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By Rebecca Owens

Does anyone else think it’s sad, pitiful, embarrassing [insert any other synonym for pathetic] that it has taken what amounts to a $700 billion bribe for the Senate to pass a bill putting mental health coverage more in line with other types of health insurance?  I’ve heard the disparity between mental health and regular health coverage called discrimination; ludicrous is more apt.  From what I have read in various articles, the discrepancy is something to the effect of a 30% increase in co-pay with only 10% the limit of health insurance!

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2 Comments

  1. It is bizarre that the issue of mental health insurance has been linked up with the economic bailout. So, we agree on that. But, the wisdom of the Act is more complex than you acknowledge, I think. There are two possible reasons, at least, why the market had often failed to provide mental health coverage as broad as that now required by the new Act. One might be some possible hostility, prejudice towards mental health issues. I wonder how true this is, however, given the broad spectrum of the population affected by mental health problems. Second, however, is a problem of moral hazard. Perhaps insurers and people who pay for policies were concerned that reducing the price of mental health treatments below their cost — which is one consequence of insurance — might lead to ‘excessive’ consumption of mental health services, many of which are of dubious efficacy but as to which people are bamboozled into partaking. This will increase the price of health insurance and thus make it less available. There’s also an adverse selection problem, given the difficulties of forcing insureds to share their mental health histories. the new Act will test whether skeptics about the consequences of broader coverage were right.

  2. I have to admit that I completely agreed with Becca when I first thought about the discrepancies between mental health coverage and other types of coverage. The argument made in the Metropolitan Live v. Massachusetts case, about the problem with adverse selection seemed to frame my opinion pretty clearly. If you don’t force mental health benefits (which, as has been pointed out, are “of dubious efficacy”) then the costs of this particular protection will be increased, due to the impact of adverse selection. Massachusetts argued that by mandating minimum coverage levels, they were effectively forcing the good-risk individuals to become part of the risk pool. Thereby lowering the costs of these benefits.

    Thoughts on that argument?


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