Cover Story

In a massive triumph for mental health care in America, Congress passed and President George Bush signed a new law that requires insurance companies to cover mental health services at the same level they do for physical services.

The bill—known as the Paul Wellstone and Pete Domenici Mental Health and Addiction Equity Act of 2008—passed Oct. 3 as part of a measure that included the controversial $700 billion financial bailout plan and was approved by a vote of 263 to 171 in the House and 74 to 25 in the Senate. The parity law takes effect Jan. 1, 2010.

"This is wonderful news for consumers of psychological services," says APA's Executive Director for Professional Practice Katherine C. Nordal, PhD.

APA has been fighting for mental health parity since the early 1990s. The 2008 bill closes several loopholes left by the 1996 Mental Health Parity Act by barring insurance companies from arbitrarily limiting all aspects of mental health coverage, including the number of hospital days or outpatient treatment sessions, or assigning higher co-payments or deductibles for those who need psychological services.

The law also ensures mental health and substance use coverage for both in-network and out-of-network services when a plan provides this for physical health services (For a full list of the legislation's components, see "Breaking it down").

Proponents of the law say that ending insurance discrimination for mental health and substance use disorders will encourage more patients to seek psychological care.

"We are ushering in a new era of health care for those with mental illnesses," said one of the bill's main sponsors in the Senate, Sen. Pete Domenici (R-N.M.), in a statement. "No longer will we allow mental health to be treated as a stepchild in the health-care system."

Rallying support on Capitol Hill

The bill's passage will greatly benefit the 113 million Americans facing unfair mental health coverage restrictions, says APA CEO Norman B. Anderson, PhD.

"The passage of mental health parity removes a significant barrier to receiving effective treatments for mental and substance use disorders," Anderson notes. "I am so proud that APA staff and members persevered for many years to contribute to this landmark legislation for the public's health."

There are good reasons why psychologists worked so hard to ensure federal mental health parity, says Nordal: Mental illnesses may be nearly as pervasive as other chronic medical conditions. According to the National Institute of Mental Health, more than 57 million Americans suffer from a mental health disorder. Yet, a 2008 nationwide survey by Harris Interactive, conducted in conjunction with APA, found that 25 percent of Americans do not have adequate access to mental health services and 44 percent either do not have mental health coverage or are not sure if they do.

In addition, a 2006 survey from the Substance Abuse and Mental Health Agency reported that 49 percent of U.S. adults with both serious psychological distress and a substance use disorder get no treatment.

"Research shows that physical health is directly connected to emotional health and millions of Americans know that suffering from a mental health disorder can be as frightening and debilitating as any major physical health disorder," Nordal says. "It's our hope that passage of this bill will facilitate earlier and better access to treatment for individuals with emotional problems."

APA members' advocacy was key to parity's passage.

"There's been a demonstrable commitment by members to pursuing this issue," says Peter Newbould, the APA Practice Organization's director of congressional and political affairs.

This year alone, psychologists sent more than 13,000 messages to their members of Congress in support of parity legislation. In March, psychology leaders attending the State Leadership Conference in Washington, D.C., participated in approximately 300 meetings with elected officials and staff, calling on Congress to ratify a parity bill. As one of the leaders of the Mental Health Liaison Group, APAPO partnered with more than 250 other mental health associations and advocacy organizations to send letters to Congress urging their support for federal parity.

In the final days leading up to the bill's passage, APAPO held a National Call-In Day for psychologists to contact their senators and representatives, and joined hundreds at a Sept. 17 parity rally on Capitol Hill. At the rally, Congress members who had championed the bill spoke about the importance of this legislation and thanked mental health organizations for their efforts to build support among legislators.

"Because of your hard work, the American dream will no longer be rationed by diagnosis," said the bill's main sponsor in the House, Rep. Patrick Kennedy (D-R.I.), at the rally.

At the state level, psychologists worked to ensure a federal measure preserved stronger state parity and consumer protection laws, says Elena J. Eisman, EdD, executive director of the Massachusetts Psychological Association. For example, Eisman notes, the federal parity bill excludes employers of 50 or fewer from extending the same mental health benefits coverage to employees.

"We had to make sure that the Massachusetts language—which covers everyone—would remain in effect for the state," Eisman says.

Hurdles remain

While the initial battle is over, the law now moves to the regulatory arena, where the U.S. Departments of Labor, Health and Human Services and Treasury will determine how it gets put into practice, Nordal says. APAPO's Government Relations staff will carefully monitor the legislation's application to ensure patients receive the benefits Congress intended.

Once regulations are set, however, there may be backlash from insurers. Before the bill passed, most health insurance providers did not cover mental health care and medical health care equally, notes Rep. Brian Baird, PhD (D-Wash.). In fact, according to a 2000 Government Accountability Office report comparing mental health benefits offered before and after the 1996 Mental Health Parity Act, almost 90 percent of health care plans impose stricter financial limitations and treatment restrictions on mental health and addiction care than they do on physical care. This is not likely to happen here, however, since this new law closes those loopholes from the 1996 law.

The Congressional Budget Office estimates that the new requirement will increase insurance premiums by an average of about four-10ths of 1 percent—a figure that, Newbould says, should not cause much financial hardship for employees, employers or insurance companies. But to head off concerns, in the coming months APAPO will begin to educate insurers and employers on the benefits of the new law for employees' overall health.

"There's no reason in the world that someone has to be condemned to a lifetime of mental suffering," Baird says. "We have treatments that can help people return to happier, healthier and more successful lives, and this legislation will make this possible."

One way psychologists can enhance the value of their services is by demonstrating that psychological services work and are cost effective, says APA Executive Director for Science Steven Breckler, PhD.

"What the medical health-care industry has been really good at doing is coming up with ways of expressing the value of their interventions in metrics that people understand," Breckler says. "Psychology is going to have to figure out how to do that." He recommends that practitioners partner more with other experts within the field—such as psychologists who focus on evaluation and testing, assessment researchers and organizational psychologists working in an occupational health setting—who collect data and demonstrate that mental health treatments are making a difference in people's lives.

For a detailed summary of the parity law, as well as specific answers on how it will affect psychologists' practices, patients and insurance plans, visit Practice Central.