House Committee Hears Mental Health Testimony

March 14, 2002 (PLANSPONSOR.com) - Lawmakers considering changes to federal mental-health insurance laws heard testimony that mental health parity mandates could prompt executives to drop the coverage entirely.

Mental health industry representatives, meanwhile, pushed hard for a parity bill mandating that employers spend as much on covering mental health issues as they do physical problems, saying that not to have such equal coverage was discriminatory.

In her testimony to the House Employer-Employee Relations Subcommittee, Jane Greenman, deputy general counsel for Honeywell International, testifying on behalf of the ERISA Industry Committee (ERIC), said there were cost and other concerns with federal mandates.

“Mandated broad mental health parity is a poor response to the public policy challenge of providing access to care to those who suffer from  mental illness,” said Greenman,

If mandate legislation passes, Greenman said, employers may  “simply stop offering mental health coverage entirely.”

Subcommittee Chairman Sam Johnson (R-Texas) said “the Subcommittee may look at legislative proposals that would strike the appropriate balance between the concerns of advocates and employers.”

Current Bill Expires in October

The Senate last year passed legislation as an amendment to an annual spending bill that would have expanded a 1996 law requiring that health insurance plans that offer mental health benefits, not have different annual or lifetime limits for mental health than for other benefits.

But the Senate-passed parity measure to was dropped from the bill when House negotiators balked. Instead, the bill extended the expiring 1996 law for an additional year, to October 1, 2002.

In other testimony:

  • Mental health advocates said parity legislation could save money. “The fact is it makes real economic sense to improve access to treatment by offering parity-level benefits,” testified Dr Henry Harbin, chairman of the board of Magellan Health Services, on behalf of the American Managed Behavioral Healthcare Association, according to Reuters.
  • Kay Nystul, a behaviorial nurse with Wassau Benefits, encouraged public policy that pressured employers to provide equal mental health coverage. However, because of health benefit funding limits, “choices have to be made.  Unreasonable new federal mandates would put these already limited health plan funds at risk,” Nystul said.
  • Lee Dixon, group director of the Health Policy Tracking Service for the National Conference of State Legislatures, said more than 20 states have enacted laws to mandate parity in mental health coverage.  More than half of the states demand parity only for serious biologically-based mental illnesses.

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