Jill Wechsler
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After more than a decade of contentious debate, Congress approved legislation last month designed to improve mental health
benefits for individuals participating in employer-based group health plans. The law does not require payers or insurers to
cover mental health treatment. But those health plans that do so must offer benefits comparable to those for medical conditions
such as cancer or diabetes.
That means no limits on number of doctor visits and no more copays for psychological conditions that are higher than those
for physical ailments. The list of covered conditions was extended to include depression, autism, eating disorders and alcohol
and drug abuse—but not sleep disorders, caffeine intoxication or other "fringe" disorders listed in a manual issued by the
American Psychiatric Assn. and backed by patient advocates.
The law was hailed as a health policy milestone that reflects the declining stigma against mental illness and scientific advances
in treatment. Although mental health advocates did not get the coverage mandates originally demanded, they acknowledged the
importance of the policy in equalizing treatment of the mentally ill.
The new policy is projected to boost health insurance premiums very slightly—less than 0.5%. But even that small amount will
increase tax deductions for premium costs, which will cost the federal government $3.4 billion in lost tax revenue over five
years. Separately, Medicare will move toward parity over six years by reducing its current 50% copays for outpatient mental
health services to meet the 20% copay it sets for other medical services. INSURERS, EMPLOYERS SIGN ON
After years of opposition to more costly mental health mandate proposals, insurers backed this bill as a reasonable compromise.
Aetna Chairman Ronald Williams praised the law, saying it was likely to improve health outcomes "through integrated medical
and behavioral benefits and services."
An important feature for insurers is continued leeway to use benefit management strategies in the mental health area, but
with more transparency on coverage decisions and denials. Under the law, which takes effect in 2010, insurers that seek to
deny payment for care on the grounds that it is not "medically necessary" or "clinically appropriate" must disclose their
criteria for such decisions related to claims for mental health services.
Ultimately, insurers are expected to integrate mental healthcare with medical and surgical benefits, based on expanded networks
of mental health providers. Already the legislation is boosting interest in the growing number of firms providing specialized
mental health benefits to employers and health plans.
Key to gaining employer support for the legislation is an exemption for companies with 50 or fewer employees from the parity
requirement. Employers also acknowledge growing evidence that treatment of mental health disorders can improve productivity.
At the same time, Helen Darling, president of the National Business Group on Health, warned that over time, requirements such
as mental health parity may erode the ability of employers to provide coverage for workers and their dependents. She advised
lawmakers to realize that support for this legislation should not be regarded as opening the door to a "one-size-fits-all"
approach to health reform.
Despite broad enthusiasm for mental health parity, it remains to be seen if the new requirements lead to a reduction in employer
health benefits or any narrowing in the range of products offered by insurers.
Jill Wechsler, a veteran reporter, has been covering Capitol Hill since 1994.
