Insights

Mental Health Parity in Employee Benefits

When we think of health, we often think of things like the flu or broken bones and back pain. Maybe we think of cancer and heart attacks. But not every health problem affects the body in obvious, outward ways. Some affect the mind.

The National Institute of Mental Health reports that in 2014, 43.6 million adults in the United States – 18.1 percent of the population – suffered from some form of mental illness, and that for 9.8 million – 4.2 percent – the mental illness was considered serious. Mental illness accounts for 13.6 percent of all years lost to illness, disability or early death in the United States, and serious mental illness costs $300 billion each year.

Mental illness is serious, common and potentially debilitating. Nevertheless, whether because of the social stigmas against it or the fact that it’s less visible, it’s not always given the weight it’s due.

When it comes to most health plans, though, mental illness must be treated the same as other types of illness.

What is mental health parity?

The Mental Health Parity and Addiction Equity Act of 2008 requires group health plans to provide mental health and substance use disorder benefits that are equal to benefits for all medical and surgical benefits. Terms – including co-pays, deductibles and visit limitations – cannot be more restrictive for mental health or substance abuse issues than they are for other health issues.

The 2008 act applies to health plans offered by employers with 50 or more employees and to health insurance issuers providing coverage to such employers. The Affordable Care Act has expanded this rule to include individual market plans and small employer-funded plans, with exceptions for plans that have been “grandfathered” in.

What are mental health parity violations?

According to the National Alliance on Mental Health, parity requirements are not limited to cost and visit limitations. Other differences – such as requiring permission for mental health care but not for other types of health care, or not having in-network mental health providers available when other in-network doctors are available – also violate parity laws.

Plan administrators may be sued for such violations. Modern Healthcare reports that in August 2015, a federal court ruled that third-party administrators could be held liable when mental health coverage is not equal to other health coverage.

Mental illness does not disappear when it’s ignored. Instead, it leads to more serious – and costly – issues. Following mental health parity guidelines will help sufferers receive the help they need and protect administrators from lawsuits.

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