In the past, many insurance carriers used to discriminate against mental health services by having different benefits for mental health than for medical services. For example, a patient could have a plan that paid 80% of covered charges for any medical services, but the insurance only paid a flat $10 for a mental health visit and the patient was responsible for the rest. The patient responsibility in some cases exceeded 80%. Many people felt this was a blatant form of health insurance discrimination.
Some of the restrictions that were placed on mental health benefits were higher copays or deductibles, limited outpatient treatment, and a cap on lifetime benefits. Most mental health providers felt this limited proper treatment and hampered results. It certainly put a strain on the patients and the families of patients who couldn’t afford the recommended treatment. Over the years, lawmakers have passed many laws trying to even out the playing field.
One such federal law was the Mental Health Parity and Addiction Equity Act of 2008. MHPAEA is a federal law that provides patients who already have benefits under mental health and substance use disorder (MH/SUD) coverage parity or equality with benefits limitations under their medical/surgical coverage. This stopped insurance carriers at a federal level from having separate reimbursement rates for mental health services and basically said that the benefits for mental health services must be equal with the benefits for medical services.
Many of these laws were introduced because of a tragic situation. For example, Timothy’s law in New York State is named after Timothy O’Clair, a Schenectady boy who completed suicide in 2001, seven weeks prior to his 13th birthday. His parents felt that his suicide was due to the discrimination that he faced at the hands of his parent’s insurance company and they made it their personal crusade to make changes in insurance coverage. Many other states have also had laws passed due to tragic situations.
Of course there are exceptions for these laws. For example, businesses with less than 50 employees, employers who do not currently offer mental health benefits, and small group health plans are all exempt from MHPAEA. That still excludes a lot of people.
Most of the individual states also have mental health parity laws in effect too which are stronger than the federal law. The state mental health parity laws vary greatly from state to state. Some states exclude the V codes. The individual states also may set limits on the diagnoses they will cover. Some states parity laws will not cover the mentally handicapped or learning disorders. Most of the states have the 50 employee exemption while some have 25 employee exemptions. A few states have no mental health parity laws in effect so they are covered only by the federal law.
Along with the mental health benefits the parity laws also cover substance abuse. If an insurance policy covers mental health and substance abuse benefits then they must now line up with benefits for medical and surgical treatment.
Even with the new laws, it It is not uncommon for a patient to have different benefits for mental health than they do for medical visits. For example, they may have a $25 copay for primary care visits but they have a $40 copay for specialist’s visits including mental health visits.
At any rate to be sure the provider is paid for any mental health services, benefits should be checked prior to seeing the patient. When asking for the mental health benefits, you will determine if there is a copay involved, if there is a deductible, if an authorization is required from the insurance carrier and if a referral is needed from the primary care physician.
Overall mental health parity laws were a big step in the right direction toward making it possible for more people to be treated for mental health diseases. But we still have a way to go.