On March 5, 2008, the House passed the Paul Wellstone Mental Health and Addiction Equity Act, H.R. 1424, which will end discrimination against patients seeking treatment for mental illnesses. The bill was signed into law on October 3, 2008, as part of the Emergency Economic Stabilization Act of 2008.
The bill amends ERISA, the Public Health Services Act, and the Internal Revenue Code to eliminate discriminatory provisions that erect obstacles to accessing care for Americans with mental health and addiction disorders. The 1996 Mental Health Parity Act required equality only for annual and lifetime limits. This bill requires equality across the terms of the health plan.
Watch Speaker Pelosi speak in support of the bill:
- Specifically, the bipartisan bill prohibits insurers and group health plans from imposing treatment or financial limitations when they offer mental health benefits that are more restrictive from those applied to medical and surgical services.
- The bill applies only to insurers and group health plans that provide mental health benefits. It also exempts businesses of 50 or fewer employees; and businesses that experience an overall premium increase of 2 percent or more in the first year and 1 percent in subsequent years.
- Over the last eight years, the Federal Employee Health Benefits Program (FEHBP) has made “parity” coverage for mental health care available to Members of Congress and 8.5 million other federal employees. Research has shown that there has been no significant cost increase attributable to this parity requirement in FEHBP.
- Furthermore, the nonpartisan Congressional Budget Office has estimated a miniscule impact on premiums for the mental health parity bill – just two-tenths of one percent.
- The two offsets in this bill were included in the CHAMP (Children’s Health and Medicare Protection) Act, which the House passed on August 1, 2007. One increases the rebate (or discount) that pharmaceutical companies are required to provide to State Medicaid programs for drugs provided to Medicaid beneficiaries. The second prohibits physicians from referring patients to hospitals in which they have an ownership interest (with a grandfather provision).
Requires equity in financial requirements. Under the bill, an insurer or group health plan must ensure that any financial requirements – such as deductibles, copayments, coinsurance, and out-of-pocket expenses – applied to mental health and addiction benefits are no more restrictive or costly than the financial requirements applied to comparable medical and surgical benefits that the plan covers.
Requires equity in treatment limits. Under the bill, a group health plan must ensure that the treatment limitations – such as frequency of treatment, number of visits, and days of coverage – applied to mental health and addiction benefits are no more restrictive than the treatment limitations applied to comparable medical and surgical benefits that the plan covers.
Does not mandate mental health benefits. The bill does not mandate insurers or group health plans to provide any mental health coverage. The bill’s provisions only apply to plans that choose to offer mental health coverage.
Exempts certain businesses. The bill exempts small businesses with 50 or fewer employees. It also exempts those businesses that experience an overall premium increase of 2 percent or more in the first year and 1 percent in subsequent years.
Covers same mental illnesses and addiction disorders as FEHBP. The bill ensures that group health plans cover the same range of mental illnesses and addiction disorders covered by the Federal Employees Health Benefits Program – i.e., the mental illnesses and addiction disorders included in the mental health practitioner’s guide, the Diagnostic and Statistical Manual of Mental Disorders (DSM).
Does not mandate out-of-network benefits. The bill simply states that if a plan already offers out-ofnetwork benefits, it must offer out-of-network benefits on the same terms for mental health services as it does for medical and surgical services.
Does not pre-empt stronger state parity laws. The bill establishes a federal standard, a floor of protections that would apply to job-based health coverage, but allows states to be more protective of their
residents with stronger parity laws.
Explicitly permits medical management of health benefits. The bill allows the use of medical management tools that are based on valid medical evidence and pertinent to the patient’s medical condition so that specific coverage is not arbitrary in its application and more transparent to the patient.
Provides for enforcement. The bill provides remedies to protect beneficiaries’ rights and permits enforcement of the bill’s equity requirements by the Internal Revenue Service, the Department of Health and Human Services, and the Department of Labor.
