President signs mental health parity into law

A new law included in the economic bailout bill President Bush signed on Friday, will ensure more than one-third of Americans better insurance coverage for mental health treatments.

The mental health care benefits parity legislation will require health care plans to provide equal coverage of mental and physical illness. In the past, insurers were able to set higher co-payments and deductibles and harsh limits on treatment for mental illness and addiction disorders.

According to Workforce Management:

For example, plans no longer will be allowed to limit the number of annual outpatient visits for treatment of mental disorders while not imposing a comparable limit on the number of outpatient visits for other medical problems.

While the plan changes would be extensive, the cost impact is expected to be modest. The Congressional Budget Office last year estimated that enactment of a similar bill would boost health insurance premiums by an average of about 0.2 percent a year.

A result of 12 years of advocacy, the new law is described as “a milestone in the quest for civil rights, an effort to end insurance discrimination and to reduce the stigma of mental illness,” according to The New York Times.

The law will be effective for most health care plans on January 1, 2010. Businesses with 50 or fewer employees are exempt.

Related post:

Mental Health Parity Bill passes House, on to negotiations

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