In June 2002 the American Psychiatric Association (APA) adopted the position that "all substance use and substance related disorders are diagnosable mental illnesses for which effective treatments are readily available" and that the APA, therefore, "strongly opposes the exclusion of substance use and substance related disorders from legislation or programs that pertain to parity of insurance coverage, access to health care services, and quality of care" (1; see box on page XXX). The APA further stated that it "considers such exclusion … discriminatory and contrary to the scientific findings of the clinical, research, health economics, and policy communities."
Although parity for treatment of any particular disorder may not "be sufficient to ensure equal access to high quality mental health care equivalent to access to other forms of care," it has been argued that parity in mental health care coverage is certainly a "step in the right direction" (2). Although some ground has been gained for mental health parity in state and federal legislation, these mandates have often not included treatment for substance use disorders (3).
During the 1990s there was a great deal of state and federal legislative activity to try to achieve parity in insurance coverage for mental health care. However, treatment for substance use disorders has often been excluded from these parity mandates (3).
The federal Mental Health Parity Act was passed in 1996 and was implemented in 1998. This legislation focused on only one aspect of inequities in mental health insurance coverage (catastrophic benefits) by prohibiting the use of lifetime and annual limits on coverage that were different for mental and somatic illnesses. However, the legislation did not apply to companies with fewer than 50 employees, to employers whose compliance with the law would increase health insurance expenses by 1 percent or more, or to other forms of benefit limits, including per episode limits, copayments, or deductibles (4,5,6). This legislation also specified that eligible illnesses were any mental illness that required mental health services, excluding substance use disorders. Although the legislation was restricted, it nevertheless set the stage for the redress of inequities in the insurance coverage of treatment for mental and substance use disorders (5). As Goldman (5) suggested, the legislation embodied the related concepts of "fairness and non-discrimination" in health care insurance coverage.
Recent state experiences with parity have varied widely. Before 1996 only five states had mental health parity mandates (7), but by November 2000 a total of 32 states had passed mental health parity laws (8). Some legislative efforts have included parity for severe mental disorders, excluding substance use disorders. Other states have included substance use disorders in their parity legislation, although states may have different definitions of parity (9).
Experiences with parity at the state level have generally been derived from parity laws enacted by state legislatures or from individual payers who have voluntarily designed parity benefits for treatment of mental and substance use disorders for their own health plans. In Ohio all health plans that serve state employees have implemented full mental health parity that includes substance use disorders (10). In Massachusetts state employees are enrolled in two types of plans that offer full parity for mental and substance use disorders, along with a managed care carve-out of this benefit (11,12).
In 1999 an administrative directive from President Clinton to the Office of Personnel Management mandated full parity for mental and substance use disorders in coverage for federal employees. This directive became effective for "in network benefits" in 2001 when all health plans that participate in the federal employees health benefits program were required to offer full mental health parity that includes treatment for substance use disorders in patient cost sharing and service limits (6).
Excluding substance use disorders from mental health parity laws is often based on two ideas: that no effective treatments exist for substance use disorders and that including treatment for substance use disorders as part of mental health care will increase the costs of health care and insurance premiums (3).
However, current evidence from multiple sources demonstrates that these two proposed rationales are unfounded. With respect to the effectiveness of treatments for substance use disorders, a growing body of evidence confirms both the biological underpinnings of these disorders and the high rates of treatment success (8,13,14,15,16,17,18). Indeed, a 1996 report of the National Treatment Improvement Evaluation Study demonstrated that 12 months after patients completed treatment for their substance use disorders, there were substantial reductions in the use of substances, gains in employment, declines in criminal activity, and decreases in medical visits related to alcohol and drugs (17). Other reports have documented the effectiveness of pharmacotherapies and other treatments for substance use disorders (15,18,19).
American Psychiatric Association Position Statement on Inclusion of Substance Related Disorders
"The American Psychiatric Association strongly and unequivocally affirms its position that all substance related disorders are diagnosable mental illnesses for which effective treatments are readily available. Furthermore, the American Psychiatric Association strongly opposes the exclusion of substance related disorders from legislation or programs that pertain to parity of insurance coverage, access to health care services and quality of care. Other chronic illnesses such as heart disease, diabetes, and asthma, among others, are not subject to the same restricted limits on access to and coverage of care as are substance related disorders. The American Psychiatric Association considers such exclusion of substance related disorder diagnoses and patients with these disorders as discriminatory and contrary to the scientific findings of the clinical, research, health economics and policy communities. The American Psychiatric Association, therefore, unequivocally states its position that such exclusions and discrimination should henceforth be ended."
Since the passage of the 1996 Mental Health Parity Act, considerable evidence has been accumulated that shows that full parity is feasible within the context of manage care without dramatically raising costs (20,21). For example, in a number of states where full parity was implemented either concurrently with managed care or in a system already influenced by managed care, costs either decreased or increased less than 1 percent of the total health budget (8).
Another study estimated that the cost increases associated with full parity for mental and substance use disorders would represent 1.4 percent of total health benefits (8,22). In addition, the study also analyzed 20 managed behavioral health care plans to determine how the cost of treating mental and substance use disorders would be affected if dollar and other limits were removed. The study found that premiums would increase by only pennies per member per month (8,23). The study also stated that the 1.4 percent increase may overestimate the true costs (22). Overall, results from a number of studies indicate that full mental health parity that includes treatment for substance use disorders can be implemented with minimal cost increases (8).
A number of other studies have focused on whether implementing parity for treatment for substance use as part of parity for mental health care would increase costs. One study used data from 25 carve-out plans that had no deductible and low copayments for the treatment of mental and substance use disorders (23,24). Adding treatment for substance use disorders as a benefit was found to increase insurance payments by $5.11 per member from 1996 to 1997 (3,23,24). For an annual insurance premium of $1,500 per member, this increase would represent approximately .3 percent of the employer's total health care costs (3). Imposing an annual limit of $10,000 for treatment for substance use disorders represented a savings of only 6 cents per member per year, but it would have adversely affected 1.3 percent of persons who used these services. Imposing an annual limit of $5,000 would have lowered insurance payments by 78 cents per member, but it would have adversely affected 11.3 percent of persons who used these services (3). The study concluded that concerns about cost increases have been the main reason for excluding care for substance use disorders from parity legislation, but data indicate that actual cost increases are quite small.
Another study estimated the increased costs associated with implementing full parity that includes treatment for substance use disorders. This model assumed full parity such that benefits for mental health and substance abuse diagnoses would be no more restrictive than those benefits for medical and surgical diagnoses in the areas of cost sharing, service limits, and annual or lifetime limits (6). The study used data on the distribution of expenses for treating mental and substance use disorders for enrollees in indemnity and managed care plans and for high-cost users.
The study found that across four types of plans (indemnity plan, preferred-provider organization, point-of-service plan, and health maintenance organization), implementing full mental health parity for mental and substance use disorders resulted in percent increases in total family annual premiums of 5.1 percent in preferred-provider organizations, 5 percent in indemnity plans, 3.5 percent in point-of-service plans, and .6 percent in health maintenance organizations.
It is important to note that the study examined separately the percent cost increases from including mental health care with and without treatment for substance use disorders. The study concluded that the relative premium increase related to treating substance use disorders was small, adding only .3 percent for preferred-provider organizations, .03 percent for indemnity plans, .1 percent for point-of-service plans, and .04 for health maintenance organizations.
Legislative efforts for full parity represent only a first step in establishing equitable insurance coverage for treatment for mental and substance use disorders. Even with the promising changes in federal and state legislation, evidence suggests that health insurance did not improve in the United States for persons with mental illnesses between 1997 and 1999 (25). For example, in that period although the percentage of individuals without health insurance did not change much in the general population, insurance status deteriorated for individuals at risk of mental health problems (25). Among persons with mental illness, rates of being uninsured increased, perceived quality of insurance declined, and perceived access to good health care decreased faster than for the general population (25). Another study found that state parity legislation implemented between 1997 and 1999 was not associated with a significant increase in any measure of mental health services use (7). One possible reason for this finding was the loss of coverage for persons who were most at risk of mental health disorders (7).
It seems that the greatest barrier to enacting parity legislation for treatment for mental and substance use disorders has been the fear of an unmanageable rise in health care costs, as the public is sensitized to a cost base for health care that is already spiraling upwards. To date, the data related to behavioral health do not support this fear. Providers, patients, and policy makers are currently faced with the lack of mandated full parity in many states and concerns that legislation of full parity may be insufficient to achieve true equity (20). Rather, full parity may be a sequential step toward achieving insurance coverage that represents fairness and nondiscrimination for patients with mental and substance use disorders (8). Full parity may in fact lead to a "nominal expansion of benefits" (8) but may not represent effective equity for treatment for mental and substance use disorders, insofar as management of care can be applied differentially. This may result in continued inequities in health care access and quality of care for persons with mental and substance use disorders, despite legislative mandates for parity.
Another significant barrier to care is societal stigma of psychiatric and substance use disorders and the internalization of that stigma by persons with these illnesses (8). Such internalization may deter individuals from seeking care. On the other hand, legislation of full mental health parity for mental and substance use disorders can send a strong message to the public that these disorders are real, that effective treatments exist, and that these treatments are offered within a health care system that provides equivalent care for all disorders, whether they are medical, surgical, or psychiatric. Finally, although full mental health parity could positively affect persons who are insured, it does little to provide these services to the estimated 40 million uninsured individuals in the United States (8). Expanding coverage to include these individuals would likely address another major factor in the unmet need for treatment for mental illness, including substance use disorders (8).
Preparation of this paper was supported by grant DA-00-407 from the National Institute on Drug Abuse. The author is the chair of the American Psychiatric Association's Council on Addiction Psychiatry and thanks persons on the council who were involved in writing the parity for substance use disorder statement: Sheila B. Blume, M.D., Kathleen T. Brady, M.D., Stephen Leist Dilts, M.D., Marc Galanter, M.D., Herbert D. Kleber, M.D., Pedro Ruiz, M.D., and Richard T. Suchinsky, M.D.
Dr. Greenfield, who is editor of this column, is affiliated with the department of psychiatry at Harvard Medical School and the alcohol and drug abuse treatment program at McLean Hospital, 115 Mill Street, Belmont, Massachusetts 02478 (e-mail, firstname.lastname@example.org). This column was endorsed by the American Psychiatric Association's Council on Addiction Psychiatry.