Are you an employer or employee in Georgia?
If so, you’ll be interested in a recent change in the law that affects Georgia employee benefit plans. This ruling extends the Mental Health Parity Act, also know as MHPA, through the end of 2007. Originally, the MHPA bill, which was signed into law in 1996, was supposed to end on September 30, 2001. Instead of expiring, this bill has been extended 5 times over the years.
MHPA says that under group health insurance coverage, mental health coverage cannot have a lower payment limit than that one used for medical treatments and surgery. The reason this law is important is that in the past, an insurance company might set a limit for mental health treatments of $15,000 while setting the surgery benefit limit at $250,000.
The Mental Health Parity Act requires group health insurance plans that cover mental health treatments not place a lower payment limit for this coverage than for other coverages, such as surgery. For instance, in the past group health insurance plans could set lifetime surgery benefit maximum of $250,000 but place the mental health treatment benefit lifetime maximum at $15,000. MHPA makes this kind of disparity illegal. Now, if $250,000 is the lifetime benefit maximum for surgery and other treatments, then this same amount has to be the lifetime benefit maximum for mental health treatments.
MHPA also applies to annual benefit limits. The annual benefit maximum established by the group health insurance plan for surgery and other medical treatments must be the same amount allocated for mental health treatments. These treatments can include visits to counselors such as psychiatrists, psychologists, and licensed therapists. Other mental health treatments included are mental hospital stays for conditions such as schizophrenia and depression. In addition, covered treatments also may include stays in rehab centers to treat drug and alcohol dependency.
The mental health treatments covered by the heath insurance plan can include stays in a drug or alcohol rehab and stays in mental hospitals for illness such as schizophrenia or depression. Visits to psychiatrists, psychologists, and licensed therapists are also included.