Good news for elders: Medicare copays for mental health drop

Good news for elders:
Medicare copays for mental health drop
(January 2009 Issue)

By Elinor Nelson

Nowadays, good financial news is difficult to find. But a new law offers a welcome financial break for Medicare recipients. Since Medicare began in 1965, recipients have paid 20 percent of the cost for outpatient services, except for most mental health services, where the co-pay has been 50 percent - but that's about to change. A new law, sponsored by U.S. Senators John Kerry (D-Mass.) and Olympia J. Snowe (R-Maine) and passed in July over President Bush's veto, will begin dropping the mental health and substance abuse service co-pays annually, down to 20 percent in 2014.

Medicare's recipients, the elderly and people with disabilities, have higher mental health needs than the rest of the population. In 2006, George Washington University researchers found that while 21 percent of the general population has mental disorders, the incidence rises to 26 percent in the Medicare population. Medicare beneficiaries with disabilities, the study showed, are particularly vulnerable: 59 percent have a mental disorder and 37 percent of them have severe disorders. A 2001 report of the Administration on Aging estimated that only half of older adults with mental health problems are being treated.

"This represents a considerable and major step in the right direction and could be considered another successful step toward parity," states Ken Libertoff, Ph.D, executive director of the Vermont Association for Mental Health. He sees this move as "nothing but good news" for older Americans. "As a consumer advocate," he adds, "it has been painful to see that the 50 percent co-pay has been an absolute barrier to access."

In Vermont, which has an aging population, this change will have a "disproportionately positive impact." According to the Centers for Disease Control and Prevention, adults over 65 have higher suicide rates than the general population and recent statistics show that Vermont has the tenth highest rate of the elderly committing suicide in the United States.

Peter Newbould, director of Congressional and Political Affairs for the American Psychological Association, has been working on this legislation for several years. The benefits won't be that significant in the first year with only a five percent co-pay decrease, he says, but "by the end of the phase-in, this will make a big difference to the elderly. . . The total health care costs are much higher for the elderly with depression than those without it," Newbould says. "This provided a sensible justification for what many members of Congress wanted to do. They wanted to do the right thing."