Insurance companies are pushing mental health care providers out of their networks, making treatment harder to find, and some states are passing laws to protect patients. Javi Sanz/Getty Images/E+ Hide caption
Toggle caption Javi Sanz/Getty Images/E+
Getting mental health care can be a frightening ordeal. Even if a patient finds a therapist in-network, insurance companies may ignore the therapist and determine that the prescribed treatment isn't medically necessary.
Such interference drives mental health professionals out of their networks, making treatment harder to find and putting patients at risk.
ProPublica sought to understand what legal protections patients might have against insurance companies interfering with their mental health care.
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The majority of Americans (over 164 million) have insurance plans through their employers, which are generally regulated by federal law.
The law requires insurers to provide mental health care just as they do physical care, but they don't have to rely on evidence-based guidelines or those recommended by professional societies to determine medical necessity. Instead, the government allows insurers to set their own standards when deciding what to pay.
“If insurance companies were allowed to set their own medical necessity standards, they would almost certainly be plagued with financial conflicts of interest,” said Mayram Bendat, a California psychotherapist and attorney who specializes in protecting access to mental health treatment.
Federal lawmakers who want to strengthen patient protections could look to state lawmakers who are spearheading stronger laws.
While these state laws only cover plans under state jurisdiction, such as individual or small group insurance purchased through state marketplaces, experts told ProPublica that they could serve as a model for broader legislation if enacted.
“States are the laboratories for innovation,” said Lauren Finke, senior director of policy at the nonprofit Kennedy Forum, which has advocated for state legislation to improve access to mental health care. “They can bring that forward and use it as a proof of concept, and then make sure that gets translated to the federal level.”
ProPublica reporters scrutinized the laws in all 50 states to find out how some states are exploring new avenues to ensure access to mental health care.
Many of the new protections are just beginning to be implemented, but a ProPublica investigation found that some states have begun to punish non-compliant companies and force compliance.
Who defines what kind of mental health care is needed?
Insurance companies generally have few constraints when it comes to defining what mental health care is medically necessary. Rather than relying on standards established by nonprofit professional medical societies, insurance companies often create their own in-house standards. These standards can be used when challenging a diagnosis or treatment plan.
“Given the for-profit motives of insurance companies, it's really shocking that federal law doesn't define medical necessity or require the use of nonprofit guidelines for decision-making,” said Bendat, who helped the California Legislature draft a stronger law, making it one of the first states to pass it in 2020.
California law requires insurers to follow generally accepted standards for treating mental and substance use disorders and must rely on evidence-based sources that establish those standards, such as nonprofit professional organizations and peer-reviewed studies. The state also prohibits insurers from covering only short-term or acute symptom treatment, such as crisis stabilization, but not underlying conditions, such as chronic depression.
Last October, California found that Kaiser Permanente violated new state laws and other health care regulations, and settled with the company, which agreed to pay a $50 million fine and invest $150 million in behavioral health care. A Kaiser spokesman said the company takes full responsibility for its performance and has adopted new guidelines that are in line with the law. (Read the full response)
A spokesman for the state's Agency for Health Care Administration said the agency audits insurers to determine whether their networks offer enough providers to serve customers and whether they provide timely access to care.
Nine states, including Oregon, Illinois and Georgia, have defined clinical standards or criteria that insurers must use when determining mental health care coverage.
Amid the opioid crisis that has claimed the lives of more than a million Americans, states have also enacted medical necessity protections for substance use treatment. For example, in Colorado, Maryland, Delaware, Connecticut, and several other states, insurers must follow guidelines from the American Society of Addiction Medicine when considering substance use treatment.
How can insurance companies challenge mental health treatment?
Before 2008, insurers across the country could impose stricter limits on how often patients could receive mental health care than they could for medical care, and they imposed even stricter caps on the number of treatments per year and the length of stays in inpatient facilities.
The federal Mental Health Parity and Addiction Equality Act banned such strict limits, so insurers turned to other ways to deny treatment. “We're not going to cover unlimited treatment, so they have to take steps to limit access,” said Tim Clement, vice president of federal government relations for the nonprofit group Mental Health America.
Insurers say they conduct what are called utilization studies, which allow them to request and review confidential, information-filled treatment records to assess whether providers are providing adequate treatment. But providers, mental health care advocates, and lawmakers say the studies are often used by insurers looking for an excuse to dispute the need for treatment.
In recent years, at least two dozen states have passed bills that attempt to regulate how insurers conduct behavioral health screening.
State lawmakers stepped up scrutiny of these processes in 2019 after the New York attorney general found that insurers including Emblem Health, Excelus and MVP had violated state and federal law in their reviews. An Excelus spokesman said it has adopted some reforms since then. MVP did not respond to ProPublica's questions, and Emblem Health forwarded a response from a managed care insurance trade group called the New York Association of Health Plans, which said the state's findings don't reflect the industry's current practices. (Read the full response.)
New York law requires that insurers must rely on state-approved evidence-based standards when reviewing treatment. Peer reviewers who evaluate the medical necessity and appropriateness of treatment for insurers must be licensed medical providers with expertise in mental health. And for children, insurers are generally prohibited from seeking pre-approval of mental health treatment or conducting reviews during the first two weeks of hospitalization.
Last year, New York state regulators found that Cigna and Wellfleet's medical necessity standards didn't comply with the new law. The state's Department of Mental Health said the insurers have been allowed to stay open while they work with the state to bring their standards into line with the law. (The companies didn't respond to requests for comment.)
Several states, including Massachusetts, New Mexico and Hawaii, require insurers to disclose to patients and providers the standards and policies they rely on for screening.
Typically, the insurance company selects the clinician who will perform the review, but in Illinois, if there is a disagreement about the necessity of treatment, the patient may choose a different clinical review physician selected jointly by the patient, provider, and insurer.
Some states also limit the frequency of reviews: In Delaware, insurers are generally prohibited from reviewing inpatient substance use treatment for the first 14 days, and in Kentucky and Ohio, insurers cannot require more than one review per year for outpatient treatment for patients with autism.
What do insurers need to disclose about access to mental health care?
Laws requiring fair coverage for mental and physical illnesses are difficult to enforce. Doing so would require comparing vastly different types of care and successfully arguing that there are disparities in access. State and federal regulators have few resources to conduct such thorough investigations, hampering their ability to scrutinize insurers.
To hold insurers accountable, at least 31 states and the District of Columbia have passed laws requiring insurers to report how well they actually provide access to mental health care.
Most of these states require insurers to provide details about standards of care and limitations, but some appear to be violating their own laws by withholding the information.
For example, the New Jersey Department of Banking and Insurance must make insurers' complaint records publicly available and post insurance compliance reports related to mental health care, but more than five years after the state passed the requirements, no such information is publicly available on the department's website.
When asked by ProPublica about the lack of transparency, spokeswoman Dawn Thomas said the department is working to implement the requirements and that the reporting process is expected to begin later this year. “We recognize that the law’s reporting provisions provide important public insight into carrier compliance,” she said in an email to ProPublica.
Chris Akin, a spokesman for New Jersey Assembly Speaker Craig Coughlin, the bill's lead sponsor, told ProPublica that his office has been in contact with the department and will “monitor the department's progress to meet reporting requirements and ensure full transparency for consumers.”
In compliance reports, states often request data and analysis from insurers, but the numbers insurers submit may not be detailed or accurate.
“I've looked at a lot of these analyses,” said Clement, who has campaigned for greater insurance transparency in several states. “In most states, the results are pretty dire.”
But in some states, such as Oregon, where detailed annual reporting is required, the analysis suggests that behavioral health claims are disproportionately more out-of-network than medical claims, and that people may face challenges accessing therapists covered by their insurance plans.
The report also found that mental health providers are paid significantly less than medical providers for consultations of comparable length. For an hour-long consultation, mental health providers were paid, on average, about half of what a medical or surgical clinician would be paid. A spokesman for the state's Department of Consumer and Business Services told ProPublica that there have been no investigations or enforcement actions regarding the new requirements.
“You can't be sure that someone is following the law unless you can ensure that they're being held accountable and demonstrating that they're being held accountable,” Clement said.
Other states, such as New York, are also beginning to use the new data to advance their investigations: A spokesman for the state's Department of Financial Services said the department has conducted nine investigations into seven insurers in response to the law since 2021.
People can file a complaint with their state's insurance department if they believe their insurance company is violating their rights.
This article was provided by ProPublica, a nonprofit news organization that investigates abuses of power.
Share your story: If you've filed a complaint with your state health department and would like to share it with ProPublica reporters, please contact us at [email protected].
ProPublica has reviewed the laws and regulations of all 50 states and the District of Columbia. If you find a state law that wasn't included, please send ProPublica a note.
ProPublica's Max Blau contributed research to this report. Maps by NPR's Connie Hanzhang Jin.
