Medicare Mental Health Parity Approved

Update: Parity Survives Presidential Veto

July 15, 2008--Congress voted quickly and overwhelmingly to override the President's veto, by 383-41 in the House and 70-26 in the Senate. The Medicare Improvements Act, with equal coverage of mental health services, becomes law.

Just a few days after reconvening from the July recess, the Senate joined the House in passing the Medicare Improvements for Patients and Providers Act of 2008 (H.R. 6331) by a veto-proof 69-30. Less-publicized than the provision that would halt a payment cut for physicians providing treatment to Medicare patients is new equity between mental health and medical coverage.

When enacted, the bill will end a longstanding requirement that affects Medicare beneficiaries who need outpatient mental health services. Currently, they face a discriminatory 50% co-insurance for outpatient psychotherapy and services furnished by non-physician mental health professionals (20% for prescription and monitoring of medications to treat mental illness). In contrast, other outpatient health services require only a 20% co-payment.

The present outdated and unfair higher co-payment for mental health services has served as an incentive to use inpatient or institutional care instead of outpatient services. It has also led seniors and people with disabilities who rely on Medicare to forgo needed mental health treatment.

The bill would establish mental health parity within the Medicare program, phasing in a reduction of the higher co-payment over six years, to 20% in 2014.

The House passed H.R. 6331 by a vote of 355-59 on June 24th. The overwhelming majority in both chambers makes a veto override likely, should the Administration carry out its earlier threat. The passage of H.R. 6331 is a significant accomplishment and makes great strides in modernizing Medicare.