HR 2593 IH

To provide for parity in the treatment of mental illness.

July 22, 1999

Mr. STARK (for himself, Mr. HINCHEY, Mr. GREEN of Texas, Mr. FROST, Mr. MCDERMOTT, Mr. FRANK of Massachusetts, Mr. LANTOS, Mr. WYNN, Ms. PELOSI, Ms. KILPATRICK, Mr. CLYBURN, Mr. SANDERS, Mrs. MORELLA, Ms. DEGETTE, Mr. RODRIGUEZ, Ms. LOFGREN, and Ms. SCHAKOWSKY) introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committee on Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

To provide for parity in the treatment of mental illness.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `National Mental Health Parity Act of 1999'.

TITLE I--PARITY FOR TREATMENT OF MENTAL ILLNESS

SEC. 101. PARITY FOR TREATMENT OF MENTAL ILLNESS.

(a) IN GENERAL- The Internal Revenue Code of 1986 is amended by adding at the end the following:

`Subtitle L--Parity for Treatment of Mental Illness

`SEC. 9901. PARITY FOR TREATMENT OF MENTAL ILLNESS.

`(a) IMPOSITION OF TAX-

`(1) HEALTH INSURANCE COVERAGE-

`(A) IN GENERAL- In the case of any health insurance coverage offered by a health insurance issuer that fails to meet the standard under subsection (c) at any time during a calendar year, there is hereby imposed a tax equal to 25 percent of the premiums received under such plan during the calendar year.

`(B) LIABILITY FOR TAX- The tax imposed under subparagraph (A) shall be paid by the health insurance issuer.

`(2) GROUP HEALTH PLAN-

`(A) IN GENERAL- In the case of a group health plan that fails to meet the standard under subsection (c) at any time during a calendar year, there is hereby imposed a tax equal to 25 percent of the health coverage expenditures for such calendar year under such plan.

`(B) LIABILITY FOR TAX- The tax imposed under subparagraph (A) shall be paid by the group health plan.

`(C) HEALTH COVERAGE EXPENDITURES- For purposes of this paragraph, the health coverage expenditures of any group health plan for any calendar year are the aggregate expenditures for such year for health coverage provided under such plan.

`(b) LIMITATION ON IMPOSITION OF TAX-

`(1) FAILURE NOT DISCOVERED EXERCISING REASONABLE DILIGENCE- No tax shall be imposed under this section on any failure to meet the standard under subsection (c) for which it is established to the satisfaction of the Secretary that none of the persons liable for the tax knew, or exercising reasonable diligence would have known, that such failure existed.

`(2) CERTAIN FAILURES CORRECTED WITHIN 30 DAYS- No tax shall be imposed under subsection (a) on any failure to meet the standard under subsection (c) if--

`(A) such failure was due to reasonable cause and not to willful neglect, and

`(B) such failure is corrected during the 30-day period beginning on the first date any person liable for the tax knew, or exercising reasonable diligence would have known, that such failure existed.

`(3) WAIVER BY SECRETARY- In the case of a failure to meet the standard under subsection (c) that is due to reasonable cause and not to willful neglect, the Secretary may waive part or all of the tax imposed by this section to the extent that the payment of such tax would be excessive relative to the failure involved.

`(c) STANDARD FOR PARITY FOR TREATMENT OF MENTAL ILLNESS-

`(1) IN GENERAL- A health insurance issuer with respect to health insurance coverage that it offers or a group health plan may not impose additional applications, preadmission screenings, or other procedural restrictions for services, nor impose treatment limitations or financial requirements on the coverage of benefits provided with respect to mental illness if similar limitations or requirements are not imposed on coverage for benefits with respect to other conditions.

`(2) RULE OF CONSTRUCTION- Nothing in paragraph (1) shall be construed as prohibiting a health insurance issuer with respect to health insurance coverage that it offers or a group health plan from requiring preadmission screening prior to the authorization of services covered under the plan or from applying other limitations that restrict coverage for mental illness to those services that are medically necessary to the extent that such preadmission screening and authorization are required for access to other services covered by the issuer or plan.

`(d) DEFINITIONS- For purposes of this section:

`(1) MENTAL ILLNESS- The term `mental illness' means all of the clinical disorders and personality disorders, except for mental retardation, diagnosed on Axis I or Axis II of the most recent edition of the American Psychiatric Association's `Diagnostic and Statistical Manual of Mental Disorders'.

`(2) HEALTH INSURANCE COVERAGE- The term `health insurance coverage' has the meaning given such term by section 9805(b)(1).

`(3) HEALTH INSURANCE ISSUER- The term `health insurance issuer' has the meaning given such term by section 9805(b)(2).

`(4) GROUP HEALTH PLAN- The term `group health plan' has the meaning given such term by section 5000(b)(1).'.

(b) CLERICAL AMENDMENT- The table of subtitles of such Code is amended by adding at the end the following new item:

`Subtitle L. Parity for treatment of mental illness.'

SEC. 102. EFFECTIVE DATE.

The amendment made by section 101 applies--

(1) with respect to health insurance coverage, to a contract, policy, or certificate initiated or renewed after December 31, 1999; and

(2) with respect to group health plans, to plan years beginning after December 31, 1999.

TITLE II--MEDICARE MENTAL HEALTH IMPROVEMENT

SEC. 201. REFERENCES IN TITLE.

Whenever in this title an amendment is expressed in terms of an amendment to or repeal of a section or other provision, the reference shall be considered to be made to that section or other provision of the Social Security Act.

SEC. 202. INPATIENT PSYCHIATRIC HOSPITAL SERVICES.

(a) SERVICES COVERED- Section 1812(a) (42 U.S.C. 1395d(a)) is amended--

(1) by striking `and' at the end of paragraph (3);

(2) by striking the period at the end of paragraph (4) and inserting `; and'; and

(3) by adding at the end the following new paragraph:

`(5) inpatient hospital services furnished primarily for the diagnosis or treatment of mental illness or substance abuse for up to 60 days during a year.'.

(b) LIMITATION ON COVERAGE- Section 1812(b)(3) (42 U.S.C. 1395d(b)) is amended to read as follows:

`(3) inpatient hospital services furnished primarily for the diagnosis or treatment of mental illness or substance abuse that are furnished to the individual during a year after such services have been furnished to the individual for a total of 60 days during the year.'.

(c) CONFORMING AMENDMENTS- (1) Section 1812(a)(1) (42 U.S.C. 1395d(a)(1)) is amended by inserting `(other than services described in paragraph (5))' after `inpatient hospital services' the first place it appears.

(2) Section 1812(b)(1) (42 U.S.C. 1395d(b)(1)) is amended by inserting `(other than services described in paragraph (3))' after `inpatient hospital services' the first place it appears.

(3) Section 1812 (42 U.S.C. 1395d) is amended by striking subsection (c).

(4) Section 1814(a) (42 U.S.C. 1395f(a)) is amended--

(A) in paragraph (2), by striking subparagraph (A);

(B) in paragraph (3), by striking `(other than inpatient psychiatric hospital services)'; and

(C) by striking paragraph (4).

(5) Section 1861 (42 U.S.C. 1395x) is amended by striking subsection (c).

(d) EFFECTIVE DATE; TRANSITION- The amendments made by this section shall take effect January 1, 2000, except that--

(1) an individual who at any time prior to such date has been furnished inpatient psychiatric hospital services (as defined for purposes of title XVIII of the Social Security Act as of the date of the enactment of this Act) for 190 consecutive days is not entitled to any services under section 1812(a)(5) of such Act (as added by subsection (a)(3)); and

(2) in the case of an individual who is not described in paragraph (1) and is receiving inpatient psychiatric hospital services (as defined for purposes of title XVIII of the Social Security Act as of the date of the enactment of this Act) on December 31, 1999, for which payment may be made under section

1812 of such Act, the number of days of services for which the individual is entitled under section 1812(a)(5) of such Act (and the number of days applicable under section 1812(b)(3) of such Act) shall be equal to the greater of 60 or the difference between 190 days and the number of days of such inpatient psychiatric hospital services furnished to the individual prior to January 1, 2000.

SEC. 203. INTENSIVE RESIDENTIAL SERVICES.

(a) COVERAGE UNDER PART A- Section 1812(a) (42 U.S.C. 1395d(a)), as amended by section 202(a), is amended--

(1) by striking `and' at the end of paragraph (4);

(2) by striking the period at the end of paragraph (5) and inserting `; and'; and

(3) by adding at the end the following new paragraph:

`(6) intensive residential services (as described in section 1861(uu)) furnished to an individual for up to 120 days during any calendar year, except that such services may be furnished to the individual for additional days during the year if necessary for the individual to complete a course of treatment to the extent that the number of days of inpatient hospital services described in paragraph (5) that may be furnished to the individual during the year (as reduced under such paragraph) is not less than 15.'.

(b) SERVICES DESCRIBED- Section 1861 (42 U.S.C. 1395x) is amended by adding at the end the following new subsection:

`Intensive Residential Services

`(uu)(1) Subject to paragraph (2), the term `intensive residential services' means inpatient services provided in any of the following facilities:

`(A) Residential detoxification centers.

`(B) Crisis residential programs or mental illness residential treatment programs.

`(C) Therapeutic family or group treatment homes.

`(D) Residential centers for substance abuse treatment.

`(2) No service may be treated as an intensive residential service under paragraph (1) unless the facility at which the service is provided--

`(A) is legally authorized to provide such service under the law of the State (or under a State regulatory mechanism provided by State law) in which the facility is located or is certified to provide such service by an appropriate accreditation entity approved by the State in consultation with the Secretary; and

`(B) meets such other requirements as the Secretary may impose to assure the quality of the intensive residential services provided.

`(3) No service may be treated as an intensive residential service under paragraph (1) unless the service is furnished in accordance with standards established by the Secretary for the management of such services.'.

(3) REDUCTION IN DAYS OF COVERAGE FOR INPATIENT SERVICES- Section 1812(a)(5) and section 1812(b)(3), as amended by section 202, are each amended by striking the period at the end and inserting the following: `, reduced by a number of days determined by the Secretary so that the actuarial value of providing such number of days of services under this paragraph to the individual is equal to the actuarial value of the days of inpatient residential services furnished to the individual under paragraph (6) during the year after such services have been furnished to the individual for 120 days during the year (rounded to the nearest day).'.

(4) AMOUNT OF PAYMENT- Section 1814 (42 U.S.C. 1395f) is amended--

(A) in subsection (b) in the matter preceding paragraph (1), by inserting `other than intensive residential services,' after `hospice care,'; and

(B) by adding at the end the following new subsection:

`Payment for Intensive Residential Services

`(m) The amount of payment under this part for intensive residential services under section 1812(a)(6) shall be equal to--

`(1) the lesser of--

`(A) the reasonable cost of such services, as determined under section 1861(v), or

`(B) the customary charges with respect to such services,

less the amount a provider may charge as described in clause (ii) of section 1866(a)(2)(A):

`(2) if such services are furnished by a public provider of services or by another provider which demonstrates to the satisfaction of the Secretary that a significant portion of its patients are low-income (and requests that payment be made under this clause), free of charge or at nominal charges to the public, the amount determined in accordance with subsection (b)(2); and

`(3) if (and for so long as) the conditions described in subsection (b)(3) are met, the amounts determined under the reimbursement system described in such section.'.

SEC. 204. LOWERING COINSURANCE FOR CERTAIN OUTPATIENT MENTAL HEALTH AND SUBSTANCE ABUSE SERVICES.

(a) IN GENERAL- Section 1833(c) (42 U.S.C. 1395l(c)) is amended by striking `mental, psychoneurotic, and personality disorders' and all that follows through `are incurred' and inserting the following: `mental illness or substance abuse of an individual who, at the time such expenses are incurred, is over 18 years of age, is not an inpatient of a hospital, and has received 5 or more sessions of such treatment during the calendar year,'.

(b) REQUIRING SERVICES TO BE FURNISHED IN ACCORDANCE WITH MANAGEMENT STANDARDS- Section 1862(a) (42 U.S.C. 1395y(a)) is amended--

(1) by striking `or' at the end of paragraph (20);

(2) by striking the period at the end of paragraph (21) and inserting `; or'; and

(3) by inserting after paragraph (21) the following new paragraph:

`(22) in the case of any items or services furnished under part B for the treatment of mental illness or emotional disturbance (including substance abuse), if the services are not furnished in accordance with standards established by the Secretary for the management of such services.'.

SEC. 205. EFFECTIVE DATE.

Except as otherwise provided in this title, the amendments made by this title shall apply to items and services furnished on or after January 1, 2000.

END