No Impact: The Effectiveness of New Mexico’s Elimination of Behavioral Health Co-Pays in Reducing Costs and Improving Access to Care

A recent study conducted by Ezra Golberstein and his team at the University of Minnesota has shed light on the effectiveness of New Mexico’s No Behavioral Health Cost Sharing Act. The law, which was implemented two years ago, eliminated behavioral health co-pays for individuals in certain insurance plans.

Initially, Golberstein was surprised by the ambitious approach taken by New Mexico to reduce costs and improve access to care. However, the study showed that while out-of-pocket costs decreased within the first six months of the law taking effect, there was no significant increase in individuals seeking mental health treatment. This is because most prescriptions are for generic drugs, which are already affordable, so reducing the cost to zero did not have a significant impact on medication dispensing patterns.

However, 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 New Mexico’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.