GOVERNMENT & MEDICINE

Mental health care still not seeing insurance parity

Many insurers don't follow a law designed to make coverage for mental illness more fair; others impose legal limits on benefits, a government report finds.

By Susan J. Landers, AMNews staff. June 5, 2000.

Washington -- Why should Parkinson's disease merit one level of health insurance coverage and schizophrenia another, lesser level?

Steven Hyman, MD, director of the National Institute of Mental Health, posed that question recently to a Senate committee looking into a new report showing that a federal law aimed at ending such disparity is falling short.

The law, known as the 1996 Mental Health Parity Act, bars insurers from setting different lifetime and annual benefit caps for mental illness than for medical/surgical illness.

Mental illnesses are disorders of an organ -- the brain -- just as coronary artery disease is a disorder of another organ -- the heart, Dr. Hyman said. Mental disorders can be diagnosed with a high degree of reliability, and treatments are highly effective, he told the Senate Committee on Health, Education, Labor and Pensions at its May 18 hearing.

Dr. Hyman said there is no need to separate mental illness from any other type of illness.

Kenneth Duckworth, MD, deputy commissioner of the Massachusetts Dept. of Mental Health, also spoke to the need to close the loopholes in the federal mental health parity law and to continue to address the stigma of mental illness.

Dr. Duckworth contrasted the societal support and encouragement he received when treated for cancer with the very different response his father had received when treated for manic-depressive illness.

"During my childhood, his condition was never talked of openly; his problems were presumed to be of his own making," Dr. Duckworth said. The attitudes of society were reflected in his insurance policy, "which did not cover him in any way as I had been."

Disparity evident

Employees who need mental health treatment for themselves or their families do not appear to be better off today than they were before Congress passed the parity act, according to a new General Accounting Office report.

The GAO found that 14% of the employers it surveyed failed to comply with the law's prohibition on varying insurance benefit caps. The noncompliant firms provide health benefits to between 9,000 and 13,000 employees.

And though the majority of the 1,656 employers surveyed did meet the law's dollar limit requirement, 87% instituted other, legal restrictions.

For example, about 65% of complying employers place greater restrictions on the number of covered outpatient office visits and hospital days for mental health treatment than they do for other health treatment, said the GAO.

The GAO surveyed employers with more than 50 employees in 26 states and the District of Columbia that have not passed state parity laws that are more comprehensive than the federal law.

The GAO also found that, despite earlier fears that the federal law would boost insurance costs, the act actually had a negligible effect on the cost of claims.

However, Dean A. Rosen, senior vice president of policy for the Health Insurance Assn. of America, said cost savings achieved by the introduction of managed care in mental health treatment had masked the increased cost of expanded coverage for mental illness.

Some lawmakers are trying to shore up the parity act. Sens. Paul Wellstone (D, Minn.) and Pete Domenici (R, N.M.) have introduced legislation intended to correct the inequities that continue despite the 1996 law, which they sponsored.

Wellstone said he viewed the earlier law, set to expire in September 2001, as a compromise. "It's not perfect," he testified before the Senate panel, of which he is also a member.

In testimony prepared for the hearing, Domenici said the parity law "is a good first start, but it is not working."

His and Wellstone's legislation would prohibit limits on the number of covered hospital days and outpatient visits for all mental illnesses. It also would provide full parity, including equal co-payments and deductibles, for such serious mental illnesses as schizophrenia, major depression and posttraumatic stress disorder, as well as for autism and other disabling mental disorders.

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