Find Affordable Health Insurance In Your Area!
In 1996, Senators Paul Wellston from Minnesota and Pete Domenici from New Mexico decided that it was time to change the landscape of mental health in the US. The two senators introduced the Mental Health Parity Act (MHPA) that was passed by Congress that same year. The goal of the Mental Health Parity Act was to ensure that mental health was not treated differently, or unfairly than other medical conditions.
Even though the new law was passed with good intention, according to Health Affairs, it was full of holes. The MHPA only applied to group health plans, such as employer-sponsored coverage, which was a good start since the majority of Americans are enrolled in health plans through their employer. Two major flaws of the law were that it only applied to health plans that offered mental health benefits and allowed health insurance plans to avoid regulations under certain circumstances.
The growing issues surrounding the early Mental Health Parity Act forced states to adopt their own mental health parity laws in the following years. In 2008, Congress passed a newer, more extensive version of MHPA that was called the Mental Health Parity and Addiction Equity Act (MHPAEA).
What Is The Mental Health Parity And Addiction Equity Act?
The Mental Health Parity and Addiction Equity Act is a newer, more comprehensive version of the 1996 Mental Health Parity Act. According to the Centers for Medicare and Medicaid Services (CMS), the Mental Health Parity and Addiction Equity Act created federal regulations that made it illegal for group health insurance plans that offer mental health coverage, or substance abuse benefits, to unfairly charge more, or place greater limitations on mental health benefits than they would on medical benefits.
Mental Health Parity Under The Affordable Care Act
There's no question that the Mental Health Parity and Addiction Equity Act was another step forward for mental health in the US, but there was still one glaring problem, the law only applied to group health plans. The Patient Protection and Affordable Care Act, usually just called the Affordable Care Act, ACA, or Obamacare, looked to change that.
Under the Affordable Care Act, the Mental Health Parity and Addiction Equity Act was expanded in 2010 to the individual and private health insurance plans, along with any individual or family plan offered through the health insurance marketplace. Under the Affordable Care Act, all health qualified health insurance plans were required to include the 10 minimum essential benefits, and those benefits included mental health coverage. This was a landmark win for mental health in the US.
What Does Mental Health Parity Mean?
The textbook definition of parity is "the state of being equal." In health insurance terms, Mental health parity just refers to health insurance companies treating mental health in an equal manner to how they would treat any other medical service. Under the Mental Health Parity and Addiction Equity Act, substance abuse and addiction must also be treated just like any other medical service. It's important to note that your mental health benefits will only be as good as your health insurance policy.
If you have a policy with limited coverage for medical services, then your mental health benefits will be limited as well. In order to maximize your health benefits, it's important to take into enrolling in a policy that offers comprehensive coverage. If you're interested in exploring your options, First Quote Health is a good place to start.
Key Changes Under The Mental Health Parity And Addiction Equity Act
Some changes were already touched on above, but here is a list of the key changes in the Mental Health Parity and Addiction Equity Act that helped with mental health benefits.
- A health insurance plan that offers mental health benefits cannot subject mental health benefits to separate cost-sharing or limitations than other health benefits.
- If a health insurance plan provides out-of-network benefits for medical services, it must provide out-of-network benefits for mental health services as well.
- Health insurance plans must meet standards for medical necessity and if a plan is going to deny mental health benefits, it must provide reason upon request.
Exceptions To The MHPAEA
Any bill that is passed is usually accompanied by some sort of loophole or exception, and the MHPAEA is no different. The federal requirements of the Mental Health Parity and Addiction don't apply to the following:
- Self-insured non-Federal governmental plans with 50 or fewer employees.
- Self-insured private employers with 50 or fewer employees.
- Self-funded non-Federal governmental employers that choose to opt-out of requirements by following the Procedures & Requirements for HIPAA Exemption Election.