Survey Finds Few Firms Will Drop Mental Health Coverage

By Staff Report

May. 19, 2009

Only a few employers are considering dropping mental health coverage in response to new parity rules that take effect for plan years beginning after October 3, according to a survey.

Meanwhile, nearly 38 percent of responding employers plan to increase the promotion and use of employee assistance program services to help them achieve mental health parity, which is required under a 2008 law, concludes the survey conducted by the Partnership for Workplace Mental Health, a program of the American Psychiatric Foundation in Arlington, Virginia.

The Paul Wellstone and Pete Domenici Mental Health Benefits Parity and Addiction Equity Act requires companies with 50 or more employees to provide the same coverage for mental disorders—and in some cases, substance abuse treatment—as they do for medical illnesses. The parity requirement applies to self-funded plans and fully insured plans.

The survey found 7.1 percent of employers are considering dropping mental health benefits and 7.8 percent are thinking about discontinuing coverage for substance abuse treatment.

However, 73.5 percent said they would not drop mental health coverage, while 76.7 percent said they don’t plan to discontinue coverage for substance abuse treatment. Another 19.5 percent said they do not know whether they plan to drop mental health coverage, while 15.5 percent are undecided about whether to discontinue coverage for substance abuse treatment.

In addition to the 38 percent of respondents who plan to step up EAP use and promotion, 26.1 percent plan to increase promotion and disease management to achieve mental health parity.

In addition, 23.9 percent are considering adding or increasing use of case and/or disability management, while 21.7 percent plan to increase utilization management and/or prior authorization for mental health treatment.

A large proportion of respondents—35.7 percent—said they expected their health benefit costs to increase less than 2 percent as a result of instituting mental health parity; 23.8 percent said they anticipate costs will remain the same.

Another 16.7 percent said they expect cost increases exceeding 2 percent, while 21.4 percent said they were uncertain what costs will do. An equal number—1.2 percent—said they expect costs to increase more than 2 percent or decrease less than 2 percent.

The survey results reflect 143 responses primarily from human resource and benefits managers.

For more information about the survey or the Partnership for Workplace Mental Health, visit

Filed by Joanne Wojcik of Business Insurance, a sister publication of Workforce Management. To comment, e-mail

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