Is this law going to impose higher costs on our health and welfare fund?
Parity for mental health and addiction is likely to increase member use of these services, causing upward pressure on costs. However, studies indicate that savings accrue from reduced reliance on medical services, thus reducing upward pressure. Overall, the Congressional Budget Office estimates a 0.02 to 0.04 percent increase in the cost of group health plans. See the Business Case for more information.
Is this law going to spur a lot of unnecessary mental health and addiction treatment?
Mental illness is a common problem in the United States, with one in four adults experiencing mental illness in any given year. Among them are many Laborers and their family members. Also, construction workers display the highest and second highest rates, respectively, of drug and alcohol abuse. With these realities, expanded treatment is appropriate and will likely lead to reductions in medical care. See Member Assistance Programs for an effective gatekeeper.
What does parity mean for LIUNA H&W Funds?
- In consultation with their consultants and attorneys, plan sponsors should review their plans to prepare for compliance with the new law on January 1, 2010, or upon expiration of any collective bargaining agreement in effect on that date.
- If your plan provides more restrictive coverage for mental health care (e.g., depression, schizophrenia or eating disorders) or addiction (e.g., alcohol or drug abuse) than the most frequent treatment of physical conditions (e.g., cancer, broken bones or heart disease), the plan must either loosen its mental health restrictions or tighten limits on physical treatments so that both are handled in the same fashion.
- If your plan sets limits on hospital in-patient days and out-patient days for mental health or addiction, but not substantially for other physical ailments, the plan will need to be amended so that the same limits apply in both cases.
- f your plan has separate cost-sharing requirements or treatment limitations applicable only to mental health or addiction benefits, these must be either eliminated or applied to all benefits equally.
- If out-of-network coverage is provided for physical ailments, it must be extended to mental health and addiction as well.
- After changes, sponsors must update plan documents and communicate with members and their dependents.