Posted: 10.22.2008
On October 3, 2008 President Bush signed into law the Emergency Economic Stabilization Act of 2008. Contained within this important but unrelated piece of emergency legislation is the Mental Health Parity and Addiction Equity Act of 2008 (the “Act”).
Key News
There are two items you should be aware of relating to this Act.
First, it requires group health plans to apply the same treatment limits on mental health or substance-related disorder benefits as they do for medical and surgical benefits.
Second, it also extends this parity requirement to inpatient and outpatient services, whether in-network or out-of-network, and to emergency care services.
Additional Information
Notably, the Act revised the definition of “mental health benefits” to now include substance-related disorder benefits. The Act also requires group health plans to apply the same beneficiary financial requirements to mental health or substance-related disorder benefits as they apply for medical and surgical benefits, including limits on deductibles, co-payments and out-of-pocket expenses.
Plan administrators are further required to make the criteria for “medical necessity” determinations with respect to mental health and substance-related disorder benefits available to plan participants, beneficiaries or providers upon request.
Action Required
If plans have limits on hospital inpatient days and/or outpatient visits for mental health treatments, but not for other treatments, they will be required to change their current plan design to comply with the new requirements of the Act.
The Act is applicable to plan years beginning after October 3, 2009 and to group health insurance plans under a collective bargaining agreement at the expiration of such agreement or by January 1, 2009.
Thus, most calendar year plans must comply with the new requirements by January 1, 2010.
Who must comply?
The following group health plans must comply with the MHPA and the Act:
- Fully insured group health plans
- Self-funded group health plans
- Church plans, and
- Non-federal governmental plans
Employers with fewer than 50 employees during the preceding calendar year are not required to comply with the MHPA and the Act. For purposes of determining group size, both part-time and full-time employees are included. Plans offering only HIPAA excepted benefits are not required to comply (e.g., dental, vision only).
Non-federal governmental plans that are self-funded may choose not to comply. In order to opt out, the plan must file an election with the Center for Medicare and Medicaid Services prior to the beginning of each plan year and notify the plan participants of its choice to opt out.
For a copy of the new law, see:
To download additional information, click here.
If you have any questions regarding this communication, please contact your ALCOS Customer Service Representative.
This information is not intended to be exhaustive nor should any discussion or opinions be constructed as legal advice. Readers should contact legal counsel for legal advice.
