With a decision released March 5th, 2019, a federal judge in Northern California ruled that a unit of one of the largest health plans in the country, UnitedHealth Group, had implemented internal policies directing employees to discriminate against patients with mental health and substance use disorders (MH/SUD). The organization’s policy was motivated by profits, intended to reduce their expenses and increase revenues. In anticipation of additional lawsuits, it is important for Texas to review current state laws related to MH/SUD to ensure that similar practices cannot be carried out in The Lone Star State.  

If a health plan includes MH/SUD treatment as a covered benefit, then it also must be covered at “parity.” This means the coverage of mental health conditions and substance use disorders by insurance plans must be equal to coverage for medical or surgical health care. For example, if an insurer provides unlimited doctor visits for hypertension or diabetes, the insurer must also provide unlimited doctor’s visits for mental health conditions, like depression, or substance use disorders like opioid addiction. It is important to note that “parity” requires equal coverage, not necessarily quality or comprehensive coverage.

In 2017, Texas lawmakers passed House Bill 10, relating to access and benefits for mental health conditions and substance use disorders. The law attempts to address ongoing challenges with MH/SUD disorder “parity” protections from four different angles: regulation, data collection, collaboration, and consumer assistance. HB 10 calls for collecting data related to certain potential non-quantitative treatment limits to help patients, providers, and insurers better understand consumers’ experiences with accessing health care. Non-quantitative treatment limitations include but are not limited to medical management, step therapy (fail first policies) and pre-authorization.

The 85th Legislature (2017) also directed the Texas Department of Insurance (TDI) and the Texas Health and Human Services Commission (HHSC) to conduct studies and prepare reports related to insurance benefits.  TDI and HHSC were required to use the requested aggregated data to prepare reports due to the legislature in September 2018. TDI studied employer-based insurance, while HHSC reported on findings in Medicaid and CHIP. The reports alone cannot verify compliance with parity. Rather, they reflect a consumer’s experience of hitting barriers when seeking health care, and how those barriers differ between mental health and substance use disorder care versus medical and surgical care.

TDI reported mental health and substance use disorder claims were denied at a higher rate than were medical and surgical claims across all treatment categories. Of those claims that were denied, mental health and substance use appeals were overturned – ruled in favor of the patient – less than half as often as medical surgical appeals. Step therapy requires patients to try one or more medications specified by the insurance company, typically a generic or lower cost medicine, to treat a health condition. Patients must then fail on the medication before allowing a “step up” to another medicine that may be more expensive for the insurer. Step therapy or “fail first” prescription drug policies were more common for mental health and substance use disorders.  Health insurance consumers were also 10 times less likely to complain about mental health and substance use disorder claims than about medical and surgical claims. This could partially be due to the stigma around mental health and substance use disorders.

TDI found utilization of out-of-network services for mental health and substance use disorder was higher than for medical and surgical services. Mental health and substance use disorder services received at residential treatment facilities were nearly 9 times more likely to be received out-of-network than medical surgical services. The report noted that “a high proportion of out-of-network claims could indicate network adequacy issues.”

HHSC reported that mental health and substance use disorder claims were denied around eight percent more often than medical surgical claims. HHSC reported a similar difference in complaints to Medicaid frequency. Of 6,060 complaints in 2017, only around 4 percent were complaints related to mental health and substance use disorder benefits. Of those complaints, 23 percent of mental health and substance use disorder claims were substantiated, contrasting with 38 percent of substantiated medical surgical claims. The report also found that a greater proportion of mental health and substance use disorder treatments were subject to prior authorization and internal appeals related to medical surgical benefits were more likely to be overturned than were mental health and substance use disorder benefits. The report stated that “a qualitative analysis is needed to ensure MCOs are in compliance with state and federal mental health parity requirements.”

Online copies of TDI’s  and HHSC’s reports to the legislature are available to the public. Advocates, patients, and providers are encouraged to compare the key findings of the report to their own experiences. The scathing California case ruling against UnitedHealth Group is an extraordinary win for mental health and substance use disorder advocates and patients. It will force the company to evaluate and change their policies, and hopefully other major health plans will follow suit. Now that a precedent has been given national media attention, Texans have greater incentive to be more vigilant when it comes to their rights as patients.