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The Mental Health Balance

Complying with the mental health parity legislation that kicked in on July 1 is more complicated than companies expected.

By Stephen Barlas | Updated on August 02, 2010

A little-noticed federal law affecting mental health and substance abuse benefits kicked in on July 1, and its cost implications could dwarf those of the earliest corporate implementations of the high-profile healthcare reform legislation. The Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) requires companies with more than 50 employees that cover mental health and substance abuse to equalize financial requirements and treatment limitations for depression, schizophrenia, drug addiction and similar conditions with those set for physical illnesses.

The government’s interim final rule specifies how companies are to comply. It establishes six care categories, such as inpatient in-network and inpatient out-of-network, and says medical and mental health or substance abuse coverage must be equalized in each category, with limitations on mental health benefits no more restrictive than those for medical or surgical benefits.

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