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APHA Scientific Session and Event Listing

Colleen L. Barry, PhD, Department of Epidemiology and Public Health, Yale University School of Medicine, 60 College Street #302, New Haven, CT 06520, 203-785-4956, colleen.barry@yale.edu and M. Susan Ridgely, JD, The RAND Corporation, 1776 Main Street, Santa Monica, CA 90407-2138.

We studied the probability of carving out mental health and substance abuse benefits before and after parity in the FEHB Program in comparison with an unaffected group of Medstat Market Scan plans using difference-in-difference estimation. We also tested for an association between the FEHB parity directive and health plan exit using a maximum likelihood discrete time implementation of a Cox proportional hazards model. The study period included two years before (1999-2000) and two years after (2001-2002) implementation of the parity directive. Plan-level data were abstracted from publicly-available FEHB plan brochures. Data elements included beneficiary cost sharing, deductibles, day, visit, and dollar limits for general medical, mental health, and substance abuse services. These data were linked with information on health plan type, geographic region, plan enrollment and plan contracting with managed behavioral health care carve-out companies. Results show that plans complied with the directive and did not exit the FEHB program due to parity as had been feared by some policymakers. However, in comparison with unaffected health plans, FEHB plans were significantly more likely to begin contracting with managed behavioral health carve-out firms after parity. As parity constrains plan flexibility in setting higher patient cost sharing, it appears that carve-outs became more attractive for managing use of services. By creating an evidence base for comprehensive insurance parity, this parity directive may act as a catalyst for broader mental health and substance abuse insurance market changes.

Learning Objectives:

• Recognize the methods involved in a difference-in-differences estimation
• Describe the response of health plans to the FEHB parity directive
• Assess the response of FEHB plans compared to the secular trend

Keywords: Mental Health, Substance Abuse

Presenting author's disclosure statement:

Any relevant financial relationships? No