[Congressional Record Volume 142, Number 123 (Tuesday, September 10, 1996)]
[Extensions of Remarks]
[Pages E1551-E1552]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             NATIONAL MENTAL HEALTH IMPROVEMENT ACT OF 1996

                                 ______
                                 

                        HON. FORTNEY PETE STARK

                             of california

                    in the house of representatives

                      Tuesday, September 10, 1996

  Mr. STARK. Mr. Speaker, today, I am introducing the National Mental 
Health Improvement Act of 1996. This bill will provide parity in 
insurance coverage of mental illness and improve mental health services 
available to Medicare beneficiaries. It represents an urgently needed 
change in coverage to end discrimination against those with mental 
illness and to reflect the contemporary methods of providing mental 
health care and preventing unnecessary hospitalizations.
  The bill prohibits health plans from imposing treatment limitations 
or financial requirements on coverage of mental illness if similar 
limitations or requirements are not imposed on coverage of services for 
other conditions. The bill also expands Medicare part A and part B 
mental health and substance abuse benefits to include a wider array of 
settings in which services may be delivered. It eliminates the current 
bias in the law toward delivering services in general hospitals. It 
permits services to be delivered in a variety of residential and 
community-based settings. Through use of residential and community-
based services, costly inpatient hospitalization can be avoided. 
Services can be delivered in the setting most appropriate to the 
individual's needs.
  In 1991, as a nation we spent approximately $58 billion for the 
treatment of mental illness and another $17 billion for substance abuse 
disorders. Medicare expenditures in these areas for 1993 were estimated 
at $3.6 billion of 2.7 percent of Medicare's total spending. Over 80 
percent of that cost was for inpatient hospitalization.
  In addition to these direct medical costs there are also enormous 
social costs resulting from these disorders. It has been estimated that 
severe mental illness and substance abuse disorders cost $78 billion 
per year in lost productivity, lost earnings due to illness or 
premature death, and costs for criminal justice, welfare, and family 
care giving.
  Two to three percent of the population experience severe mental 
illness or substance abuse disorders. This population is very diverse. 
When given the appropriate treatment, some people's mental health 
problems never recur. Others have chronic problems that can persist for 
decades. And mental illness and substance abuse disorders include many 
different diagnoses, levels of disability, and duration of disability.
  This bill addresses two fundamental problems in both public, as well 
as private, health care coverage of mental illness today. First, 
despite the prevalence and cost of untreated mental illness, many 
health insurance plans do not cover the expense of mental illness 
treatment as they do other illnesses. Insurance companies set 
different, lower limits on the scope and duration of care for mental 
illness as compared to other illnesses. This means that people 
suffering from depression get less care and less coverage than those 
suffering a heart attack. Yet, both illnesses are real.
  Access problems to mental health benefits are mainly the result of 
these restrictions. About half of all health care plans limit coverage 
for hospitalization cost from 30 to 60 days. Outpatient benefits are 
restricted by the number of visits or dollar limits in 70 percent of 
the plans. Plan participants with mental health disorders are subject 
to arbitrary limits that are unrelated to treatment needs. Patients 
rarely have the choice of alternative plans with greater coverage since 
more than 80 percent of all plans limit inpatient care and more than 98 
percent of plans limit outpatient care.
  Access to equitable mental health treatment is essential. And it can 
be done at a reasonable price. By enacting this bill, we can reduce 
public sector spending by $16.6 billion, while only slightly increasing 
insurance premiums--just 4 percent or around $2.50 per person a month. 
The out-of-pocket expenses for individuals receiving care would be 
lowered by about $3.2 billion. Two dollars and fifty cents is a small 
price to pay for ending health care discrimination.
  Second, diagnosis and treatment of mental illness and substance abuse 
have changed dramatically since the Medicare benefit was designed. No 
longer are treatment options limited to large public psychiatric 
hospitals. The great majority of people can be treated on an outpatient 
basis, recover quickly and return to productive lives. Even those who 
once would have been banished to the back wards of large institutions 
can now live successfully in the community. But today's Medicare 
benefits do not reflect this change in mental health care.
  This bill would permit Medicare to pay for a number of intensive 
community-based services. In addition to outpatient psychotherapy and 
partial hospitalization that are already covered, beneficiaries would 
also have access to psychiatric rehabilitation, ambulatory 
detoxification, in-home services, day treatment for substance abuse and 
day treatment for children under age 19. In these programs, people can 
remain in their own homes while receiving services. These programs 
provide the structure and assistance that people need to function on a 
daily basis and return to productive lives.
  They do so at a cost that is much less than inpatient 
hospitalization. For example, the National Institute of Mental Health 
in 1993 estimated that the cost of inpatient treatment for 
schizophrenia can run as high as $700 per

[[Page E1552]]

day, including medication. The average daily cost of partial 
hospitalization in a community mental health center is only about $90 
per day. When community-based services are provided, inpatient 
hospitalizations will be less frequent and stays will be shorter. In 
many cases hospitalizations will be prevented altogether.
  This bill will also make case management available for those with 
severe mental illness or substance abuse disorders. People with severe 
disorders often need help managing many aspects of their lives. Case 
management assists people with severe disorders by making referrals to 
appropriate providers and monitoring the services received to make sure 
they are coordinated and meeting the beneficiaries' needs. Case 
managers can also help beneficiaries in areas such as obtaining a job, 
housing, or legal assistance. When services are coordinated through a 
case manager, the chances of successful treatment are improved.
  For those who cannot be treated while living in their own homes, this 
bill will make several residential treatment alternatives available. 
These alternatives include residential detoxification centers, crisis 
residential programs, therapeutic family or group treatment homes and 
residential centers for substance abuse. Clinicians will no longer be 
limited to sending their patients to inpatient hospitals. Treatment can 
be provided in the specialized setting best suited to addressing the 
person's specific problem.
  Right now in psychiatric hospitals, benefits may be paid for 190 days 
in a person's lifetime. This limit was originally established primarily 
in order to contain Federal costs. In fact, CBO estimates that under 
modern treatment methods only about 1.6 percent of Medicare enrollees 
hospitalized for mental disorders or substance abuse used more than 190 
days of service over a 5-year period.
  Under the provisions of this bill, beneficiaries who need inpatient 
hospitalization can be admitted to the type of hospital that can best 
provide treatment for his or her needs. Inpatient hospitalization would 
be covered for up to 60 days per year. The average length of hospital 
stay for mental illness in 1992 for an adult was 16 days and for an 
adolescent was 24 days. The 60-day limit, therefore, would adequately 
cover inpatient hospitalization for the vast majority of Medicare 
beneficiaries, while still providing some modest cost containment. 
Restructuring the benefit in this manner will level the playing field 
for psychiatric and general hospitals.
  The bill I am introducing today is an important step toward providing 
comprehensive coverage for mental health. Leveling the health care 
coverage playing field to include mental illness and timely treatment 
in appropriate settings will lessen health care costs in the long run. 
These provisions will also lessen the social costs of crime, welfare, 
and lost productivity to society. This bill will assure that the mental 
health needs of all Americans are no longer ignored. I urge my 
colleagues to join me in support of this bill.
  A summary of the bill follows:


                               in general

  The bill revises the current tax code to deter health plans from 
imposing treatment limitations or financial requirements on coverage of 
mental illness if similar limitations or requirements are not imposed 
on coverage of services for other conditions. The bill also revises the 
current mental health benefits available under Medicare to deemphasize 
inpatient hospitalization and to include an array of intensive 
residential and intensive community-based services.


                           title i provisions

  The bill prohibits health plans for imposing treatment limitations or 
financial requirements on coverage of mental illness if similar 
limitations or requirements are not imposed on coverage of services for 
other conditions.
  The bill amends the Tax Code to impose a tax equal to 25 percent of 
the health plan's premiums if health plans do not comply. The tax 
applies only to those plans who are willfully negligent.


                          title ii provisions

  The bill permits benefits to be paid for 60 days per year for 
inpatient hospital services furnished primarily for the diagnosis or 
treatment of mental illness or substance abuse. The benefit is the same 
in both psychiatric and general hospitals.
  The following intensive residential services are covered for up to 
120 days per year: Residential detoxification centers; crisis 
residential or mental illness treatment programs; therapeutic family or 
group treatment home; and residential centers for substance abuse.
  Additional days to complete treatment in an intensive residential 
setting may be used from inpatient hospital days, as long as 15 days 
are retained for inpatient hospitalization. The cost of providing the 
additional days of service, however, could not exceed the actuarial 
value of days of inpatient services.
  A facility must be legally authorized under State law to provide 
intensive residential services or be accredited by an accreditation 
organization approved by the Secretary in consultation with the State.
  A facility must meet other requirements the Secretary may impose to 
assure quality of services.
  Services must be furnished in accordance with standards established 
by the Secretary for management of the services.
  Inpatient hospitalization and intensive residential services would be 
subject to the same deductibles and copayment as inpatient hospital 
services for physical disorders.


                           part b provisions

  Outpatient psychotherapy for children and the initial 5 outpatient 
visits for treatment of mental illness or substance abuse of an 
individual over age 18 have a 20-percent copayment. Subsequent therapy 
for adults would remain subject to the 50-percent copayment.
  The following intensive community-based services are available for 90 
days per year with a 20-percent copayment--except as noted below: 
Partial hospitalization; psychiatric rehabilitation; day treatment for 
substance abuse; day treatment under age 19; in-home services; case 
management; and ambulatory detoxification.
  Case management would be available with no copayment and for 
unlimited duration for ``an adult with serious mental illness, a child 
with a serious emotional disturbance, or an adult or child with a 
serious substance abuse disorder--as determined in accordance with 
criteria established by the Secretary.''
  Day treatment for children under age 19 would be available for up to 
180 days per year.
  Additional days of service to complete treatment can be used from 
intensive residential days. The cost of providing the additional days 
of service, however, could not exceed the actuarial value of days of 
intensive residential services.
  A nonphysician mental health or substance abuse professional is 
permitted to supervise the individualized plan of treatment to the 
extent permitted under State law. A physician remains responsible for 
the establishment and periodic review of the plan of treatment.
  Any program furnishing these services--whether facility-based or 
freestanding--must be legally authorized under State law or accredited 
by an accreditation organization approved by the Secretary in 
consultation with the State. They must meet standards established by 
the Secretary for the management of such services.

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