If you think your health coverage costs a lot now, just wait until Colorado state government finishes legislating parity for “behavioral, mental health, and substance use disorders.” House Bill 19-1269 extends and expands on the federal standards included in the Mental Health Parity and Addiction Equity Act to Medicaid and other health plans regulated by Colorado.
For physical health, insurers routinely require prior authorization for some medications. They use drug formularies to control treatment costs. They may also require patients to begin therapy with less expensive drugs. Progression to more expensive drugs is covered only if less expensive therapies fail. Under federal mental health parity law, it is legal to apply such requirements to drugs approved for substance abuse if they are also used for drugs used to treat physical ailments.
Even Colorado Medicaid uses preferred drug lists and prior authorization. It informs patients and providers that its Preferred Drug List allows “Colorado the ability to provide medications at the lowest possible costs.” It requires prior authorization before patients can get any drug not on the Preferred Drug list, even if it is FDA approved for a certain indication.
House Bill 1269 would make it illegal to use these types of controls to restrict access to any drug that the FDA has approved for the treatment of substance abuse disorders. All FDA approved drugs for substance abuse must be made available without any prior authorization by both private insurers and Colorado Medicaid. No step therapy requirements may be imposed. All FDA approved substance abuse drugs must be included on the lowest formulary level.
This requirement is unusual. If private insurers and state Medicaid programs already include FDA approved drugs for substance use disorders, why is this requirement needed? And if they don’t, they might have good reasons not to. If these laws improve treatment for substance abuse, why would eliminating prior authorization, tiered formularies, and step therapy not also improve treatment for physical health problems?
Some of the reasons why states restrict access to substance abuse medications are outlined in a 2018 Substance Abuse and Mental Health Services Administration report on Medicaid coverage of treatments for substance abuse. Though buprenorphine and buprenorphine-naloxone are FDA approved for opioid abuse treatment, many state Medicaid plans require prior authorization to limit possible abuse, misuse, resale, and other diversion. Combining buprenorphine with central nervous system depressants like alcohol can be deadly.
As the FDA does not consider cost when it approves drugs, state Medicaid plans interested in controlling costs often require that substance abuse patients try a generic medication before being prescribed a brand name medication. In 2018, 19 state Medicaid plans required pre-approval for extended-release injectable naltrexone to treat alcohol abuse. Oral naltrexone has a generic version available. The extended-release injectable does not.
It appears that the same lawmakers who lecture the private sector on spending too much on health care think they have the expertise to determine that the benefits of extended-release injectable naltrexone are well worth its higher costs now and in the future.
In addition to denying insurers the ability to control access to drugs approved for substance abuse, House Bill 1269 demands that they provide an “annual mental wellness checkup that is no less extensive than the coverage for the annual physical examination.” The annual reporting must provide “disaggregated information” on “consumer utilization of behavioral health services utilization.”
The bill also requires the state to increase payments for treatment clinics and extensive new reporting from all insurers. Among other things, all entities providing coverage must report on behavioral health utilization by groups of individuals with “housing instability,” “limited English proficiency,” and who are comprised of Black, Native American, Latino, Lesbian, Gay Bisexual, Transgender, or Queer individuals.
How are insurers supposed to determine who is in those groups? Does the legislature really think health insurers should give everyone an English proficiency test?
Moreover, these kinds of classifications shouldn’t even matter. Do Colorado legislators really believe that people in the named groups are more likely to have mental health problems? How offensive is that?
Here we have a state government that has already agreed to allow judges to decide whether to take people’s firearms based on other people’s say-so. It now wants to require your health insurer to assess your mental state and report on your use of mental health services.
Other than higher health costs, what could possibly go wrong?
Linda Gorman directs the health care policy center at the Independence Institute, a free market think tank in Denver.