labor lawAdivision of labor law center

The $700 billion Wall Street bailout  recently signed by President George W. Bush also included an important provision related to employee health benefits.  

 

The law ensures that American workers continue to receive insurance coverage for mental health treatments, on parity with coverage for physical illness, under their group health insurance.  

A similar law in effect for the past 12 years was scheduled to expire on January 1, 2010. This measure extends the law.  

 

This law requires insurance carriers to provide equal coverage of mental and physical illnesses. It means that workers receive benefits for treatment of depression, phobias, grief, alcoholism, drug dependence, bipolar disorder and other mental health issues. Before the passage of this law, it was legal for health care plans to set higher deductibles and copayments, and strict limits on treatment for mental illness, addiction and other disorders. Some group health insurance plans, for example, covered physical illness up to $200,000 per year. However, treatment for mental illness was limited to $2,000 per year. This law makes that disparity illegal. 

 

This measure is expected to cover up to one third of all workers in the U.S. The bill passed the House on October 3 with a vote of 263 to 171.  

 

According to Workforce Management, plans no longer will be allowed to limit the number of annual outpatient visits for treatment of mental disorders while not imposing a comparable limit on the number of outpatient visits for other medical problems.While the plan changes would be extensive, the cost impact is expected to be modest. The Congressional Budget Office last year estimated that enactment of a similar bill would boost health insurance premiums by an average of about 0.2 percent a year. 

 

The new law is described as “a milestone in the quest for civil rights, an effort to end insurance discrimination and to reduce the stigma of mental illness,” in the The New York Times.

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