Over the next few months, I’ll be writing about “mental health parity.” This first post explains what “parity” is. Future posts will look at ongoing mental health parity issues and the intersection with the Affordable Care Act (ACA)—including how efforts to repeal or replace the ACA could weaken today’s parity rules.
The idea behind mental health parity is simple — insurance companies should treat mental and behavioral health the same way they treat physical health. Coverage should be just as good and care should be just as accessible whether you need in-patient care to treat addiction or cancer.
Before 2008, people in need of mental health and substance use disorder (MH/SUD) care were subject to discrimination in health insurance. If health plans included MH/SUD benefits at all, the benefits were often more expensive and limited compared to medical benefits. Accessing MH/SUD benefits required overcoming significant administrative obstacles. Often health insurance plans had benefits for medical services that were significantly less restrictive than those for MH/SUD services.
What is “parity”?
“Parity” describes the equal treatment of mental health conditions and substance use disorders in insurance plans when compared to medical benefits. When a plan has “parity,” it means that if an insurer provides you unlimited doctor visits for a chronic condition like diabetes then the insurer should also offer unlimited visits for a mental health condition such as depression or schizophrenia. However, “parity” doesn’t guarantee that you will get high-quality MH/SUD health coverage. Comprehensive parity requires equal coverage but not necessarily “good” coverage.mental heal
The Mental Health Parity and Addiction Equity Act
The Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act (MHPAEA) passed by Congress in 2008 aimed to fix the problems with disparities in health insurance coverage for MH/SUD services. The MHPAEA and subsequent amendments to it require most health plans that cover MH/SUD benefits to do so on par with medical benefits.
The MHPAEA is a basic—yet powerful—move toward increasing equity in our health care system.
Key MHPAEA provisions include:
- The financial requirements, deductibles and co-payments, and treatment limitations (e.g., number of visits or days of coverage) that apply to MH/SUD benefits must be no more restrictive than the predominant financial requirements or treatment limitations that apply to medical benefits.
- The scope and duration of treatment, the medical management techniques (e.g. standards determining medical necessity limiting or excluding benefits or the formulary design for prescription drugs) that apply to MH/SUD benefits must be no more restrictive than the treatment limitations applied to medical benefits.
- MH/SUD benefits may not be subject to any separate cost-sharing requirements or treatment limitations that only apply to such benefits.
- If a health plan provides for out-of-network medical benefits, it must provide the same access for out-of-network MH/SUD benefits.
- Standards for medical necessity determinations and reasons for any denial of benefits relating to MH/SUD care must be disclosed upon request.
The MHPAEA is a big step forward in the fight to end discriminatory coverage of MH/SUD in health insurance policies. However, this law only applied to employers with 51 or more workers using fully insured group plans subject to state regulation The ACA later added small employers and plans bought directly from an insurer or in the ACA Marketplace, so full or partial ACA repeal in Congress could remove protections from many Texans.
Achieving true equity in accessing MH/SUD care requires attention by advocates and public agencies responsible for the implementation and enforcement. Future posts will look at what additional work is needed to make the promise of parity a reality in today’s uncertain landscape.