Mental Health Parity Measure Signed Into Law as Part of Economic Stabilization Plan

October 10, 2008

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President Bush on October 3 signed into law mental health parity legislation as part of the Emergency Economic Stabilization Act (H.R. 1424). The new law amends ERISA and the Public Health Service Act by not allowing employer group health plans to adopt unfair limitations on mental health treatments, place financial qualifications or impose out-of-network limits unless similar requirements are instituted for medical and surgical benefits. The new law is applicable for all employers, except those with less than 50 workers.

ERIC opposed and testified against the mandate. The mental health industry has sought the parity requirement for over a decade and at one point urged that their entire listing (DSM-IV) of mental disorders and complaints be covered.

While there is no requirement for what conditions are covered by the measure, once a mental health or substance-use condition is adopted, there must be parity with medical coverage, with an exception pertaining to the extent that a state parity law requires broader coverage.

The new mental health parity requirement is effective for all group health plans that begin their plan year one year after enactment of the bill (October 3, 2009). An exception for collectively bargained agreements applies until current agreement expires. The text of the requirement begins on page 117 of 169.