In 2019, New Mexico passed a unique law that eliminated out-of-pocket costs for behavioral health care in certain insurance plans. A recent study on the law’s impact has shown mixed results. Ezra Golberstein, an associate professor at the University of Minnesota, was initially impressed by the No Behavioral Health Cost Sharing Act when he first learned about it in a newsletter. He noted that no other state had attempted such an ambitious approach to reducing costs for consumers and improving access to care.
The study conducted by Golberstein’s team found that within the first six months of the law taking effect, out-of-pocket costs decreased. However, the law did not necessarily lead to an increase in individuals seeking mental health treatment. Golberstein explained that since most prescriptions are for generic drugs, which are already affordable, reducing the cost to zero for these medications did not significantly impact medication dispensing patterns. Despite this, there was a slight rise in new prescriptions for more expensive medications.
There are limitations to the law, as it specifically targets insurance plans obtained through employers. Many of the state’s largest employers are not required to comply due to a carveout for “self-funded” insurance, which is commonly chosen by large companies. However, individuals with insurance through the Affordable Care Act Marketplace or state employees are affected by the law. Golberstein emphasized that New Mexico continues to serve as a testing ground for this type of legislation, and his team plans to conduct further research on its impact.
The study was made possible by funding from the W.K. Kellogg Foundation and KUNM listeners.