The Senate Health, Education, Labor, and Pensions Committee approved the Paul Wellstone Mental Health Parity Act of 2007 (S.558) in an 18-3 vote. Senators Allard (R-CO), Coburn (R-OK), and Burr (R- NC) voted against the measure. The next step is for the bill will move to the Senate floor for a vote by the entire Senate. The House is expected to introduce a different bill next week. We will continue to keep you posted on any action in the Senate and House as well as provide you with the differences between the legislations. Below are Q&As outlining what the Senate Bill requires. If you have any questions, please call or email us at 1-800-333-7636, kkroeger@aacap.org, erorick@aacap.org.

Thank you to all the members who called their Senator to urge their support of this important legislation!

Mental Health Parity Act of 2007 – Q & A
Q: What does the bill do?
A: This bill requires insurance companies and employers offering mental health coverage to provide parity between mental health and physical health coverage, meaning that they must treat the two benefits similarly to each other. They can’t establish different financial requirements for mental health, such as deductibles, co-pays, annual and lifetime limits, etc. Plans can also not create different treatment limitations such as day and visit limits for mental health, meaning that the treatment they cover for mental health should be on par with what you would receive for physical health care.

Q: Does it mandate or require a plan to offer mental health coverage?
A: No. It simply requires a plan that offers mental health coverage to treat that coverage in a similar way to its physical health coverage.

Q: Will it take away my state mandated mental health coverage?
A: No. State laws requiring plans to provide mental health coverage will remain in effect. The primary difference is that these plans will now have to treat your mental health coverage the same as physical health coverage under the federal parity guidelines that address financial requirements such as co-pays, and treatment limitations such as day and visit limits.

Q: What happens if my state’s laws outline specific mental health treatment limitations?
A: This bill would not affect the state’s basic mandate of mental health coverage, but it would take the place of any specific day or visit limits that your state might currently mandate.

Q: Are small businesses required to comply with the parity rule?
A: No, businesses of 50 or fewer employees do not have to offer plans with parity under this bill, but they’ll still be required to follow state regulations that apply to them.

Q: Will the parity requirement result in a cost to employers?
A: Past Congressional Budget Office scoring of mental health parity has shown a less than 1% increase in cost to employers.

Q: Can companies and insurance providers opt out of providing parity?
A: Yes, but only if they can show that their actual costs for providing parity increased their overall cost by 2% over the course of the first year parity is in effect or 1% for subsequent years. If so, they may choose to opt out for one year, but must comply with the parity requirements the next year.

Q: Will the states all enforce parity in the same way?
A: Yes. Each state is required to enact the federal parity standard, or change their state law to mirror the federal standard. This ensures uniformity in how the states enforce the parity requirements.

Q: Will my out of network mental health coverage be protected by parity?
A: Yes, the bill requires that plans which offer out of network mental health coverage provide parity for that coverage, so that out of network mental health coverage is treated the same as out of network physical health coverage. However, the bill does not require that a plan offer out of network mental health coverage, even if the plan does offer out of network coverage for physical health.

Q: Is substance abuse treatment included in the bill?
A: Yes, plans that cover substance abuse will be required to provide parity, but the bill does not mandate that plans offer any substance abuse coverage.

Q: Does it affect my coverage under Medicare or Medicaid?
A: Yes and no. Medicare is not affected. Medicaid managed care, SCHIP, and some state and local health plans are affected.

Department of Government Affairs
Kristin K. Ptakowski, Director
Elizabeth Rorick, Assistant Director
Ramon Gardenhire, Assistant Director for State Advocacy
Abby Schopick, Legislative Assistant