out-of-network and inpatient visits tend to precipitate surprise billing, the upward trend in out-of-network, inpatient behavioral healthcare could be a costly one.

The authors urged healthcare payers to use this information as incentive to revisit their reimbursement strategy. They called on healthcare payers to ensure parity between behavioral and physical healthcare providers’ reimbursements. While acknowledging the range of factors involved in discerning payment levels, the nonquantitative metrics and their application must be equivalent between the two reimbursement strategies in accordance with the non-quantitative treatment limitation (NQTL) standards.

In addition to the NQTL rules, the authors also directed health plans to evaluate their reimbursement levels in accordance with the Mental Health Parity and Addiction Equity Act (MHPAEA).

If a disparity is found, the solution should be to raise the behavioral healthcare providers’ reimbursement to meet the physical healthcare providers’ levels, the study explained.

Raising behavioral healthcare providers’ reimbursements may lead to some compensation for that increased financial output.

Higher behavioral healthcare reimbursement rates attract quality behavioral healthcare practitioners who will enable members to stay in-network. This may lower the overall healthcare spending by not forcing members to venture out-of-network for access to care.

These levels may be further compensated as behavioral healthcare expands and its effects become evident, the authors suggested. Physical healthcare suffers and causes higher expenditures when behavioral healthcare needs go unmet.

By expanding behavioral healthcare teams and compensating them appropriately, healthcare payers may find that their members are healthier and less prone to high healthcare spending and surprise medical billing.

Improving behavioral healthcare reimbursement levels may enable plans to achieve the quadruple aim which, the authors argue, should be healthcare payers’ goal. By accurately reimbursing behavioral healthcare and expanding the behavioral healthcare team, healthcare payers facilitate strong member health, positive patient experience, lower healthcare spending, and better provider experience.

Major payers like Anthem pursue behavioral healthcare goals by engaging with or acquiring third-party vendors to help manage their behavioral healthcare programs.

Earlier this year, Anthem acquired Beacon Health Options, a company that works with payers to manage behavioral coordinated care teams. The acquired company said that Anthem’s resources will help it scale up and improve its offerings, giving Anthem members greater access to mental and behavioral healthcare options.