The Mental Health Parity Act of 1996 (MHPA) is a federal law that may prevent your group health plan from placing annual or lifetime dollar limits on mental health benefits that are lower - less favorable - than annual or lifetime dollar limits for medical and surgical benefits offered under the plan. For example, if your health plan has a $1 million lifetime limit on medical and surgical benefits, it cannot put a $100,000 lifetime limit on mental health benefits. The term "mental health benefits" means benefits for mental health services defined by the health plan or coverage.

Although the law requires "parity," or equivalence, with regard to dollar limits, MHPA does NOT require group health plans and their health insurance issuers to include mental health coverage in their benefits package. The law's requirements apply only to group health plans and their health insurance issuers that include mental health benefits in their benefits packages.

If your group health plan has separate dollar limits for mental health benefits, the dollar amounts that your plan has for treatment of substance abuse or chemical dependency are NOT counted when adding up the limits for mental health benefits and medical and surgical benefits to determine if there is parity.

MHPA applies to most group health plans with more than 50 workers. MHPA does NOT apply to group health plans sponsored by employers with fewer than 51 workers. MHPA also does NOT apply to health insurance coverage in the individual market. But you should check to see if your state law requires mental health parity in other cases.

An example of a coverage provision that violates MHPA is as follows: Your plan has a limit of 60 visits per year for mental health benefits, along with a fixed dollar limit of $50 per visit - a total annual dollar limit of $3,000. It places no similar limits on medical and surgical benefits. MHPA does NOT allow this inequality to exist for group health plans covered by the law.

Group health plans may impose some restrictions on mental health benefits and still comply with the law. MHPA does NOT prohibit group health plans from:

Increasing co-payments or limiting the number of visits for mental health benefits;

Imposing limits on the number of covered visits, even if the plan does not impose similar visit limits for medical and surgical benefits; and

Having a different cost-sharing arrangement, such as higher coinsurance payments, for mental health benefits as compared to medical and surgical benefits.

For further information about MHPA and how it relates to your specific circumstances, you can e-mail us at phig@cms.hhs.gov. Or you may call us at 1-877-267-2323, ext. 61565.

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MHPA Statute

Page Last Modified: 01/08/2008 9:29:23 AM
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