Policy Focus: Mental Health Parity Enforcement
The Parity Act, formerly known as the Mental Health Parity and Addiction Equality Act (MHPAEA) of 2008, was enacted in 2009 and is an extension of the Mental Health Parity Law of 1996. The 1996 law extended coverage by certain health insurance companies to include mental health issues, along with the usual medical issues. The Parity Act extends coverage even further to include substance abuse issues.
UACF will continue to collaborate with the Department of Health Care Services and other entities to support Mental Health Parity in California and nationwide. California has attempted to facilitate greater mental health parity through passage of its own parity law. Similar to the MHPAEA that would follow, the California Mental Health Parity Act of 1999 attempted to compensate for the shortcomings in the MHPA. It eliminated mental health benefit limits and cost-sharing requirements that are less comprehensive than those for physical conditions. And, unlike the federal parity laws, California’s statute mandates that health insurance plans offered in the state provide coverage for a list of nine mental health conditions: schizophrenia, schizoaffective disorder, bipolar disorder, major depression, panic disorder, obsessive-compulsive disorder, pervasive developmental disorder or autism, anorexia nervosa, and bulimia nervosa. The state law also has broader scope than the federal parity statutes, covering all group insurance plans as well as individual insurance plans.
While opponents of health parity laws initially argued that equality in mental health coverage would be too costly a strain on the California health care system, actuarial studies have shown that the costs of the laws is actually quite modest. Studies assessing the cost of implementing California’s Mental Health Parity Law found that the law did not appear to have had any adverse consequences on the health insurance market. There were no decreases in health insurance offerings by employers, and while premiums did increase during the initial years of the law’s implementation, these increases were due to other factors.
California’s mental health parity provisions are among the strongest in the country, and greatly enhance federal parity laws. But even California’s strong mental health parity protections have room for improvement. The effectiveness of the state mental health parity laws is undermined by a weak, complaint-driven enforcement system and low public awareness of the state law, often resulting in a denial of care.
From A Short Primer on Mental Health Parity in California by Shariff Osman.