Group health plans can no longer set higher costs for caring for patients' mental healthcare than their medical and surgical services due to a new federal law. The sweeping change applies to the estimated 140 million Americans, who have group insurance plans.
Physician organizations, including the American Medical Association, American Psychiatric Association and many mental health advocacy groups, applaud the newly enacted legislation and have supported these changes since the first mental health parity act took place in 1996. While the 1996 legislation stopped insurers from instituting lower yearly and lifetime amounts for treating mental illness, it did not prevent health plans from enacting higher cost sharing and treatment limits for patients.
"This legislation is a reflection of the American public's recognition that mental illnesses are real and treatable, and that fair coverage is to everyone's benefit," says Dr. Nada L. Stotland, past APA President. Advocates regard the law as a triumph for both insurance equality and for the fight to remove the stigma from mental illness.
On the cost side, the equality in mental health coverage is expected to have a moderate effect on health insurance costs. Many employers now recognize that managing chronic diseases, including mental illnesses, makes economic sense because employees are more productive.
Taking effect for most insurance plans on Jan. 1, the law covers groups of over 50 employees and was developed to stop what Kathleen Sebelius, Health and Human Services Secretary, describes as "needless and arbitrary limits on care."
The law has limits though. It does not affect individual insurance policy coverage, and it does not mandate group plans to supply mental health and substance abuse treatment, although the majority already do.
To learn more:
- read this Washington Post article