Disability insurance next on state push for parity
Building off laws requiring health insurers to cover mental health treatment the same way as physical ailments, a legislative push is now underway to extend the same parity to disability insurance.
Mental health advocates on Thursday urged the Joint Committee on Financial Services to take action on a bill that would ban insurance companies from limiting the disability benefits for claimants affected by behavioral health disorders in ways they do not limit benefits for people who have been physically disabled.
Rep. Ruth Balser, a Newton Democrat who sponsored the bill, said that time limits on payouts for mental health disability claims -- typically two or three years -- amount to a form of discrimination.
"If you're going to cover heart disease, you wouldn't not cover cancer, and you wouldn't say we're not going to cover cancer because it's too expensive," Balser said. "This is the same thing."
Insurance industry representatives said Balser's bill (H 786) would restrict consumer choice, driving up costs by taking away less expensive options from employers who choose not to offer unlimited mental health disability coverage.
"What if the commonwealth told every consumer that they had to buy a Volkswagen turbo diesel with a manual transmission?" said insurance advisor and financial planner Matthew Berard. "Where would that consumer be today?"
A Massachusetts law requiring parity for mental health treatment coverage was passed in 2000 and broadened in 2008. A Sen. Brian Joyce amendment to a substance abuse prevention bill passed by the Senate earlier this month seeks to deter insurance carriers from violating the parity law by requiring them to provide information on claim denials, with potential fines for wrongful denials.
Susan Fendell, senior attorney for the state's Mental Health Legal Advisors Committee, said that the way disability insurance handles mental health is based on stigmas and ignores that treatment can improve conditions.
"The current practice in the disability insurance industry in Massachusetts is based on outdated views of mental health," Fendell said. "They seem to think it's not real and the only way you can tell it's real is if a person is in the hospital."
Supporters said the parity measure would be more cost-effective for the government, allowing people whose mental health issues keep them out of work to meet their needs without relying on Social Security, food stamps, or government health care programs.
"I'm glad those programs are there for the people who need them, but these people have deliberately, systematically applied and paid for private coverage so that they would not have to resort to using government resources for the people who cannot afford these monthly premiums, who do not work in jobs that provide them insurance benefits," said Finn Gardiner, the Boston community coordinator for the Autistic Self Advocacy Network.
Insurance industry experts offered a contrasting perspective, telling the committee that the coverage requirement would drive up the cost of disability insurance to the point where fewer people could afford it and more had to rely on government programs.
"More and more consumers, workers in the workplace, are being expected to pick up a greater share of their benefits cost," said Chuck Piacentini, vice president of state legislative affairs at Unum. "As more and more of the cost gets shifted onto consumers, they have to make choices between what coverage they choose to have and what coverage they choose not to have."
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