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Mental Health Parity Act

The American Psychoanalytic Association has signed in support of the Mental Health Parity Act of 2007 along with 97 other organizations support including the American Psychiatric Association and the American Psychological Association.

Known in full as the "Senator Paul Wellstone Mental Health Parity Act of 2007" named after the Democratic Senator from Minnesota who was killed in a plane crash, the bill essentially has two requirements that apply to group health plans that provide both medical surgical benefits and mental health benefits.

Such group health plans must ensure that:

(1) the financial requirements applicable to mental health benefits are no more restrictive that those that apply to medical surgical benefits (including deductibles, copayments, coinsurance, out-of-pocket expenses and annual and lifetime limits) and may not establish separate cost sharing requirements applicable only to mental health benefits, and

(2) treatment limits applicable to mental health benefits are no more restrictive than those applicable to medical surgical benefits (including limits on frequency of treatment, number of visits, days of coverage or similar limits on the scope or duration of treatment).

As the summary explains:

the bill offers a cost exception for those health plans that can prove that the mental health parity requirements in the bill result in an increase in total plan costs of 2% or more. However, the 2% provision applies only in the first year in which the parity provisions are applicable. The exception is available if costs related to the parity provision cause increases of only 1% or more in any year after the first year.

the bill does not require health plans to offer any mental health coverage, and in fact, expressly reserves the right of health plans to not offer any such coverage.

the bill does not prohibit insurance plans from negotiating separate reimbursement or provider payment rates for different benefits.

Nor does the bill prohibit a health plan from "managing the provision of mental health benefits in order to provide medically necessary services for covered benefits, including through the use of any utilization review, authorization or management practices, the application of medical necessity and appropriateness criteria applicable to behavioral health and contracting with and use of a network or providers."

As reported, the mental health parity provisions do not apply to group health plans for businesses of 50 employees or less.

The bill has bipartisan support.

Details and Background on the Mental Health Parity Act of 2007

The American Psychoanalytic Association has signed in support of the Mental Health Parity Act of 2007 along with 97 other organizations support including the American Psychiatric Association and the American Psychological Association.

Known in full as the "Senator Paul Wellstone Mental Health Parity Act of 2007" named after the Democratic Senator from Minnesota who was killed in a plane crash, the bill essentially has two requirements that apply to group health plans that provide both medical surgical benefits and mental health benefits.

Such group health plans must ensure that:

(1) the financial requirements applicable to mental health benefits are no more restrictive that those that apply to medical surgical benefits (including deductibles, copayments, coinsurance, out-of-pocket expenses and annual and lifetime limits) and may not establish separate cost sharing requirements applicable only to mental health benefits, and

(2) treatment limits applicable to mental health benefits are no more restrictive than those applicable to medical surgical benefits (including limits on frequency of treatment, number of visits, days of coverage or similar limits on the scope or duration of treatment).

As the summary explains:

the bill offers a cost exception for those health plans that can prove that the mental health parity requirements in the bill result in an increase in total plan costs of 2% or more. However, the 2% provision applies only in the first year in which the parity provisions are applicable. The exception is available if costs related to the parity provision cause increases of only 1% or more in any year after the first year.

the bill does not require health plans to offer any mental health coverage, and in fact, expressly reserves the right of health plans to not offer any such coverage.

the bill does not prohibit insurance plans from negotiating separate reimbursement or provider payment rates for different benefits.

Nor does the bill prohibit a health plan from "managing the provision of mental health benefits in order to provide medically necessary services for covered benefits, including through the use of any utilization review, authorization or management practices, the application of medical necessity and appropriateness criteria applicable to behavioral health and contracting with and use of a network or providers."

As reported, the mental health parity provisions do not apply to group health plans for businesses of 50 employees or less.