My name is Bridget Bearden, Research and Development Strategist at the Employee Benefit Research Institute (EBRI). Thank you for inviting me to testify before the ERISA Advisory Council (“the Council”), on the topic of mental health disparity and long–term disability insurance benefits. The COVID-19 pandemic and its mental health aftermath has put a spotlight on the need for employer-provided mental health benefits as well as the flexibility for traditional workplace benefits to incorporate the rapidly increasing prevalence of mental illness more fully.
EBRI’s mission is to produce and communicate independent, objective, nonpartisan data, research, and other information about employee benefits. Our work supports employers, policymakers, service providers, and others in developing innovative solutions and making policy and design decisions.
This testimony draws upon multiple data sources, including publicly available data from the National Compensation Survey from the U.S. Bureau of Labor Statistics and the American Community Survey from U.S. Census Bureau, proprietary survey sets including the EBRI/Greenwald Workplace Wellness Survey and the EBRI/Greenwald Retirement Confidence Survey, and new qualitative research with employers and benefits brokers. We hope the Advisory Council finds this mixed-methods approach helpful in their deliberations on the topic.
This testimony is structured as follows: First, I will address the prevalence of disability among Americans and among the employee population. Next, I will address the state of mental health in the workplace, and then access to and uptake in employer-sponsored long–term disability insurance programs. I will conclude with the intersection of mental health and disability insurance benefits based on qualitative research conducted in preparation for this testimony.
Appendix: Charts qua 50 wor disabil My na litative a me is B it ke y rs. [F igure pproa At the sa ridge 2] ch t B . . me t IS e t’ ince as rde im im 2019, ther n, R e porta , we ese nt t obse aro ch a e note tha rv ha e nd that s be De e t whil the ve n a lopment S 10 pe lar ege EBR st rc incr eInt i fie traetegist nc a lds s se re in o a urv a se t in fe the fe ys a rthe ing Empl nd c number of oye oll long ee c B of ts –ter ene the m fit • Generally (eight in ten) employers paid the full cost of the long–term disability coverage, e propr mploye ietad ry d population ata, we a lso with a disa have acbil cess t ity. o c ertain anonymized administrative datasets, including and employee contributions were not required for the long–term disability insurance disabil Researc ith y insu Instit ra ute ( nceEBR since I) 2010 ( . Thank you f 22 perco er invit nt) is a ing m mong e e to t mpl esti oye fy be rs w for ith less than 50 w e the ERISA Advisory orkers. We 401(k), individual retirement account (IRA), health savings account (HSA), and health care premi Fig um ure s.5: Retirement Confidence by Self-Reported Mental Health Status a Clso ob ouncil se (“ rve the Counc differenc ile ”s in ), on the acce ss t topi o long c of menta –term di l hesa alt bil h it dispar y proit gra y a ms base nd longd o –ter n m empl disabil oyment st ity atus, Figure 3: Prevalence of Six Disabilities Among Employed Population, 2021 Figure 9: Uptake of Long–Term Disability Insurance by Mental Health Q: O Fig ver ure all7: , how Percentag confident e of Priv are y ate ou t Industry hat you ( Work and ers your With spous Access e) wilto l hav Long e –Term Of claims those disable . However, d in t EBR he I wor does not kplac ha e, ve the a most ccess t fro eq aue rentl pre y re sentative sa ported type o mple f disa of group bility is cognit disability ive, at • Five of the 11 employers surveyed were planning to make changes to their long–term insura where nc full e b -ti eme w nefitsorke . The rs C ha OV veID gre -19 ater pa a nde ccemi ss t co the and i be ts m nee fit t ntal he han pa alth a rt-ti fte me w rmath has orkers put a spotli [Figure 3, 8 26] 8. ,ght 0 02 3,500,000 U.S. Department of Labor Disabil Status ity Insurance enough money to live comfortably throughout your retirement years? insura 38 perc nc ee nt c . laims In 20 da 18, c ta ogn for e itmpi ive dif rica fic l ana ulty surpa lysis. Give ssed n thi ambul s da atory diff ta limitaiculty as t tion on group he most insura reporte nce d disability insurance benefits in the next 12 to 24 months. These changes included carrier on the need for eF mpl iguoye re 1 r: -provide Prevalen d menta ce of Disa l heab ltil h be ity ne by fits as w Age, All ell a Civilian s the fle s, xibi 202 li1 ty for traditional Having estab 3,000,00li 0shed the baseline statistics on the status of mental health in the workplace and the disabil claims, itwe y in t conduc he empl tedoye intd population erviews with be [Figure nefits bro 3]. Ske ince rs 2019, ther and employe e ha rs s b in pr een a epa n 18 ration fo percr this ent 70% changes and making the benefit fully employer paid. Some employers that do currently 70% 100% workplace benefits to incorporate the rapidly increasing prevalence of mental illness more fully. 6% 9% 61% 50% ERISA Advisory Council 47% 60% availability of long–term disability insurance benefits, now I will turn to the intersection of testimony. Our summary observations from these interviews are as follows: 45% increase in the number 7% of employees with a cognitive disability. impose a duration limit on mental health conditions indicated they are reviewing these 90% 2,500,000 60% 45% 36% mental health and long-term disability. 30% 60% EBRI’s mission is to produce and communicate independent, objective, nonpartisan data, limits, including 16% increasing or removing duration limits for mental health. 80% 2,000,000 40% Whil 50% e we understand this definition of cognitive difficulty may be different than other • There is inconsistent terminology used on mental health limitations among employers, research, and other information about employee benefits. Our work supports employers, 70% 55% 40% 50% W 35% hereas the National Compensation Survey gauges employer-reported access to benefits, the 1,500,000 definitions of mental health issues, it is an importa nt context when we turn to the mental well- their benefits consultants, and insurance providers. This is also evident in differing terms As concluded in other EBRI research, a significant number of Americans suffer from mental policymake 36% rs, service providers, and others in developing innovative solutions and making 54% 33% 6 40 0% % 32% EBRI/Greenwald Workplace Wellness Survey tracks worker awareness of being offered the 30% being of workers. In the 2022 EBRI/Greenwald Workplace Wellness Survey, we learned that among policies and diagnostic codes relative to mental health, behavioral health, and illness or a substance use disorder each year, and while the COVID-19 pandemic has 29% 34% policy a 1,0 nd de 00,000 sign decisions. 25% 40% 50% Meeting on: 23% benefit. In 2022, we found that 56 percent of workers reported having access to a long–term 30% 4.7 pe 25% rcent of workers report emotional well-being/mental health as “poor,” and 13.7 percent exacerba subst ted su anc ch iss e abus uee s , in it a claims lso he re ight porting. As with any ened employers’ awa empl rene oye ss and e ben re efit, sponse a lac to employee k of a standa s’ rd 22% 40% 500,000 Thursday, September 21, 2023 disability polic 67% y. Yet, as we iii see uneven awareness on access to employer-sponsored benefits by 18% This testimony draws upon multiple data sources, including publicly available data f65% rom the report their lexic eon c mota ional w n compli ellc -be ate ing/ thementa decisi l hea on-making lth as “ fa pro ir” c e [F ssigu and re 4] im. pe In total, thi de innovatio s an mount . s to just menta 20% l health disorders. The connection between disability, health, and wealth benefits is 30% 20% 55% C5320, Room 6, Frances Perkins Building, Washington, D.C. 30% 56% employer size, employment status, and sociodemographic characteristics, we also observe Na ove ti r ona 18 pe l Crompensa cent, or n tie on arlS y 1 in 5, urvey frwho om t he say their U.S. B menta ureau of L l healt a 13% bor St h is wor atise sti c than s and the “good. Ame ” rican - 12% 23% incr • e asingl Despit y cle e the la ar, as c we k o ll as f stathe c ndard onne termi ctinology, on betwe menta en menta l hea l, phys lth issica ues l, and are a c fina omm ncial we on prim llbe ary ing. 15% 52% 22% 57% diff 20e % rences in access to long–term disability insurance by mental health status. We find higher 10% 2010 2011 2012 2013 201 44% 4 2015 2016 2017 2018 2019 2021 Community Survey from U.S. Census B8% ureau, proprietary survey sets including the EBRI applauds the diagnostic c C ode oun for cil long ’s inquiry int –term disabil o menta 7% ity c l laims health . B dis ene pa fits broke rity and long rs sha –ter red m that menta disability l 20% 7% 10% 5% rates of low mental health status among those who are not offered or do not know whe 8% ther they 10% The 2022 EBRI/Greenwald Retirement Confidence surve 10% y found a similar prevalence of total 35% be EBR nefits I/G he . W rea elt nw eh look to be o c alaims ld Workpl are ofte f suppor ace n in Well the top t as e ness S mpl urve -five oye y diagnostic c rs, i andndust the EBR ry pr ategor I/G ovider re ies enw s, a foar nd po ld R long eti – liter re cymake ment C m disabili rs onfide dety ve lop nce 5% 0% With a hearing difficulty With a vision difficulty 3% 1% 1% are offered long-term disability. Specifically, 13 percent o 5% f employees who are offered long– 3% re 10% sponde 0% nts (including both workers and retirees) who reported a mental/emotional health of fair comprehe insura 2nsive 010 nc a e 2nd 0c 1laims 1 inte 2g 0.1 ra 2ted be 2013nefits progr 2014 20 a1ms 5 to 2 0a 1ddre 6 2 ss hol 017 ist 20ic w 18 e2 ll0be 19ing2 . 0 2 0 2021 2022 Survey, and new qualitative research with employers and benefits brokers. We hope the Advisory 0% With a cognitive difficulty With an ambulatory difficulty term disabilVe ity insu ry confid ra enc nt e report Soed me wh “fa at ir c” on or fide“ npoo t r” menta Not too l hea confide ltn h st t atus, No 25 pe t at allrc coe nnt o fidenf e t mployees or poor, at 19 percent (approximately 1 in 5 respondents). • Common duration limitations for mental health and substance abuse claims are typically Council finds this mixed-methods approach helpful in their deliberations on the topic. Under 5 Years 5 to 17 years 18 to 34 years 35 to 64 years 65 to 74 years 75 years and Employer size is less than 50 workers Employer size is 50-99 workers who 0% are not offere W d it long h a s– elf- ter ca m re d disabil ifficultit yy insurance self W -r ite hport an in ed dep thei endr me ent liv nt inagl hea difficu lth st lty atus as 24 months, which aEx ppe ce a llr es to nt be Ve ry standa good rd de Goofa d ultF langua air Poge or in most long–term disability over Excellent(5) Very good(4) Good(3) Fair(2) Poor(1) Long Emp –Term loyer siz Disab e is 10il 0-4 ity 99 B wo erk ne ers fits and M Emp en lo tal He yer size alth is 500 Disp workear rs o ity r m ore “fair” or “poor,” and 27 percent who don’t know whether they are offered long–term disability This testimony is structured as follows: First, I will address the prevalence of disability among Mental illness impacts both current financial security and expectations of future financial policies. Employers can negotiate and customize this duration limit, but the prevalence of Source: EBRI Analysis of United States Census Bureau. American Community Survey. Source: 2022 EBRI/Greenwald Research RMa etire le meFem nt C aonfide le nce Survey insurance self-reported their mental health status as “fair” or “poor.” Taken another way, 60 se So Ame c uurity rc ric e:a . 2 n 02 Using t s a 2 nd a EBR mong t he I/Gr mea eeh s ne ure w e ald mpl of W r oye e or tire k ep population. ment c lace W on elln fide es Ne nc s Su xt, I w e, or the rveyil l addr ir abil eit ss t y to have he state of enough money to mental health in this customization depends on employer size and industry, use of a broker, awareness, Source: U.S. Bureau of Labor Statistics, National Compensation Survey (NCS) percent of employees with fair/poor mental health are not offered or do not know whether they live comfortably throughout retirement, in 2022 we found that across our entire sample, about the workpla and re cesour , and c e then s, among ot access to and upta her constrake int in s. employer-sponsored long–term disability S ource: EBRI analysis of United States Census Bureau. American Community Survey. a re offered long–term disability insurance. Statement for the Record by Bridget Bearden, Ph.D. two-thirds said they were somewhat or very confident in their retirement prospects. [Specifically, insura • nc C eomorbidi programs ti. I w es, cil ausa l conc lity ( lude w whether ith the inter mental he sea clt tih on of issue menta s arise l he beaclt ah a usend dis of ana obil ther ity Figure 4: Self-Reported Mental Health Status Research & Development Strategist 29 percent of individuals surveyed felt they will have enough money to live comfortably through disabil Fit ig yure ), a nd whe 6: Percther entag the e of disabil Worke ity rs re W sult ith s in a Access totto Dis al loss of a abilitbil y Iit nsura y to wor nce k are insurance benefits based on qualitative research conducted in preparation for this testimony. Among those w Q: I it n h a gene cce ral ss, to l how ong woul -ter d m di you rsa atbil e yit our y in ... Em sura ot nc ional e, 56 p wele lrc -bei ent ar ng/Me e e nt nrolle al head in lth , or Employee Benefit Research Institute (EBRI) Figure 8: Percentage of Full-Time Private Industry Workers Participating in retirement, and 35 percent were somewhat confident.] Just under 1 in 10 (9.5 percent) of i additional important considerations that Bene ofte fitsn require subjective review relative to job U.S. Census Bureau, American Community Survey. 2021 ACS 1-Year Estimates. S1810 Disability Figure 2: Percentage of Employed Population With a Disability participating in, the benefit, though not necessarily making a claim on the benefit. With respect According to the American Community Survey (A CS), as of 2021, 42.5 million Americans of all respondents were not at all c Ionfide nsuranc nt t e ha Bet t ne he fits: y wo Long uld have -Term eDisa nough money t bility o be comfortable responsibilities and policy description. 5% Characteristics. Total Civilian Noninstitutionalized Population. 50% i to uptake by mental health status, while more research on benefits optimization and adverse ages have a disability, or 13 percent of the civilian non-inst 43% itutionalized population. While the throughout retirement. 41% 460% 5% 21% 39% 39% 14% selection is needed, the data in the 2022 EBRI/Greenwald Workplace Wellness Survey suggest a ii survey shows that only 11 percent of working age adults aged 18–64 have a disability, we also 36% 36% 40% U.S. Census Bureau, How Disability Data are Colle 35% cted from The America35% n Community Survey. We also received anonymized input from nearly a dozen benefits decision-makers at large 6.5% 33% 33% curved uptake, where self-reported “excellent” mental health indicates a 66 percent uptake, 35% understand that the prevalence of disability increases with age, as 33 percent of civilian However, when we segment by self-reported mental health status, we find that mental health has ht50% tps://www.census.gov/topics/health/disability/guidance/data-collection-acs.html 6.0% employers who are very familiar with the disabilit y insurance design of their organization. In 27% 6% 30% 5% 5% 5% 5% “good” is a 44 percent uptake, and “poor” is a 65 percent4% uptake 4% [Figure 4% 9]. 4% Americans ages 65 and o 5% ver ha 5% ve at least one disability [Figure 1]. 23% a substanti 6% al impact on an individual’s retirement confidence. Across workers and retirees, lack 6.0% 6% aggregate, these employers represented over 300,000 employees across different industries. Excellent(5) 25% iii 40% Fronstin, Paul, and M. Christopher Roebuck, “Use of Health Care Services for Mental Health Disorders of confidence in having enough money to live comfortably throughout the retirement years 20% Given the small sample, the results should be interpreted as qualitative to inform further research 5.4% and Spe 5.5% nding Trends,” EBRI Issue Brief, no. 569 (September 8, 2022). 5.2% Nota 15% bly, the EBRI/Greenwald Workplace Wellness Survey 5.2% does not distinguish among the The American Community Survey, the Survey of Income and Program Par5.2% ticipation, and the increases as self-reported mental health declines [Figure 5]. Whereas 92 percent of those with Very good(4) and not representative of all employers. Our summary observations among those we spoke with 5.1% 5.1% 5.0% 30% 10% ii various designs of long–term disability insurance benefits, such as ERISA status, funding Current Population Survey use a six-item set of questions to gauge disability. Survey “excellent” self-reported mental health were very or somewhat confident, only 43 percent of are as follows: 4.8% 4.8% 5% 4.8% 5.0% strategy, or the level of employee contribution. These designs likely have an impact on employee Good(3) respondents may select multiple types of disabilities within the survey. The six disabili 45%ty t45% ypes those with “fair” self-reported menta 44% l healt44% h were44% very or 44% some44% what conf 44% ide44% nt, and only 15 43% 43% 0% 42% 41% 20% 27% uptake of the benefit. are: percent wit Civilian h “: lo poo ng r” - se Cliv f-ire lian porte : shod ment rt- Priva ate l hea indlt ush try w :ePriv re ve ate ry or indu som stry: e St wh ate at co and lo nfide cal nt. St ate and local 4.5% • Ten of the 11 employers that took the survey offered a long-term disability insurance Fair(2) term disability term disability long-term short-term government: government: 1. Hearing difficulty — Deaf or having serious diff iculty hearing. 10% benefit plan subject to ERISA. For these empl 33% oyers, the most common funding strategy insurance insurance disability disability long-term short-term When we ask employees who have any kind of disability insurance whether they believe they 2. Vision difficulty — Blind or having serious difficulty seeing, even when wearing glasses. 4.0% Having addressed the prevalence of disability related to cognitive difficulty broadly and in the for long–term disability insurance benefits was fully funded/fully insured. Poor(1) insurance insurance disability disability have 0% enough coverage to protect against potential financial risks, 61 percent say they have 3. Cognitive difficulty — Because of a physical, mental, or emotional problem, having workplace, and the impact of mental health status on retirement confidence, I turn now to access • Six of the ten with plans subject to ERISA indicated that disabil insurit an y income ce be insu ne ran fits ca ce n 3.5% enough c2010 overage 2011 , 26 p2012 ercent say the 2013 2014 y do not hav 2015 e 2016 enough c 2017 ove 2018 rage, a 2019 nd 13 pe 2020 rcent do not 2021 2022 know difficulty remembering, concentrating, or making decisions. and participation in long–term disability insurance. The views expressed in this statement are solely those of Bridget Bearden and should not be continue until retirement age regardless of reason for disability (illness, injury, medical, whether they have enough coverage. Notably, 2012 the pe 202 rc 2entage of employees who report they have 4. Ambulatory difficulty — Having serious difficulty walking or climbing stairs. attribute 3.0% menta d to the l, sub Empl stanc oye e use e Be , ne etc.) fit R . F eou sea r of rch ten Instit indi ute ( catEBR ed that I), the E certain BR disabil I Educ ita y be tion a nefits nd R we ese rea rch Full-time Part-time In se enough c tting t ove her stage age d, ec ba re se asd on es as self the N -re atiporte onal d C menta ompensa l hea tion lth st Surve atus dec y — li ane surv s. Na ey of tura busi lly, it ne follows ss 5. Self-care difficulty — Having difficulty bathing or dressing. Source: 2022 EBRI/Greenwald Workplace Wellness Survey 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2021 subject to duration limit of 24 months. Fund, any of its programs, officers, trustees, sponsors, or other staff. The Employee Benefit Source: U.S. Bureau of Labor Statistics, National Compensation Survey (NCS) that even when employees with “poor” or “fair” self-reported mental health are asked whether establis 6. hments Independe — nt l weivi fin ng diff d that ic ac ult cey ss t — o B long ecause -ter of a m disabil physica ity insu l, me ra ntal, or nce be e ne mot fits has inc ional problem, reased 3 Source: U.S. Bureau of Labor Statistics, National Compensation Survey (NCS) • Among those that had a duration limit, most (three) reported that mental health Research Institute is a nonprofit, nonpartisan, education and research organization established in the disability benefit offered by their employer contributes to their feeling of financial security, having difficulty doing errands alone such as visiting a doctor’s office or shopping. S pe ourc rcent e: aEBR ge point I Ana s in lysi priva s of te indust United St ry ov ates Census B er the last 10 ye ureau. a rs Ame [Figu rica re n C 6]omm . Like unit acc y S ess t urve o re y. ti rement conditions applied to the limit. One employer indicated that pre-existing conditions also Washington, DC, in 1978. EBRI does not take policy positions, nor does it lobby, advocate they are less likely to agree than those with stronger mental health statuses. and health benefits in the private sector, we find differences in access to long–term disability applied to the duration limit. specific policy recommendations, or receive federal funding. Naturally, not all these individuals are employed in the labor force. As of 2021, ACS estimated benefits according to employer size [Figure 7]. Employers with more than 500 employees are The last component of this testimony draws upon qualitative insights gained from interviews that of the 145 million individuals in the labor force, 8.7 million (5.99 percent) had some kind of three times more likely to offer long-term disability as compared with employers with less than with benefits brokers and employers on long–term disability benefit design. Here we use a 11 10 6 9 8 4 3 2 7 5 901 D Street, SW, Suite 802, Washington, DC 20024 | (202) 659-0670 | info@ebri.org Employed Population, count