Mental Health Parity Act Flawed

New Mexico’s Rio Grande Foundation has posted a response to the National Center’s press release yesterday about the Mental Health Parity Act, which is being introduced by Senators Ted Kennedy, Mike Enzi, and New Mexico’s own Pete Domenici.

Our release says:

Senators Domenici, Enzi and Kennedy To Make Health Insurance More Expensive With So-Called Mental Health Parity ActLegislation advancing through in the U.S. Senate to regulate so-called mental health parity will instead simply make health insurance more expensive or mental health benefits less available.

“This is a surefire way to wreak more havoc on health insurance markets,” says David Hogberg, a senior policy analyst with The National Center for Public Policy Research. Hogberg notes that 33 states have already imposed mental health parity mandates on their insurance markets. According to the Council for Affordable Health Insurance, these mandates have increased insurance costs by an estimated five to ten percent.

“The Mental Health Party Act of 2007,” sponsored by Senators Pete Domenici (R-NM), Mike Enzi (R-WY) and Ted Kennedy (D-MA), forces the health insurance programs of large businesses that cover mental illnesses to treat mental illness the same way it treats other illnesses. In practice, this means that insurance programs cannot have different co-pays and deductibles for mental health services and procedures than they have for other health services and procedures.

“If you force insurance programs to cover mental health the same way as other illnesses, the result is more expensive health insurance. That means more businesses will increase their insurance premiums or drop their insurance altogether, resulting in an increase in the uninsured,” says Hogberg. “The more likely result is that businesses will simply drop their mental illness coverage from their insurance policies, meaning that employees will have less access to mental health benefits.”

“For all the hype and worry in Congress about making health insurance more affordable and preventing the unraveling of the employer-based health insurance system, you’d think the senators would have more sense than this,” noted Hogberg.

Thus far, the Mental Health Parity Act of 2007 has been approved in the Senate by Senator Kennedy’s Health, Welfare, Labor and Pensions Committee. A similar measure is being pushed in the House of Representatives by Senator Kennedy’s son, Patrick Kennedy (D-RI), along with Reps. Jim Ramstad (R-MN) and Anna Eshoo (D-CA).

“Congress needs to come to its senses about the Mental Health Parity Act,” said Hogberg. “This is exactly the sort of measure that has made health insurance costs rise so precipitously in recent years.”

The National Center for Public Policy Research is a communications and research foundation supportive of a strong national defense and dedicated to providing free market solutions to today’s public policy problems. We believe that the principles of a free market, individual liberty and personal responsibility provide the greatest hope for meeting the challenges facing America in the 21st century.