The Price of Parity: Why Low-Income Kids with Autism Don’t Get Costly Care

Cherie has autism—but it’s not easy to see signs of the disorder in the exuberant 4-year-old. She only needs a gentle prompt from her mother, Jenny, before she says hello to the strangers in her living room. After the nudge, Cherie is a whirl of activity: She spins around in her purple and pink dress, brings her mother a tiny bouquet of yellow daisies she picked herself and calls upstairs for her older sister to come and play with her.

The difference between today and the day Cherie was diagnosed with autism at 27 months is stunning, Jenny says. At the age of 2, her daughter had changed from a chatty toddler to a withdrawn and silent child. Jenny holds out a picture of her daughter around the time of her autism diagnosis—she’s sitting perfectly still in her high chair, a blank stare on her cherubic face.

Cherie started a therapy called applied behavior analysis (ABA) a few weeks after her diagnosis of mild to moderate autism. The change in her daughter was swift, Jenny says. “She just came back from the very deep fog she was in.”

Earlier this year, Jenny found out that she might lose coverage for the therapy that she says brought her daughter back from the fog—all because she cannot afford private insurance. Starting this year, California requires children like Cherie, who receive private insurance subsidized by the state through a program called Healthy Families, to switch to Medi-Cal, the state’s version of Medicaid, the publicly funded health insurance for low-income children and adults. Jenny was reassured by the state, as were all other families who had to make the change, that autistic children would receive all of the same benefits under Medi-Cal that they had under private insurance.

That turned out not to be the case. Families who switched coverage slowly realized that despite these assurances, their children’s applied behavior analysis would not be covered by Medi-Cal. Some had their treatment halted abruptly. Parents fear their children will lose access to ABA for good.

Federal laws require that mental health—including developmental disorders like autism—and physical ailments be covered equally by insurance. These rules are referred to as parity in health care. Federal rules were further extended by the Affordable Care Act, which will soon require coverage of behavioral therapies as part of mental health parity.

States, however, will determine precisely what parity in behavioral therapy means. Some have decided to mandate coverage of ABA, a treatment accepted over the past five years as a standard intervention for autism, to fulfill parity laws. Other states don’t see an ABA mandate as essential to maintaining parity.

California has approached the question of whether or not to mandate coverage of the intensive, expensive therapy in an especially curious way. The state mandates that all private insurance policies cover evidence-based autism treatment, including ABA. But California exempts Medi-Cal from that requirement. As a result, families with private coverage get ABA for their autistic children. But most of those who are low-income and covered by public insurance do not.

A Sea Change in Treatment

Cherie bounces with anticipation in the minutes before her therapy session starts and hurries to the door when she hears a car in the driveway. “This is my Camille,” Cherie croons by way of introduction when her autism therapist arrives. Camille sits cross-legged on the floor in front of her, opens a bag of toys and pulls out a paper-bag puppet with the face of an elephant. She puts it on her hand and makes it talk to Cherie: “I’m saaad,” the elephant says. “Don’t be sad,” Cherie says encouragingly to the elephant.

What seems like play is actually designed to teach a series of social skills, all part of a personalized plan where her progress is carefully documented. Camille arrived with a goal sheet several pages long. “Cherie will engage in a reciprocal conversation on a neutral topic,” one goal read, “that will include making at least five appropriate comments with social partner while using eye contact and waiting appropriately.” There are boxes for her therapist to note how well Cherie did on each task. Camille guides Cherie through the tasks with a combination of firm disapproval and warm encouragement.

ABA is a form of behavior analysis, an approach that uses rewards to encourage helpful behaviors and discourage harmful habits. The therapy is intensive and conducted several times a week, sometimes even every day, in as many as 40 hours a week. Because of the intense, one-on-one nature of the therapy, ABA is expensive— costing as much as $60,000 a year.

Advocates say that ABA is worth the cost because it works, and they cite studies to back up their point. “Some studies have shown that as many as 40 percent of these children do not need special ed by the age of 6,” says Karen Fessel, executive director of the Autism Health Insurance Project, an advocacy group that helps parents get treatment for their autistic children covered by insurance.

While some parents say that the treatment comes close to a cure for their child’s autism, ABA does not help every child who receives the therapy. And ABA has not yet been subjected to a randomized trial to prove its effectiveness. Still, the therapy has prestigious endorsements as a treatment for autism, from the Office of the Surgeon General to the American Academy of Pediatrics.

ABA has been a treatment for autism for decades, but insurance companies routinely denied coverage on the grounds that it was educational or experimental or that it was not medically necessary, until laws compelled them to pay, says Kristin Jacobson, co-founder and president of Autism Deserves Equal Coverage and California policy chair for Autism Speaks, an international advocacy group. “Health plans created a myth that it was not the standard of care,” Jacobson says, “but over the last five years we have been able to dispel those myths.” Autism Speaks says the last five years have brought a “sea change” in the understanding of ABA as a standard treatment for autism.

With this shift in perspective, some state laws guiding what insurance companies must cover have changed. Others have not. Thirty-four states have passed laws requiring that autism treatment be covered by at least some types of insurance policies. Eighteen will require that insurance companies participating in their state insurance exchange pay for ABA.

Paradoxically, one of those states is California.

Tiers of Parity

The autism specialist who diagnosed Cherie in 2010 offered Jenny little hope that her daughter would regain her speech and ability to function. She advised Jenny to grieve. “I’ll grieve later,” Jenny responded, “I just want to know right now what to do.” Jenny turned to the Internet and found a thriving community of parents of autistic children. They guided her toward treatment options that included applied behavior analysis.

Kaiser, her insurance provider, denied her first two requests for coverage of her daughter’s ABA in 2010, Jenny says. She turned to the Internet again and, with the help of advice from other parents, successfully appealed the decision.

As a private insurance company, Kaiser has not been allowed to deny coverage for applied behavior analysis for an autistic child since 2012, after California legislators passed a law requiring that private insurance companies cover the therapy.

That law was somewhat unusual. Many of the insurance mandates in California law require coverage of particular conditions, such as drug dependency or infertility. Others require that insurers help cover the cost of an ambulance and of screening children for lead in their blood. In the case of ABA, insurers were already required to provide the therapy if it was considered medically necessary. But many insurance companies, disputing the therapy’s effectiveness, were refusing to cover it. So the legislature stepped in and ordered them to do so.

But the law requiring private insurance companies to pay for ABA still exempted Healthy Families and CalPERS, the insurance plan for state employees. The state legislature passed an emergency measure to include those plans in the mandate for coverage last year.

Medi-Cal was exempted from these mandates without explanation, creating two different classes of autistic children: those who benefit from parity laws and those who do not.

The Affordable Care Act, which lists essential health benefits that insurance policies must provide starting in 2014, is unlikely to impose uniformity in covered treatments for autism. While “mental health and substance use disorder services, including behavioral health treatment,” are among the 10 essential benefits that insurance plans must offer according to rules issued early this year, the rules also left the specifics of what to include as a covered treatment to the states to define. Autism advocates who wanted applied behavior analysis named as an essential benefit for children throughout the United States were bitterly disappointed.

Advocates in California say that the lack of uniformity creates a system where coverage is not just varied, but unequal. The transition from subsidized private insurance to Medi Cal is just one instance in which low-income autistic children suffer the most from lack of access to care. As families with private insurance continue to access their benefits for ABA, families on Medi-Cal must contact regional centers that provide services to all people with disabilities—from children to adults—and ask if their children are eligible for ABA there.

The California Department of Health Care Services, which declined to be interviewed for this article, provided a statement saying that ABA is covered by services offered to the disabled at regional centers. The centers are tasked with helping adults and children with disabilities.

Most autistic children, however, don’t qualify for ABA at regional centers, advocates say. “The problem with the regional center is that you have to have a certain level of disability to qualify,” Fessel says. That level of disability, she adds, is profound. “If you don’t qualify, you’re basically hosed.” She estimates that 500 low-income families have already had treatment for their autistic children disrupted since the switch from Healthy Families to Medi-Cal.

For families with autistic children, fighting for benefits is par for the course. Fessel, for instance, founded the Autism Health Insurance Project after her own difficulties getting her insurance policy to cover treatment for her son, who has Asperger’s syndrome.

She now guides families through the maze of accessing their benefits. How much help families need from her depends on how well they can advocate for themselves. “If they are very capable, a lot are just fine with advice,” she says, “but a lot of families don’t even speak English.”

Not all parents, in other words, are like Jenny. People who do not speak English or otherwise lack the skills or time to advocate have the hardest time securing services for their children. For instance, assistance for autistic children between 3 and 6 years old, the window for early intervention, varies widely by race, according to an analysis of 2010 data by the Los Angeles Times. The Times found that the state Department of Developmental Services spent significantly more on white and Asian children than on Latinos and African Americans, more than $11,000 per child for whites and Asians, compared to about $7,600 for Latinos and about $6,600 for African Americans.

Fessel finds it difficult to understand the logic of a law requiring therapies for some autistic children but not others. The legislation that mandated coverage for ABA, Fessel notes, recognized the need for therapy as urgent while excluding a population of kids on Medi-Cal. “How can it be urgent for people with money,” she asks, “and not urgent for people without money?”

The Ultimate Price

Jenny lives in San Mateo County, not far from San Francisco, at the end of a winding road fringed by olive trees and sunbleached grass. She doesn’t look like someone who needs government assistance, but paying insurance premiums for an autistic child is not even a remote possibility for her, nor would it be for most middle-class families.

Despite her challenges, Jenny says that she is lucky. Her family helps as much as they can. They help pay for a nanny to watch Cherie while Jenny works as a property manager. They help pay for Cherie’s art and music therapy too. But there is no way they can afford to pay for Cherie’s applied behavior analysis.

The costs to Cherie’s health and future would be devastating if she lost her therapy, Jenny says. Thinking about what they would lose if Cherie’s therapy stopped, Jenny pauses as her eyes fill with tears. “Just being part of the family,” she says after wiping her eyes dry.

The costs to Cherie and her family will be incalculable. But the costs of autism to society have been measured in various ways over the years. One influential article published in JAMA Pediatrics in 2007 put the lifetime costs of autism for one person, both direct and indirect, at $3.2 million. “Although autism is typically thought of as a disorder of childhood,” the researchers note, “its costs can be felt well into adulthood.” Much of the costs of adulthood come in indirect costs, such as housing and lost wages for people with autism and the family members who take care of them.

Though the costs of ABA therapy for autism are high in childhood, they pay off in savings in the relative short term, Fessel says, in three to five years, as children are more functional, and fewer need special education classes in youth and special care into adulthood.

Advocates and parents hoped that the state would enact a one-year stopgap budget measure that would cover ABA for children on Medi-Cal starting July 2013. That item, however, was deleted from the final state budget. Children on Medi-Cal will not be automatically eligible for the therapy in the foreseeable future. That includes children like Cherie who were already receiving ABA under Healthy Families.

Jenny says she managed to get Cherie 15 hours of ABA through the school system, but only with the assistance of a lawyer. She knows her child is fortunate. Other families don’t have her resources. “Every autistic child should have ABA available to them,” she says, “regardless of income or class.” CHR

This story originally appeared in the Summer 2013 issue of the California Health Report magazine. Sign up for the magazine here and never miss another story that connects the community, the capitol and the places in between.

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