Mental Health Parity law takes effect, cost effects unknown

Legislation requiring group plans to align mental health benefits with medical and surgical benefits took effect July 1, reports the Kansas City Business Journal.

"Congress wanted people who needed mental health benefits to be treated fairly and not have anything put into place that would discourage them from using those services," Linda Sheppard, director of the accident and health division with the Kansas Department of Insurance told the Business Journal.

According to experts, the Mental Health Parity Act could add anywhere from 2 to 10 percent to the cost of coverage.

In addition, Susan Johnson, spokeswoman for Blue Cross and Blue Shield of Kansas City, said cost increases affect individual premiums. "Federal officials estimate that complying with the law will increase premiums nationwide by four-tenths of 1 percent, or about $25.6 billion over 10 years," reports the Washington Post.

Some worry that companies may drop coverage in order to avoid the parity law's cost increase.

Although, the parity law only applies to insurance plans offering mental health coverage, others may become subject to the law, and its possible cost increase. The Patient Protection and Affordable Care Act set to take effect in 2014 will require all health insurance plans to cover mental health, notes the Business Journal.

For more:
- here's the Kansas City Business Journal article
- read the Washington Post article