Several States Take Action On Insurance Parity
Legislation mandating insurance parity for mental health conditions has advanced in several states this year, including a measure in New York that advocates have been urging for 20 years.
A bill in New York known as “Timothy's Law” (A 02912), for example, would require insurance companies to cover most mental illnesses, including a broad range of mental illnesses and conditions specifically related to children.
Lawmakers in both chambers of the state legislature reached agreement on the measure shortly before adjourning in June, and they are expected to formally approve it when they reconvene later this year.
“This is a good plan for New York that offers a reasonable amount of coverage for individuals and families of those with mental illness,” said Ann Marie Sullivan, M.D., who represents Area 2 on the APA Board of Trustees.
One of the most important aspects of the measure, Sullivan told Psychiatric News, is its mandate that copayments for psychotropic drugs not exceed the costs of medications for other conditions. The need for regular medication for many serious mental illnesses has traditionally placed a large financial burden on people with such disorders.
Advocates of the measure, which included the National Alliance on Mental Illness, have pushed for a parity measure in the state for 20 years, said Sullivan. The measure was repeatedly passed in the Assembly but stalled in the Senate on concerns it would hurt small businesses. Gov. George Pataki (R) has not indicated whether he would sign such legislation.
To address the cost concerns raised by small businesses, the measure would exempt businesses with fewer than 50 employees from any increase in insurance premiums that result from it.
The legislation would require insurance companies to cover 30 inpatient and 20 outpatient days of treatment for “biologically based” mental illnesses, defined as schizophrenia/psychotic disorders, major depression, bipolar disorder, delusional disorders, panic disorder, obsessive-compulsive disorder, bulimia, anorexia, and binge eating.
In addition, the bill would require insurance coverage for children under age 18 with conditions such as attention-deficit/hyperactivity disorder, disruptive behavior disorders, and pervasive development disorders when there are serious suicidal symptoms or other life-threatening, self-destructive behavior.
The bill cited studies that found parity measures in other states increased cost per insurance policy between 0 percent and 3.5 percent a year, depending on the benefit level and whether the benefits are managed. It contrasted that with the estimated $79 billion annual cost in lost productivity and increased absenteeism found to stem from the lack of mental health care.
Idaho State Employees Covered
A measure to provide Idaho state employees with parity in mental health treatment went into effect in July. The law (HB 615) covers “serious mental illness” in seven major illness categories: schizophrenia, paranoia and other psychotic disorders, bipolar disorder, major depressive disorder, schizoaffective disorder, panic disorder, and obsessive-compulsive disorder.
The law created a pilot program to determine the real costs and benefits of including mental health coverage in group health insurance coverage. A report on its costs and benefits is due to the legislature by 2011, including whether it reduces repetitive visits for physical ailments that may be associated with untreated mental illness.
State officials estimated the fiscal impact on health insurance plans at about 1.8 percent of total plan costs, or about $1.89 million.
Illinois Expands Parity Coverage
Illinois amended its existing parity statute to increase from 35 to 60 the number of “medically necessary” outpatient mental health visits covered in a calendar year. The measure (HB 4202), signed into law in June and sponsored by rep. Lou Lang (D), aims to reduce the “special limits” insurers place on coverage for mental illness.
Advocates of the measure said it was needed to bolster Illinois' 2001 parity law, which was much weaker than the parity laws enacted in most other states. They described the change as cost-effective because treatment in the community is far less expensive than the hospitalization that could result when symptoms of serious mental illnesses are left untreated.
Another measure signed into law in June (HB 4125) added health maintenance organizations to the requirements of the state's parity law.
The text of Timothy's Law is posted at<http://assembly.state.ny.us/leg/?bn=A02912>. The Idaho measure is posted at<www3.state.id.us/oasis/H0615.html>. The Illinois law extending outpatient visits is posted at<www.ilga.gov/legislation/billstatus.asp?DocNum=4202&GAID=8&GA=94&DocTypeID=HB&LegID=22245&SessionID=50>, and the measure adding HMOs to the parity law is at<http://www.ilga.gov/legislation/fulltext.asp?DocName=&SessionId=50&GA=94&DocTypeId=HB&DocNum=4125&GAID=8&LegID=21926&SpecSess=&Session=>.▪
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Published online: 4 August 2006
Published in print: August 4, 2006
Notes
While New York is getting closer to enacting a parity law, Idaho now mandates coverage of “serious mental illnesses,” and Illinois has expanded its law.
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