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Mental Health Spending Increased 54% During Pandemic: Study

Mental Health Spending Increased 54% During Pandemic: Study

Aug. 28, 2023 – A new study reveals the dramatic increase in the use of mental health services during the pandemic and shows that the increase has largely been sustained, mostly by people accessing care via telehealth. 

American adults increased their usage of mental health services over the course of the pandemic by 39%, and spending increased by 54%, according to the new analysis of insurance claims published Friday. While in-person mental health visits during the early part of the pandemic plummeted, they rebounded to about 80% of their pre-pandemic level by August 2022. 

The findings were published in JAMA Health Forum and included data from more than 1.5 million claims filed for 7 million U.S. adults with employer-based private insurance. The researchers warned that the sustained increase in usage and spending could result in insurers reducing coverage in the future.

For the analysis, claims were compared from three periods: The year before the pandemic, the period from March 2020 until December 2020, and then from December 2020 through August 2022.

During the period of March to December 2020, in-person visits decreased by 40%, while telehealth mental health visits increased by 10 times, compared to the previous year. When the decrease of in-person visits and the increase of telehealth visits were combined, they equaled a 22% increase in the use of mental health services during the early phase of the pandemic. 

When the researchers looked at the conditions people sought services for, such as depression, anxiety, or bipolar disorder, they found that the increase was consistent across condition types. 

During the period from December 2020 to August 2022, telehealth visits stayed at their higher rate, while in-person mental health visits gradually increased by about 2% each month. By August 2022, in-person visits had returned to about 80% of their pre-pandemic level.

“If greater utilization of health services drives higher health care spending, insurers may begin pushing back on the new status quo,” Jonathan Cantor, PhD, lead author of the study and a policy researcher at the nonprofit RAND Corp., said in a news release. “Insurers may look for ways to curb costs, and that could mean less flexibility about using telehealth for mental health services.”

The authors noted that their study had some limitations, including that they only used claims from private, employer-based insurance. That means the data doesn’t include mental health care usage by people who have other insurance, such as federal coverage from Medicaid or Medicare. The researchers also said they couldn’t distinguish between people who newly sought mental health care and people who were continuing care.