SD25 - Coverage for Therapies for Biologically Based Mental Illnesses

  • Published: 2001
  • Author: Special Advisory Commission on Mandated Health Insurance Benefits
  • Enabling Authority: Code of Virginia - § 9-298

Executive Summary:
INTRODUCTION

Senate Bill 165 was referred to the Special Advisory Commission on Mandated Health Insurance Benefits (Advisory Commission) by the Senate Committee on Commerce and Labor in the 2000 Session of the General Assembly. Senator John S. Edwards introduced the bill.

The Advisory Commission held a public hearing on November 9, 2000, in Richmond, to receive public comments on Senate Bill 165. Two concerned citizens and a representative of the Speech, Language and Hearing Association of Virginia (SHAV) spoke in support of the bill. The Virginia Association of Health Plans (VAHP) and a physician for Kaiser Permanente spoke in opposition to the bill. Written comments in support of the bill were received from a concerned citizen, the Autism Program of Virginia (TAP-VA), and SHAV. Written comments in opposition to the bill were received from the VAHP, the Health Insurance Association of America (HIAA), a physician for Kaiser Permanente, Trigon Blue Cross Blue Shield (Trigon), and the Virginia Chamber of Commerce.

SUMMARY OF PROPOSED LEGISLATION

The language of the bill amends existing § 2.1-20.1 in the health insurance requirements for state employees. The bill also amends § 38.2-3412.1:01 in Title 38.2 of the Code of Virginia. The section contains requirements for the coverage for biologically based mental illness. Group accident and sickness policies providing hospital, medical and surgical, or major medical coverage on an expense-incurred basis; each corporation providing group accident and sickness subscription contracts and health maintenance organization health care plans must provide coverage for biologically based mental illnesses. The term "biologically based mental illness" is defined as:

"...any mental or nervous condition caused by a biological disorder of the brain that results in a clinically significant syndrome that substantially limits the person's functioning; specifically, the following diagnoses are defined as biologically based mental illness as they apply to adults and children: schizophrenia, schizoaffective disorder, bipolar disorder, major depressive disorder, panic disorder, obsessive-compulsive disorder, attention deficit hyperactivity disorder, autism, and drug and alcoholism addiction."

The benefits for the biologically based mental illnesses may be different from benefits for other illnesses, conditions, or disorders if the benefits meet the medical criteria necessary to achieve the same outcomes achieved by the benefits for any other covered illness, condition, or disorder.

The coverage is not to be separate from coverage for any other illness, condition, or disorder for determining deductibles, benefit year or lifetime durational limits, benefit year or lifetime dollar limits, lifetime episodes or treatment limits, copayment and coinsurance factors and benefit year maximums for deductibles, copayment, and co-insurance.

The language in the bill requires the coverage to include speech and language therapy, occupational therapy, physical therapy, and related therapies that are relevant to the treatment of these illnesses, whether or not they effect a cure.

The existing section does not apply to (i) short-term travel, accident only, limited or specified disease policies; (ii) short-term nonrenewable policies of not more than six months' duration; (iii) policies, contracts, or plans issued in the individual market or small group market to employers with less than 25 employees; or (iv) policies issued for persons eligible for coverage under Medicare or any other coverage under state or federal government plans.

Section 38.2-3412.1:01 does not preclude the use of usual and customary procedures to determine the appropriateness of, and medical necessity for, treatment of biologically based mental illnesses provided that the determinations are made in the same manner as determinations for the treatment of any other illness, condition, or disorder.

Two other bills, Senate Bill 266 and Senate Bill 605, were introduced in the 2000 Session that would require similar coverage for state employees only. They were continued in the House Committee on Appropriations until 2001.

The original bill language requires coverage for some of the services mandated for young children under § 38.2-3418.5 that mandates coverage for early intervention services. The coverage under that mandate must be limited to $5,000 per year. This appears to create a conflict. The bill did not include an effective date for the new requirements.

The original bill language does not restrict the number of sessions or time periods for the therapies relating to biologically based mental illnesses. If it is intended that insurers are not allowed to restrict the therapies to situations when reasonable improvements can be made or restrictions on the amount of therapy that must be covered, there may also be a concern with the current language in subsection C. That subsection allows insurers to restrict coverage similar to other illnesses in terms of durational limits. It is uncertain how insurers would determine how to treat this benefit the same as any other illness.

Senator Edwards, patron of the bill, informed Advisory Commission staff that it was his intention to request an amendment to the bill. The amended bill revises the current requirements in § 38.2-3418.5 that, as previously mentioned, requires coverage for "early intervention services" in policies, contracts, and plans. The section requires coverage for medically necessary early intervention services in policies, contracts, and plans. The coverage shall be limited to $5,000 per insured or member per policy or calendar year and, except for the requirement in subsection C, the coverage is not to be subject to dollar limits, deductibles, and coinsurance factors no less favorable than for physical illness generally. The section defines "early intervention services" as

"medically necessary speech and language therapy, occupational therapy, physical therapy and assistive technology services and devices for dependents from birth to age three who are certified by the Department of Mental Health, Mental Retardation and Substance Abuse Services as eligible for services under Part H of the Individuals with Disabilities Education Act (20 U.S.C. § 1471 et seq.). 'Medically necessary early intervention services for the population certified by the Department of Mental Health, Mental Retardation and Substance Abuse Services' shall mean those services designed to help an individual attain or retain the capability to function age-appropriately within his environment, and shall include services that enhance functional ability without effecting a cure."

Subsection C of § 38.2-3418.5 provides that "The cost of early intervention services shall not be applied to any contractual provision limiting the total amount of coverage paid by the insurer, corporation or health maintenance organization to or on behalf of the insured or member during the insured's or member's lifetime."

Subsection D of § 38.2-3418.5 defines "Financial costs" as "...any copayment, coinsurance, or deductible in the policy or plan. Financial costs may be paid through the use of federal Part H program funds, state general funds, or local government funds appropriated to implement Part H services for families who may refuse the use of their insurance to pay for early intervention services due to a financial cost."

The section does not apply to short-term travel, accident only, limited or specified disease policies, policies or contracts designed for issuance to persons eligible for coverage under Medicare, or any other similar coverage under state or governmental plans or to short-term nonrenewable policies of not more than six months' duration.

The amended bill revises the definition of early intervention services to include "children ages three through twelve with diagnosed developmental disabilities" and medically necessary early intervention services is revised to include "medically necessary early intervention services for children ages three to twelve with diagnosed developmental disabilities." The amended bill restricts the provision in subsection C to "children from birth to age three who are certified by the Department of Mental Health, Mental Retardation and Substance Abuse Services." The amended bill also restricts the definition of "financial costs" for children birth to age three who are certified by the Department of Mental Health, Mental Retardation and Substance Abuse Services.

The language in the amended bill does not define "developmental disabilities."