Mental Health and Substance Abuse Insurance Parity

In our state, lack of access to mental health and substance care is a pressing issue. Over the last decade, New Hampshire (NH) residents have consistently reported high rates of alcohol and substance abuse in comparison to national averages, yet the state's efforts and infrastructure to deal with mental health and substance abuse issues continue to fall short of national standards. Furthermore, our research shows that the costs of mental illness, in NH as well as the U.S., are high and continuing to rise, rendering the issue of mental health coverage even more critical.

Last year, President George W. Bush signed into law the Emergency Economic Stabilization Act of 2008 (H.R. 1424), which included the Paul Wellstone and Peter Domenici Mental Health Parity and Addiction Equity Act of 2008. This legislation mandates that employers providing health insurance offer mental health and substance abuse benefits equitable to the medical and surgical treatment benefits they provide. This act, in combination with other recently passed legislation discussed in this report, may have a complex effect in NH, where thousands of small businesses, Medicaid subscribers, and the 16 percent of the population that is uninsured or self-insured may remain untouched by these new parity regulations.

As case studies of Maryland, Vermont, and Connecticut illustrate, comprehensive state- based parity legislation does not have detrimental effects, but neither does it greatly increase the number of needy people with access to care. For example, in Vermont six years after parity, comprehensive mental health insurance parity had not increased overall healthcare spending, nor had it significantly reduced the number of insured persons – two major concerns of opponents to parity. On the contrary, following the implementation of parity, spending in Vermont decreased, though possibly due to other factors, while access to and utilization of care improved slightly.

While it is difficult to determine how H.R. 1424 will impact NH until the regulations have been written by the relevant federal agencies, we conclude this report with an elaboration of such policy recommendations in NH as the expansion of Medicaid substance abuse coverage, the extension of parity laws to small businesses, the maintenance of funding for community mental health centers, and an education campaign to inform consumers of parity stipulations and the possible applications to their lives. We also suggest that further study be done on the many states with full or partial parity laws, to better understand how such laws change access to mental health and substance abuse treatment and whether the NH legislature should amend its parity laws.