During these difficult economic times, a frustrating paradox occurs. The stress of the realities associated with a struggling economy (e.g., reduced income, mortgage failure) create and exacerbate psychological and behavioral problems, such as anxiety, depression, and substance abuse. Many individuals suffering from such problems receive relief from psychotherapy. Yet, therapy may be one of those ï¿½luxuriesï¿½ that people decide they cannot afford when money is scarce.
Often people assume that their health plans either do not cover mental health services, or that their coverage is very limited in terms of what conditions are covered, how many visits they may have, or what therapists they may see. This blog is intended to provide readers with some information regarding their rights to insurance coverage for mental health and addiction treatment.
Beginning in July 2000, California State Assembly Bill 88 (Mental Health Parity Law) required that every health care service plan that provides hospital, medical or surgical coverage to also provide coverage for several diagnoses of severe mental illness in a person of any age and for serious emotional disturbances of a child.
The diagnoses covered by AB 88 included: schizophrenia, schizoaffective disorder, bipolar disorder, major depression, obsessive-compulsive disorder, panic disorder, eating disorders (anorexia nervosa and bulimia nervosa), autism or pervasive developmental disorder, and serious emotional disturbance in children and adolescents (SEM).
All but one in the list of diagnoses are mental disorders identified in the most recent version of the Diagnostic and Statistical Manual of Mental Disorders (DSM IV). SEM is defined in the statute.
The benefits were mandated to include: outpatient services, inpatient hospital services, partial hospitalization services, and prescription drugs, if the plan contract included coverage for prescription drugs.
On October 3, 2008, a federal law entitled the Mental Health Parity and Addiction Parity Act of 2008 was enacted.
This new law expanded the parity requirements for group health care plans with more than 50 employees or employer self-insured or self-funded plans.
First, the law will mandate that health insurance plans that have mental health components additionally cover substance abuse, as well as any other mental health disorder listed in the DSM. Second, the law prohibits insurers and health plans from imposing treatment limitations on mental health benefits that are more restrictive than those applied to medical services (e.g., frequency of treatment, number of visits).
Third, the law prohibits insurers and health plans from imposing financial limitations on mental health benefits that are more restrictive than those applied to medical services (e.g., deductibles, co-payments, co-insurance, and out of pocket expenses).
And fourth, the law mandates that plans that offer out-of-network benefits for medical and surgical services must offer out-of-network benefits for mental health services on the same terms.