Insurers Failed To Comply With Mental Health Coverage Law, Department Of Labor Report Finds

The probe found widespread noncompliance and violations of federal law in how health plans and insurers cover mental health care, echoing the findings of a recent ProPublica investigation.

The U.S. Department of Labor found widespread noncompliance and violations of federal law in how health plans and insurers cover mental health care, findings that mirror a recent ProPublica investigation.

This article was written by Duaa Eldeib, Maya Miller, Annie Waldman and Max Blau, and originally published by ProPublica.

Health plans, and the companies that administer them, have excluded key behavioral treatments, such as therapies for substance use and autism, and offered inadequate networks of mental health providers, according to a 142-page report released Jan. 17 in conjunction with the Treasury and Health and Human Services departments.

The report, which the agencies are required to file regularly to Congress, also detailed the results of secret shopper surveys of more than 4,300 mental health providers listed in insurance directories and found an “alarming proportion” were “unresponsive or unreachable.” Such error-ridden plans, commonly known as ghost networks, make it harder for patients to get the treatment they need, ProPublica has previously found.

Since 2021, the Labor Department has addressed violations in health plans that serve more than 7 million people, according to the report. The agency has worked to remedy the problems by seeking changes to plan provisions, policies and procedures, as well as working to ensure wrongly denied claims were paid.

But the report acknowledged that while plans and insurers have made some progress, they continue to fall short. For instance, federal officials wrote that insurers were working faster to fix problems in their plans once they had been identified, but officials had not seen sufficient improvement overall.

The report examined the enforcement and implementation of the federal Mental Health Parity and Addiction Equity Act, which requires health insurance plans to provide the same access to mental health care as they do to medical care. Last week, on the same day the report was released, department staff told ProPublica that the agency was investigating issues related to our reporting.

The Labor Department regulates insurance plans for about 136 million Americans who receive health coverage through their employers and is responsible for enforcing federal protections around their mental health claims. Federal regulators have struggled to hold insurance companies accountable for improperly denying mental health coverage, in part because of staffing and budgetary constraints.

The agency has asked Congress for additional funding on multiple occasions and, in its most recent congressional report, wrote that the agency is left with one investigator for every 13,900 plans it regulates, a higher workload than in previous years. Some temporary funding runs out in September, and its “full depletion will likely have catastrophic effects” on its enforcement capabilities, according to the report.

Timothy Hauser, a deputy assistant secretary of labor, said in an interview on the day of the report’s release that the agency is investigating the oversight and management of doctors hired by insurance companies who repeatedly deny mental health coverage for patients — and may open additional investigations.

Hauser, who has worked at the agency for more than three decades and is staying on in the new administration, said the agency is probing how insurers use and supervise doctors they rely on to conduct reviews of coverage and whether those doctors review cases in a “fair and dispassionate” way. ProPublica’s reporting raised serious concerns around those issues.