Study reveals a 50 percent increase in mental health spending since the onset of the COVID-19 pandemic

A recent study conducted by the RAND Corporation and Castlight Health experts reveals that employer-provided private insurance funds spent on mental health services have increased by more than 50% since the onset of the COVID-19 pandemic. The study, published in JAMA Health Forum, analyzes data from January 2019 to August 2022 and shows a 53.7% rise in spending and a 38.8% rise in the utilization of mental health services by adults with employer-provided private insurance during the pandemic.

Specifically, the study examines services related to PTSD, major depressive disorder, bipolar disorder, and schizophrenia. It finds that the changes brought about by the pandemic have led to a significant expansion in the use of mental health services among adults with employer-based health insurance. It remains uncertain whether this trend will continue or if it will return to pre-pandemic levels.

During the early stages of the pandemic, when lockdowns were first implemented, in-person mental health services declined by approximately 40%. However, telehealth services became more prevalent during this time. As the pandemic progressed, in-person services gradually increased by 2% monthly. By the end of the pandemic, in-person mental health visits had reached around 80% of pre-pandemic levels.

Despite these developments, researchers are uncertain about the future trajectory of these trends. If the increased utilization of mental health services leads to higher healthcare spending, insurance providers may begin to push back. In such a scenario, there may be less flexibility in using telehealth for mental health services as insurers seek to curb costs.

The study analyzed insurance claims from approximately 7 million adults with employer-based private insurance to gather its research data. This comprehensive approach provides valuable insights into the impact of the pandemic on mental health utilization.