NY State Legislative UpdateNEW YORK CITYVOICES: November/December 2001
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By Scott Transue, Director of Public Policy, MHA in New York State
The closing months of 2001 find the mental health community struggling to get the Community Reinvestment Act reauthorized. This act, passed in December of 1993, restructured the way local governments receive State aid for mental health services by allowing the reinvestment of funds into community-based services for persons with serious mental illness and children with serious emotional disturbances, based on savings due to the reduction of state-operated inpatient care for adults aged 22-64. For the period 1994-1999, the Act was responsible for a total of $164 million in redirected funds into local mental health facilities.
As the Act was passed with only a five-year authorization, continued State aid is now contingent upon annual legislative approval. The legislature went ahead and passed such authorization through September 30, 2001. However, due in large part to the tragic events of September 11, the Act was allowed to expire on September 30 without legislative action.
On October 18, Assemblyman Martin Luster, Chair of the Assembly Mental Health Committee, held a public hearing in Albany designed to gather input on a future plan for mental health service delivery across the state. Among those giving testimony was Mental Health Association in New York State (MHANYS) President/CEO Joseph Glazer. In his remarks, Mr. Glazer spoke of the fiscal crisis felt by local mental health providers statewide, many of whom will be forced to cut both staff and services unless money received through the Community Reinvestment Act is approved by the legislature through next Spring.
During the last round of budget negotiations in Albany, Assemblyman Luster made a strong push for reauthorization, but to no avail. The legislature is scheduled to reconvene in Albany shortly after Thanksgiving and it is imperative that providers, consumers, and other advocates make their voices heard that Reinvestment should be among their elected representatives' top priorities. A badly needed 2.5% cost-of-living increase for staff and a 10% Medicaid fee increase are among the items to be included in Reinvestment for this fiscal year.
On another front, the Mental Health Association's annual Legislative Conference was held on October 30. Among the items to be fought for during next year's legislative session are Mental Health Parity and the Medicaid Buy-In program.
Statewide mental health parity legislation would give those suffering from mental illness the same dignity and rights to insurance funding that those inflicted with physical illness receive. An underlying and erroneous belief exists among many insurers today that mental illness is not "curable" and, therefore, should not be entitled to the same insurance coverage as "treatable" physical illnesses are. In short, one could go to the hospital with heart disease and not be the least bit worried about whether an insurance plan would cover the costs associated with treatment. However, if one were to seek treatment for any number of mental disorders, including those associated with substance abuse, the chances of full insurance funding are low. In fact, most insurance plans impose a $50,000 lifetime limit for inpatient psychiatric treatment, compared to $1,000,000 for physical illness (heart disease, cancer, etc.). In addition, outpatient visits are often capped at 30 per year, with increasing co-payments as te 30-visit limit is reached.
As they often do, insurance companies across the state are turning the parity debate into one of economics by stating that full parity would cause a prohibitively high increase in their expenditures and a corresponding increase in premiums that would cause many company-sponsored plans to drop already deficient mental health coverage completely. However, a recent study by the United States Department of Health and Human Services shows that this is clearly not the case.
The study examined six private companies doing business on a nationwide scale that instituted full, or nearly full, parity within their health insurance plans. The companies surveyed stated that the increase in premium per individual was "small" and the corresponding expenses involved in providing full mental health treatment was also small when compared to the costs associated with losing a mentally-ill employee completely and having to hire and train a new one. In addition, a study done by the accounting firm Pricewaterhousecoopers in 2000 showed that full parity for mental health and substance abuse diagnoses would raise family premiums only 3.6% annually. This can certainly not be considered "cost prohibitive". Full parity legislation was just recently passed by the United States Senate and there is a companion bill now moving through the House of Representatives.
The Medicaid Buy-In program represents an important piece of legislation geared towards those individuals with mental illness who are able to hold gainful employment. As Governor Pataki is now famous for saying, "People with disabilities should not have to choose between going to work or having health insurance." When enacted into law, the Program will allow those individuals with disabilities to seek employment without losing the Medicaid benefits they now receive. In essence, the individuals would be allowed to "buy in" to the Medicaid program in much the same way that other individuals buy into their company-sponsored health plans.
Existing law now mandates that those earning above a certain income level automatically become disqualified for Medicaid. The Medicaid Buy-In proposal would increase those income ceilings for disabled individuals and allow them to retain needed benefits by contributing a small portion of their monthly earnings. As this would also save the State money on Medicaid costs, it has strong support from the Governor.
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