Suicide Prevention: A Policy Solution?

Mental illness impacts over five million people in the United States. Historically, many of these individuals have not been able to receive adequate treatment due to gaps in health insurance coverage for mental illness. Lack of treatment is correlated with increased risk of suicide, as individuals’ mental illness can worsen without the psychotherapy and prescription drug management needed for proper treatment.

The passage of the Federal Mental Health Parity Act of 1996 mandated that health insurance plans with mental health care coverage must provide the same amount of insurance benefits for both physical and mental illness. Although critics of the law argued that it was too lenient, as it did not mandate all insurance plans to provide coverage of mental health treatment, it did serve as a catalyst for many states to pass state-level mental health laws, some of which were stricter than the federal law. This is explained in “The Impact of Mental Health Insurance Laws on State Suicide Rates,” in which researcher Matthew Lang analyzes the impact of mental health insurance laws on suicide rates using a variety of specifications, providing robust evidence that mental health parity laws significantly decrease state-level suicide rates.

Lang defined “access-to-parity states” as states that “require insurance packages to include access to mental health care at the same terms as physical health care.” He analyzed how the timing of a state becoming, or not becoming, an access-to-parity state impacted the state-level suicide rate. He found that suicide rates were lower after a state enacted a mental health parity law. He calculated a difference-in-difference estimate to check for confounding unobservable characteristics.

He then used panel data techniques to “more precisely estimate the relationship” between mental health parity insurance laws and suicide rates. Because non-parity states and access-to-parity states may be different in terms of political ideologies, religiosity, and attitudes toward mental health, Lang restricted his dataset to states that eventually became access-to-parity states between 1990 and 2004. Results from both his restricted and non-restricted data sets indicated that the access-to-parity states reduced suicide rates after the implementation of mental health parity. A result from a first differences analysis showed that in the year following the “access to parity” law enactment, the suicide rate of a state decreased, on average, by four percent. In an event study analysis, Lang controlled for the possibility that a state may enact a mental health parity law because of increasing suicide rates. He found no significant difference between the state-level suicide rate the year before and the year of enactment of a metal health parity law, nullifying this concern. Lastly, Lang ensured the robustness of his estimates by analyzing the impact of the access-to-parity laws on specific age groups and by controlling for the “possibility that the change in suicide rate is just a decline in overall mortality.”

Using the results from his analyses, Lang estimated that a total of 592 suicides were prevented per year in the 29 access-to-parity states. He then conducted a cost-benefit analysis to calculate the cost of saving a life through a mental health parity laws. By comparing lost wages to insurance premium increases, Lang concluded that the cost of each prevented suicide is between $1.3 and $2.1 million. However, this estimate is likely an upper bound, as it does not account for increased productivity, quality of life, better physical health outcomes, and the non-suicidal patients who also benefit from parity laws.

With the ACA’s recent expansion of bundled payment structures, it would serve health economists and policy entrepreneurs to quantify the impact of access-to-parity laws on health care costs for all patients with mental illnesses. Access-to-parity laws may not just prevent suicides. They may improve medical compliance for individuals living with mental illness, and therefore reduce health care spending.

Feature Photo: cc/(Amber Kost)