Parity Benefits Show Little Effect on Treatment for Substance Abuse

Parity in insurance coverage of treatment for substance abuse disorders improved insurance protection for individuals—as measured by out-of-pocket costs incurred by patients—but had little impact on overall utilization, costs for plans, or quality of care.

Those were the findings of a study looking at historical patterns of service utilization and cost in the Federal Employees Health Benefits (FEHB) plans covering the period before and after parity coverage of substance abuse and mental health treatment was mandated. The study also compared those patterns with nonfederal health plans that did not provide parity coverage.

The report appeared in the February Psychiatric Services.

"Implementation of parity in these large FEHB plans was not associated with significant increases in the probability of using substance abuse services," wrote lead author Vanessa Azzone, Ph.D., of Harvard University and colleagues. "[T]he rate of decrease in out-of-pocket spending was significantly larger for FEHB plans. Although parity was associated with a higher probability of identifying adults with a substance abuse or dependence diagnosis, there were no measurable impacts on initiation or engagement in substance abuse treatment among those identified with a substance use disorder. These findings are generally consistent with other studies examining the effects of parity on mental health and substance abuse treatment utilization and spending when behavioral health benefits are administered by an MCO [managed care organization]."

Her fellow researchers included Richard Frank, Ph.D., and Sharon-Lise Normand, Ph.D., of Harvard Medical School, and M. Audrey Burnam, Ph.D., of RAND.

A previous landmark study of parity implementation in seven large FEHB health plans by Psychiatric Services editor Howard Goldman, M.D., and colleagues was published in the March 30, 2006, New England Journal of Medicine. The study found few effects of parity on utilization of mental health and substance abuse treatment services or on spending for these services, though reductions in beneficiary out-of-pocket spending were found in five of the seven plans.

The Psychiatric Services study is the first to look at the effect of parity on utilization and cost of substance abuse treatment services alone, rather than in combination with other mental health treatment.

Parity coverage in the FEHB plans began in January 2001. In the study, Azzone and colleagues compared substance abuse treatment spending and utilization from 1999 to 2002 for continuously enrolled beneficiaries covered by six plans in the FEHB program with parity coverage of mental health and substance use disorders with spending and utilization among beneficiaries in a matched set of health plans without parity coverage.

Statistical analysis estimated the probability of any substance abuse service use as well as total and out-of-pocket spending. Data on three quality indicators for substance abuse treatment were also estimated: identification of adult enrollees with a new substance abuse diagnosis, treatment initiation, and treatment engagement.

Results showed that there were no significant differences between FEHB and non-FEHB plans in rates of change in average utilization of substance abuse services. However, the rate of substance abuse treatment out-of-pocket spending declined significantly in the FEHB plans after institution of parity, compared with the non-FEHB plans, with a mean difference of $101.09; at the same time, changes in total plan spending per user did not differ significantly.

With parity, more patients had new diagnoses of a substance use disorder, but there were no statistically significant differences for rates of initiation and engagement in substance abuse treatment, according to the study.

"Our main finding is that, for continuously enrolled populations, providing parity of substance abuse treatment coverage improved insurance protection by reducing out-of-pocket costs of substance abuse treatment for beneficiaries," Azzone said in comments to Psychiatric News. "Although parity had no detectable impact on the probability of utilizing treatment services, it was associated with improvement in one of three indicators of quality of substance abuse treatment services.

"Policy makers should be assured that this parity law does what it's supposed to do, lower out-of-pocket expenses for covered individuals, not increase the overall costs," she added. "I think clinicians should push more for their patients, even if it is hard for them to promote services when they have so many obstacles. This is already a population that finds it very hard to engage in and continue to get services. Parity should enable clinicians to be able to help patients."