What Is the Mental Health Parity and Addiction Equity Act?

Mental health is a part of your health. It shouldn't be treated differently than physical health, although many view it as such. Congress passed the Mental Health Parity and Addiction Equity Act (MHPAEA) in 2009. This federal parity law ensures that insurers offering mental health coverage treat mental health as they do physical health. Under the MHPAEA, health insurers must provide equal benefits for mental health and physical health conditions and providers.

This FindLaw article explores coverage for mental health and substance use disorder services.

Mental Health Coverage

Millions of Americans struggle every year with mental illness and substance use disorder. The National Alliance on Mental Illness (NAMI) is a mental health advocacy organization. According to NAMI, the following groups experience some form of mental illness each year:

• American adults – 23%
• American youth – 16%

Mental health practitioners provide mental health services to help this population manage their illness. Coverage of mental health and substance use disorders includes a mix of inpatient and outpatient treatment options.

Mental Health Conditions

The phrase 'mental health conditions' is broad. It includes, but is not limited to, the following:

• Depression
• Anxiety disorders
• Substance abuse
• Personality disorders
• Anorexia and bulimia
• Schizophrenia
• Bipolar disorders

Mental Health and Insurance

Before the MHPAEA, health plans offered different benefits for mentally ill patients compared to physical conditions. Insurers often imposed less favorable benefit limitations on behavioral health than medical health. For example, a plan might have different co-pays for mental health care than medical care.

The MHPAEA originally applied to group health plans and group health insurance coverage. This changed after the passage of the Affordable Care Act (ACA). The ACA amended the MHPAEA to include individual health insurance coverage.

MHPAEA Requirements

The MHPAEA requires mental health and substance abuse coverage to be at parity with medical and surgical coverage. In other words, a qualified insurance plan can't make mental health and substance abuse coverage more complex and more expensive than medical coverage.

"Parity" means that elements of insurance coverage are fundamentally comparable. For example, a plan wouldn't meet parity requirements if the length of inpatient visits covered are shorter for mental health treatment than for medical treatment.

Elements of Insurance Coverage

The MHPAEA distinguishes between quantitative and non-quantitative treatment limitations. Quantitative treatment limitations look at numbers and include things like number of visits. Non-quantitative treatment limitations include things like prior authorizations.

Qualified insurance plans must guarantee that coverage is at parity for the following:

• Co-pays
• Coinsurance
• Cost-sharing
• Deductibles
• Reimbursements
• Numerical treatment limitations
• Out-of-pocket maximums
• Inpatient and outpatient visit limits
• Prior authorization
• Out-of-network coverage

Medical necessity criteria (used to determine whether insurance will pay for treatment)

MHPAEA Parity Requirement Exemptions

The Affordable Care Act (ACA) impacted many areas of the MHPAEA by extending the parity requirements to apply to more plans. Before the implementation of the ACA, small employer plans weren't subject to the MHPAEA. Also, parity requirements didn't apply to plans without mental health coverage.

Today, insurance plans can't omit mental health coverage—it is an essential health benefit. Non-exempt insurance plans must include mental health care and substance use disorder benefits. Such plans must also meet parity requirements.

Exempt Health Insurance Plans

MHPAEA requirements don't apply to the following health insurance plans:

• Retiree plans
• Medicare
• Some Medicaid plans
• Government-sponsored self-insured plans
• Small group insurance plans
• Small employer plans created before March 23, 2010

State Mental Health Parity Laws

The MHPAEA is a federal parity law. State parity laws are often stricter about enforcing parity. For example, New York has one of the more stringent parity laws among the states. New York State requires a minimum of 30 days of inpatient and 20 days of outpatient treatment for mental health. The law also defines those illnesses that health insurance companies must fully cover.

Defining illnesses eliminates reliance on medical necessity criteria to avoid paying for mental health coverage.

Get Legal Help

If your health insurance plan doesn't offer comparable mental health and substance use disorder treatments, you should get legal counsel. A health care attorney can help you understand applicable federal and state laws concerning mental health parity. Speak to an experienced healthcare attorney today.