Effects of a No Cost Sharing Mandate for Behavioral Health Care in its First Year

• In Event: Mental Health Services and Policy

Abstract

Mental health and substance use disorder (MH/SUD) care is often underused, and cost of care is frequently cited as an access barrier, including among commercially insured individuals. We examine a novel and dramatic state policy change intended to improve MH/SUD care affordability. In 2022 New Mexico implemented SB 317, a law that aimed to reduce financial barriers by eliminating all cost-sharing for in-network MH/SUD care in the commercial insurance plans that the state could legally regulate. We use 2018-2022 claims data from the Health Care Cost Institute to estimate difference-in-difference models of spending and utilization for MH/SUD services. We examine pre/post changes in MH/SUD treatment utilization and spending among New Mexico enrollees in the “treated” group of fully-insured employer-sponsored plans who were affected by the law compared with New Mexico enrollees in self-insured employer-sponsored plans who were not affected by this law. Our difference-in-differences results imply that the policy had a modest impact on both financial costs to consumers and MH/SUD service use. Specifically, we find that in the first year of the law’s implementation, the law led to a decline in average out-of-pocket spending for MH/SUD care, without finding evidence of a significant increase in overall MH/SUD spending. We find limited evidence that the law led to significant increases in access or utilization of MH/SUD care in its first year. These results have implications for future policy making around cost-sharing for MH/SUD care. The modest effects that we estimate highlight limitations of state insurance legislation as a vehicle to influence affordability and access to care. Specifically, a large share of the treatment group were enrolled in high-deductible health plans, which were exempted from much of the no-cost sharing law’s requirements. Other market constraints, such as limitations imposed by federal ERISA restrictions, limit the impacted population size, and local provider networks and provider availability likely limit the reach of state insurance legislation.

Author

• James Matthew Campbell, University of Minnesota - Twin Cities
  Presenting Author