Questions Arise About Parity in Health Reform Plans

Details of plans to overhaul the U.S. health care system released by late June address some—though not all—of the issues critical to psychiatrists and people with mental illness.

Congress began considering the three leading legislative proposals in June, including plans by the Senate Finance and Health, Education, Labor, and Pensions committees, as well as a unified House Democratic proposal. The varying scopes of the plans mean that they will have to be reconciled before Congress can clear legislation for President Obama's consideration. Obama said he hopes to sign a bill by October.

The bill that has progressed most quickly is sponsored by Sen. Edward Kennedy (D-Mass.), a longtime advocate of national health care reform and better access to treatment. It would require all Americans to get medical insurance, establish complex new insurance exchanges to facilitate near-universal coverage, and dramatically increase regulatory oversight of the insurance industry. Some drafts of the legislation include a government-run insurance option and a mandate for businesses to insure employees—both measures that are bitterly opposed by Republicans and some conservative Democrats.

A second Senate bill hoped to attract bipartisan support in the Finance Committee also would require that individuals have health care coverage and would offer tax credits to help them afford it. It also would establish“ insurance exchanges” or marketplaces for people to buy various levels of coverage.

The plan taking shape in the House has been carefully negotiated by the chairs of the three committees with jurisdiction over health reform. It would require all Americans to have insurance and all employers to provide coverage or pay a penalty. The bill emphasizes preventive care but does not detail how those costs would be covered. The House plan also would bar insurance companies from denying coverage or charging higher premiums to people with preexisting conditions.

Among the most controversial aspects of the House bill is the option for individuals to buy insurance through the federal government, which is the so-called public option. Republicans have opposed any public option over concerns it would undermine private insurers and lead to the creation of a single-payer health care system, charges Obama and House Democrats reject.

Cost estimates by the nonpartisan Congressional Budget Office sapped some of the momentum from the Senate bills, which are more expensive and provide less coverage than some supporters hoped. The Kennedy bill would cost $647 billion in the first 10 years and would buy coverage for 20 million of America's 47 million uninsured. The Senate Finance Committee's bill would cover more than two-thirds of the uninsured but cost $1.6 trillion over 10 years.

Supporters of the House bill expect it to cover 95 percent of the uninsured, but its cost estimates were not completed by late June.

Mental health advocates said they have been repeatedly assured by congressional supporters that the passage of the federal insurance parity law (PL 110-343) in October 2008 created the assumption that coverage for psychiatric conditions would be included in any health care overhaul. But emerging legislative plans have added some uncertainty to that assumption.

These advocates have not seen evidence that reform proponents intend to undermine parity; however, it remains unclear how insurance exchanges that would be created by some of the proposals would incorporate parity. Advocates want clarification of whether individuals who move to a government exchange from employer-provided insurance would still have access to insurance that offers parity for mental illness. Potentially complicating factors are that the federal parity law applies only to employers with more than 50 employees and doesn't apply to the individual insurance market.

“We're trying to figure out how parity would work with all of [these proposals] because it is complicated,” said Matt Sturm, an associate director of APA's Department of Government Relations.

Numerous questions also surround the public insurance plan that may be created under health care reform. The Kennedy bill, for instance, would require physicians who voluntarily treat Medicare patients also to participate in the new public plan. Physician reimbursement under the public option would be at the standard Medicare rate plus 10 percent for all services. The mandatory participation provision of the Kennedy bill has been opposed by the AMA, however, and APA is waiting to receive input from more of its members before taking a position.

The House bill's provisions “to ensure that mental health and substance use services are available to all individuals included in the new program to cover the uninsured is absolutely critical,” said David Shern, Ph.D., president and CEO of Mental Health America, in testimony before a House panel in June.

Mental health advocates also have sought to include mental illness under the various plans' definitions of chronic illnesses that insurers cannot refuse to cover as preexisting conditions (see Original article: MH Care Called Integral to Health System Reform). The Finance Committee plan is the only proposal to explicitly include mental illness as a chronic disease.

One clearly positive step for many people with mental illness is the Kennedy plan's requirement that insurers offer coverage to beneficiaries' children up to age 27, instead of the common cut-off of 22 or the end of college.

The need for strong mental health care for young people was highlighted by Shern, who cited research showing that half of people with a psychiatric diagnosis become ill by age 14 but do not receive treatment until age 24 on average.

“This 10-year delay in treatment and early age of onset interfere with a young person's ability to succeed in school and gain employment, thus increasing the likelihood of developing a costly disability,” he said.

Psychiatrists also may be affected by quality reporting requirements. Some proposals have included requirements for physicians to participate in the Physician Quality Reporting Initiative (PQRI) or face penalties beginning in 2012. Physician advocates have urged a delay in PQRI penalties to avoid consequences such as physicians, who are already in short supply in general medicine and some specialties, retiring to avoid additional paperwork burdens.

An outline of the Senate Finance bill is posted at<http://finance.senate.gov/sitepages/legislation.htm>. The Kennedy bill is posted at<http://help.senate.gov/BAI09A84_xml.pdf>. The House measure is posted at<http://waysandmeans.house.gov/MoreInfo.asp?section=52>.▪