Mental Health Parity and Addiction Equity Act (MHPAEA)

In October 2008, Congress passed the Mental Health Parity and Addiction Equity Act (MHPAEA). The statute amended and expanded upon a variety of previously enacted parity provisions that appeared in the Employee Retirement Income Security Act (ERISA), the Public Health  Service Act (PHSA), and the Internal Revenue Code (Code).

In general, the MHPAEA requires group health plans that offer mental health and/or substance use disorder benefits to ensure that those benefits are equivalent to the medical/surgical benefits offered by the same plan. This concept is referred to as “parity of benefits.” Some of the areas in which parity is required include financial requirements such as deductibles, copayments, and coinsurance percentages, treatment limitations such as annual number of office visits covered, and the level of coverage offered to treatment by out-of-network providers.

Mental health parity legislation was first enacted at the federal level in 1996. That legislation — called the Mental Health Parity Act of 1996 (MHPA) — required group health plans to provide parity in certain very limited aspects of mental health benefits.  Specifically, plans were prohibited from imposing a lower cap on annual or lifetime mental health benefits than was applied to medical health benefits.