Eliminates the expiration and repeal of Timothy's law

Summary of provisions

Section 1 of the bill would amend section 8 of Chapter 748 of the Laws of 2006 to repeal the expiration date.

Section 2 of the bill would provide for an immediate effective date.

Existing law

Chapter 748 of the Laws of 2006 contains the provisions of Timothy's Law, which: (1) requires group health insurance policies to provide a minimum of 30 inpatient days and 20 outpatient visits for the treatment of mental health conditions ("30/20 benefit"); (2) requires large group health insurance policies (more than 50 employees or members) to provide coverage for adults and children diagnosed with biologically based mental illness (BBMI) and children diagnosed with serious emotional disturbances (SED) on par with coverage provided for other health condi- tions; and (3) requires the Insurance Department, in consultation with the Office of Mental Health, to study the effectiveness of mental health parity and report these findings. Timothy's Law took effect on January 1, 2007, and sunsets on December 31, 2009.

Chapter 502 of the Laws of 2007 made technical amendments to Timothy's Law to correct, for example: (1) unintended limitations on mental health benefits; (2) use of terminology that does not reflect insurance indus- try standards; and (3) inconsistent application to the various types of entities writing health insurance coverage.

Justification

Mental illness affects one in four adults in the United States each year. Studies have shown that one in ten individuals experience an illness serious enough to impair functioning at home, school or work. Despite its prevalence, mental illness often goes untreated. Recent research concludes that the average age of onset of a mental illness is 14 years of age, and that there is an average delay of nine years from the onset of symptoms until the initial receipt of care. Delays in receiving care often are due to a failure to recognize symptoms, the

stigma of seeking care, challenges in finding care, a fragmented deliv- ery system and the lack of insurance coverage.

In recent years, the costs associated with mental illness have ranked ahead of cancer and heart disease. Many of these costs are attributable to the lack of timely, quality care. Untreated mental illness results in a higher number of individuals in prison or participating in disability programs, receiving excess emergency and long term health care, and facing homelessness, school failure and suicide. In addition, major mental disorders cost the nation at least $193 billion annually in lost earnings alone, according to a 2008 study funded by the National Insti- tute of Mental Health.

Timothy's Law required the Superintendent of Insurance, in consultation with the Office of Mental Health, to report on the results of a study evaluating the costs under Timothy's Law of providing the required coverage, the number of policyholders and group contract holders which have elected to purchase mental health coverage required to be made available under Timothy's Law (BBMI/SED benefits in the small group market) and a comparison of the type and number of illnesses for which coverage has been provided. Findings from the study include: (1) access to 30/20 mental health benefits with cost sharing levels equal to those for other health benefits provided under the same policies increased from 42% to 100% in the combined large and small group markets; (2) access to coverage for biologically based mental illnesses in adults and children and coverage for serious emotional disturbances in children beyond the 30/20 benefit increased from 9.6% to 43.7% in the small group market and 11% to 100% in the large group market; and (3) the 30/20 benefit increased monthly costs in the small group market by approxi- mately $1.04 per member per month, amounting to 1/2 of 1% of total costs.

On October 3, 2008, as part of the Emergency Economic Stabilization Act of 2008 (H.R. 1424) Congress passed and the President signed into law the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008. This Act does not mandate that employers provide coverage for mental health benefits. However, those large employer groups (more than 50 employees) that do provide mental health benefits must do so in full parity with other medical benefits. Timothy's Law mandates a minimum set of mental health benefits for all employers. If Timothy's Law is allowed to sunset, many New Yorkers could be left with- out mental health coverage if employers choose not to purchase coverage with mental health benefits.

Timothy's Law has been successful in helping more New Yorkers receive mental health benefits critical to ensuring their success at work, in school and at home. Making Timothy's Law permanent will ensure that New Yorkers continue to receive the quality mental health benefits they need.

Budget implications

This bill is not anticipated to have an additional impact on State finances. A subsidy for providing the 30/20 benefit for small employers is continued in the 2009-2010 enacted State budget at approximately $100 million.

Local fiscal implications

This bill would apply to local governments in the same way that it would apply to any other employer. As this bill would simply make permanent a current provision of law that is scheduled to sunset, there would be no additional fiscal impact to local governments.

Effective date

This bill would take effect immediately.