Paul Wellstone Pete Domenici Mental Health Parity and Addiction Equity Act of 2008

1. Paul Wellstone & Pete Domenici Mental Health Parity and Addiction Equity Act of 2008

2. Mental Health Parity and Addiction Equity Act of 2008 Included in the Emergency Economic Stabilization Act of 2008 Signed into law on October 3, 2008 Goes into effect January 1, 2010 Plans maintained under collective bargaining agreements ratified before the enactment date are not subject to the Act until they terminate. Requires the Depts. Of Labor, Health & Human Services and Treasury to write regulations.

3. History Behind Passage Apr. 2008: Both House and Senate pass separate mental health and addiction parity bills; the House bill would have covered all MH conditions within the DSM-IV, but the Senate bill placed limitations on the conditions covered. June 2008: House and Senate negotiators agreed on a compromise between the two bills. Sept. 2008: House passes parity legislation as a stand-alone bill while the Senate passes parity as part of a larger bill. This necessitated another vote because both Houses of Congress must pass legislation in the same form. Oct. 2008: Parity included in the Emergency Economic Stabilization Act of 2008.

4. Building on the 1996 Parity Law The Mental Health Parity and Addiction Equity Act of 2008 builds upon the 1996 Parity Act. Applicable plans must provide comparable annual or lifetime dollar limits for mental health and physical health services. It amends the 1996 Parity Act to include substance use disorders (SUDs). The 1996 Parity Law remains in effect through 2009.

5. Mental Health Parity and Addiction Equity Act of 2008 Equity Coverage for both mental health and addictions treatment services Applies to all financial requirements, including deductibles, copayments, coinsurance, and out-of-pocket expenses, and to all treatment limitations, including frequency of treatment, number of visits, days of coverage, or other similar limits. Out-Of-Network Benefits A group health plan (or coverage) that provides out-of-network coverage for medical/surgical benefits must also provide out-of-network coverage, at parity, for mental health/substance use disorder benefits

6. Mental Health Parity and Addiction Equity Act of 2008 Preservation of State Law The current HIPAA preemption standard applies. This standard is extremely protective of State law. Only a State law that �prevents the application� of this Act will be preempted which means that stronger State parity and other consumer protection laws remain in place. Small Employer Exemption As w/ 1996 law, small employers of 50 or fewer employees are exempt from the requirements of the Act. State parity laws will continue to apply to these employers, as well as to individual plans

7. Mental Health Parity and Addiction Equity Act of 2008 Cost Exemption If a group health plan (or coverage) experiences an increase in total costs (inclusive of medical/surgical and mental health and SUD services) of 1% (2% in the first plan year that this Act is applicable), the plan can be exempted from the law, for one year. A qualified actuary (member of American Academy of Actuaries) shall determine and prepare a written report regarding a plan�s cost increase after a plan has complied with the Act for the first six months of the plan year involved. Plan must promptly notify the appropriate Federal and State agencies, and participants and beneficiaries when it elects an exemption. Labor or HHS (as appropriate) and State agencies may audit a plan to determine compliance with the Act when the plan has elected an exemption.

8. This Law Does Not� This law does not apply to Medicare There is parity in Medicare through the Medicare Improvements for Patients and Providers Act (MIPPA) This law does not mandate that covered plans provide a mental health/SUD benefit. Instead, if a plan chooses to offer MH/SUD coverage, then costs and limits must be at parity to those of physical health coverage

9. This Law Does Not� It does not mandate that all mental health and SUD conditions are covered. Only requires coverage of conditions as defined under the terms of each plan. Experience from the 1996 Parity Law suggests that plans are not likely to remove certain diagnoses they currently cover or drop MH/SUD coverage all together.

10. Evaluation Compliance Report By 2012 and every two years after, the Labor Secretary shall submit to Congress a report on group health plan (or coverage) compliance with this Act. The report will include the results of: any audits or surveys on compliance by group health plans an analysis of reasons for any failures to comply with the law

11. Evaluation GAO Study GAO will conduct a study that analyzes: The specific rates, patterns and trends in coverage Any exclusion of specific mental health and substance use diagnoses by health plans The impact of this Act on trends of in coverage or exclusion of diagnoses The impact of covering or excluding specific diagnoses on beneficiaries� health, health care coverage, and the costs of delivering care. GAO will provide a report to Congress within three years (and an additional report after five years) on the results of the study.

12. Covered Entities Group plans sponsored by private-sector employers and unions Church-sponsored plans (can assess tax penalties on employers that don�t comply) Medicaid managed care Some SCHIP plans Some state and local health plans

13. Impact & Opportunities at the State Level Create opportunities to publicize the importance of mental health and addictions parity, dispel myths about the costs of parity, and examine state regulations regarding mental health benefits Establish/reconvene a parity task force to develop a focused advocacy agenda Speak to state officials about the significance of the 2008 Parity Act and how state regulations could support the federal bill

14. Impact & Opportunities at the State Level Monitor compliance with the Federal laws and report concerns to ombudsman of the Secretary of Labor and/or the Secretary of Health and Human Services. Examine fee structures to be sure that insurers are reimbursing at rates comparable to medical and surgical benefits. Consider opportunities for press stories that highlight inequities in pay and to highlight the value of your specialty services.

15. How Does This Law Impact Providers? For in-network providers, parity in financial requirements and treatment limitations will likely increase the number of potential clients seeking services. This also means that other types of providers may see this as a business opportunity and develop their capacity to provide MH and SUD services. Although plans must now cover out-of-network MH/SUD providers as they do physical health providers, it is still more beneficial for providers to be in-network. Some plans don�t cover any out-of-network services Even if covered, beneficiary still faces higher co-insurance than in-network coverage, putting full provider reimbursement for services at risk.

16. Need more Information? Visit http://www.thenationalcouncil.org/cs/public_policy/legislative_issues_parity Email Chris Loftis, Director of State Policy, National Council for Community Behavioral Healthcare (chrisl@thenationalcouncil.org)