Mental Health Underwriting
May 2025
Authors
Cassandra R. Henson, Dr.P.A., MBA
Randyl A. Cochran, Ph.D., MPA
Executive Summary
Objective: The current study aims to meet the following objectives: 1) examine existing literature and research studies on the association between mental health, morbidity, and health insurance underwriting, 2) examine publicly available survey data for demographic, socioeconomic, and health-related indicators to identify the relationship between mental health diagnoses, medical comorbidities, and mortality, and 3) establish guidelines on implementing sound social determinants of health (SDOH) data collection efforts to support improvements to mental health care, as well as life insurance underwriting practices.
Methods: Data was sampled from three data sources: 1) the Behavioral Risk Factor Surveillance System (BRFSS), 2) the SAMHSA Mental Health Client-Level Data (MH-CLD), and 3) the SAMHSA Treatment Episode Data Set - Discharge (TEDS-D) for the study period 2017-2021. Descriptive analyses were conducted to examine the prevalence of different mental health conditions (including serious mental illnesses and severe emotional disturbance), medical comorbidities, and substance use disorders. Logistic regression analyses were conducted to identify significant predictors of depressive disorder and to determine predictors of mortality during treatment.
Results: Depressive disorder was the primary diagnosis of approximately 19.17% of the survey population (BRFSS). Approximately 66% of individuals with depressive disorder have at least one comorbidity. Depressive disorder was more prevalent in white females who were 65 years of age and older. Alcohol-related disorders were the most prevalent substance use disorder among clients in the SAMHSA datasets. The likelihood of mortality during the course of mental health treatment was lower for individuals with private insurance (when compared to self-pay clients), but the likelihood of mortality was higher for Medicaid beneficiaries, clients who received free/charity care, and clients with other sources of payment. The overall likelihood of mortality during treatment was higher for clients with any type of substance use disorder (alcohol only, other drugs only, or alcohol and other drugs) than for clients with no substance use disorder.
Conclusions and Implications: Underwriting practices should be updated or modified to more accurately capture social determinants of health and other demographic information to identify characteristics and indicators for mental health risk assessment. This information would support predictive analytics, which could facilitate offering tailored products and services and improve decision making.
Materials
Acknowledgements
The authors’ deepest gratitude goes to those without whose efforts this project could not have come to fruition: the volunteers who generously shared their wisdom, insights, advice, guidance, and arm’s-length review of this study prior to publication. Any opinions expressed may not reflect their opinions nor those of their employers. Any errors belong to the authors alone.
Project Oversight Group members:
Elisha Hack, FSA, MAAA
Min Ji, Ph.D., FSA, FIA, MAAA
Michael Levine, FSA
Hezhong Ma, FSA, MAAA
William Mehilos, FSA, MAAA
Tony Pistilli, FSA, FCA, MAAA, CERA
Feng Sun, FSA, CERA
Yifan Zhang, FSA
At the Society of Actuaries Research Institute:
Joe Alaimo, ASA, ACIA, Research Consultant
R. Dale Hall, FSA, MAAA, CFA, CERA, Managing Director of Research
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