Parity Law Has Little Effect on Spending For Substance Abuse Treatment

Despite predictions that requiring health insurers to provide equal coverage for substance use disorder treatment would raise costs, a Yale study finds that the economic impact so far has been minimal. The study is published online in The American Journal of Managed Care.

A team of researchers led by Susan Busch of the Yale School of Public Health studied the first year of the federal parity law’s implementation and found that it did not result in an increase in the proportion of enrollees seeking treatment for substance use disorders (SUDs). Their analysis also identified only a modest increase in spending for substance use disorder treatment—$10 annually per health plan enrollee.

The Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act, named after two former U.S. senators and chief supporters of the legislation, was enacted by Congress in 2008 and went into effect for most plans in 2010. Prior to the law’s passage, health plans often imposed limitations on treatment for SUDs, including restricting the number of visits and requiring higher cost-sharing.

“To my knowledge this is the first peer-reviewed study to examine the effects of the 2008 federal parity law on substance use treatment,” said Busch, associate professor and chair of the department of health policy and management. “The small increase in per-enrollee spending suggests plans are unlikely to drop coverage for SUD treatment in response to the law.”

During congressional debate on the bill, some employers and health plans opposed the parity measure on the grounds that it would significantly raise their costs. The researchers concluded that in terms of SUD treatment, it appears that this concern was unfounded.

Busch and her coauthors from the University of Pennsylvania and the John Hopkins Bloomberg School of Public Health noted that their analysis only considered the first year after the law took effect and further research is needed to gauge subsequent impact.

“It will be important to look at the effects of federal parity in future years. Since 2010 new federal regulations have taken effect that may have additional impacts on SUD use and spending,” said Busch.

Source: – January 24, 2014

Parity Laws For Substance Abuse Disorder Linked To Increased Treatment

“State implementation of laws that require health plans to cover treatment for substance abuse disorder (SUD) appears to increase the treatment rate, according to a study by Hefei Wen, B.A., of Emory University, Atlanta, Ga., and colleagues.

Researchers analyzed all state-level SUD parity laws in the private insurance market that were implemented between October 2000 and March 2008 and found that implementing any SUD parity law increased the treatment rate a relative 9 percent in all specialty SUD treatment facilities and by 15 percent in facilities that accept private insurance.

“Our study provides useful information into the potential effect of the implementation and the comprehensiveness of SUD parity on access to SUD treatment and, in broad terms, the potential of financial incentives and policy leverage to influence treatment-seeking behavior,” the authors conclude.

This study was supported in part by grants from the National Institute of Mental Health. The article appeared in the October 23, 2013 issue of JAMA Psychiatry.”

 The abstract is available at:

Source: – October 16, 2013

New Illinois Parity Law Recognizes State Funded Addiction Treatment Providers

In a move that raises the bar for addiction treatment advocates and legislators in other states, state-funded addiction treatment providers were specifically codified in to law as covered providers when Illinois Governor Pat Quinn signed the Illinois Mental Health Parity bill August 18, 2011.

HB 1530 establishes parity for addiction treatment services among health insurance policies, but exceeds the recently enacted Federal law in several ways. The Illinois law specifically recognizes those community-based providers that the state contracts with for services. Additionally, the law sets forth a definition for substance use disorders and requires medical necessity determinations to be made in accordance with appropriate patient placement criteria established by the American Society of Addiction Medicine (ASAM).

Source: AHP Healthcare SolutionsAugust 29, 2011

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