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Government News
Published Online: 7 November 2008

New Federal Parity Law Detailed

Publication: Psychiatric News
Volume 43, Number 21
https://doi.org/10.1176/pn.43.21.0004
Here are some details about the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 to help APA members and their patients better understand how the law may impact them. This information was provided by APA's Department of Government Relations (DGR).
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The law amends the Mental Health Parity Act of 1996 to require that group health plans of 50 or more employees that provide both medical and surgical benefits and mental health or substance use benefits must have financial requirements and treatment limitations for mental health/substance use disorder benefits that are no more restrictive than those placed on medical/surgical benefits. Equity coverage applies to all financial requirements, including deductibles, copayments, coinsurance, and out-of-pocket expenses, and to all treatment limitations, including frequency of treatment, number of visits, days of coverage, or other similar limits.
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The law goes into effect on October 3, 2009—a year from the date of its enactment. For most plans, this means the effective date is January 1, 2010. Plans maintained under collective bargaining agreements ratified before the enactment date are not subject to the law until they terminate (or until January 1, 2009, if this is a later date). In the period leading up to the law's becoming effective, federal agencies will develop implementation rules, and the public will have an opportunity to comment on proposals.
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The law protects state mental health parity laws, including state coverage mandates, provided they are stronger than federal law and do not interfere with it. Thus, the federal law should be seen as a floor.
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If a group health plan experiences an increase in actual total costs with respect to medical/surgical and mental health/substance use benefits of 1 percent (or 2 percent in the first plan year that the law is in effect), the plan can be exempted from the law. Plans may opt out for only one year and may be under audit by the Department of Health and Human Services, the Department of Labor, and actuarial analysis to assure transparency.
According to DGR Director Nicholas Meyers, DGR staff will continue to work with the executive branch to implement the legislation (see Parity Victory Was Long,Winding Road). The law directs the secretary of Labor to issue guidance, in conjunction with the secretaries of Health and Human Services and Treasury, which will be widely distributed to group health plans, beneficiaries, regulatory bodies, state and local governments, and insurance commissioners to ease the transition and to inform them of the details of the legislation. APA will be working with these administrative agencies in developing this guidance to ensure that it is complete and accurate. APA will also be following any audits conducted by the government, as well as reports from the General Accountability Office, to make sure that these plans adhere to the guidance issued by the government.
Parity provisions are contained in HR 1424, the Emergency Economic Stabilization Act of 2008. The law is posted at<http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=110_cong_bills&docid=f:h1424enr.txt.pdf>.▪

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Psychiatric News
Volume 43 • Number 21 • November 7, 2008
Pages: 4

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Published online: 7 November 2008
Published in print: November 7, 2008

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