Federal Policy Limits Pre Authorization For Therapy

Did you know that adults spent about $1500 on average out of pocket in 2021 even with private health insurance to be treated for anxiety or depression—which was nearly twice as much spent as someone without any mental health diagnoses. This stat, from the Kaiser Family Foundation, highlights the high cost of treatment for mental health but it doesn’t reflect the underappreciated cost of just getting an appointment.

A policy is now in place to help.

The Biden administration announced new steps this week to make sure insurers will better cover mental health at parity with physical health, though such requirements have technically existed for more than a decade. Insurers will need to analyze their provider networks, how much they pay out of network providers and how often they require, and deny, prior authorization. This is good for patients, on the whole, and potentially for therapists who increasingly have resisted joining these networks or in many cases, leaving them, which leaves patients with less access and paying more per session.

Plans will be required to make changes if they are not compliant. This rule specifies that health plans cannot use more restrictive prior-authorization or narrower networks that make it harder for people to access their mental health and SUD benefits compared to their medical benefits. Over 200 non-federal governmental health plans, such as state and local government employee plans, also must comply with the 2008 parity law for the first time.