A recent change in the law has widespread effects on Massachusetts employee benefit plans.
This ruling was issued by the US Employee Benefits Security Administration, also known as EBSA. EBSA is the agency of the federal government that ensures businesses comply with pension and health insurance laws. US EBSA covers most businesses and applies to over 150 million workers in the US.
This ruling extends the expiration date on the Mental Health Parity Act, also known as MHPA. Signed into law in 1996, this law was originally due to expire the end of September, 2001. Instead, the expiration date has been extended 5 times. Under the recent ruling, the act is due to expire on December 31, 2007.
Because of MHPA, lifetime and annual benefit caps cannot be lower for mental health treatments than they are for other types of medical treatments and surgery. The covered mental health treatments may include visits to licensed therapists, psychiatrists, and psychologists. If necessary, a stay in a rehab facility to treat drug or alcohol dependency also should be covered. In addition, in the case of schizophrenia, depression, post-traumatic stress disorder and other ailments, a stay in a mental hospital should be covered.
Not all group health insurance plans cover mental health treatments, and this law does not require them to do so. Instead, this law states that if mental health treatments are covered by the group health insurance plan, then the plan should have the same limit for mental health treatments that it has for other treatments.
MHPA only applies to group heath insurance plans that include treatments for mental health conditions. The Mental Health Parity Act does not mandate that mental health treatments be included in all group health insurance plans.
The MHPA bill, or the Mental Health Parity Act, passed in 1996 included a provision that expired on September 30, 2001. The law has since been amended five times, which extended it. The most recent extension was in February 2007, which continues the act until December 31, 2007. I don’t think we really have t worry about this law expiring permanently any time soon.
The MHPA provides guidelines for those insurance plans that choose to cover mental health treatments. Before 1996, there were many group health care plans that set awfully low annual limits for mental health treatments. Health insurance plans could pay up to $100,000 per year for surgery yet limit coverage for mental health treatment to only $2,000 per year. Now, because of MHPA, that is against the law.
Insurance plans now have to pay the same amount for both medical and mental health treatments. It is required by law that any group health insurance plan that funds mental health treatment, cover it at the same rate as other medical treatments, surgery included.
Massachusetts employee benefits may or may not cover mental health treatment. Even though most employers offer plans that do insure mental health, there are still many that do not cover any type of psychotherapy, or mental treatments. It is also true that inpatient or outpatient treatment in a hospital or mental health facility may not be included in some plans. Since there is no statute claiming employer provided benefits have to insure mental health treatment, not offering this type of coverage is still an option.
The Employee Benefits Security Administration (EBSA) handles the claims and law violations concerning health care and pensions for over 150 million employees. The EBSA is the special agency that the federal government has set aside to enforce the laws that govern employee benefits and pension plans.
What does all this talk about the Massachusetts Health Insurance Connector Board have to do with you, my loyal readers and ardent employers? Well, you Massachusetts employers out there sure should be interested in this Massachusetts health reform plan and its exact details, down to these minimum criteria.
The whole reason that the Massachusetts Health Insurance Connector Board decided to give the extra time for people to get this minimum criteria for their health insurance was to give employers of the state more time to change their health care plans. In other words, if you are an employer in the state of Massachusetts, and you provide your employees with health care coverage or help pay for some of it, then it probably looks like it will fall to you to make sure that your employees meet these minimum criteria requirements of the Massachusetts health care reform law.
Ah, back up—I think I found out what these minimum criteria are after all. All Massachusetts state residents are required to be part of a health care plan that has no annual dollar limits on their covered expenses. The plans cannot also have deductibles for in-network provider services that would be more than $2,000 per year for a single person, or $4,000 per year for a family plan. Also, the annual maximum out of pocket limit for these plans cannot be more than $5,000 for a single person, or $10,000 per year for a family.
High deductible health insurance plans, on the other hand, as long as they were connected to health savings accounts, would be considered coverage that would get credit from the state as being enough.
The board, meanwhile, also suggested that all employers in Massachusetts offer to their employees—even part timers—that they can pay their health insurance premiums with pretax dollars.