Parity is the recognition and treatment of mental health conditions and substance use disorders as equal to other health conditions.
About half of all covered Americans are enrolled in large self-insured health insurance plans that are subject to federal, not state, law. The new federal parity law does not require plans to offer coverage for mental health or substance use disorders, but if these conditions are covered, then the new law requires coverage that is equitable with coverage for other health conditions. Additionally, the new federal parity law applies to all plans available through state and federally-facilitated health insurance marketplaces.
One of the most common misperceptions is that parity will get you good mental health coverage. Comprehensive parity requires equal coverage, not necessarily "good" coverage. If your health insurance plan is very limited, then your mental health coverage will be similarly limited, even in a state with a strong parity law or in a plan that is subject to federal parity.
This should be a simple question, but it isn't. Whether or not your plan is covered by a state or federal parity law depends on the kind of health plan you are enrolled in and even its size. If you are unsure about what type of plan you have, ask your insurance carrier or agent, your plan administrator, or your human resources department.
|Type of Plan||Subject to State Parity||Subject to Federal Parity||Comments|
|Individual Health Plan||Maybe||Yes, if the plan is purchased through a state or federally facilitated Health Insurance Marketplace.||Review "Affected Policies" for your state in State Mental Health Parity Laws at www.nami.org/stateparity. If individual plans are not listed, then your plan is not covered by a state parity law.|
|State-Regulated Group Health Plan (50 or fewer employees)||Maybe||Yes, if the plan is purchased through a state or federally facilitated Health Insurance Marketplace.||A group plan is typically subject to the laws of the state in which the association or company's headquarters is based. Review information under the appropriate state (e.g. company headquarters) in State Mental Health Parity Laws at www.nami.org/stateparity.|
|State-Regulated Group Health Plan (51 or more employees)||Maybe||Yes||State-regulated plans for 51 or more employees must comply with the federal parity law and "stronger" state requirements, if any. For example, if state law governing your plan requires plans to cover mental health conditions, then they must do so, even though coverage is optional under federal parity. Review information under the appropriate state (e.g. company headquarters) in State Mental Health Parity Laws at www.nami.org/stateparity.|
|Self-Insured Group Health Plan (50 or fewer employees)||No||No||Self-insured plans for 50 or fewer employees are not covered by federal parity (but are subject to other federal requirements) and are not covered by state law.|
|Self-Insured Group Health Plan (51 or more employees)||No||Yes||Self-insured plans for 51 or more employees must comply with the federal parity law, but are not covered by state law.|
|S-CHIP (State Children's Health Insurance Program)||No||Yes||S-CHIP is a shared federal/state program. Like Medicaid, S-CHIP plans vary by state and even by plan options within a state. S-CHIP plans may be public plans—or they may be private sector health plans. For details, contact your state Medicaid agency. Private-sector S-CHIP plans are subject to federal parity requirements.|
|Medicare||No||No||Medicare is a federal health plan that does not currently provide parity coverage for mental health and substance use conditions. However, Medicare's cost-sharing for outpatient mental health services do comply with parity.|
|Medicaid||Maybe||Maybe||Medicaid is a shared federal/state program. While an array of mental health services is available in many Medicaid plans, services vary by state and even by plan within a state. For details, contact your state mental health or Medicaid agency. The new federal parity law requires equivalent coverage in Medicaid alternative plans, (in states that expand their Medicaid programs) but not in existing state Medicaid plans.|
Not necessarily. Many states exclude certain mental health and/or substance use conditions from their parity law or restrict their parity law to a state-defined list of "serious mental illness" or "biologically-based mental illness." To find out what conditions your state law covers, click here: State Mental Health Parity Laws. If your large group plan is subject to federal parity, the law allows the plan to define which mental health and substance use conditions it will cover, if any.
Under parity, plans are typically permitted to cover only "medically necessary" care. Federal parity does apply to the clinical criteria used by health insurers to approve or deny mental health or substance use treatment. The standard for medical necessity determinations– whether the treatment or supplies are considered by the health plan to be reasonable, necessary, and/or appropriate– must be made available to any current or potential health plan member upon request. The reason for denials of coverage must also be made available upon request.
If your treatment is denied and you disagree, you should contact your plan's customer relations division right away. You may file a written formal appeal (ask your plan for details) if your informal attempts are not successful.
All plans must have an external review process available if you've completed your plan's internal appeals process and are not satisfied. For help, contact your state insurance division. If you are in a self-insured plan or government plan (e.g. Medicare or Medicaid), you will have to follow different appeals processes (contact the plan for details).
If you think your plan is out of compliance with parity requirements, you can get help by emailing firstname.lastname@example.org or download the Parity Toolkit . You may also contact the insurance division in the state that regulates your plan to file a complaint.
You may also call the U.S. Department of Labor's (DOL) toll free number at 1 (866) 444-3272 or contact a health benefits advisor in one of DOL's regional offices which can be found at www.askebsa.dol.gov.
If your parity law isn't helping people the way you expected, you can advocate for better regulations, enforcement, or legislation to strengthen your laws. For example, if your state's parity law is quite limited, you may advocate for a more comprehensive law. The following states have some of the more comprehensive parity laws in our country: Connecticut, Minnesota, and Vermont.
Your state parity law may also not be working as intended because various patient protections need to be strengthened. If there are not enough providers available on a plan, for example, you may advocate with your Insurance Division for regulations or better enforcement—or you may wish to advocate for legislation regarding adequacy of network provider panels.
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