What the Mental Health Parity Act Means for Depression Patients

Teri Robert Health Guide
  • Mental health parity has been a difficult issue for those of us with mental health and wellness conditions for quite some time now. It has been so difficult, in fact, that federal legislation is necessary to address it.

     

    The Paul Wellstone-Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA), included in the Emergency Economic Stabilization Act of 2008, was signed into law on October 3, 2008 and went into effect October 3, 2009. The MHPAEA requires that plan mental health and substance use disorder benefit terms and conditions, including but not limited to: financial limitations (e.g., copayments, coinsurance, deductibles, out-of-pocket maximums), and treatment limitations (e.g., number and frequency of visits, days of coverage), must be at parity with – equal to or better than – plan medical and surgical benefit terms and conditions.

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    The basics of the MHPAEA:

     

    The Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) is a federal law that may apply to two different types of coverage:

    1. Large group self-funded group health plans (the Centers for Medicare and Medicaid Services [CMS] has jurisdiction over self-funded public sector (non-federal governmental) plans, while the Department of Labor (866-444-3272) has jurisdiction over private sector self-funded group health plans.);
    2. Large group fully insured group health plans.

    Some states offer additional protections, so contact your state's insurance department to find out about whether additional protections apply to your coverage if you are in a fully insured group health plan or have individual market (non-employment based) health coverage.

     

    Older legislation, the Mental Health Parity Act of 1996 (MHPA) states that a group health plan may not impose annual or lifetime dollar limits on mental health benefits that are less favorable than any such limits imposed on medical surgical benefits.

     

    MHPAEA preserves the MHPA protections, and adds significant new protections. Although the law requires "parity", or equivalence, with regard to annual and lifetime dollar limits, financial requirements and treatment limitations, MHPAEA does NOT require large group health plans and their health insurance issuers to include mental health (MH)/substance use disorder (SUD) benefits in their benefits package. The law's requirements apply only to large group health plans and their health insurance issuers that already include MH/SUD benefits in their benefit packages.

     

    Key changes made by MHPAEA, which is generally effective for plan years beginning after October 3, 2009, include the following:

    • If a group health plan includes medical/surgical benefits and mental health benefits, the financial requirements (e.g., deductibles and co-payments) and treatment limitations (e.g., number of visits or days of coverage) that apply to mental health benefits must be no more restrictive than the predominant financial requirements or treatment limitations that apply to substantially all medical/surgical benefits;
    • If a group health plan includes medical/surgical benefits and substance use disorder benefits, the financial requirements and treatment limitations that apply to substance use disorder benefits must be no more restrictive than the predominant financial requirements or treatment limitations that apply to substantially all medical/surgical benefits;
    • MH/SUD benefits may not be subject to any separate cost sharing requirements or treatment limitations that only apply to such benefits;
    • If a group health plan includes medical/surgical benefits and mental health benefits, and the plan provides for out of network medical/surgical benefits, it must provide for out of network mental health benefits;
    • If a group health plan includes medical/surgical benefits and substance use disorder benefits, and the plan provides for out of network medical/surgical benefits, it must provide for out of network substance use disorder benefits;
    • Standards for medical necessity determinations and reasons for any denial of benefits relating to MH/SUD, must be disclosed upon request;
    • The MHPA parity requirements under existing law (regarding annual and lifetime dollar limits) continue and are extended to substance use disorder benefits.

    There are three exceptions to the MHPAEA requirements:

    • MHPAEA requirements do not apply to small employers who have between two and 50 employees;
    • Large group health plan sponsors that meet the requirements stated in the MHPAEA download below (Section 512(a)(2) Cost Exemption) and demonstrate that compliance with MHPAEA increases their claims by at least two percent in the first year (one percent in subsequent years) may request exemption from the MHPAEA based on their cost exemption. Subsequently, the plan sponsors may notify the plan beneficiaries that MHPAEA does not apply to their coverage; and
    • A nonfederal governmental employer that provides self-funded group health plan coverage to its employees (coverage that is not provided through an insurer) may elect to exempt its plan (opt-out) from the requirements of MHPAEA by following the Procedures & Requirements posted on the Self-Funded Nonfederal Governmental Plans webpage, then issuing a notice of opt-out to enrollees at the time of enrollment and on an annual basis. Thereafter, the employer must also file the opt-out notification with CMS.

    What does this mean to us?

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    All of this can be difficult to digest and follow. Now that I've shared the "official" information with you, let me break it down and summarize what the MHPAEA means to those of us living with depression and other mental health and wellness issues.

    • The MHPAEA doesn't apply to small businesses with 50 or fewer employees.
    • For group health plans that include medical/surgical benefits and mental health benefits, deductibles: co-payments, and any treatment limitations for mental health benefits have to be in parity with (equal to) correlating financial requirements or treatment limitations that apply to medical/surgical benefits.
    • For group health plans that include medical/surgical benefits and substance use disorder benefits: deductibles, co-payments, and any treatment limitations for mental health benefits have to be in parity with (equal to) correlating financial requirements or treatment limitations that apply to medical/surgical benefits.
    • This isn't the first mental health parity act. The MHPAEA preserves the protections Mental Health Parity Act of 1996 (MHPA) and adds new ones. The MPHA states that a group health plan may not impose annual or lifetime dollar limits on mental health benefits that are less favorable than any such limits imposed on medical surgical benefits.

    In the most basic terms. these two mental health parity acts say that group health plans can't pay less for or require us to pay more for mental health and substance use disorder treatment than for medical and surgical treatment.

     

    Some states have laws that offer additional protections. If you're not sure of the laws in your state, check with the state insurance department.

     

    Photo: Mental Health America Conference; June, 2009. Mrs. Rosalyn Carter introduced Senator Pete Domenici as he was honored for his work in mental health. Although his health did not permit him to attend, Senator Edward Kennedy was also honored.

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    Resources:

     

    Paul Wellstone-Pete Domenici Mental Health Parity and Addiction Equity Act of 2008. A copy is available HERE.

     

    U.S. Department of Health and Human Services. "The Mental Health Parity and Addiction Equity Act." Centers for Medicare & Medicaid Services. January 12, 2010.


     

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    © Teri Robert, 2010. Last updated January 19, 2010..

Published On: January 20, 2010