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<p><strong>You Are Here:</strong> <span class="crumb_link"><a href="/" class="crumb_link">AHRQ Archive Home</a> > <a href="/research/resarch.htm" class="crumb_link"><em>Research Activities</em> Archive</a> > <a href="." class="crumb_link">April 2001</a> </span></p>
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<td><h1><a name="h1" id="h1"></a>Health Care Costs and Financing </h1>
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<p>This information is for reference purposes only. It was current when produced and may now be outdated. Archive material is no longer maintained, and some links may not work. Persons with disabilities having difficulty accessing this information should contact us at: <a href="https://info.ahrq.gov/">https://info.ahrq.gov</a>. Let us know the nature of the problem, the Web address of what you want, and your contact information. </p>
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<h2>Equalizing coverage for mental health and physical health would substantially reduce consumers' share of mental health costs</h2>
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<p>Equalizing health plan coverage of mental health services with that for physical health care is still being actively debated at both the national and State levels. Full mental health parity would substantially reduce consumers' share of mental health expenditures, with larger savings in outpatient care compared with inpatient care. However, the impact of parity on consumer incentives to use mental health services would vary greatly, depending on individual insurance plans, concludes a study by researchers at the Agency for Healthcare Research and Quality. </p>
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<p>Samuel H. Zuvekas, Ph.D., Jessica S. Banthin, Ph.D., and Thomas M. Selden, Ph.D., used detailed information on health plan benefits for a nationally representative sample of the privately insured nonelderly population taken from the 1987 National Medical Expenditure Survey. They aged and reweighted the survey data to represent 1995 population and coverage characteristics. The researchers computed marginal out-of-pocket costs from the cost-sharing benefits described by booklets under current coverage and under parity for various mental health treatment expenditure levels using a microsimulation model. </p>
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<p>Results showed that as of 1995, parity coverage would substantially reduce consumer out-of-pocket
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costs for mental health care, assuming no change in physical health coverage. For outpatient mental health services, mean marginal out-of-pocket costs would decline from between 40 and 50 percent to 20 percent or less for lower expenditure levels and from between 80 and 90 percent to less than 10 percent for higher expenditure levels. For inpatient care, the mean marginal out-of-pocket costs would decline by about 15 to 20 percent for lower expenditures and between 50 and 60 percent as expenditures rise to $50,000. </p>
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<p>Lowering out-of-pocket costs is likely to substantially increase the demand for mental health treatment, especially outpatient treatment, where the savings are more dramatic. However, the researchers caution that parity in benefits does not necessarily mean equal access to treatment, given the supply-side constraints imposed under managed care. </p>
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<p>See "How would mental health parity affect the marginal price of care?" by Drs. Zuvekas, Banthin, and Selden, in the February 2001 <em>Health Services Research</em> 35(6), pp. 1207-1227.</p>
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<p>Reprints (AHRQ Publication No. 01-R042) are available from the <a href="https://www.ahrq.gov/research/publications/order/order-research-activities.html">AHRQ Publications Clearinghouse</a>.</p>
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