December 24, 2006

New York Approves Insurance Parity Bill

New York's Governor George Pataki signed into law a bill known as Timothy's Law which was to mandate that health insurance providers provide coverage for mental health and substance abuse services that is "on par" with all other health care services covered under that policy. However, coverage that would have mandated treatment for alcohol and drug addiction was removed from the bill.

Detractors of the law have stated that demanding insurance parity will raise insurance premiums, however, studies have shown that the increased cost is actually minimal, with advocates of Timothy's Law citing a mere additional $1.26 per person per month. Governor Pataki, before signing the bill, had satisfied himself that the bill would not unduly raise health insurance costs.

The New York Times reports that in spite of the attention this new law is getting, because it is on a state level rather than a federal level, it will not have a far-reaching impact. This is because most people have health insurance through large employers or unions. These plans are usually governed by federal law, which exempts them from having to comply with state laws. In addition, small employers were exempted from having to comply, although the law pledges that the state will develop a method to help small businesses, who wish to purchase equivalent coverage (parity) for mental and physical illness, pay for that coverage.

According to a press release issued by New York State Sen. John A. DeFrancisco:

"Timothy's Law" will require insurance policies to cover 30 inpatient days of treatment and 20 outpatient days of treatment for all mental illnesses. The law also mandates that insurance companies fully cover biologically based mental illnesses, including schizophrenia/psychotic disorders, major depression, bipolar disorder, delusional disorders, panic disorder, obsessive compulsive disorder, bulimia, anorexia and binge eating.

Under the legislation, a broad range of mental illnesses and conditions specifically related to children under the age of 18 will also be covered. Insurance policies will now be required to cover treatment for: attention deficit disorder, disruptive behavior disorders or pervasive development disorders where there are serious suicidal symptoms or other life-threatening self-destructive behavior; significant psychotic symptoms (hallucinations, delusion, bizarre behaviors); behavior caused by emotional disturbances that placed the child at risk of causing personal injury or significant property damage; or behavior caused by emotional disturbances that placed the child at substantial risk of removal from the household.

The law will be in effect from the beginning of 2007 through the end of 2009, after which time it can be amended based on findings and recommendations found in the interim.

Read the article: Pataki Signs Bill on Parity in Health Care

Other Resources: Timothy's Law


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