Autism spectrum disorder (ASD) comprises a group of developmental disabilities that cause impairment in social interactions, communication skills, and behaviors that can have long-term health and social functioning costs for individuals with ASD and their families. In 2014, the Centers for Disease Control and Prevention (CDC) reported that approximately one in 68 children in the United States were diagnosed with autism spectrum disorder.11 Researchers estimate that it costs between $1.4 and $2.4 million to support an individual with ASD over a lifetime for direct costs such as medical care or special education, and indirect costs such as lost employment.2 Federal agencies, advocacy groups, and states are paying more attention to the prevalence, diagnosis, and treatment costs for ASD, demonstrated by an influx in research and an increasing number of states that have mandated certain insurers to provide coverage for ASD diagnosis and treatment.
In 2012 and 2013, Michigan passed legislation that:
- Required state-regulated private health plans to provide coverage for the diagnosis and treatment of ASD;
- Established a reimbursement fund for private health insurance carriers to help offset the autism benefit costs and encourage self-funded plans not regulated by the state3 to offer ASD coverage; and
- Created a benefit program to offer applied behavior analysis (ABA) services to children enrolled in Medicaid or in the Children’s Health Insurance Program (CHIP), known as MIChild in Michigan.
This issue brief provides an overview of ASD, various treatment approaches, federal and state coverage requirements, and the opportunities and challenges created by Michigan’s legislation.
- Speech and language therapy: Speech and language therapy may be used help children with ASD gain the ability to speak or to initiate language development. It is usually provided by a speech and language pathologist, but may also be provided by a behavior analyst.
- Occupational therapy: Occupational therapy may be used to improve independent functioning and to teach basic skills such as bathing. This therapy is usually provided by an occupational therapist.
Physical therapy: Physical therapy involves using exercise and other measures (such as heat) to help children with ASD control body movements and is provided by a physical therapist.
- Mental health services, including prescription drug therapy: Psychiatrists, psychologists, and social workers also provide individual psychotherapy to address several issues including anxiety, disruptive behavior, coping with stress and bullying, social skills, feeding, and toileting. Physicians, particularly psychiatrists, may also prescribe a variety of prescription drugs to children with ASD to treat associated behaviors and mental health disorders such as anxiety, attention deficit hyperactivity disorder (ADHD), and depression. Between 50 and 80 percent of children with ASD have at least one psychiatric comorbidity.13
- Intensive behavioral intervention (IBI): Intensive behavioral therapies include highly structured, skill-oriented activities administered on a one-to-one basis to treat inappropriate, repetitive, and aggressive behaviors. For example, applied behavior analysis (ABA) is a behavioral therapy for ASD that focuses on learning and motivation through several methods, such as positive reinforcement, to improve communication and social interactions and reduce repetitive behaviors.14 ABA, which has been recognized for its incorporation of multiple evidence-based treatment strategies by the National Standards Project,15,16 may be provided by or supervised by a certified behavior analyst.
Other treatment strategies include training, education, and support for family members of children with ASD, treatment through the education system, and other medical interventions (such as treatment for epilepsy).17 Parent education and training programs play an important role in teaching parenting skills to better manage challenging behaviors, supplementing the child’s treatment intervention, and bolstering confidence and reducing stress for parents and their children.18
Applied Behavior Analysis for Treating Symptoms of ASD
ABA, which has been studied for decades and has become a prominent behavioral treatment strategy for many children with ASD, encompasses a variety of behavior modification approaches that are tailored to the needs of individuals with ASD. In 2012, the AAP recommended guidelines for treatment and priorities for future research needs for children with ASD. Guidelines were developed by a technical expert panel that determined that more intense treatment and a longer treatment period resulted in better outcomes in communication, language, play and challenging behaviors.19 The panel also determined that in a meta-analysis of ABA programs, researchers found promising results in language, adaptive skills, and intelligence quotient (IQ) scores. In addition to intensity and duration of the ABA treatment, researchers have found that other factors that contribute to the effectiveness of treatment include the active engagement of parents in carrying out the treatment plans and providing treatment in the child’s usual environment (for example, the child’s home or school).20,21 However, the time commitment and costs associated with ABA treatment can be challenging and expensive for families to sustain.
Researchers have examined the effectiveness of ABA on improving developmental progress and intellectual performance in young children with ASD.22,23 Studies over the past 50 years have examined the effect of various behavior treatment approaches on IQ scores, educational placement, language skills, or a reduction in stereotypies (repetitive movement) or challenging behaviors such as aggression or self-injury.24,25 Due to the varying levels of severity in children with ASD and challenges in assessing outcomes as a result of behavioral therapy, it is difficult to conduct large, randomized trials to measure the effectiveness of specific or a group of ABA therapies for children with ASD. Additionally, not all children with ASD benefit from ABA therapy in the same way, to the same extent, or even at all—which has resulted in mixed outcomes in some studies. Findings from a meta-analysis of ABA-based early intervention programs for children with ASD found considerable variability in sample size, study design, type and intensity of treatment, and results; however, early and intensive ABA treatment still had a positive effect in many young children with ASD.26
Some of the challenges of studying the efficacy of ABA therapy have been in establishing standardized measures of improvement to compare across studies and generalizability across the broader ASD population.27,28 Despite these challenges, ABA has been studied extensively for the treatment of ASD, has shown to have a positive effect on the developmental progress of many children with ASD, and has been endorsed by several professional organizations, including the National Institute of Mental Health, as well as by the U.S. Surgeon General.29
Federal Requirements for ASD Coverage
Historically, the federal government has had few ASDspecific coverage requirements for private health plans, Medicaid, or CHIP programs. However, the Patient Protection and Affordable Care Act (ACA) and recent guidance from the Department of Health and Human Services have created several new coverage standards that benefit individuals with ASD. Furthermore, in July 2014, the Centers for Medicare and Medicaid Services (CMS) issued a bulletin which stated that comprehensive ASD services must be covered for individuals under the age of 21 for all state Medicaid and Children’s Health Insurance Programs.30 States are sorting out the bulletin’s scope and requirements and deciding how to implement this new coverage within their state plans in compliance with state and federal statutory requirements.31
Private Coverage for ASD
Under the ACA, both self-insured and fully-insured health plans32 (in all states) must comply with several new federal standards, and many of these new standards will be relevant for individuals with ASD. For example:
- Coverage can no longer be denied because of a preexisting condition;
- Higher premiums cannot be charged because of an individual’s health history (for example, someone with ASD cannot be required to pay more because of their diagnosis);
- Coverage for certain preventative services must be provided without cost-sharing (including ASD screening for children aged 18 to 24 months); and
- Dependents are permitted to stay on their parent or guardian’s health plan until age 26.
The ACA also includes coverage requirements that only apply to fully-insured health plans in the individual and small group markets. Specifically, the ACA requires individual and small group health plan products33 to cover benefits in ten general categories known as the essential health benefits (EHB).34 To define which services would be included in the EHB package, each state had to develop a “benchmark” plan based on an existing health plan product in the state. Twenty-six states, including Michigan, and the District of Columbia included ABA therapy for children with ASD as a required service in their benchmark plans, thereby ensuring ABA treatments were covered by new individual and small group health plan products sold in their states in 2014 and beyond.35,36
Finally, as part of the EHB requirement, health plans in the individual and small group markets are required to cover mental health services. The ACA mandates that the mental health coverage provided by these plans comply with the Mental Health Parity and Addiction Equality Act of 2008 (MHPAEA), which requires health plans to ensure that financial and treatment limits on mental health services are comparable to those placed on medical services.
Medicaid and CHIP
Federal law requires Medicaid programs to cover a minimum set of health care services for children, known as the Early, Periodic Screening, Diagnosis, and Treatment (EPSDT) benefit, which includes preventative, screening, diagnostic, and treatment services. Screening services for physical and mental conditions must be covered at specified intervals and whenever a problem is suspected, while diagnostic and treatment services must be covered when considered medically necessary.37 In July 2014, the Center for Medicaid and CHIP Services released guidance affirming that, under EPSDT, medically necessary services for children with ASD must be covered by Medicaid, including behavioral therapies like ABA.38 States will need to review the federal guidance and select an implementation process that complies with both federal and state statutory requirements,39 particularly the few states that have Medicaid waivers to provide ASD-related services to children. Due to limited funding for these Medicaid waiver programs, many of the states have prioritized services for the most severe cases of ASD and maintain waiting lists for others to enroll into the waiver service.
State CHIP programs provide coverage for uninsured children whose families cannot afford private coverage but earn too much to qualify for Medicaid. Under CHIP, states are able to design their own program and benefit packages. Therefore, coverage for ASD services provided by CHIP varies widely by state.40
Prior to the autism insurance mandate in Michigan and the Affordable Care Act changes, many health insurance policies limited their coverage of ASD services to diagnostic services or a finite number of visits for occupational, physical, and speech therapy. Many plans considered behavioral therapy for ASD, such as ABA, to be experimental treatment, and few health plans covered such therapies. Medicaid and MIChild covered services considered medically necessary regardless of diagnosis, including occupational, physical, speech therapy, and some behavioral therapy such as family therapy, but ABA therapy was not covered.
In 2012 and 2013, Michigan passed legislation aimed at increasing access to early and intensive treatment interventions for children with ASD. Brian Calley, the lieutenant governor of Michigan during the passage of this legislation, has a child with ASD and played a significant role in advocating passage of the legislation. These laws are discussed below.
Private Coverage Mandate and Reimbursement
Coverage for ASD-related services shifted rapidly for children in Michigan, starting in 2012, when Michigan became the 30th state to require all state-regulated private insurance health plans to cover diagnosis and medically necessary treatments for all covered children with ASD through 18 years of age.41,42 The law requires all state-regulated health plans (for-profit, HMO, and nonprofit) to cover ASD-related services for diagnosis, evidence-based behavioral health (including ABA therapy), pharmacy, psychiatry, psychology, and therapeutic care up to a specified spending limit based on the child’s age. However, the annual dollar limits were eliminated for health plan products due to a conflict with federal law.43 While many behavioral health services associated with ASD are also used for other health conditions and are generally covered under health plans’ mental health benefit package, ABA therapy is a newly covered service for most plans. Additionally, any cost-sharing (such as copayments or deductibles) that is applied to an ASD-related service must also be applied to physical health services in general.
As a part of providing coverage, insurers can require the use and submission of an autism diagnostic observation schedule (ADOS) or other protocols for diagnosing and assessing ASD, treatment plans, and annual development evaluations. Treatment must be provided by a licensed professional for psychiatric and therapeutic care. Behavioral health treatments, such as ABA, must be provided or supervised by a board certified behavior analyst (BCBA)44 or licensed psychologist with the appropriate training. Figure 1
FIGURE 1: Benefits for Children with Autism Spectrum Disorder in Michigan
|State-regulated Insurance Plans||Medicaid and MIChild Autism Benefit|
|Effective Date||October 2012||April 2013|
|Covered Population||Birth through 18 years old||18 months old through 5 years old|
|Requirements for coverage||Medical diagnosis of ASD by licensed physician or psychologist, and re-diagnosis every three years|
Providers much be licensed in their field (i.e., speech, occupational, physical therapies, and psychology)
ABA therapy must be provided by a Board Certified Behavior Analyst (BCBA) or licensed psychologist with specific qualifications as an ABA provider
|Medical diagnosis of ASD by a physician, child psychiatrist, fully licensed psychologist, or child mental health professional (CMHP) and validated by a physician, child psychiatrist, or fully licensed psychologist at a Pre-paid Insurance Plan (PIHP)
ABA therapy must be provided under the supervision of either:
|Covered Treatment||Evidenced-based behavioral health treatment (including ABA)|
Therapeutic care (speech, physical, and occupational therapy)
|Applied behavior analysis*|
|Limitations||Hourly or daily limits are permitted during 2014. Starting January 1, 2015, insurers will not be able to place dollar limits or non-quantitative limits (e.g., visit limits, hourly limits, or daily limits) on treatments for ASD.||Coverage ends for children when they turn 6 years of age|
* Prior to the new ABA benefit, Medicaid and MIChild programs included many services that children with ASD could access including speech therapy, physical therapy, occupational therapy, family training, and medication administration and review.
Autism Coverage Reimbursement Fund
In 2012, 63.5 percent of individuals in Michigan who had coverage through an employer were enrolled in a self-insured plan and therefore exempt from the state autism mandate.45 To encourage all health plans to cover ASD services, the Michigan Legislature established the Autism Coverage Reimbursement Fund for all health insurance carriers and for self-insured plans that have begun offering coverage for ASD to help offset the costs of offering benefits for the diagnosis and treatment of ASD.46 Michigan is the first state to establish a state fund that reimburses insurers who submit claims for providing ASD-related services. Health insurance carriers and self-funded plans access the fund by registering with the Michigan Department of Insurance and Financial Services and submitting reimbursement requests for ASD-related claims via an online system.47
As of June 2014, 23 self-insured employers had begun offering the benefit; many of them submit ASD claims for their covered employees or dependents to the fund for reimbursement.48 Other self-insured employers had not yet chosen to offer the ASD benefit because of concerns about increased long-term health care costs. When the fund was established, the legislature appropriated a total of $26 million to the fund ($15 million in fiscal year 2013 and $11 million in FY 2014) with no guarantee about how long that money will last. As of October 1, 2014, the fund has $18,811,535.78 remaining; however, the legislature does have the authority to redistribute the funds to other programs or services.49,50,51 Without the fund, the Michigan Senate Fiscal Agency projected the mandate would cause an increase in health insurance costs in the state of a maximum of 0.5 percent.52
Medicaid & MIChild Coverage of ASD Services
Prior to 2013, children enrolled in Medicaid and MIChild had access to medically-necessary services for ASD,53 but did not have coverage for ABA. In April 2013, the Michigan Legislature established a benefit program to provide ABA services for all children diagnosed with ASD from 18 months through five years of age, regardless of the level of severity of the disorder (Figure 1) in order to more closely align ASD coverage in the Medicaid and MIChild programs with the private insurance mandate.54
To access the ABA benefit program, a child enrolled in Medicaid or MIChild who shows signs of ASD must be referred to the prepaid inpatient health plan (PIHP)55 associated with the local community mental health (CMH) agency to receive a diagnostic evaluation. If a child receives a diagnosis of ASD from a child mental health professional, validated by a licensed psychologist or physician, the PIHP and the child’s providers will develop a treatment plan that includes a combination of ABA and other ASD treatments, such as speech therapy, occupational therapy, and/or family training.56
The new ABA benefit is intended to supplement services provided at schools or other settings, such as special education, and may be provided for different periods of time and levels of intensity, depending on the needs of the child and his or her family. ABA supervisors must meet certain licensing or certification requirements in order to deliver ABA therapy (see Figure 1).57
Challenges with ASD Coverage Implementation
Since the autism insurance mandate and Medicaid/MIChild requirements went into effect, one of the major obstacles in delivering ASD-related services has been the shortage of behavior analysts in Michigan. As of July 2014, there are 240 certified behavior analysts in the state, but fewer than half of them treat individuals with ASD,58 compared to an estimated 16,000 children in Michigan public schools with ASD.59,60,61 While only some of the behavior analysts have historically treated individuals with ASD, many more are focusing their work on treating individuals with ASD now that they can be reimbursed for ASD-related services. Behavior analysts may have a caseload of six to 24 patients at one time, depending on the complexity of the cases and whether or not there is additional personnel support.62 By comparison, there are more than 7,000 licensed occupational therapists, over 13,000 licensed physical therapists, about 4,000 licensed speech and language pathologists, and more than 7,000 licensed psychologists (master’s and doctorate) in Michigan.63
Moreover, in order to satisfy the mandate to provide ABA services when medically necessary, commercial health insurers needed to contract with board certified behavior analysts (BCBAs) and board certified assistant behavior analysts (BCaBAs). Unlike the other providers in the state that insurers contract with, BCBAs/BCaBAs are the only provider group that is not licensed by the State of Michigan. This lack of licensure has left insurers responsible for verifying the credentials of BCBAs/BCaBAs, which is an additional step and liability for insurers.
In addition to the limited number of ABA providers and the lack of BCBA/BCaBAs licensure in Michigan, both the private insurance mandate and Medicaid/MIChild autism mandates have limitations on the type of provider that can deliver ASD diagnoses.64 While the purpose of the limitation is to ensure that children are appropriately diagnosed and receive an effective treatment plan, requirements for members to use designated centers— combined with the limited number of such centers—have resulted in insurers putting many children who need a diagnosis and treatment plan on waiting lists to receive these services. As of September 2014, the average wait time for children with private insurance to be evaluated is nearly five months.65 Providers and insurers are in the process of establishing additional diagnostic centers, but it is not clear when these facilities will be open.
Opportunities with ASD Coverage Legislation
The legislation provides an opportunity for expanding the ABA provider network in Michigan. In 2013, MDCH allocated $2.6 million in funding, with support from the Michigan Legislature, for initiatives at several universities and a nonprofit organization to increase the number of ABA professionals and expand services in the state Figure 2.66 In addition to the state funding to expand BCBA programs and services, six universities in Michigan currently have BCaBA and/or BCBA programs,67 some of which have offered stipends to encourage enrollment. In the most recent academic year, approximately 50 students completed their ABA program at a Michigan university, which may take two years for an eligible full-time student. Graduation rates will increase as other universities implement BCBA programs or expand their current programs.
Michigan’s autism mandate legislation and its implementation create an opportunity to better understand the treatment of ASD and to learn how to design benefit packages to cover other mental health services. Specifically, implementation of these laws provides insight on the effects of benefit design for evidence-based treatment, such as ABA, on the quality of services, access to care, provider network, and associated costs to deliver services. Additionally, the establishment of the reimbursement fund provides insight on how states can develop legislation for ASD-related coverage that encourages employers offering self-insured plans to participate and how a coverage fund could mitigate the potential increases in health insurance premiums as a result of the autism mandate.
FIGURE 2: Goals and Objectives for Autism Education Centers and Program Grants in Michigan, FY2014
|Central Michigan University||Eastern Michigan University||Oakland University||Western Michigan University||Autism Alliance of Michigan|
|Develop BCBA and BCaBA degree programs||Expand the Autism Collaborative Center in Southeast Michigan||Develop a vocational program to prepare individuals with ASD for employment in specific industries||Build resources for children with ASD and their families (e.g., tele-consultation for community mental health agencies)||Create an adult service resource and trainings for families, caregivers, and schools|
|Enroll at least 25 students in the BCaBA program and at least 8 graduate students in the BCBA program||Provide 10 trainings on ASD diagnostics, evaluations, individualized education plans to professionals and families||Develop vocational program to train 15 individuals with ASD for employment in film/ entertainment media industry||Produce and disseminate 8 to 10 video podcasts relevant to autism spectrum disorder for professionals serving individuals with ASD, families and caregivers||Provide 100 autism safety trainings to law enforcement, emergency responders, schools, families, and jail diversion program|
Suggested citation: Peters, Claire; Lausch, Kersten; and Udow-Phillips, Marianne. Autism Spectrum Disorder in Michigan. October 2014. Center for Healthcare Research & Transformation, Ann Arbor, MI.
Special thanks to Lisa Grost.