Friday, February 29, 2008

Parity legislation in the 110th Congress

End Health Discrimination



The House of Representatives has scheduled a historic vote on a comprehensive mental health/substance use parity bill on March 5. Please urge your U.S. Representative to support passage of H.R. 1424, the Paul Wellstone Mental Health and Addiction Equity Act.

Given the importance of this vote, please take a minute to also call your Representative using the toll-free Parity Hotline, 1-866-parity4 (1-866-727-4894). The Parity Hotline reaches the Capitol switchboard, which can connect callers to their members of Congress. If you do not know the name of your Representative, click here. Be sure to let us know you called!

Policy Position and Call to Action

All people in America should have a right to health-care benefits, including needed behavioral health services. The Mental Health America calls on federal and state government to ensure, as a matter of law, that public and private health plans afford people access to needed behavioral health care and treatment on the same basis. Such services should be subject to the same terms and conditions as care and treatment for any other illness, without regard to diagnosis, severity, or cause.


Mental health is essential to leading a healthy life and to the development and realization of every person’s full potential. Yet mental illness and substance-use disorders are leading causes of disability and premature mortality in the United States. As the President’s New Freedom Commission on Mental Health observed in its final report,[1] mental disorders are “shockingly common.” Most people are affected in some way by mental illness at some point in their lives.

With striking scientific advances over the last half century, behavioral health problems are now reliably diagnosed, and there is a range of treatments for virtually every such disorder. Those treatments have efficacy rates comparable to or exceeding those for many medical and surgical conditions. Yet all too often people with diagnosable mental disorders do not seek treatment. “Concerns about the cost of care – concerns made worse by the disparity in insurance coverage for mental disorders in contrast to other illnesses – are among the foremost reasons why people do not seek needed mental health care,” the Surgeon General observed in the landmark 1999 report on mental health.[2]

Health insurance plans, from private individual and group coverage to the Medicare program, have long imposed barriers that limit access to needed behavioral health care for both mental and substance-use disorders, with far-reaching and often tragic results. No comparable barriers limit access to needed care for other illnesses. That such blatant discrimination continues to flourish -- more than a decade after enactment of the Americans with Disabilities Act, some forty years after the adoption of the first modern civil rights’ laws, and nearly a century since this organization’s establishment as a movement based on principles of social justice -- attests to the deep-rootedness of the stigma surrounding behavioral health disorders. But that such ongoing arbitrary discrimination is countenanced by federal law is nothing short of shameful.

The widespread practice of providing unequal coverage for behavioral health and other medical care not only limits access to needed care, but subjects many Americans to the risk of major financial losses from out-of-pocket costs. At the most profound level, these practices reinforce the poisonous stigma underlying disparate treatment of “others”. That disparate coverage of behavioral health should be routine, and that discrimination against people with or at risk of behavioral health disorders should be lawful, is not only morally offensive in itself, but fosters a climate that tolerates and even encourages other forms of discrimination and weakens the fabric of equal-opportunity laws.

No rational basis supports these discriminatory health-insurance practices, which have drawn criticism from voices ranging from President George W. Bush to Fortune 500 chief executive officers.[3] A landmark report by the National Business Group on Health recommends employers equalize their medical and behavioral benefit structures given evidence that parity yields significant clinical benefit without increasing overall healthcare costs.[4]

Lack of understanding regarding mental health and deep-rooted stigma help explain why it is still so common for health plans to place greater restrictions on treating behavioral health disorders than on other illnesses. While enlightened business leaders in some industries and communities have voluntarily provided parity protection for their workforces, voluntary measures are not an answer to the widespread discrimination facing most insured Americans. Thus, Mental Health America supports insurance-parity legislation.

Congress took a first step toward ending such discriminatory insurance practices when it enacted the Mental Health Parity Act of 1996. The Act established the principle that there should be no disparity in health insurance between mental-health and general medical benefits. By its terms, however, the Act provided only that employer health plans that cover more than fifty employees and that offer mental health benefits may not impose disparate annual or lifetime dollar limits on mental health care.

The 1996 Act represented an important milestone, but has not produced fundamental changes. People with or at risk of behavioral-health disorders still face widespread, arbitrary discrimination in insurance plans. As the General Accounting Office (GAO) reported in reviewing the Act’s implementation, the vast majority of employers it surveyed complied with the 1996 law, but substituted new restrictions and limitations on mental health benefits, thereby evading the spirit of the law.[5] As GAO documented, employers routinely limited mental health benefits more severely than medical and surgical coverage, most often by restricting the number of covered outpatient visits and hospital days, and by imposing far higher cost-sharing requirements.[6]

Although subsequent efforts to enact a comprehensive federal parity law have been unsuccessful, the federal Government further advanced the principle of parity by requiring insurers to equalize behavioral-health and other health benefits under the Federal Employee Health Benefits program (FEHB), which covers federal employees (including Members of Congress), retirees and dependents.[7]

Most states have adopted laws requiring parity between mental health and general health benefits in group health insurance. But those state laws vary widely in scope, and, under federal law, do not govern the health plans of the many employers who elect to self-insure.[8]

Those opposing parity legislation often assert that it will add to the cost of health care. But as the National Business Group on Health observed in its employer’s guide to behavioral health services, a number of parity studies have found that equalizing specialty behavioral health and general medical benefits will either not increase total healthcare expenses at all or will increase them by only a very modest amount of total healthcare premium. [9] The real cost lies in not treating behavioral health disorders. As the National Business Group noted, the indirect costs associated with mental illness and substance-use disorders – excess turnover, lost productivity, absenteeism and disability – commonly meet or exceed the direct treatment costs, and have been estimated to be as high as $105 billion annually.[10]

The discrimination in health insurance against people with or at risk of behavioral health disorders; the lack of real protection in current law against such discrimination; and the loss of life, health, and productivity attributable to these insurance barriers make it critical that Congress ensure that public and private health plans equalize medical and behavioral health benefit structures. Some attack parity legislation targeting employer-provided insurance as inappropriate regulation of benefits provided at the employer’s discretion. But these discriminatory practices frustrate the compelling governmental interest of protecting all Americans equally, at whatever level of coverage the employer or the insured can afford. Indeed, federal law subsidizes employers through the federal tax code for providing health insurance to employees (allowing the cost of insurance as an ordinary business expense).[11] It is wholly appropriate for Congress to condition entitlement to such tax benefits on employers’ providing health benefits in a non-discriminatory manner.

Facing opposition to parity proposals, legislators have in some instances limited the scope of such measures and provided parity protection to only certain populations. Sound public policy aimed at achieving fairness is certainly not realized, however, when the law affords fair and equal treatment to some and not others. Mental Health America, therefore, does not support enactment of legislation that limits parity protection only to individuals who have specified diagnoses.[12]

Compelling principles dictate the adoption of comprehensive parity legislation. These include recognition that:

  1. All people in America should have a right to health-care benefits, including needed behavioral health services.

  2. Since comprehensive health-care is critical to people’s well-being and to realizing their full potential, barriers to behavioral health care and treatment cannot be justified or tolerated.

  3. Coverage of needed health care – whether through government, employment, or individual purchase – must be afforded equitably to all people, without regard to the nature, severity, or cause of the individual’s illness or disability.

  4. Insurance practices that set stricter limits on behavioral health coverage than on coverage for other illnesses cannot be justified and must not be permitted.

Effective Period

The Mental Health America Board of Directors approved this policy on September 8, 2006. It will remain in effect for five (5) years and is reviewed as required by the Mental Health America Prevention and Adults Mental Health Services Committee.

Expiration: September 8, 2011

[1] “Achieving the Promise: Transforming Mental Health Care in America,” New Freedom Commission on Mental Health, p. 1, 2003.

[2] “Mental Health: A Report of the Surgeon General,” p. 23, 1999.

[3] Remarks by the President on Mental Health, April 29, 2002; Hackett, J.T., CEO of Ocean Energy Inc., testimony before the Subcommittee on Health of the Energy and Commerce Committee, House of Representatives, July 23, 2002.

[4]An Employer’s Guide to Behavioral Health Services,” National Business Group on Health, p. 68, November 2005.

[5] “Mental Health Parity Act: Despite New Federal Standards, Mental Health Benefits Remain Limited,” United States General Accounting Office, p. 21, May 2000.

[6] Id. at pp. 13-14.

[7] Federal Employee Health Benefits Program Carrier Letter, April 11, 2000.

[8] The Employer Retirement Income Security Act of 1974 (ERISA) allows employers to offer uniform national health benefits by preempting states from regulating employer-sponsored benefit plans. Thus, while states can regulate health insurers, they are unable to regulate employee benefit plans established by employers. Federal parity legislation explicitly amends ERISA to ensure that self-insured employer health plans are subject to federal parity requirements. (See H.R. 1402, 109th Congress.)

[9] Report, op. cit., p. 52.

[10] Report, op. cit., p. 30.

[11] See 26 U.S.C.A. sec. 162(a)(1).

[12] A law that requires health plans to provide parity only for those with a severe mental illness or those with a “biologically-based mental illness,” for example, implicitly conveys the message that it is acceptable to discriminate against those with other mental disorders, and suggests that such disorders do not merit the law’s protection. Such limited parity protection discourages early intervention and leaves children at particular risk, since the few illnesses covered under such laws seldom occur until late adolescence or early adulthood. Mental Health America does, nevertheless, recognize that enactment and implementation of such laws have enabled advocates in some states to build on an incremental gain and later win passage of comprehensive legislation.

Mental Health America
Mental Health America's Advocacy Network


MrsMenopausal said...

Thanks for the information and the heads up. I've signed up and added the sticker to my blog.

My blog: Weighing The Facts