Medicare Parity and Outpatient Mental Health Service Use and Costs Among Beneficiaries With Depression

Less than half of the US population with any mental health condition receives services. Cost is the most commonly cited barrier to treatment.

To examine whether service use and out-of-pocket expenditures among Medicare beneficiaries with depression changed after Medicare implemented equal cost-sharing for outpatient mental health and medical services (Medicare parity).

This economic evaluation used a single-group, interrupted time series design and examined data from the Medical Expenditure Panel Survey Household Component from 2008 to 2019. The sample included Medicare beneficiaries aged 65 years or older with depression. Data were analyzed from June 2, 2023, to June 17, 2024.

Under the Medicare Improvements for Patients and Providers Act of 2008, beneficiary cost-sharing for outpatient mental health services decreased from 50% prior to 2010 to 20% in 2014, creating parity with equivalent medical care.

The primary outcomes were outpatient mental health service use, as assessed by mean use, proportion of beneficiaries with any use, and intensity of use (ie, mean use among users), and out-of-pocket expenditures.

The analysis included 5831 Medicare beneficiaries. Using the Medical Expenditure Panel Survey person-level survey weights, this number corresponded to a nationally representative sample of 72 436 656 beneficiaries (median [IQR] age, 72 [68-79] years; 64.2%-72.2% female per study year). After Medicare parity, mean use of outpatient mental health services among beneficiaries with depression increased by 0.54 visits per year (95% CI, 0.31-0.76 visits per year), and proportion of use increased by 6.61% per year (95% CI, 2.23%-10.99% per year). Intensity of use decreased at parity by a factor of 0.90 (95% CI, 0.82-1.00) and increased after parity by a multiple of 1.07 per year (95% CI, 1.04-1.10 per year). Mean out-of-pocket expenditures for these services increased after parity by $12.25 per year (95% CI, $2.42-$22.08 per year). Sensitivity analysis using the 2016 US Preventive Services Task Force recommendation for routine adult depression screening indicated that the proportion of use increased 28.26% (95% CI, 24.33%-32.19%) once the recommendation was issued.

In this economic evaluation of Medicare parity, implementation of Medicare parity coupled with routine adult depression screening was associated with significant increases in outpatient mental health service use among Medicare beneficiaries with depression. These findings suggest that parity policies alone may not be sufficient to effectively address multiple barriers to mental health care but in tandem with physician screening, diagnosis, and referral practices, may increase the accessibility of mental health services.