Among the many reasons employers choose to set aside fully insured health plans in favor of self-funding plans is cost containment. Simply put, self-funded plans are cheaper. Employers keep costs in check by customizing plans and limiting coverage. That brings up an interesting question: should self-funded plans offer mental health benefits?
It is a valid question in light of the push for mental health benefits covered by fully insured plans. Insurance companies and employers alike are beginning to press for mental health benefits to help workers impacted by everything from pandemic fears to financial problems. Mental health benefits are the latest ‘big thing’ in boosting employee benefits packages.
More Discriminating with Coverage
No doubt that self-funded health plans are a low-cost alternative to traditional medical insurance. The plans offer a range of health benefits that could include everything from free telemedicine visits to discounted prescription drugs. The difference is that, unlike fully insured plans, employers get to decide for themselves what they want to offer in terms of benefits.
Employers tend to be more discriminating in order to contain costs. For example, some of the plans administered by Las Vegas-based StarMed Benefits (https://starmedbenefits.com/) limit the number of in-person primary care visits they will cover in a single plan year. But subscribers have unlimited access to free telemedicine visits.
What does this have to do with mental health benefits? Everything. A company trying to contain its healthcare costs by utilizing self-funded benefits will carefully consider every benefit option before deciding what to include in its package. For some at least, mental health benefits will not be deemed important enough to include. There may be good reason to change that.
Mental Health in Decline?
There has been quite a bit of talk about America’s collective mental health since the start of the COVID pandemic. By some accounts, mental health in this country is now in decline. We do not have hard-and-fast data proving that to be the case, but the data we do have is still alarming. Check out these statistics from the National Alliance on Mental Illness:
- 20% of Americans have been diagnosed with a mental illness
- 5% have been diagnosed with a serious mental illness
- 19% live with anxiety
- 4% live with depression
- 12+ million American adults have seriously considered suicide.
All these statistics are alarming enough. But there’s more. Almost one-third of adults with a mental illness also have a substance abuse problem. Those living with depression have a 40% greater risk of developing cardiovascular disease. To top it all off, only about 46% of adults with mental illness actually receive treatment. It is not a good situation.
Mental Health Effects the Workplace
With 20% of all American adults being diagnosed with a mental illness, it’s highly likely that most employers have workers on the payroll who struggle with anxiety, depression, or some other sort of mental health problem. And that belies another reality: mental health does affect the workplace.
It would seem in the best interests of employers to offer mental health benefits just the same way they offer primary care, catastrophic care, diagnostic testing, prescription programs, and so on. A mentally healthy employee is just as good for business as a physically healthy one. And like it or not, physical and mental health are intrinsically connected.
Employers may seek out self-funded health plans in order to contain costs, but they should still consider the possibility of adding mental health benefits to their plans. Mental health is too important to leave to chance. It should be part of every self-funded, level-funded, and fully insured health plan.
