On May 18th, the United States General Accounting
Office (GAO) released testimony presented to the Senate Committee on Health,
Education, Labor and Pensions. The document entitled, Mental Health Parity Act: Employers´ Mental Health Benefits Remain
Limited Despite New Federal Standards, is an assessment of the
implementation of the Mental Health
Parity Act of 1996 (MHPA).
The MHPA of 1996 established a federal standard for
employer-sponsored group health plans. Â
Although an estimated 40 million American adults suffer some form of
mental illness each year, private health insurance plans provide less coverage
for the treatment of mental illness than they provide for medical and surgical
treatments. Â The law requires that
employers, who impose lifetime and annual dollar limits on patient health care
coverage, not differentiate between mental health and other illnesses. The law
does not require any employer-sponsored plan to offer mental health coverage or
to include substance abuse treatment. Â
The employer can still require higher cost sharing and greater service
limits (hospital stays or outpatient visits) for mental health coverage.
As of March 2000, according to the National Conference of
State Legislators´ (NCLS) Health Policy Tracking Service, forty-three states
and the District of Columbia have laws concerning mental health benefits in
employer-sponsored group health plans. Â
Twenty-nine of the states provide parity that includes cost-sharing and
service limits. Sixteen states require full parity --mental health must be
covered and parity includes dollar and service limits as well as cost sharing.
To see if employers were complying with the MHPA, the
Health, Education and Human Services Division (HEHS) of the GAO surveyed
employers in states that did not have laws more comprehensive that the federal
regulation. Â They found that 86% of
employers who responded were complying with the federal parity requirements and
14% were not compliant. Â A large
percentage of employers changed a mental health benefit in their plans to
mitigate any costs arising from the parity in dollars required by the new
law. Â Mostly they limited outpatient
visits
and hospital stays. Â
These changes made it difficult to determine if parity increased the
cost of the plan. Â Only 3% of employers
surveyed reported that claims costs rose with the federal legislation.
In states that require parity in dollars, service and
cost-sharing, studies have determined that the increase in cost is between two
and four percent.
Without legislative action the MHPA will no longer be in
effect as of September 30, 2001. The cost of the legislation for employer-sponsored
plans has been negligible. Â Has the
effect of the legislation been negligible as well? Â Â The majority of Americans still remain in employer-sponsored
health plans that provide little or no increase in access to mental health
benefits.