Lansing Eyes Mental Health Parity

September 26, 2003
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LANSING — Legislation requiring employers to provide mental health treatment coverage as part of their employee health benefits is expected to come up for Michigan Senate consideration this fall.

The proposal is renewing debate on the cost of new health care mandates vs. claimed long-term benefits.

Two mental health parity bills that State Sen. Beverly Hammerstrom, R-Temperance, introduced in the spring would require health plans to offer mental health benefits that are not more restrictive or limiting than other covered medical benefits.

Her proposals’ mandates would apply to Blue Cross Blue Shield of Michigan, to commercial health insurers and to health maintenance organizations.

Both sides in the hotly debated issue cite data that they claim show either the benefits or adverse affects of mental health parity mandates.

Opponents see the bills as creating another unfunded government mandate that’s bound to drive up the cost of group health coverage premiums.

They argue that the increases would come at a time when employers and employees are already struggling to deal with double-digit annual premium increases of the last few years.

Advocates say mental health parity would help people with mental health problems receive treatment before their condition reaches the point that it affects their general medical condition.

Earlier recognition and treatment of mental health problems, advocates argue, would ultimately result in long-term cost savings to the health care system.

The advocates also argue that mental health parity would, in the long run, benefit employers through healthier, happier and more productive employees.

“Pennies up front save dollars in the back end of the overall health system,” said Wayne Creelman, M.D.,executive vice president and medical director for Pine Rest Christian Mental Health Services in Grand Rapids.

“That’s what the whole idea of health prevention, quite frankly, is all about.”

Creelman, the current president of the Kent County Medical Society, points to an article in the June 18 edition of the Journal of the American Medical Society.

Researchers compiling the article estimated that, nationwide, depression costs $44 billion annually in lost worker productivity.

Creelman and other advocates of mental health parity contend that it would enable persons with mental afflictions such as depression to have their condition diagnosed and treated earlier, saving money in the long run for the health system and employers.

“You’ll be able to treat illnesses more completely at the grassroots level,” he said.

Those opposing the bill include business advocates, such as the Michigan Chamber of Commerce and the National Federation of Independent Businesses, who simply don’t buy that argument.

Charles Owens, director of the NFIB’s Michigan office, cites data showing that for every 1 percent rise in health care costs, 300,000 people lose their health coverage as employers drop coverage.

He and other critics of the legislation worry that mental health parity is one more mandate that would only make it harder for employers to afford health coverage.

They contend, moreover, that the measure would lead more employers to drop health care coverage altogether, creating a greater burden on the remainder of firms that provide such coverage.

A Senate Fiscal Agency analysis on the bills, SB 4 and SB 5, cites studies that estimate the cost of mental health parity as adding amounts ranging from insignificant to 3.4 percent of the cost of a health premium.

“It pays dividends for a few people at the expense of others,” Owens said.

“If you can’t afford health insurance as it is now, how are you going to support mental health?”

He calls data suggesting long-term cost savings as “hocus pocus” and “bogus numbers,” saying such savings are hard to quantify.

Creelman responds that concerns over higher costs from mental health parity are nothing more than “scare tactics” from opponents.

“The problem is they just don’t see the forest between the trees,” he said.

While they differ on the issue, Owens and Creelman do see the mental health parity bills making it out of the Senate Health Policy Committee that Sen. Hammerstrom chairs.

Owens believes they will also pass the full Senate and go on for consideration in the House.

Hammerstrom’s bills are not the only legislation dealing with mental health parity.

A bill introduced Sept. 16 by State Sen. Cameron Brown, R-Fawn River Township, would provide employers a 2 percent credit on the state’s Single Business Tax if they offer mental health and substance abuse services as part of their health plan.    

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