Q&A: Insurer to address health system’s ‘blind spot’ by supporting psychedelic treatment
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With a rising number of clinical studies demonstrating the potential benefits of psychedelic treatments for a wide range of behavioral health conditions, insurance plan provider Enthea aims to expand employer funding for these services.
In December, the company announced the successful seed-round fundraising of $2 million, led by Tabula Rasa Ventures, for the planned launch of Enthea’s health plan benefits into 40 major markets across the United States.
The company launched its services in January in New York; Austin, Texas; and the Bay Area, the release stated, and plans further expansion by the end of 2023. Its mission is to make psychedelic-assisted therapies affordable, accessible and equitable with additional employer funding to include these treatments in employee health care.
Healio spoke with Enthea CEO and co-founder Sherry Rais and Tabula Rasa Managing Partner Maria Velkova on the national rollout of services, who will benefit and how the partnership will take on traditional attitudes regarding health care.
Healio: What led Enthea to partner with Tabula Rasa?
Rais: Tabula Rasa is dedicated to investing in the blind spots of the health care industry and supporting the most ambitious, values-aligned and effective entrepreneurs building the future of health. They are also the first psychedelic accelerator for early-stage startups. They are 100% aligned with Enthea’s mission and truly care about effecting positive change in the world.
Healio: What specific issues did your company encounter with traditional health insurers that led you to steer Enthea in the direction of psychedelic health coverage?
Rais: Our chief medical officer (and co-founder Dan Rome), having worked for more than 20 years in the health insurance industry, recognized that for mainstream health insurers, acceptance and funding of psychedelic medicine will come slowly. Unfamiliarity with this unique treatment model — the careful combination of psychotherapy with a novel class of medicines that temporarily alter the patients state of mind — as well as the reputational stigma these compounds carry in the minds of some as misguided targets of the 50-year “war on drugs.”
Our mission from day one has been to assure that as these treatments continue to come online that they become available and affordable to all who can benefit.
Healio: What led to the decision to choose 40 cities for the initial rollout, and what was the thinking behind a staggered release?
Rais: Enthea wants to be able to cover as many people as possible as soon as practically possible. We are not able to open everywhere at once due to state licensing and the on-boarding of providers in each city to deliver treatment.
We chose 40 as the number of cities we would realistically be able to achieve in our first year. Over the first 2 years, we are targeting the 80 largest cities in the U.S.
Healio: What attracted Tabula Rasa to Enthea as a partner for this venture?
Velkova: Enthea is the first benefit plan administrator that provides health plan benefit riders and single case agreement services for psychedelic health care through employers. The team’s deep subject matter expertise in the health insurance industry for 20-plus years positions Enthea as a lucrative investment opportunity that will build out the initial reimbursement infrastructure for broad and safe patient access to psychedelic-assisted therapies.
After the COVID-19 pandemic, employees are looking for mental health support from employers in the midst of the “great resignation.” Employers have the opportunity to provide better care for their talent, improve employee retention and support a healthier workforce.
Healio: What do you see as the main obstacles to treatment with psychedelics and the implementation of health coverage specifically for these treatments?
Velkova: The biggest challenges that psychedelic-assisted therapy will face lay beyond FDA approval, especially for classic psychedelic drugs like MDMA and psilocybin, which will be first to hit the market. Once the FDA stamp of approval and DEA reclassification are complete, enabling broad access to patients will pose challenges.
Enthea is currently the only benefit plan administrator positioned to build out a certified network of psychedelic-assisted therapy providers and enable early and safe access to these therapies through employer health benefits to solve this challenge.
Additionally, psychedelic-assisted therapy is a multimodal therapeutic approach that requires coordination between multiple stakeholders. Prescribers (psychiatrists) and providers (clinics, therapists) are two different stakeholders, and the reimbursement for the drug (pharmacy benefit) and the coverage for the therapy will be coming from two different buckets that rarely interact. This is a blind spot of the current health insurance system, which will create a coordination challenge and require new infrastructure and a coordinator for this process.
Reference:
- Enthea announces nationwide rollout to offer psychedelic therapy as a workplace benefit. https://www.businesswire.com/news/home/20221206005192/en/Enthea-Announces-Nationwide-Rollout-to-Offer-Psychedelic-Therapy-as-a-Workplace-Benefit?_gl=1*a5gr8z*_ga*MTg3NzYwMzA4LjE2Njk5MzEzMzA.*_ga_ZQWF70T3FK*MTY3MDMzNTIyMi45LjEuMTY3MDMzNTIzOC4wLjAuMA. Posted Dec. 6, 2022. Accessed Feb. 3, 2023.