Insurers Illegally Denying Mental Health, Substance Use Disorder Benefits

January 25, 2022

The US Departments of Labor, Health and Human Services and the Treasury released a report on January 25 that suggests health insurers are illegally denying mental health and substance use disorder benefits to the growing number of people who need them.

The Department of Labor (DOL) typically publishes these reports every other year, in response to the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). That federal law requires insurers to offer mental health and substance use disorder benefits on parity with physical medical care and surgery benefits. In other words, they cannot make the former more restrictive through higher co-pays or prior authorization requirements. Mental health and medical issues must be considered similarly important; the price must reflect that.

“The DOL’s authority to assess civil monetary penalties for parity violations likely has the greatest chance to strengthen protections.”

The latest report states that the DOL and the Department of Health and Human Services (HHS) “are committed to using all their available authority to ensure that individuals realize the full promise of MHPAEA, and to ensure that Americans with [mental health and substance-use disorder] coverage can access [mental health and substance-use disorder] care that is not limited in any way that medical/surgical care is not.” To do so, they say that they will proactively and rigorously enforce MHPAEA by “conducting extensive training for existing agency staff, recruiting and retaining additional staff, and employing experts when necessary.”

The departments note that the DOL’s authority to assess civil monetary penalties for parity violations likely has the greatest chance to strengthen MHPAEA protections. They also recommend amending the Employee Retirement Income Security Act (ERISA), which set standards for private retirement and health insurance plans. They call for Congress to allow the DOL’s Employee Benefits Security Administration (EBSA)—which administers, regulates and enforces ERISA—to “expressly provide the agency with the authority to directly pursue parity violations” and “recover amounts lost by participants and beneficiaries who wrongly had their claims denied.” They also ask Congress to permanently expand telehealth and remote care services.

On a press call, officials did not offer much clarity on why parity has not yet been achieved. But it’s easy to understand the heightened importance: Overdose rates have reached record highs during the pandemic, and as the 2022 report emphasizes, mental illness has long been ubiquitous in the United States, with almost 52 million adults experiencing such a condition in 2019.

COVID only exacerbated these issues, especially among communities of color, who have disproportionately contracted or died from the virus. As the report notes, for example, “Black and Hispanic adults were more likely than white adults to report symptoms of anxiety or depressive disorder during the COVID-19 pandemic,” and Black communities experienced higher fatal overdose rates in 2020, with 36.8 per 100,000—a figure 16.3 percent higher than the white population that year.

The Biden administration has made addressing the “overdose epidemic” something of a priority, indicating that it would promote “evidence-based prevention, treatment, harm reduction, and recovery support services, as well as reducing the supply of illicit drugs.” Some jurisdictions have recently gone further: New Jersey just eliminated a massive hurdle to allow syringe service programs (SSP) to operate, for instance, and New York City’s two safe consumption sites, which have legally been running for two months, have already reversed 114 overdoses.

“Enforcement of this law is a top priority for the Department of Labor and an objective I take personally.”

“The report’s findings clearly indicate the health plans and insurance companies are falling short of providing parity in mental health and substance use disorder benefits, at a time when those benefits are needed like never before,” US Secretary of Labor Marty Walsh, who has been open about his past experience of alcohol use disorder, said in a press statement.

“The pandemic is having a negative impact on the mental health of people in the US and driving a rise in substance use,” he continued. “As a person in recovery, I know firsthand how important access to mental health and substance use disorder treatment is. Enforcement of this law is a top priority for the Department of Labor and an objective I take personally.”



Photograph of Marty Walsh by Joe Spurr via Flickr/Creative Commons 2.0

Alex Norcia

Alex was formerly Filter’s news editor. He previously worked as a reporter and copy editor at VICE, and has been published in the New York Times Magazine, the Columbia Journalism Review, the Los Angeles Times and the New Republic, among other outlets. He was also previously a freelance editorial consultant for the Foundation for a Smoke-Free World; The Influence Foundation, which operates Filter, has received grants from the Foundation for a Smoke-Free World. He is currently based in Los Angeles.

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