A report released Tuesday by the state’s Office of Health Strategy found shortfalls in reimbursement for behavioral health services across all insurance types, which could lead to issues for residents trying to access care.
Using Connecticut’s all-payer claims database, the report’s authors investigated discrepancies in behavioral health reimbursement rates between public and commercial payers, as well as discrepancies within payers for how they reimburse behavioral health compared to other medical services.
The findings revealed that Medicaid, known as HUSKY in Connecticut, underpays behavioral health providers compared to commercial insurers, on par with findings from another report on Medicaid reimbursement rates published by the Department of Social Services earlier this year.
But the analysis by OHS also looked at other types of insurers, as well.
In a review of seven commercial insurance providers, four — Anthem, Cigna, ConnectiCare and UnitedHealthcare — showed evidence of underpaying behavioral health providers compared to providers in other specialties. The analysis also found that Medicare Advantage pays behavioral health providers less than commercial insurers for many services.
Medicare Advantage is a type of Medicare plan offered by a private company and, both nationally and in Connecticut, over half of Medicare beneficiaries are enrolled in Medicare Advantage as opposed to traditional Medicare.
There is a seemingly unending demand for behavioral health services, which includes treatment for mental health and substance use disorders. But accessing care can be difficult: in Connecticut, 40% of people live in mental health workforce shortage areas. Shortages tend to be more acute for people with Medicaid, which is typically accepted by fewer providers.
Since the report analyzes data on services provided, it doesn’t provide a clear picture into how many people are facing insurmountable barriers to care.
“We don’t know how many people weren’t able to get the care they needed, when they needed it, and for how many people it was because they had to bear too great a share of the cost,” said Mark Schaefer, vice president at the Connecticut Hospital Association.
The report’s recommendations included further examination of HUSKY reimbursement rates compared to Medicare and median commercial insurance benchmarks and a closer examination of the four commercial insurance providers with potential disparities in their payments to behavioral health providers.
A spokesperson for Anthem said the company was reviewing the report. Spokespeople with ConnectiCare and UnitedHealthcare did not respond to requests for comment.
And a spokesperson with Cigna deferred comment to a spokesperson with the CT Association of Health Plans.
“We are still in the process of digesting the report. There are nuances to the numbers that are in need of further review and analysis,” said Susan Halpin, executive director of the CT Association of Health Plans.
HUSKY rates
Providers have been calling on the state to increase Medicaid reimbursement rates for the last several years, arguing that the low rates make it financially unsustainable to treat more low-income patients.
The study revealed that, within behavioral health, there are significantly fewer providers who saw HUSKY enrollees compared to those that saw commercial insurance enrollees. For psychologists, in particular, the difference is stark: there are more than four times the number of providers seeing commercially insured patients than those with HUSKY.
“It arguably limits the participation in Medicaid for those who have a choice,” said Schaefer, adding that the newly released report reinforces the findings from the DSS study released earlier this year.
This dynamic also puts more pressure on the providers who do accept HUSKY patients. Behavioral health providers who saw HUSKY enrollees served almost double the number of patients compared to providers who saw commercially insured patients.
Commercial insurance paid more for nearly all common behavioral health services compared to HUSKY. In a particularly extreme example, HUSKY paid less than 70% of what commercial insurance paid for established patient office visits performed by psychiatrists, advanced practice registered nurses, and physician’s assistants.
Medicaid reimbursement rates establish how much the state pays providers to treat low-income patients. In 2007, Connecticut set the Medicaid reimbursement rates for most physician services at 57.5% of the Medicare rate at the time.
The rates have not been broadly adjusted since, though certain providers, including primary care physicians and OBGYNs, have received rate increases. Effective July 1, 2024, DSS increased rates for certain behavioral health services provided to people 20 and under, according to the OHS report.
The report estimated that increasing HUSKY rates for services with the largest discrepancies would cost an additional $7.6 million, representing a 5.2% increase in total 2022 behavioral health spending for the services included in the analysis.