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Potential Cost Of New Mental Health Parity Law

Ruzanna Harutyunyan's picture

The Los Angeles Times on Monday examined how a new mental health parity law, which was included in the $700 billion bailout of Wall Street firms that President Bush signed last week, could affect the cost of health care in the U.S. (Worth [1], Los Angeles Times, 10/13). The legislation (HR 1424) requires group health plans of 51 or more employees to cover mental illnesses at the same level as physical ailments. It does not require the plans to offer such coverage but it must be equivalent if they do. The law, for most health plans, will take effect Jan. 1, 2010 (Kaiser Daily Health Policy Report, 10/10).

According to the Times, an increase in group health insurance premiums is "[m]ost likely, but estimates vary."

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According to Michael Carter, vice president of benefits consulting firm Hay Group, some small business owners might shift costs to employees or reduce workers' health benefits (Worth [1], Los Angeles Times, 10/13). Carter said the law could prompt some small businesses to eliminate mental health coverage altogether but that is not likely. He said, "There has been a continuous increase in copays for doctor's visits and drugs and hospitals, and here's yet another force entering in the equation" (Worth [2], Los Angeles Times, 10/13).

Time Interviews Parity Bill Advocate Sen. Domenici

Time Magazine last week interviewed Sen. Pete Domenici (R-N.M.), who for more than a decade "pioneered the fight" to pass mental health parity legislation. In the interview, Domenici called the disparity in coverage for mental health "almost a civil-rights issue." He said, "We take care of people with heart trouble, we operate on them, we have great learning centers where we study all there is to know about the heart," adding, "And yet, if you have schizophrenia, which is an illness of the brain instead of the heart, because we started off early on saying it wasn't an illness, we kept it and they wouldn't let us change it" (Stephey, Time Magazine, 10/10).

Reprinted with permission from kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, and sign up for email delivery at kaisernetwork.org/email . The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation. © 2007 Advisory Board Company and Kaiser Family Foundation. All rights reserved.