With mental health and substance abuse disorder services deemed an essential health benefit under the Affordable Care Act, employee assistance program providers are taking on a new role – helping employers and health plans sniff out fraudulent health care activity among substance abuse and mental health treatment facilities.

Some facilities “prey on the out-of-network benefits,” said Brendan J. Young, president and CEO of Mental Health Consultants, an EAP provider in southeastern Pennsylvania. He explained that these fraudulent facilities almost always collect from employer health plans rather than direct payment from the individual. Young noted that one facility even bought a private jet to fly participants in for treatment.

In southern U.S. states, federal authorities have investigated and charged numerous facilities with filing false claim reports, multimillion dollar health care fraud and kick-back schemes.

The Department of Justice said in April that CRC Health Corp., which owns a Burns, Tenn.-based facility, agreed to pay out $9.25 million to settle claims that it knowingly submitted false claims for adult and adolescent Medicaid patients suffering from alcohol and drug addiction. CRC is a nationwide company that offers substance abuse and mental health treatment services.

See also: 3 ways to counsel employers through an employee's depression-related return to work

Meanwhile, in October, the U.S. Attorney’s Office handed down indictments to a number of doctors and nurses associated with Biscayne Milieu, a Miami-based mental health clinic that operated a partial hospitalization program that serves as treatment for severe mental illness. Charges include conspiracy to commit health care fraud, health care fraud, and false statements related to health care matters.

“It’s a growing problem and one that is only getting more attention now that the ACA has more people looking for coverage that didn’t have coverage,” Young told attendees at the International Foundation of Employee Benefit Plans’ 60th Annual Employee Benefits Conference.

The ACA helped to bridge the Mental Health Parity and Addiction Equity Act of 2008 so that federal protections could be gleaned by about 62 million Americans – including participants and their dependent children up to age 26. Because treatment of mental and or substance abuse disorders now fall under essential health benefits, the ACA included these programs as preventative care. Also, most non-grandfathered health plans, including those available through the health insurance marketplace, must cover preventative care measures.

See also: The risks of maintaining grandfathered health plan status

“The Affordable Care Act has actually said that mental health and substance abuse are essential benefits,” said Margaret C. Lemkin, Ph.D., president of Med-Care Management, Inc. a West Palm Beach, Fla.-based care management company. She said the proliferation of facilities is likely “because now there are unlimited benefits.”

According to the Substance Abuse and Mental Health Services Administration, a division of the Department of Health and Human Services, substance use disorder plagued one in 12 U.S. adults last year. Also, 43.8 million adults had some form of mental health illness, defined as individuals that have any behavioral or emotional disorder, according to SAMHSA’s 2013 National Survey on Drug Use and Health. 

Meanwhile, 7.7 million report having both substance abuse and mental health illness, the survey said.

According to Young, whose organization works with Fortune 500 companies, self-funded employers, small- to mid-size employers and nonprofits, EAPs can serve as gatekeepers to shield their clients from the bad eggs of the substance abuse and mental health treatment world. Because employer HR and workforce relations department may have their hands full with other benefit issues, Young disclosed that EAPs should be able to maintain relationships and question facility practices. If facilities inquire about the benefit plans for employees, he said EAPs and employers should determine an “allowable rate” for treatment, which can prevent further abuses down the road.

“The fund will pay up to allowable rate,” Young recommended other employers and EAP managers tell treatment facilities that question coverage. “Anything over that is on you and the patient. That allowable rate was set at a reasonable rate and that, for the shady facilities, pretty much ended the conversation.”

Effective utilization

Sniffing out fraud is just one of component that can be beneficial to the EAP-employer relationship. According to a prior report, Federal Occupation Health said that EAPs can “clearly improve health and productivity.” Data from more than 400 agencies highlighted that, among companies that offer EAPs, unplanned absences and lateness decreased by an average of 1.5 days and ease of performing daily tasks showed a 73% productivity improvement rate.

But, according to Martha M. Hendrickson, director of workforce relations at the Associated General Contractors of Minnesota, experiences can vary when participants lack knowledge or are afraid to use the program.

“The best EAP in the world doesn’t do any good if you have an employee population that is afraid to use it,” Hendrickson said at the IFEBP conference.

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