The Effects of Federal Parity on Substance Use Disorder Treatment | Page 4

Published Online: January 23, 2014
Susan H. Busch, PhD; Andrew J. Epstein, PhD; Michael O. Harhay, MPH; David A. Fiellin, MD; Hyong Un, MD; Deane Leader Jr, DBA, MBA; and Colleen L. Barry, PhD, MPP
Finally, this study examined only the first year after MHPAEA took effect. The interim final regulations of MHPAEA, which were released in February 2010 and took effect for most plans in 2011, prohibited plans from using so-called nonquantitative treatment limits for mental health and SUD benefits unless these limits were comparable to those used for general medical services.24 Nonquantitative treatment limits include medical management standards, prior authorization, utilization review, prescription drug formulary design, standards for provider admission to participate in a network, and provider reimbursement. It is possible that these regulations could lead to different effects of the law; therefore, it is critical for future research to examine use and spending in response to MHPAEA in subsequent years.

Take-Away Points

Federal parity, as implemented in 2010, is unlikely to lead to large increases in total healthcare spending. 
  • In 1 national health plan, federal parity led to a small increase in spending on substance use disorder treatment per enrollee ($9.99, 95% confidence interval, 2.54-18.21) in 2010, the first year after the policy took effect.
  • This increase was not due to more individuals initiating treatment.
  • Future work should consider the effects of the law in subsequent years after regulations affecting the management of care (eg, utilization review, network access) take effect
Author Affiliations: From Perelman School of Medicine, University of Pennsylvania (AJE, MOH), Philadelphia, PA; Yale School of Public Health (SHB, DAF), New Haven, CT; Yale School of Medicine (DAF), New Haven, CT; Aetna (HU, DL), Hartford, CT; John Hopkins Bloomberg School of Public Health (CLB), Baltimore, MD.

Funding Source: This study was funded by the National Institute on Drug Abuse (grant DA 026414).

Author Disclosures: The authors report no relationship or financial interest with any entity that would pose a conflict of interest with the subject matter of this article.

Authorship Information: Concept and design (SHB, AJE, DAF, CLB); acquisition of data (SHB, DL, CLB); analysis and interpretation of data (SHB, AJE, MOH, DAF, HU, DL, CLB); drafting of the manuscript (SHB, CLB); critical revision of the manuscript for important intellectual content (SHB, AJE, MOH, DAF, HU, DL, CLB); statistical analysis (SHB, AJE, MOH, CLB); obtaining funding (SHB, DAF, CLB), administrative, technical, or logistic support (SHB, AJE, MOH, DL, CLB); and supervision (SHB, CLB).

Address correspondence to: Susan H. Busch, PhD, Yale School of Public Health, 60 College St, New Haven CT 06520-8034.
1. Barry C, Sindelar JL. Equity in private insurance coverage for substance abuse: a perspective on parity. Health Aff (Millwood). 2007; 26(6):w706-w716.

2. Gabel JR, Whitmore H, Pickreign JD, Levitt KR, Coffey RM, Vandivort- Warren R. Substance abuse benefits: still limited after all these years. Health Aff (Millwood). 2007;26(4):w474-w482.

3. National Alliance on Mental Illness. State mental health parity laws. http://www.nami.org/Content/ContentGroups/Policy/Issues_Spotlights/ Parity1/State_Parity_Chart_0709.pdf. Revised July 2009. Accessed September 17, 2012.

4. Goldman HH, Frank RG, Burnam MA, et al. Behavioral health insurance parity for federal employees. N Engl J Med. 2006;354(13): 1378-1386.

5. Barry CL, Busch SH. Do state parity laws reduce the financial burden on families of children with mental health care needs? Health Serv Res. 2007;42(3, pt 1):1061-1084.

6. Pacula RL, Sturm R. Mental health parity legislation: much ado about nothing? Health Serv Res. 2000;35(1, pt 2): 263-275.

7. Barry CL, Busch SH. Caring for children with mental disorders: do state parity laws increase access to treatment? J Ment Health Policy Econ. 2008;11(2):57-66.

8. Barry CL, Frank RG, McGuire TG. The costs of mental health parity: still an impediment? Health Aff (Millwood). 2006;25(3):623-634.

9. Azrin ST, Huskamp HA, Azzone V, et al. Impact of full mental health and substance abuse parity for children in the Federal Employees Health Benefits Program. Pediatrics. 2007;119(2):e452-e459.

10. McConnell KJ, Gast SH, Ridgely MS, et al. Behavioral health insurance parity: does Oregon’s experience presage the national experience with the Mental Health Parity and Addiction Equity Act? Am J Psychiatry. 2012;169(1):31-38.

11. Busch SH, Barry CL. New evidence on the effects of state mental health mandates. Inquiry. 2008;45(3):308-322.

12. Azzone V, Frank RG, Normand ST, Burnam MA. Effect of insurance parity on substance abuse treatment. Psychiatric Serv. 2011;62(2): 129-134.

13. Dave D, Mukerjee S. Mental health parity legislation, cost-sharing and substance abuse treatment admissions. Health Econ. 2011;20(2): 161-183.

14. Hanson KW. Public opinion and the mental health parity debate: lessons from the survey literature. Psychiatric Serv. 1998;49(8): 1059-1066.

15. Sturm R, Zhang W, Schoenbaum M. How expensive are unlimited substance abuse benefits under managed care? J Behav Health Serv Res. 1999;26(2):203-210.

16. Garnick DW, Lee MT, Chalk M, et al. Establishing the feasibility of performance measures for alcohol and other drugs. J Substance Abuse Treatment. 2002;23(4):375-385.

17. McCorry F, Garnick DW, Bartlett J, Cotter F, Chalk M; Washington Circle Group. Developing performance measures for alcohol and other drug services in managed care plans. Jt Comm J Qual Improv. 2000;26(11):633-643.

18. Manning WG, Mullahy J. Estimating log models: to transform or not to transform? J Health Econ. 2001;20(4):461-494.

19. Papke LE, Wooldridge JM. Econometric methods for fractional response variables with an application to 401(K) plan participation rates. J Appl Econometrics. 1996;11(6):619-632.

20. Efron B, Tibsharani J. An Introduction to the Bootstrap. London: Chapman and Hall; 1993.

21. Kaiser Family Foundation and The Health Research and Educational Trust. Employer Health Benefits Annual Survey, 2010 Annual Survey. http://kaiserfamilyfoundation.files.wordpress.com/2013/04/8085.pdf. Published 2010. Accessed May 20, 2013.

22. Barry CL, Huskamp HA, Goldman HH. A political history of federal mental health and addiction insurance parity. Milbank Q. 2010;88(3): 404-433.

23. Ettner SL, Huang D, Evans E, et al. Benefit-Cost in the California Treatment Outcome Project: Does Substance Abuse Treatment Pay for Itself? Health Services Research. 2006;41(1):192-213.

24. Internal Revenue Service, Department of the Treasury; Employee Benefits Security Administration, Department of Labor; Centers for Medicare & Medicaid Services, Department of Health and Human Services. Interim final rules under the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008: interim final rules with request for comments. Fed Regist. 2010;75(21): 5409-5451
Issue: January 2014
More on AJMC.COM