May 05, 2005 (The Editor’s Desk is updated each business day.)

Insurance coverage for mental healthcare

The primary impact of the Mental Health Parity Act (MHPA) of 1996 on mental health provisions of employer-provided health insurance was the requirement that coverage for lifetime and annual dollar limits for mental health benefits be the same as those for medical and surgical benefits.

[Chart data—TXT]

The incidence of employees in medical plans imposing more restrictive dollar limits on mental healthcare has decreased from 41 percent in 1997 to 7 percent in 2002 for inpatient care and from 55 percent to 7 percent for outpatient care.

In contrast, the incidence of employees covered by medical plans that provide for fewer inpatient days of care for mental illness than for other medical conditions has increased from 61 percent in 1997 to 77 percent in 2002.

The MHPA reduces differences in how medical care plans that offer both mental health and medical-surgical benefits treat those benefits in terms of lifetime and annual dollar benefit limits. The MHPA still allows day limits for inpatient or outpatient care, higher deductibles or coinsurance, and restrictions on prescription drugs.

These data on employer-provided mental health coverage come from the BLS National Compensation Survey - Benefits program. To learn more, see "Trends in employer-provided mental health and substance abuse benefits," by John D. Morton and Patricia Aleman, Monthly Labor Review, April 2005.