Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008

On October 3, 2008, as part if the economic bail out bill, President Bush signed into law the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 – Amends the Employee Retirement Income Security Act of 1974 (ERISA), the Public Health Service Act, and the Internal Revenue Code to require a group health plan that provides both medical and surgical benefits and mental health or substance use disorder benefits to ensure that: (1) the financial requirements, such as deductibles and copayments, applicable to such mental health or substance use disorder benefits are no more restrictive than the predominant financial requirements applied to substantially all medical and surgical benefits covered by the plan; (2) there are no separate cost sharing requirements that are applicable only with respect to mental health or substance use disorder benefits; (3) the treatment limitations applicable to such mental health or substance use disorder benefits are no more restrictive than the predominant treatment limitations applied to substantially all medical and surgical benefits covered by the plan; and (4) there are no separate treatment limitations that are applicable only with respect to mental health or substance use disorder benefits.

Requires the criteria for medical necessity determinations and the reason for any denial of reimbursement or payment for services made under the plan with respect to mental health or substance use disorder benefits to be made available by the plan administrator.

Requires the plan to provide out-of network coverage for mental health or substance use disorder benefits if the plan provides coverage for medical or surgical benefits provided by out-of network providers.

Exempts from the requirements of this Act a group health plan if the application of this Act results in an increase for the plan year of the actual total costs of coverage with respect to medical and surgical benefits and mental health and substance use disorder benefits by an amount that exceeds 2% for the first plan year and 1% for each subsequent plan year. Requires determinations as to increases in actual costs under a plan to be made and certified by a qualified and licensed actuary.

Summary of Mental Health Parity and Addiction Equity Act of 2008

 

New Law Provides Parity for Mental Health, Addiction Services

Business with 51 or more employees that offers coverage for mental health services is required to provide the same level of deductibles, copayments, out-of-pocket expenses, co-insurance, covered hospital stays and covered outpatient visits for mental health services and addiction services as it does for physical ailments, said Hannah Vanderbush, deputy press secretary for Sen. Pete Domenici, R-N.M., a chief sponsor of the legislation.

 

The bottom line spells increased costs to all employers with 51 or more employees.

 

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