Alternate Insurance Arrangements and the Treatment of Depression: What are the Facts?

22 Pages Posted: 11 Jul 2000 Last revised: 22 May 2022

See all articles by Ernst R. Berndt

Ernst R. Berndt

Massachusetts Institute of Technology (MIT) - Sloan School of Management; National Bureau of Economic Research (NBER)

Richard G. Frank

Harvard Medical School; National Bureau of Economic Research (NBER)

Thomas G. McGuire

affiliation not provided to SSRN

Date Written: November 1996

Abstract

Using insurance claims data from nine large self-insured employers offering 26 alternative health benefit plans, we examine empirically how the composition and utilization for the treatment of depression vary under alternative organizational forms of insurance (indemnity, preferred provider organization networks or PPOs, and mental health carve-outs), and variations in patient cost-sharing (copayments for psychotherapy and for prescription drugs). Although total outpatient mental health/substance abuse (MHSA) expenditures per treated individual do not vary significantly across insurance forms, the depressed outpatient is more likely to receive anti-depressant drug (ADD) medications in PPOs and carve-outs than under indemnity insurance. Those individuals facing higher copayments for psychotherapy are more likely to receive ADD medications. For those receiving ADD treatment, increases in prescription drug copay tend to increase the share of ADD medication costs accounted for by the newest (and more costly) generation of drugs, the selective serotonin reuptake inhibitors.

Suggested Citation

Berndt, Ernst R. and Frank, Richard G. and McGuire, Thomas, Alternate Insurance Arrangements and the Treatment of Depression: What are the Facts? (November 1996). NBER Working Paper No. w5813, Available at SSRN: https://ssrn.com/abstract=225601

Ernst R. Berndt (Contact Author)

Massachusetts Institute of Technology (MIT) - Sloan School of Management ( email )

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Richard G. Frank

Harvard Medical School ( email )

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National Bureau of Economic Research (NBER)

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Thomas McGuire

affiliation not provided to SSRN

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