This post was co-authored by Stephen Estes & Max Jaffe, the co-founders of WeRecover.
Los Angeles, CA - As the co-founders of WeRecover, the world’s first online booking engine for addiction recovery centers, we have seen thousands of people go through hundreds of treatment programs and we have a broad view of the addiction and recovery landscape in the United States. As President Trump’s opioid and drug addiction task force takes shape, we would like to offer the President some specific policy advice derived from our experience as patient advocates.
However, before we offer any political solutions to America’s addiction epidemic, we first must define the problem and its symptoms.
According to the Surgeon General’s recent report on addiction, substance misuse and substance use disorders cost the United States more than $400 billion annually in crime, health, and lost productivity.
That is a staggering figure. So staggering, in fact, that from an economic perspective alone, this problem warrants government intervention. The reason we mention this first is because some aspects of stemming this epidemic will require money - taxpayer’s money. However, the cost of addressing this epidemic will be offset by both gains in economic productivity and expenditures diverted from other programs, like incarceration.
Beyond the economic justification for recapturing $400 billion/year in lost productivity, there is a very real human reason why we must tackle this epidemic: Americans are dying. Every single day, every single hour of every single day - Americans are dying. According to the US Center for Disease Control, in the United States a baby is born addicted to heroin every nineteen minutes, 91 people die everyday of an opioid overdose, and over half a million Americans have lost their lives due to drug overdoses between the years 2000 and 2015.
That is more deaths from drug overdoses than American casualties in World War Two. This is no longer something we as a society can ignore, and we are glad to see the President and Governor Chris Christie taking it seriously. With that said, here are the top 4 things we advise the US government to do to stem the tide of America’s addiction epidemic:
1. Increase Medicaid’s reimbursement rates for detox, residential inpatient, partial hospitalization, intensive outpatient, and outpatient programs
This is critical. Millions of Americans - those suffering the most from addiction - have Medicaid as their primary insurance policy. And unfortunately, the Medicaid reimbursement rates for substance abuse treatment are so low that many privately owned centers cannot afford to accept these patients. Thus, those with Medicaid are forced to find free or government-sponsored programs with waiting lists that are weeks and months long. The government doesn’t need to finance new rehabs. There are many incredible and life-changing centers that already exist; the government just needs to make admission into these programs a possibility for those on Medicaid. If Medicaid were to increase their reimbursement rates to levels comparable with private insurance, those who need treatment the most would be able to receive it. This is a costly proposal, but we should note that President Elect Trump alluded to this very proposal in a speech he gave in New Hampshire while on the campaign trail. We know this, and are aware of that speech, because our CEO, Stephen Estes helped co-author it with Alex Lightman, WeRecover’s head of Research and Development.
2. End the War on Drugs and use the money saved to finance:
A) Increased Medicaid reimbursement rates
B) Vocational subsidies
The U.S. federal government spends over $15 billion dollars a year on the War on Drugs - at a rate of about $500 per second - while local and state governments spend over $25 billion. If you were wondering where we propose the Federal government gets the money to finance the increased Medicaid reimbursement rates we touched on above: this is the source. End the War on Drugs and divert the money to two key areas: A) Finance Medicaid reimbursement rates that are comparable to private insurance policies, and B) Follow Portugal, which has successfully turned the tide on their addiction epidemic, by subsidizing the salaries of newly sober individuals for a period of time.
The reason we propose subsidizing the salaries of those in recovery for a period of time after they complete treatment is simple: if somebody doesn’t have a job, they are likely to relapse, over and over again. We know this from first hand experience and have witnessed this in hundreds of people. They get out of rehab, they don’t have a job, they don’t have a means to support themselves, and they go back to their old friends and their old ways - and they relapse. The number one thing somebody can do post-treatment (other than continue a program of recovery like AA) is to get a job and keep it.
But hiring a newly sober individual is a risky bet for an employer. However, that risk can be greatly mitigated if their salary were subsidized. And while this may seem like a radical welfare proposal, consider this: the cost of a salary subsidy and increased Medicaid reimbursement rates to cover treatment can amount to less than half of what our government spends incarcerating individuals. These proposals will save the taxpayers money, and we encourage the Government Accounting Office to analyze their fiscal viability.
3. Enforce the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA)
The Mental Health Parity Act mandates that insurance companies take mental health seriously and cover it just like they would any other disorder. The problem is: the insurance companies are not operating within the bounds of the law. Blue Shield of California, for example, technically covers substance abuse treatment, but their reimbursement rates are so low that most out-of-network rehabs can’t afford to accept Blue Shield of California customers. Blue Shield is intentionally misleading people. They are advertising that they cover treatment, and people are paying higher premiums for lower deductible policies with the assumption that the policy will cover rehab, only to find that when they actually need to go to rehab, every center they apply to turns them down because their policy pays less than Medicaid. On this front, the government need only enforce the existing law - the Mental Health and Addiction Parity Act.
4. Make insurance companies publish their “reimbursement rates”
When shopping for a health insurance policy, an informed shopper might click on the “summary of benefits” - basically a brochure for the plan - and review all the things it offers and the rates at which certain treatment and procedures are covered. One might go to the substance abuse treatment section of a summary of benefits, and find that residential inpatient, partial hospitalization and intensive outpatient are all covered at a rate of 50% until one hits their maximum out of pocket, after which they are covered at 100%. Thus, you can deduce that that after you hit your maximum out of pocket - which might be $5,000 for example - you pay nothing for treatment.
But that is not how it works in reality. A rehab center needs a certain amount per day to break even or turn a mild profit, and if the amount the insurance company pays (reimbursement rate) is lower than that number, they will bill the individual for it. Thus, despite having a $5,000 maximum out of pocket and zero deductible, for example, one might be quoted $20,000 to go to a rehab - if their insurance policy has a low reimbursement rate.
The way these policies are advertised is intentionally misleading. If you want the best plan, you might go for a Gold or Platinum PPO, thinking that those will give you the most options, when in reality the deductible and maximum out of pocket matter far less than the reimbursement rates. And reimbursement rates are a tightly held secret. Insurance companies don’t publish them, and in fact, the sharing of them is even prohibited by, of all things, the Sherman Anti-Trust Act (we know this because we wanted to crowdsource reimbursement rates and share them on an open source platform, only to be told by our attorneys that we would be in violation of the law). If we want to truly empower health insurance consumers, insurance companies should regularly publish their reimbursement rates for every procedure so that individuals can purchase policies that cover what they need.