Congress’ action recently to infuse the nation’s banking system with capital will also have an impact on health insurance companies nationwide. The $700 billion bailout bill included a provision which requires insurers who provide coverage for mental health conditions to provide coverage for those issues identically to that provided for physical conditions. Although a “Mental Health Parity Act” was passed in 1996, it only provided for equal dollar amount coverage annually or over the lifetime of a plan for mental health benefits. Historically, and within the parameters set by the Mental Health Parity Act of 1996, insurers have often required higher deductibles or co-payments for mental health treatment, or had a lower number of covered visits to mental health providers than for physical health conditions.

The bill applies to any group health plan with more than fifty (50) employees. The law will become effective in October 2009, so affected employers should particularly keep the legislation in mind when reviewing benefits offerings for calendar year 2010. (Employees covered by a collective bargaining agreement have a longer time period for implementing the parity requirement.) Notably, the law does not require that health plans offer mental health coverage, just that, if they do so, it be equal to coverage for physical health conditions. The law also provides for regulations to be issued by the Department of Labor and other federal agencies within the year, and we will, of course, keep you updated on any pertinent developments.