New Mental Health Parity Law

Tucked into the Wall Street bailout bill was a breakthrough for the estimated 113 million Americans suffering from mental illness - a provision making it illegal for health insurance companies to discriminate against patients suffering from psychological or behavioral disorders.

Adoption of the measure, hailed by a leading mental health advocacy group as a "great civil rights victory," marks the end of a decade-long struggle led by Senator Edward M. Kennedy of Massachusetts and his son, Representative Patrick Kennedy of Rhode Island, to ensure parity for mental illnesses in the eyes of the American healthcare system.

The mental parity law, one of many amendments included in the legislation to broaden legislative support for the bailout package, requires health insurance companies to charge the same deductibles, copayments, and out-of-pocket expenses for mental health treatments (including addictions treatments) as for all other illnesses. Group health plans will no longer be able to impose limits on inpatient days or outpatient visits

There is a special effective date rule for collective bargaining agreements that would delay imposition of the parity requirements until the next collective bargaining contract goes into effect.  The law requires that the Departments of Labor, Health and Human Services and Treasury issue regulations within 1 year, although failure to issue such regulations will not delay the effective date of parity.

Among other requirements, the law also requires the US Department of Labor to report to Congress every two years on how group health plans are complying with the law.

The terms of the new law apply to businesses that employ 50 or more people and that offer health insurance with mental health coverage. Now, these businesses must offer mental health coverage to the same extent as all other benefits. Most of the requirements take effect b y January 1, 2010.

We are sure to learn more about this landmark legislation as the deadline approaches.

-From: “Mental-health parity law a big win for Kennedys” by Bryan Bender, The Boston Globe, October 4, 2008, retrieved at: http://www.boston.com/news/nation/articles/2008/10/04/mental_health_parity_law_a_big_win_for_kennedys/; “ Mental Health Parity Approved With Bailout Bill” by Julie Rovner, All Things Considered, National Public Radio, October 6, 2008, retrieved at: http://www.npr.org/templates/story/story.php?storyId=95435676; “ Economic Bailout Includes Long-Sought Mental Health Coverage”, Institute for Geriatric Social Work Newsletter, October 10, 2008; and “ Victory on Parity!”, National Alliance on Mental Illness, October 3, 2008, retrieved at: http://www.nami.org/Template.cfm?Section=October11&Template=/ContentManagement/ContentDisplay.cfm&ContentID=67625.

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