Alignment for Progress: 
A National Strategy for Mental Health and Substance Use Disorders

Individuals needing MH/SUD services often face difficulties finding and accessing in-network providers. This can result in long wait times, high out-of-pocket costs associated with out-of-network care, and not receiving critical services. While some states have established their own network adequacy standards for MH/SUD providers, such as timely access and geographic distance standards, these standards vary widely. And even in many states that have standards, they are qualitative, rather than quantitative in nature, significantly impairing beneficiaries’ rights and making the standards difficult to measure or enforce.[1] Studies show that provider network directories overstate provider availability and current network adequacy standards – such as enrollee-to-provider ratios – may not reflect actual access.[2]

The Centers for Medicare and Medicaid Services (CMS) has proposed a new rule on network adequacy standards for Medicaid managed care plans, which includes new national maximum wait time standards for certain appointments and independent secret shopper surveys to validate plan compliance. The proposed maximum wait time standard for routine outpatient MH and SUD appointments is 10 business days.[2] The proposed rule is a significant step forward, and CMS should finalize it without delay.

To further strengthen rules, Congress should establish uniform, quantitative timely access and distance standards for MH/SUD services for all Medicaid managed care plans nationwide. If a plan’s network is unable to provide needed MH/SUD services for a beneficiary within these standards, the plan should be required to arrange out-of-network services with the beneficiary’s cost-sharing limited to what they would have paid had in-network services been available. Several states have implemented such standards, including California, which requires that health plans have medically necessary MH/SUD services available within 10 days.[3]

Many ERISA plans use discretionary clauses to avoid liability for improperly denying benefits, particularly for mental health and substance use disorders. By inserting “discretionary clauses” into their plan policies, ERISA plans permit themselves to interpret the meaning of the terms of the policies they administer and the facts they consider when adjudicating benefits under these policies. Where these clauses are allowed, courts must broadly defer to insurers’ coverage determinations. Under the deferential standard of review, courts only reverse benefit denials found to be “arbitrary and capricious,” even if the court believes the plan has made an incorrect determination.

This problematic higher burden of proof has imperiled the landmark federal court case Wit v. United Behavioral Health (UBH), an ERISA case recognized nationwide as a landmark case for mental health.[1] Nationally, there is a clear movement by states regulating fully-insured ERISA plans to ban discretionary clauses. In fact, the National Association of Insurance Commissioners (NAIC) has adopted a model law entitled the “Prohibition on the Use of Discretionary Clauses Model Act.” The NAIC describes the purpose of the model act to prohibit discretionary clauses “to assure that health insurance benefits and disability income protection coverage are contractually guaranteed, and to avoid the conflict of interest that occurs when the carrier responsible for providing benefits has discretionary authority to decide when benefits are due.”[2] Nearly half of states have now banned these clauses.

Where the clauses are allowed to stand, patients are at a terrible disadvantage in challenging wrongful denials of health care coverage. Federal Circuit Courts have articulated the unfairness that can result from applying a discretionary review in benefits cases, while various federal trial courts have noted that the standard of review in benefits matters is determinative and that the abuse of discretion standards of review permits incorrect outcomes.

The Mental Health Matters Act (H.R. 7780), which included language to ban discretionary clauses, passed the U.S. House in 2022.[3]

As of June 2023, 163 million Americans were living in mental health Health Professional Shortage Areas (HPSAs)[2] with an insufficient number of healthcare professionals relative to the population’s health needs.[3] According to the Commonwealth Fund, in 2021, fewer than half of people with a mental health condition were able to access timely care; those with substance use disorders were even less likely.[4] This has particularly impacted underserved communities.[5]

To address this gap, Medicare’s HPSA Physician Bonus Program pays a 10 percent quarterly bonus to medical doctors when they provide services in an HPSA.[6][7] These bonuses should be expanded to include non-physician providers.[1] The Senate Finance Committee included this change in its 2022 Mental Health Workforce Enhancement Discussion Draft.[1][8]

Self-funded employer plans (typically large employers) frequently hire third-party administrators (TPAs) to administer health plan benefits on their behalf. These TPAs are usually well-known insurance companies with recognizable brand names. Employers seeking to comply with the Mental Health Parity and Addiction Equity Act (MHPAEA) and other health coverage rules have reported that some TPAs refuse to provide information and data on the employers’ health plans, claiming that the information is proprietary. “[Employers] also say they often are unable to get the information they need from third parties—typically insurers—that administer their plans.”[1] Such refusals are unacceptable and inconsistent with employers’ and TPA’s obligations under the law. TPAs should be prohibited from imposing such indefensible barriers to compliance.

Health centers conduct more than 1.7 million substance use disorder (SUD) visits and over 15 million mental health visits.[4]  Unfortunately, despite providing indispensable integrated health care services for individuals enrolled in Medicaid and Medicare, a significant percentage of FQHCs have historically not provided core evidence-based treatments for SUDs, including opioid use disorder. One survey showed that, in 2019, 36 percent of community health centers did not offer MAT.[5] While the percentage of FQHCs providing MAT has improved over time, no FQHC should be permitted to not provide this life-saving treatment. Particularly now that Congress has eliminated the requirement that buprenorphine (a key MOUD) prescribers have a separate waiver (X-Waiver), there can be no excuse for an FQHC failing to provide MOUD and wraparound and counseling services.[1] FQHCs can be particularly important in increasing access to needed SUD treatment in rural communities.[6]

Additionally, there is a gap in coverage and treatment facilities across most states. More than 163 million people live in a mental health Health Professional Shortage Areas (HPSAs), meaning they do not have access to MH/SUD health professionals or treatment and support services.[7] Co-location of primary care and MH/SUD services has been shown to improve access to care and health outcomes.[8] This type of care entails providers using similar technologies, such as electronic health records, and being in the same physical location.[8]  By providing funding to states, they can develop the necessary infrastructure to provide MH/SUD care services at the same physical location.[2][3]

Currently, services that are indispensable treatments for common mental health and substance use disorders (MH/SUDs) are not covered by many public and private payers. For example, commercial plans largely fail to cover Coordinated Specialty Care, the evidence-based intervention for first episodes of psychosis, which often first appear in adolescence and early adulthood. The failure of commercial insurance to cover these services results in cost-shifts to Medicaid and contributes to approximately 75 percent of the 100,000 young people experiencing first psychosis each year not receiving this life-altering treatment. The federal government should not allow such evidence-based treatments to not be covered.[1][2]