Decisions to improve psychiatric benefits for federal workers and encourage agencies to hire more people with psychiatric disabilities may not cost as much as premium-payers fear. (Taxpayers pick up about 72 percent of the total health premium for feds and retirees.)
By the same token, the White House-ordered changes in federal mental health coverage -- effective in 2001 -- may not be as helpful in cutting out-of-pocket costs for psychiatric services as some workers anticipate.
It is one thing to announce a major policy initiative, issue executive orders and crank out laudatory news releases. It is another -- the tough part -- to translate that program into reality, especially in a complex situation like this.
Administration officials say requiring parity between mental and medical benefits will increase premiums only slightly. But that estimate doesn't take into account the unknown factor: How many more people will use expanded benefits once agencies streamline procedures for hiring them.
Officials familiar with the nation's largest group health plan say change would return the federal health program to Kennedy-era times when mental and physical health benefits were relatively equal. Over the years, mental health benefits, which vary from plan to plan, have been trimmed.
Edwin Hustead, the former chief actuary of the Office of Personnel Management says some of the benefit cutbacks resulted from pressure by insurance companies. At times, he said, they overemphasized the cost of mental health coverage to the program. Hustead, now a vice president with The Hay Group benefits consulting firm, said there also was widespread publicity during the 1970s about the heavy concentration of psychiatrists in the Washington area. Newspaper stories said the psychiatrists were lured to this area by the large number of federal workers with generous mental health benefits.
Hustead said there also were instances where aspiring psychoanalysts, who are required to undergo analysis themselves, either took government jobs or had their spouses get government jobs long enough for the federal health plan to pay for their sessions.
Overall, Hustead says, the federal program has often been more generous in mental health coverage than most private-sector plans. But he said the percentage of people using the coverage and the percentage of costs vs. total payouts have been lower than in the private sector.
OPM data show that 500,000 of the 8.7 million people covered by federal health plans use mental health benefits each year. The agency says $2 of every $100 paid out in benefits is for mental treatment, exclusive of prescriptions.
About 2 percent of those covered by federal health plans use mental health benefits compared with about 4 percent in the private sector. OPM says that the vast majority of people in the federal health program who use out-patient mental health services use less than five visits a year. In private-sector health plans, Hustead said, a slightly larger percentage of covered individuals uses mental health benefits, which run about $3 per $100 of total cost.
Several federal health plans still provide mental health benefits that are more generous than those available in most private-sector plans. Those with the best mental benefits often have the highest premiums. The amount of premiums paid by employees and retirees (about 28 percent of the total premium) range from a few hundred to several thousands dollars a year to covered workers and retirees.
The Clinton administration will require all of the federal health plans -- including the 22 available to feds and retirees in this area -- to offer equal mental health and medical coverage.
In the past, many private-sector health plans have boosted mental health benefits but reduced costs by the "carve out" method, in which a special managed-care group monitors those benefits to make sure services are necessary and then tracks their use and cost. That, experts say, could easily happen in the federal program.
Tipper Gore, wife of the vice president, recently announced that she was treated for depression a decade ago. Like about half the people in the Washington area, she is covered by the federal health program. Her husband, as senator and vice president, belonged to the BACE health plan limited to congressional staff members. At one time, it was the top-rated federal plan because of its small, relatively young pool of subscribers. But last year, BACE, which had lost customers and faced major cost outlays, dropped out of the federal health program.
Sunday, June 13, 1999