Blue Cross and Blue Shield of Illinois Mental Health Parity Act Legislation Effective October 3, 2009 for Group Plans
The Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 becomes effective for benefit plans beginning on or after one year from the date the legislation was signed into law (October 3, 2008). All plans and products, including self-funded (ASO) groups – with the exception of ERISA-exempt groups – are affected and will be required to comply with the new law.*
While the law originally exempted the small group 2-50 market segment, Blue Cross and Blue Shield of Illinois has decided to implement Mental Health Parity for this 2-50 segment for all products. As a result, the provisions of the law apply to new contracts and renewals on or after October 3, 2009.
The Act does not require coverage of mental health or substance abuse benefits. However, the law does require that if benefits are offered for mental health and substance use disorders, they must have the same treatment and financial levels as the predominant medical and surgical benefits provided in the benefit plan. Equity of coverage applies to all treatment limitations – including frequency of treatment, number of visits, days of coverage or other similar limits – to ensure that treatment limitations applicable to mental health and substance abuse disorder benefits are not more restrictive or less generous than the limits applied to medical and surgical benefits.
For ERISA-Exempt Groups
ERISA-exempt groups subject to the Public Health Service Act (PHSA) are also subject to Mental Health Parity unless they seek an exemption under the PHSA. If they have not sought an exemption from the PHSA, then the law applies. The group must provide the annual opt-out by mailing a request to the Centers for Medicare & Medicaid Services (CMS) prior to the beginning of each plan year. Unless these groups are annually opting out of the HIPAA Mental Health Parity or don’t offer mental health coverage, they are required to meet the parity standards. If groups have not received an exemption, then they can still opt out under the rules for the Mental Health Parity Cost Exemption Amendments, which require the plan to implement mental health parity/substance abuse benefits for at least the first six months the law is in effect.
For PPO Business
Beginning October 3, 2009 for new and existing groups upon renewal, Serious Mental Illness, non-serious mental health, and/or substance abuse will not be specifically mentioned on PPO highlight sheets. Instead, it will be noted that all mental health conditions must be treated the same or better than other medical conditions under the office visit and inpatient hospital services sections. The standard office visit benefit copayment, coinsurance, and/or deductible will also apply to mental health and substance abuse services. Inpatient hospital services will include benefits for mental health and substance abuse, eliminating any previous inpatient/outpatient day limitations.
For HMO Business
Beginning October 3, 2009 for new and renewing groups, the description of the HMO benefits will be changed to remove any and all reference to mental health or Serious Mental Illness. Also, reference to inpatient days and outpatient visits associated with mental health are being eliminated.
*An amendment was made to the Act which allows plans maintained pursuant to one or more collective bargaining agreements (CBA) to wait until the later of (i) the date on which the CBA relating to the plan terminates (determined without regard to any extension agreed to after the enactment of the Wellstone Act) or (ii) January 1, 2010, to comply with the Wellstone Act. The original bill stated that compliance must be achieved by January 1, 2009.