Introduction

The COVID-19 pandemic has caused rates of anxiety and depression to surge. Left untreated, these conditions may contribute to serious physical illness and impede the ability of people to perform at work. Mindful of the stress experienced by their employees, as well as the lost productivity and higher healthcare costs, many employers have enhanced benefits and access to mental health (MH) and substance use disorder (SUD) services.

In particular, employers have turned to telehealth strategies to help address the growing need for MH/SUD treatment and other supportive services. During the COVID-19 pandemic’s acute phase, telemedicine visits for MH/SUD conditions soared, providing vital access to care at a time when many patients were leery of in-person appointments or office locations were closed. Even as we emerge from the acute phase of the pandemic, MH concerns remain high, and employers are increasingly offering access to digital apps that connect employees to MH/SUD resources and care.

This paper explores the implications of the mental health crisis for employers. It then guides them through potential next steps, including how to vet digital MH/SUD treatment vendors, as they seek to manage their company’s healthcare costs and nurture their employees’ well-being.

Background

The World Health Organization (WHO) recently reported that the global prevalence of anxiety and depression increased by 25% during the first year of the COVID-19 pandemic.¹ In the United States, the National Institute of Mental Health estimates that, in 2020, nearly one in five adults—over 50 million people—were living with a mental illness.² The Kaiser Family Foundation (KFF) found that about four in 10 adults in the United States reported symptoms of anxiety or depressive disorders in January 2021, up from one in 10 adults who reported these symptoms from January to June 2019.³ The same report showed that 49% of adults 25 to 49 reported symptoms of anxiety and/or depressive disorders as of December 2020.⁴ KFF also reported in March 2021 that a majority of adults under 30 (61%) and women (55%), particularly mothers with children 18 years or younger living at home (58%), stated that stress from the pandemic had a negative impact on their mental health.⁵

The American Psychological Association (APA) defines anxiety as, “an emotion characterized by feelings of tension, worried thoughts, and physical changes like increased blood pressure…Anxiety is considered a future-oriented, long-acting response broadly focused on a diffuse threat.”⁶ Depression is “extreme sadness or despair that lasts more than days. It interferes with the activities of daily life and can cause physical symptoms such as pain, weight loss or gain, sleeping pattern disruptions, or lack of energy.”⁷ Anxiety or depression can increase the risk of developing a serious physical disease, impede the ability to recover from physical illness, interfere with work and play, and impair an individual’s ability to cope with the challenges of daily life.⁸ Persistent anxiety and depression are generally treatable with medications and/or psychotherapy.⁹ However, the National Institute of Mental Health reports that one-third of adults with a major depressive episode¹⁰ and over one-half of adults with generalized anxiety disorder are untreated.¹¹

While the COVID-19 pandemic is a global phenomenon that has disrupted our lives, it has also impacted our state of mind, which can affect us at work. Over the past two and a half years of the pandemic, employers have increasingly recognized the stresses on workers and their families, and some employers have taken steps to enhance benefits and access to MH and SUD services. A 2021 KFF survey of employers found that, of those with at least 50 employees, 3% increased coverage for out-of-network MH/SUD services; 6% expanded the number of MH/SUD providers in their plans’ networks; 4% waived or reduced cost sharing for MH/SUD services; 31% expanded the ways through which members could get MH/SUD services, for example, through telehealth; and 16% developed new resources, such as an employee assistance program.¹²

MH care access has emerged as both a challenge and an opportunity as the United States transitions out of the acute phase of the pandemic. While the pandemic increased the need for MH services, it also inspired innovation in MH care, resulting in rapid expansion of telehealth and other digital solutions. For employers, the market has responded to their interest by creating or expanding employer benefit options, especially in remote or digital format, to supplement more traditional benefits. Employers will likely continue to recognize the heightened level of anxiety, depression, and other MH/SUD conditions and develop and refine benefit strategies designed for the characteristics and challenges of their employees as the high level of pandemic-related uncertainty recedes.

Telemedicine

Telehealth refers to the broader remote healthcare services, including non-clinical services such as provider training, administrative meetings, and continuing education as well as clinical services like telemedicine.¹³ Telemedicine is providing clinical services using electronic communications, information technology, or other means between a licensed physician (or other credentialed provider) in one location, and a patient in another location, with or without an intervening healthcare provider.¹⁴ It typically involves the application of secure videoconferencing or store and forward technology to provide or support healthcare delivery by replicating the interaction of a traditional, encounter in person between a provider and a patient.¹⁴ Given the increased need for services and concerns about the availability of MH/SUD care providers, employers and health plans bolstering access to these services through telehealth has been a recent strategy. Not only did the percentage of employers with a telemedicine benefit increase through 2021, but some employers also made the benefit easier to use by expanding the number and types of providers available, expanding the settings or locations where the benefit could be used, supporting additional modes of communicating with providers, or waiving cost sharing for telemedicine services.¹⁵ The COVID-19 pandemic resulted in a rapid expansion of the use of telemedicine in general and even more so in MH/SUD, where provider access, at least within insurance networks, has been a longer-standing issue for workers. Milliman research¹⁶ shows that commercially insured MH/SUD telemedicine utilization increased from less than 1% of MH/SUD office visits prior to the COVID-19 pandemic to one-third of MH/SUD office visits in 2Q 2021. This is about double the use of telemedicine for other medical office visits.

Among employers with at least 50 employees, almost half of those offering health benefits believe that telemedicine will be very important in providing access in the future.¹⁷ Given that expanding access to telemedicine and virtual MH care options is a core objective of the White House’s Strategy to Address Our National Mental Health Crisis, telemedicine MH/SUD services seem poised to continue to grow.¹⁸

Recent systematic reviews of studies of MH/SUD-related telemedicine trials have generally reported that psychological interventions delivered via telemedicine or delivered face-to-face lead to similar outcomes of a variety of types, including substance use, symptom severity, quality of life, therapeutic alliance, engagement and retention in treatment, and treatment satisfaction in both adults and young people with MH/SUD conditions.¹⁹ While the provision of care via telemedicine appears be a viable alternative to the provision of care face-to-face, researchers recommend further investigation with longer follow-up and conducted in a wider range of settings.

The digital mental health market

Many of us turned to digital solutions for entertainment, fitness, education, and well-being during the COVID-19 pandemic. Worldwide installs of mobile wellness apps passed 100 million for the first time in March 2020 and passed 200 million one month later.²⁰ Emotional wellness apps, which include meditation and mindfulness apps, represented over 20% of the downloads and grew by over 40%.²⁰

The heightened demand for mental health apps has caught the eye of innovators and investors, and the easy access (any place, any time), low cost (sometimes free), and anonymity may continue to be advantages to users. While digital mental health apps, part of telehealth strategies, may overlap with telemedicine, they differ because their typical focus is not limited to the provision of clinical services by a provider in one location to a patient in a different location.²¹ Digital mental health apps are generally accessed via a smartphone or other mobile device and focus on improving different aspects of MH and well-being, such as wellness, relaxation, stress management, and sleep.²¹ They may also offer self-help tools, therapeutic activities, and access to treatment by licensed MH professionals. One Mind PsyberGuide estimated there were 10,000 to 20,000 mental health-related apps²² in 2021. The U.S. mental health apps market is projected to grow by almost 15% between 2022 and 2030.²³

A recent review of 145 randomized controlled trials of digital mental health app use did not find convincing evidence in support of any mobile phone-based intervention on any MH-related outcome.²⁴ However, the researchers found suggestive evidence for some mobile phone-based interventions on some outcomes (e.g., smartphone interventions on depression, anxiety, and stress; text message interventions on smoking cessation).²⁴ It would be prudent for employers to follow future research in this area, including the possibility of standardized and transparent formal evaluation of these interventions’ clinical efficacy (e.g., by the United States Food and Drug Administration) that may help guide them, as well as consumers and providers, in assessing the potential value of mental health apps. Ultimately, the market will need to demonstrate value through evidence-based studies showing improved outcomes for users to continue to download and use these apps.

What does MH and SUD cost?

Based on the 2022 Milliman Health Cost Guidelines™ ²⁵, the projected nationwide average cost of MH/SUD is about 6% of total allowed costs (before member cost sharing). The chart in Figure 1 shows the distribution of allowed costs by type of service with MH/SUD shown in more detail in the pie graph on the right.

Over the last several years, the increased levels of anxiety and depression due to the COVID-19 pandemic have resulted in higher utilization in both MH/SUD outpatient and professional services and higher average reimbursement in MH/SUD outpatient services, potentially due to fee schedule increases and a higher severity in the services provided. In 2021, 12% of employers with at least 50 employees, including 46% of firms with 5,000 or more employees, reported an increase in the share of employees using MH services since the COVID-19 pandemic began.²⁶

What options are there for employers?

The Mental Health Parity and Addiction Equity Act (MHPAEA) of 2008²⁷ required parity between MH/SUD benefits and medical/surgical benefits. Under these regulations, both the financial requirements (e.g., deductibles, coinsurance, and copays) and treatment limitations (e.g., number of visits or days of coverage) for MH/SUD benefits must not be more restrictive than the treatment limitations for medical/surgical benefits. While compliance and enforcement are still evolving, MHPAEA helped to level the playing field for MH/SUD and mitigate some of the stigma with receiving these services. Employers also typically offer Employee Assistance Plans (EAPs). An EAP is usually a voluntary, confidential service offered to employees and their dependents. EAPs act as an early engagement resource to address less severe emotional health issues and sometimes provide a gatekeeper process to more comprehensive and/or clinical treatment options.

According to a Milliman Pulse Survey²⁸ on MH benefits, most (78%) respondents indicate they rely on their medical carriers to provide MH resources to their employees. With the increase in anxiety, depression, and other MH/SUD conditions, several new options, especially in digital format, have become available to employers. Our Pulse Survey indicates that employers are aware of these options, and 56% plan to incorporate one or more third-party solution to expand access to care and promote emotional well-being and stress management in 2023.

Most vendors create direct engagement with the employee through a mobile app. The mobile app then provides access to online resources such as white papers and research on a variety of MH/SUD topics, coaching, and potentially psychotherapy. The employee utilizes the app to find online resources and schedule appointments with coaches and therapists, as well as to conduct virtual visits.

Next steps for employers?

The costs of new or exacerbated anxiety, depression, and other MH/SUD conditions will impact the bottom line as total healthcare costs for these conditions increase. Additionally, the healthcare costs for physical conditions for individuals with MH/SUD have been found to be substantially higher than individuals without MH/SUD conditions, which could further increase healthcare costs.²⁹ Employers should also consider other impacts outside of healthcare costs when thinking about the impact of MH/SUD conditions and how MH/SUD benefits impact employees and the workplace as a whole. Effective engagement in MH/SUD programs and services has the potential to impact absenteeism, presenteeism, employee dissatisfaction, turnover rates, and workers’ compensation and disability claim rates.

Many employers will recognize the challenges employees continue to face as the acute phase of the pandemic ends and may consider expanding benefits and/or offering new tools to help. The evidence base is growing for the favorable impact of effective MH/SUD interventions on health outcomes and total costs for patients and payers.²⁹ A few steps for employers looking to expand or refine their MH/SUD benefits include:

1. Understand different options for meeting employee’s rising need for MH/SUD.
• Traditional face-to-face care with a physician or other MH/SUD specialty provider
• Traditional EAP service
• Telemedicine
• Digital MH/SUD or other telehealth
2. Ensure compliance with MHPAEA.
• This is not as easy as simply comparing cost sharing in Summary Plan Documents as the MHPAEA provides specific guidance on measuring compliance.
3. Review telehealth options with medical carriers or MH/SUD carve-out vendors and discuss opportunities to increase MH/SUD utilization and acceptance.
4. Engage with employees over expanded MH/SUD services.
• Ensure and confirm confidentiality of employees that inquire about or access MH/SUD services.
• Successful expansion of MH/SUD services requires effective messaging from leadership and employee buy-in.
• Employee surveys and/or focus groups may be a good way to understand the perception and value of the current MH/SUD services, as well as to identify potential enhancements.
5. Understand the digital mental health app vendors.
• Each vendor will differentiate itself from its competition. Make sure the range of services within each vendor’s offering is clear when doing comparisons.
• Focus on the MH care, as well as the technology. The technology is valuable for access; however, the vendor should also have the appropriate MH background supporting it (e.g., clinicians across the range of relevant disciplines; expertise regarding evidence-based clinical guidelines and knowledge of gaps in evidence; research on MH topics).
• Review approach to vendor services that may include employee engagement to see if and how it complements the internal communication strategy.
• Identify high-risk employee groups that may be harder to reach (e.g., by age, race/ethnicity, job category, etc.) and consider how vendor services incorporate strategies known to be effective in reaching high-risk individuals. Consider whether the vendor is flexible and applies a continuous improvement lens or uses a fixed model.
• Be clear whether the vendor services include EAPs, what they will provide relative to the current EAP vendor, and whether both are needed. Consider the cost of separate EAPs versus bundled EAPs.
• The goals of each vendor may be different; some may only provide access to their apps while others may target a return on the investment (ROI) through medical management or network options. Make sure goals align and everyone is working toward those goals to best serve the employees. If an ROI is the goal or required by leadership, engage an independent third party to work with the employer and vendor to define the methodology and measure the ROI.
• Critically review claims of historical vendor “success,” including health, absenteeism, and other outcomes. Credible evaluation of a vendor’s offering requires a robust methodology that accounts for factors that can have a large impact on vendor-reported outcomes (engagement, completion, improved symptomatology, cost savings, etc.).
• Consider performance guarantees to help achieve goals.
• The cost structure may vary by vendor (per employee per month, per participant per month, fixed cost, etc.). Watch for hidden costs such as those for implementation and reporting and link the costs to the specific services offered.
• The vendor may require data feeds such as demographics and health insurance eligibility.
• Engage with the IT department so it can provide input into data privacy and security (e.g., HIPAA).
• Consider discussing the integration of the vendor data with the medical carrier and/or MH/SUD carve-out vendor data to see if there may be medical management value in understanding the vendor usage patterns or vice versa.

Summary

As we emerge from the acute phase of the COVID-19 pandemic, many individuals continue to face increased anxiety, depression, and stress from health and healthcare fears, poor work-life balance, and social isolation. Because we spend much of our day working, employers have a vested interest in their employees’ well-being. There are many options available to employers to help address the MH/SUD care needs of their employees and their families. We encourage employers to follow the steps above as they consider, evaluate, and implement solutions to best align benefit enhancements and new tools with unmet employees’ needs.

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¹ World Health Organization (March 2, 2022). COVID-19 pandemic triggers 25% increase in prevalence of anxiety and depression worldwide. Retrieved October 25, 2022, from https://www.who.int/news/item/02-03-2022-covid-19-pandemic-triggers-25-increase-in-prevalence-of-anxiety-and-depression-worldwide.

² National Institute of Mental Health. Mental Illness. Retrieved October 25, 2022, from https://www.nimh.nih.gov/health/statistics/mental-illness.

³ Nirmita Panchal, Rabah Kamal, Cynthia Cox, & Rachel Garfield (February 10, 2021). The Implications of COVID-19 for Mental Health and Substance Use, Figure 1. Kaiser Family Foundation. Retrieved October 25, 2022, from https://www.kff.org/coronavirus-covid-19/issue-brief/the-implications-of-covid-19-for-mental-health-and-substance-use/.

⁴ Ibid., Figure 3 based on U.S. Census Bureau, Household Pulse Survey (2020).

⁵ Kearney A., Hamel, L., & Brodie, M. (April 14, 2021). Mental Health Impact of the COVID-19 Pandemic: An Update. Kaiser Family Foundation. Retrieved October 25, 2022, from https://www.kff.org/report-section/mental-health-impact-of-the-covid-19-pandemic-an-update-findings.

⁶ American Psychological Association. Anxiety. Retrieved October 25, 2022, from https://www.apa.org/topics/anxiety.

⁷ American Psychological Association. Depression. Retrieved October 25, 2022, from https://www.apa.org/topics/depression.

⁸ Brody, J. (October 4, 2021). The Devastating Ways Depression and Anxiety Impact the Body. New York Times. Retrieved October 25, 2022, from https://www.nytimes.com/2021/10/04/well/mind/depression-anxiety-physical-health.html.

⁹ Anxiety & Depression Association of America. Retrieved October 25, 2022, from https://adaa.org/understanding-anxiety/depression/treatment.

¹⁰ National Institute of Mental Health. Major Depression. Retrieved October 25, 2022, from https://www.nimh.nih.gov/health/statistics/major-depression.

¹¹ National Institute of Mental Health. Generalized Anxiety Disorder. Retrieved October 25, 2022, from https://www.nimh.nih.gov/health/statistics/generalized-anxiety-disorder.

¹² Kaiser Family Foundation (November 10, 2021). 2021 Employer Health Benefits Survey, Summary of Findings, Figure I. Retrieved October 25, 2022, from https://www.kff.org/health-costs/report/2021-employer-health-benefits-survey/.

¹³ Office of the National Coordinator for Health Information Technology, What is telehealth? How is telehealth different from telemedicine? Retrieved October 26, 2022 from https://www.healthit.gov/faq/what-telehealth-how-telehealth-different-telemedicine.

¹⁴ Federation of State Medical Boards, Guidelines for the Structure and Function of a State Medical and Osteopathic Board (April 28, 2018). Retrieved October 26, 2022 from https://www.fsmb.org/siteassets/annual-meeting/hod/april-28-2018-fsmb-hod-book.pdf.

¹⁵ Ibid., Figure H.

¹⁶ Milliman (February 2022). COVID-19 impacts and considerations: A supplement to the 2022 Health Cost Guidelines™.

¹⁷ Kaiser Family Foundation, 2021 Employer Health Benefits Survey, op cit., Figure 13.4.

¹⁸ White House (March 1, 2022). FACT SHEET: President Biden to Announce Strategy to Address Our National Mental Health Crisis, As Part of Unity Agenda in his First State of the Union. Retrieved October 25, 2022, from https://www.whitehouse.gov/briefing-room/statements-releases/2022/03/01/fact-sheet-president-biden-to-announce-strategy-to-address-our-national-mental-health-crisis-as-part-of-unity-agenda-in-his-first-state-of-the-union/.

¹⁹ Anna Scott, Justin Clark, Hannah Greenwood, Natalia Krzyzaniak, Magnolia Cardona, Ruwani Peiris, Rebecca Sims and Paul Glasziou (August 12, 2022). Telehealth v. face-to-face provision of care to patients with depression: a systematic review and meta-analysis. Psychological Medicine Retrieved October 25, 2022 from https://www.cambridge.org/core/journals/psychological-medicine/article/telehealth-v-facetoface-provision-of-care-to-patients-with-depression-a-systematic-review-and-metaanalysis/A6E4E3C36FEE4691C2ED427CA1151209.
Dawn Bellanti. Marija Kelber, Don Workman, Erin Beech, Brad E. Belsher (May/June 2022). Rapid Review on the Effectiveness of Telehealth Interventions for the Treatment of Behavioral Health Disorders. Military Medicine. Retrieved October 25, 2022 from https://academic.oup.com/milmed/article/187/5-6/e577/6345927.
Substance Abuse and Mental Health Services Administration (2021). Telehealth for the Treatment of Serious Mental Illness and Substance Use Disorders . Retrieved October 25, 2022 from https://store.samhsa.gov/sites/default/files/SAMHSA_Digital_Download/PEP21-06-02-001.pdf.

²⁰ Sensor Tower. Mobile Wellness Market Trends.

²¹ Morin, Amy (updated October 25, 2022). Best Mental Health Apps, Find peace of mind from your smartphone or tablet. Retrieved October 26, 2022 from https://www.verywellmind.com/best-mental-health-apps-4692902#toc-what-are-mental-health-apps.

²² Rebecca A. Clay (January 1, 2021). Mental health apps are gaining traction. American Psychological Association. Retrieved October 25, 2022, from https://www.apa.org/monitor/2021/01/trends-mental-health-apps.

²³ Grand Review Research. Mental Health Apps Market Size, Share and Trends Analysis Report by Platform Type (Android, iOS), by Application Type (Depression and Anxiety Management, Stress Management), by Region, and Segment Forecasts, 2022-2030. Market Analysis Report. Retrieved October 25, 2022, from https://www.grandviewresearch.com/industry-analysis/mental-health-apps-market-report.

²⁴ John Torous, Laura Roberts (May 2017). Needed Innovation in Digital Health and Smartphone Applications for Mental Health Transparency and Trust. JAMA Psychiatry. Retrieved October 25, 2022 from https://jamanetwork.com/journals/jamapsychiatry/fullarticle/2616170.

²⁵ Milliman (2022). Health Cost Guidelines – Commercial Rating Structures™, Section 5: Basic Tables.

²⁶ Kaiser Family Foundation, 2021 Employer Health Benefits Survey, op cit., Figure 13.14.

²⁷ Centers for Medicare and Medicaid Services. The Mental Health Parity and Addiction Equity Act (MHPEA). Retrieved October 25, 2022, from https://www.cms.gov/CCIIO/Programs-and-Initiatives/Other-Insurance-Protections/mhpaea_factsheet.

²⁸ Simmons, G. (June 29, 2022). Pulse Survey Results: Mental Health Benefits. Milliman Insight. Retrieved October 25, 2022, from https://www.milliman.com/en/insight/mental-health-benefits-pulse-survey.

²⁹ Davenport, S., Gray, T.J., & Melek, S. (August 13, 2020). How Do Individuals With Behavioral Health Conditions Contribute to Physical and Total Healthcare Spending? Milliman Research Report. Retrieved October 25, 2022, from https://www.milliman.com/en/insight/how-do-individuals-with-behavioral-health-conditions-contribute-to-physical.