Implementation of the mental health parity law is proving to be another huge headache for employers. The law requires that benefits provided by employers for the treatment of mental illnesses and substance abuse be on a par with other medical and surgical benefits. The effective date is Jan. 1 for health plans on a calendar year, but the agencies in charge of writing the implementation rules have yet to produce them. “There are a lot of open questions and no guidance from the government,” says Kaye Pestaina of The Segal Company.
One key question is whether it’s OK to have separate deductibles. Employer groups say the law does allow that, and lacking contrary guidance, many companies are deciding to go that route. Employers that use a different vendor for mental health benefits than for other health benefits say separate deductibles are a must because of coordination problems. “A single deductible would result in a substantial and costly administrative burden to the plan,” say the American Benefits Council and the U.S. Chamber of Commerce in a letter to the Department of Labor.
But congressional supporters of the legislation wrote in a recent letter to regulators that “separate but equal” is not parity. They said it’s discriminatory and “should be prohibited.”
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Copays are also an issue. Many plans have higher copays for specialists than for primary care doctors, and they want to use the higher ones for mental illnesses, regardless of the provider’s credentials. “Group health plans should be permitted to classify all mental health providers as specialists and apply the plan’s specialist co-pay to such providers,” say the council and the Chamber in their letter.
Another ambiguous issue involves the scope of services. Employers want confirmation that it’s up to the plan sponsor to determine what’s a covered benefit and what isn’t. Just as employers can decide not to cover certain medical services, such as chiropractic care or fertility treatments, they must be able to do the same in the area of mental health, they say. But in their letter to regulators, lawmakers asserted that the law intended that patients have access “to the full scope of services, medically appropriate for their condition.”
Employers can seek a one-year exemption from the parity law if their costs go up by 2% or more in 2010 or at least 1% in subsequent years. Employer groups have asked regulators to allow firms that qualify for an exemption one year to have an actuary make a forecast of costs for subsequent years.
Regulators are expected to go easy on enforcement the first year, especially since no guidance was available for employers as they were making decisions on how to comply with the law. As long as employers make a good faith effort to comply, regulators won’t take enforcement action against them.
For weekly updates on topics to improve your business decisionmaking, click here.
-
AI Goes To SchoolThe Kiplinger Letter Artificial intelligence is rapidly heading to K-12 classrooms nationwide. Expect tech companies to cash in on the fast-emerging trend.
-
The New AI Agents Will Tackle Your To-Do ListThe Kiplinger Letter Autonomous AI agents “see” your computer screen, then complete a task, from buying a concert ticket to organizing email. This opens up a world of possibilities.
-
AI’s Medical RevolutionThe Kiplinger Letter Medicine is a field ripe for finding both exciting and practical uses for AI. The tech is already being used by doctors and researchers.
-
The Economic Impact of the US-China Trade WarThe Letter The US-China trade war will impact US consumers and business. The decoupling process could be messy.
-
AI Heads to WashingtonThe Kiplinger Letter There’s big opportunity for AI tools that analyze MRIs and other medical images. But also big challenges that clinicians and companies will have to overcome.
-
The AI Doctor Coming to Read Your Test ResultsThe Kiplinger Letter There’s big opportunity for AI tools that analyze CAT scans, MRIs and other medical images. But there are also big challenges that human clinicians and tech companies will have to overcome.
-
The New Space Age Takes OffThe Kiplinger Letter From fast broadband to SOS texting, space has never been more embedded in peoples’ lives. The future is even more exciting for rockets, satellites and emerging space tech.
-
Rising AI Demand Stokes Undersea InvestmentsThe Kiplinger Letter As demand soars for AI, there’s a need to transport huge amounts of data across oceans. Tech giants have big plans for new submarine cables, including the longest ever.
