Mental Health Parity

At Issue

In 1996, the Mental Health Parity Act was enacted; it went into effect on January 1, 1998. This Act specifies that companies providing mental health benefits to their workers cannot make the annual or lifetime dollar ceilings on those benefits any more restrictive than their ceilings on medical or surgical benefits; it does not mandate that health insurance plans include mental health benefits. Employers that are exempt from the federal law include those with fewer than 50 employees and those that experience more than a one-percent increase in premiums as a result of implementing the parity requirement. (Learn more here.) Since 2002, various bills to expand the existing federal Mental Health Parity law and close some of its perceived loopholes have been introduced in Congress. During the 110th Congress, two measures are under active consideration: S. 558, a bipartisan measure crafted with the support of advocacy, business and insurer groups, and H.R. 1424, a more extreme measure pending in the House.

NAHU's Position

NAHU supports S. 558 because it takes into consideration the impact that the legislation could have on the cost of group health insurance and the ability of employers to continue to provide coverage for their employees, as well as existing state laws that address mental health parity. Under H.R. 1424, existing stronger state parity laws would be permitted to trump the federal requirements for fully-insured health plans, creating an inconsistent pattern of requirements across the states.

Another flawed aspect of the House bill is that it specifies that if a group health plan offers any mental health benefits, then it must cover all conditions listed in the DSM-IV manual, the privately-produced guide used by mental health professionals to diagnose all mental health conditions. Conditions listed in the DSM-IV include items like caffeine addiction and jet lag. However, the Senate bill allows employers and health plans the option of choosing which mental illnesses to cover.

Additionally, the House bill mandates that if a group health plan provides out-of-network benefits for medical and surgical benefits then it must provide out-of-network benefits for mental health benefits. This requirement is not included in the Senate bill and is significantly more stringent than the requirements that apply under numerous state parity laws or the parity requirements for health plans offered to federal employees, including Members of Congress.

For these reasons, NAHU strongly supports Senate Bill 558 and is working tirelessly to ensure its enactment.

NAHU's Action

Thanks to our members who came to the Capitol Conference and lobbied their Representatives, NAHU has been able to provide critical information to House Members in order to move S. 558 out of committee (it is currently being reviewed in the House Education and Labor's Subcommittee on Health, Employment, Labor, and Pensions). NAHU lobbyists and our coalition partners have been meeting with Members of Congress and their staffs to explain the impact H.R. 1424 would have on the cost of health insurance and consequences it poses for employers who offer mental health benefits to their employees. NAHU lobbyists also attend weekly meetings with coalition partners to discuss strategies regarding this important issue. NAHU and coalition partners teamed up to create this ad.

Legislative Action

- The White House issued a statement that denounced the House legislation. (Read it here.)

- Now, as a result of the vote's narrow margin and the Administration's disapproval of the House version,
Senate Majority Leader Reid will be less likely to bring the House bill to the Senate floor by skipping
the conference process.

- The Senate will also possess the necessary bargaining clout in conference discussions because only 47 Republicans
voted for HR 1424 (originally, there was a total of 274 cosponsors for the bill, a greater number than those who voted for the bill).

NAHU staff will continue to work with both House and Senate Members - Republicans and Democrats - and their staff as preconference negotiations between the chambers begin.

• Amend the Employee Retirement Income Security Act (ERISA) and the Public Health Service Act to require a group health plan that provides both medical and surgical benefits and mental health benefits to ensure that the loopholes in the 1996 Act are closed.
• Mental health benefits' financial requirements are no more restrictive than those of medical and surgical benefits covered by the plan, including deductibles and copayments.
• Treatment limitations, including frequency of treatments or similar limits on the scope or duration of treatment, are no more restrictive than those applied to medical and surgical benefits covered by the plan. Separate cost sharing requirements applicable only to mental health benefits are prohibited.
• An employer with 50 employees or less and those whose costs of compliance increase the total costs of coverage by more than a specified percentage.
• Group health plan ombudsman must be designated by the Secretaries of both the Department of Labor and Department of Health and Human Services. Random audits of group health plans to ensure compliance with this Act are required by the Secretaries.
• The Comptroller General is required to study the effect of this Act on the cost of health insurance coverage, access to such coverage, the quality of health care, and the impact on benefits and coverage for mental health and substance use disorders.

• Out-of-network language: The House bill requires that if out of net services are provided for medical services, then such benefits have to be offered for mental health. One major concern is that mental health providers outside the network have not had a good track record in accepting in-network rates and conditions for participation. There are also not enough providers, particularly pediatric providers.
• Mandating that employers offering mental health benefits cover all conditions listed in the Diagnostic and Statistical Manual of Mental Disorders Manual (DSM-IV). The DSM-IV is a teaching tool developed by the American Psychological Association designed to categorize both disease and character disorders spanning a wide range of conditions. This expansive manual was never intended to become the basis for reimbursement. Its legality may be challenged if it becomes law since the government can not make payments for services based on the work of a non-governmental body. If this were the allowed, then other specialty groups would be incentivized to develop their manuals under which they would demand the govern base their reimbursements.
• Preemption Language: HR 1424 would allow for inconsistent requirements across the states, and would also allow state laws to undercut medical management practices.

Resources

NAHU's Mental Health Parity Issue Summary

NAHU's Press Release on Mental Health Parity

NAHU's Op-Ed Piece on Mental Health Parity

NAHU's Letter to Congressman Kennedy in support of S. 558

Comparison of Senate Bill 558 and House Bill 1424, courtesy of the National Retail Federation

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