The following is a list of misconceptions that the mental
health lobby has forwarded about mental health parity, and the
facts that counter and disprove their arguments. This shows
the need for legislative caution and for the federal Mental
Health Equitable Treatment Act to be shelved. State mandated
mental health parity should also be abolished.
2.0 What They Say:
The federal Mental Health Equitable Treatment Act, which
provides for mental health parity, needs to be passed immediately.
2.1 What They Don’t Say:
According to the Congressional Budget Office (CBO), the
cost of mental health parity will be $5.4 billion and will
raise health insurance premiums by nearly 1%. However, this
is most likely far less than the real costs, as studies show
that low percentage increases are flawed. The legislation
will force companies and businesses that offer mental health
coverage—many of whom are already suffering tremendous financial
hardships because of the attacks on America—to foot this bill.7
The bill imposes a private-sector mandate on group health
plans and group health insurance issuers by prohibiting them
from imposing treatment limitations or financial requirements
for mental health benefits that differ from those placed on
medical and surgical benefits.8
Businesses that offer mental health coverage will not be
able to minimize the increases in insurance premiums (the
prior 1996 law had a 1% increase cap on premiums) and will
be forced to cover all of the disorders listed in the American
Psychiatric Association’s Diagnostic and Statistical Manual
of Mental Disorders (DSM).9
Yet candidly, Dr. Joseph Glenmullen, Clinical Instructor
in Psychiatry at Harvard Medical School, states, “…the current
DSM is a compendium of checklist diagnoses: cursory, superficial
menus of symptoms in which a minimum number (for example,
four of eight or three of twelve) is needed to make a particular
diagnosis….Any attempt to help patients understand themselves
and to effect real change is lost in the rush to diagnose
and medicate them.”10
Michael Tanner, Director of Health and Welfare Studies
at the CATO Institute, says, “Mandating parity for mental
health treatment amounts to a virtual blank check for the
mental health industry.”11
The National Center for Policy Analysis (NCPA), a Dallas-based
think-tank says that the Mental Health Equitable Treatment
Act “is more bad news for businesses.” Senior Fellow Greg
Scandlen said: “Congress is getting real good about spending
money. They love to pass mandates on the way you do business
because they can go home and tell voters they have done something
about a social problem—at no cost to taxpayers.” But this
law “will have a huge cost. It’s another straw on the camel’s
back,” he said.12
Dr. Mark Schiller, psychiatrist and Senior Fellow in Medical
Studies at the California-based Pacific Research Institute
for Public Policy, says, “…Mental health parity legislation
is not a civil rights issue. It is an issue of whether government
should force private companies to do something that is against
their business interests and which would have severe unintended
consequences. Increased mental health coverage will cost money….”13
3.0 What They Say:
“Since the Mental Health Parity Act became law, we have
seen that the costs have remained low and manageable.”14
3.1 What They Don’t Say:
In 2001, the National Center for Policy Analysis said that
critics of mental health parity have testified that “studies
showing little or no cost were flawed because they reviewed
plans which adopted managed care at the same time as mental
health parity so that the savings from the adoption of managed
care masked the cost of expanded mental illness coverage.”15
The CBO says that S.543 would cost the federal government
$5.4 billion over the next decade and private-sector health
insurers an additional $3 billion in 2002, which would further
increase in later years.”16 This
is saddling the nation’s companies with a financial burden
it ill deserves or needs in these times of terrorist threats
and economic upheaval.
In 2001, The National Association of Health Underwriters’
(NAHU) statement on Federal Health Benefit Mandates said that
insurance mandates “add to the cost of health insurance as
has been demonstrated at the state level. Estimates are that
there are now over 1000 benefit mandates in existence, which
various studies have shown add as much as 25% to the cost
of insurance premiums….”
The 1996 mental health parity mandate reportedly added
between an 8.4% and 11.4% increase to the cost of insurance,
according to one study. And this action on mental health has,
in turn, opened the door to other demands for federal benefit
mandates. “The more mandating the federal government does,
the more the demands for specialized mandates from all the
special interests disease groups,” NAHU stated. 17
California psychiatrist Mark Schiller says, “Academic research
concludes that mental health parity laws can increase insurance
premiums between 2.5% and 8.7% in the first year.”18
A 1999 Substance Abuse and Mental Health Services Administration
(SAMHSA) report revealed that substance abuse parity mandates
alone would increase insurance premiums by 3.6%.19
Mental health parity legislation was estimated to cost
the Oklahoma economy between $15.2 million and $49.5 million
per year, and premium increases will cause 4,100 to 13,600
Oklahoma residents to go without insurance.20
In Wisconsin on March 23, 2000, the Office of the Commissioner
of Insurance (OCI) determined that the mental health parity
mandate would add between $27 million and $54 million per
year to premium costs for health insurance companies in this
state, borne mostly by small businesses.21
4.0 What They Say:
Mental health parity will provide equal insurance for
all; not to provide parity is “discriminatory.”
4.1 What They Don’t Say:
Mental health parity will swell the ranks of uninsured,
thereby discriminating people out of the insurance market
completely. A 1998 study by Dr. William Custer showed that
people living in states with mandated mental health coverage
were nearly 6% more likely to be uninsured than people in
states without mandated benefit. Even the SAMHSA report released
in October 1999 supported this claim, showing that substance
abuse parity mandates would increase insurance premiums by
3.6%, a cost, according to the Congressional Budget Office,
that would increase the number of uninsured Americans by over
half a million a year. And private economists put this number
closer to one million.22
The Buckeye Institute in Dayton, Ohio, found that even
with a lower range of premium increases for mental health
parity, some 30,000 to 45,000 people in Ohio would become
uninsured. Higher premium increase estimates would produce
80,000 to 120,000 more uninsured.23
The Goldwater Institute in Arizona found similar results
with an estimated 11,000 to 37,000 Arizonans predicted to
lose medical coverage.24
Large majorities of people are unlikely to benefit from
mental health parity. In a RAND Institute study, it was found
that the generosity of insurance did not affect the mental
health status of the average person. They conclude, “For policies
targeted at the average person, improved mental health status,
per se, does not appear to provide a compelling argument in
favor of more generous coverage.”25
Next: Mental Health Parity Analysis continued
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