Federal and State Mental Health Parity Statutes
Before it adjourned, the 109th Congress passed, and President Bush signed last week, an extension of the Mental Health Parity Act. It will now remain in effect through the end of 2007 instead of expiring at the end of this year. CCH reports on the Congressional action here. You can read the CMS description of the Mental Health Parity Act here.
The federal Mental Health Parity Act first became law in 1996. It requires group health plans to provide the same annual and lifetime dollar limits for mental illness as exist for physical illnesses. However, the federal mental health mandate is easily circumvented because it does not require group health plans to offer mental health benefits at all. The required coverage only applies to group plans that choose to offer mental health benefits. The federal statute also allows groups to completely exclude coverage for substance abuse and chemical dependency and does not apply to employers with fewer than 51 employees. Moreover, it doesn’t limit a group plan’s ability to restrict the number of covered visits to a mental health physician nor does it prevent the group plans from increasing co-payments or co-insurance for mental illnesses above those for physical illnesses. In short, the statute is pretty much toothless.
In contrast, many states have enacted more comprehensive mental health parity statutes for insurers operating within those states. You can find a chart comparing the various states here as well as here. For the most part, so long as they apply only to insurers as opposed to self funded employer sponsored welfare benefit plans, these state mental health mandates are not preempted by ERISA.
Of course, the debate rages about the extent to which these mandated benefits increase insurance premiums, whether there is an offsetting benefit in the form of greater use of mental healthcare resources, how to measure any benefit that exists from expanded access to mental healthcare services, etc. But suffice it to say that public awareness of, and support for, mental healthcare coverage has increased in the last twenty years.
Most people have a family member or friend who has need of healthcare for mental, emotional or behavioral problems. We recognize more than ever how debilitating mental illness can be for both individuals and society. Mental health issues are more openly discussed and readily dealt with than ever before. Hand in glove with the broader discussion of healthcare reform in this country, I don’t see the issue of mental health parity going away anytime soon.