The U.S. government for decades has struggled to devise programs that integrate needed services for people with severe mental illnesses. Implementation has been limited by inadequacies in the behavioral health policy framework, poorly designed payment approaches, and dysfunctional regulations. Fortunately, the Affordable Care Act has brought a number of policy changes that improve access to mental and behavioral health services for millions of Americans.
Expansion in Insurance Coverage
The proliferation of health insurance coverage through the Health Insurance Exchanges (HIE) and state-specific Medicaid dramatically expands coverage for those not eligible for Medicare. The ACA also prohibits insurance companies from denial of coverage to individuals with pre-existing conditions. This is significant because mental health disorders were among the most common pre-existing conditions triggering health insurance denials before the full implementation of the ACA.
Improved Mental Health Coverage and Funds for Behavioral Health Treatment
Through the expansion of the Mental Health Parity and Addiction Equity Act (MHPAE) of 2008, mental health and substance use treatment is now one of the ten “essential health benefits” for all health insurance plans in the individual and employer market, inside and outside HIEs. Insurance plans must now treat physical and mental illness with parity when considering necessity for medical treatment.
Second, the Medicare Improvements for Patients and Providers Act (MIPPA) ends the discriminatory mental health coverage that required patients pay up to 50 percent of the cost of approved services, in contrast to the 20 percent copayment applied to other types of outpatient services. 100 percent parity now applies in copayments for outpatient service; thus, Medicare will now cover 80 percent of the cost of mental health outpatient services, consistent with other types of outpatient services.
Third, ACA establishes the Community Health Center Fund, which provides $11 billion to expand services offered in Community Health Centers and to construct additional sites, including those for behavioral health treatment. These funds can potentially enable access to mental health treatment in rural areas where such services are often scarce.
What this Means
The dramatic expansion in insurance coverage for American and improved mental health coverage and allotment of funds for behavioral health treatment in rural settings means more funds are now accessible for the delivery mental and behavioral health services in the U.S.–healthcare tech companies in this space stand to benefit from the new opportunities in reimbursement.