Treatment Coverage Falls Short

Employer-based health insurance plans often don't provide the treatment for alcoholism and other drug addictions that is mandated by state law, a new analysis by Ensuring Solutions to Alcohol Problems (ESAP) at George Washington University Medical Center has found.

ESAP researchers discovered that at least 10 major plans in 5 states (see chart at end) were not in compliance with state laws governing insurance coverage for alcoholism treatment.

"Some of the largest insurers in states, including those that provide alcohol treatment coverage for the greatest percentage of employed residents, aren't complying with state laws. The most common violation we discovered was that they aren't allowing people with alcoholism to remain in treatment—either inpatient or outpatient—as long as the laws in their states require," stated ESAP director Eric Goplerud.

Goplerud called upon state legislators to more carefully monitor the insurers' compliance with these laws, arguing that "these illegal limitations are counterproductive for patients as well as the companies who are providing employee health coverage through these insurers. Research indicates that longer duration of treatment improves the chances that a patient will recover.

Noncompliance also can affect state budgets by shifting more of the cost to treat alcohol problems from the private sector to the public sector, even though the majority of people who need alcohol treatment are employed."

Other violations of state law by employer-based health insurance plans included higher insurance co-payments, which research shows discourages patients from seeking alcohol treatment; coverage for detoxification services only, which are insufficient for treating alcoholism; and no coverage for detoxification services, which are medically necessary for alcohol-dependent patients.

ESAP researchers examined 70 health plans in 36 states and the District of Columbia. For purposes of the study, states were categorized according to their insurance laws:

• Parity (P): 7 states in which insurers must provide the same level coverage for alcohol treatment as for other illnesses;
• Mandated Minimum (MM): 20 states in which insurers must provide a minimum level of coverage for alcohol treatment, though typically at a lower level than that for other illnesses;
• Mandated Offering (MO): 17 states require insurers to offer the purchasers of employer-based health plans the option of a plan that includes alcohol treatment; and
• No Laws: 6 states do not require insurers to offer alcohol treatment coverage of any kind

The insurers, who were promised that they would remain unnamed in this study, provided ESAP copies of summary plan descriptions of their health insurance products that covered the greatest number of beneficiaries. These descriptions outline the scope of coverage, and must accurately summarize for beneficiaries the extent of contractually covered benefits.

Researchers then compared the alcohol treatment benefits drawn from the plan descriptions to abstracted information about states' alcohol health insurance laws as of December 1, 2002 provided by the Health Policy Tracking Project of the National Conference of State Legislatures (Delaney, D., Crean, E. Mandated Benefits and Mandated offerings for Mental Health and Substance Abuse Treatment, Health Policy Tracking Service, NCSL, Washington, DC.).

The new analysis continues the work begun by ESAP with Workplace Solutions: Treating Alcohol Problems Through-Employment-Based Health Insurance, a research report published in December 2002 and available on-line.