Reforming State Mental Health Parity Law

This Article is the final installment in a three-part project that presents a comprehensive challenge to lingering legal distinctions between physical and mental illness in the context of health insurance. The first installment in this series narrowly inquired as to whether the postpartum mood disorders should be classified as physical or mental illnesses in a range of health law contexts, including the context of health insurance. The second installment was broader in scope and challenged a number of federal provisions that allow publicly- and privately-funded health care programs and plans to provide mental health insurance benefits that are less comprehensive than their physical counterparts. The second installment also proposed comprehensive federal reforms, including the extension of federal mental health parity law to individuals who do not currently benefit from mental health parity law. This third and final Article undertakes an important correction of state mental health parity law. The first section of this Article examines in detail the mental health parity laws of four states: Idaho, Maryland, Nevada, and Vermont. I categorize these states’ divergent mental health parity laws by their breadth and depth of application, whether they mandate the option or inclusion of mental health and substance use disorder benefits, and the extent to which parity between physical and mental health benefits is required in all rates, terms, and conditions. The second section of this Article justifies and proposes amendments that would not only conform these and other state laws to minimum federal requirements, but would also expand state mental health parity law to all health plans subject to state insurance regulation, require inclusion of mental health and substance use disorder benefits in such plans, and eliminate artificial “biologically-based” and “severe mental illness” distinctions. The third section of this Article offers a uniform mental health parity law for consideration by state legislatures