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Milliman Behavioral Health Advisor The debate over separate but equal deductibles and out-of-pocket limits My opinion is that the best result will come from providing the right care at the right time to patients that need it. The Mental Health Parity and Addictions Equity Act of 2008 requires that “the financial requirements applicable to such mental health or substance use disorder benefits are no more restrictive than the predominant financial requirements applied to substantially all medical and surgical benefits covered by the plan (or coverage) and there are no separate cost sharing requirements that are applicable only with respect to mental health or substance use disorder benefits”. The interpretation of what this actually means has produced two distinctly different opinions: 1. 2. The medical and behavioral healthcare benefits share an integrated deductible and out-of-pocket limit The medical and behavioral healthcare benefits can have separate but equal deductibles and outof-pocket limits Support for Interpretation #1 – Integrated Approach Supporters of the integrated deductible and out-of-pocket limit contend that “no separate cost sharing requirements” means that there is no separate deductible or additional out-of-pocket requirement for the mental health and substance use disorder benefits – plain and simple. They would be subject to the same deductible as all other medical and surgical benefits. They should not be singled out as a different healthcare specialty and be treated differently from cardiology, radiology, oncology, etc. This integrated approach would require that the administration of the medical and behavioral benefits must be integrated – that is, the cost sharing requirements must be managed together. The claim administration process of medical and behavioral benefits must work together or interface, likely with daily feeds of administrative claim data between the two systems (if they exist separately). If these systems do not currently interact or “talk to each other”, it would likely be a significant change to make this happen, both in the investment of time and dollars. Support for Interpretation #2 – Separate but Equal Approach Supporters of the separate but equal approach believe that the law is written to allow for plans and health insurers to have the flexibility to apply either separate or shared financial requirements to mental health and substance use disorder benefits. Some contend that an integrated approach would have a direct impact on the administrative cost of plans and create a disadvantage for a significant number of plan participants by increasing the cost sharing requirements as a result of the large, extra administrative costs of changing the systems interface. Heightened cost sharing may result in limiting access to care and duration of care for those seeking treatment, which seems to go against the spirit of the parity act. Additionally, some contend that if separate but equal was allowed, it could benefit members with high deductible plans if the plans could choose to lower the separate behavioral health deductible rather than having it subject to the higher integrated deductible (e.g. a $5,000 medical deductible coupled with a separate $1,000 behavioral deductible allows for greater utilization of behavioral care given the lower out of pocket costs compared to a separate but equal $5,000 behavioral deductible). What’s the Answer? We’ll know the correct interpretation(s) hopefully when the regulations are completed. My opinion is that the best result will come from providing the right care at the right time to patients that need it. Design your plan benefits, provider reimbursements, and systems of care in such a way that members that need behavioral healthcare can get it at the right time in an affordable manner – it will likely lead to a healthier population and lower healthcare costs over time, and certainly increase productivity of employees and member satisfaction with their insured benefits. The Behavioral Health Advisor is a monthly publication by Steve Melek, designed to bring interesting and informative behavioral health topics to the forefront. Melek is a leading professional in combining actuarial expertise with behavioral health knowledge. He consults on effective integration of medical and behavioral healthcare, efficiency in delivery and successful health outcomes, predictive modeling, and collaborative research with other disciplines. July 2009 Stephen P. Melek, F.S.A., MAAA Principal & Consulting Actuary Direct: 303 299.9400 [email protected] milliman.com