GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1995

H	1 

HOUSE BILL 823

Short Title:  Mental Health Parity.	(Public)

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Sponsors: Representatives Alexander; Beall, Earle, Easterling, Fox, H. Hunter, McAllister, and Ramsey.

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Referred to:  Insurance.

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April 11, 1995

A BILL TO BE ENTITLED
AN ACT TO REQUIRE PARITY IN HEALTH INSURANCE FOR MENTAL ILLNESS AND CHEMICAL DEPENDENCY.
The General Assembly of North Carolina enacts:
Section 1.  G.S. 58-50-155 is amended by inserting a new subsection to read:
"( a2)	Notwithstanding G.S. 58-50-125(c), the standard health plan developed and approved under G.S. 58-50-125 shall provide coverage for the treatment of chemical dependency and mental illness that is at least equal to the coverage required by G.S. 58-51-50 and G.S. 58-51-55, respectively."
Sec. 2.  G.S. 58-51-50 reads as rewritten:
"§ 58-51-50.  Coverage for chemical dependency treatment.
(a)	As used in this section, the term 'chemical dependency' means the pathological use or abuse of alcohol or other drugs in a manner or to a degree that produces an impairment in personal, social or occupational functioning and which may, but need not, include a pattern of tolerance and withdrawal.
(b)	Every insurer that writes a policy or contract of group or blanket health insurance or group or blanket accident and health insurance that is issued, renewed, or amended on or after January 1, 1985, shall provide to its insureds benefits for the necessary care and treatment of chemical dependency that are not less favorable than benefits for physical illness generally. Benefits for treatment of chemical dependency shall be subject to the same durational limits, dollar limits, deductibles, and coinsurance factors as are benefits for physical illness generally.
			(d)	Provisions for benefits for necessary care and treatment of chemical dependency in group policies or group contracts of insurance shall provide benefit payments for the following providers of necessary care and treatment of chemical dependency:
(1)	The following units of a general hospital licensed under Article 5 of General Statutes Chapter 131E:
a.	Chemical dependency units in facilities licensed after October 1, 1984;
b.	Medical units;
c.	Psychiatric units; and
(2)	The following facilities or programs licensed after July 1, 1984, under Article 2 of General Statutes Chapter 122C:
a.	Chemical dependency units in psychiatric hospitals;
b.	Chemical dependency hospitals;
c.	Residential chemical dependency treatment facilities;
d.	Social setting detoxification facilities or programs;
e.	Medical detoxification or programs; and
(3)	Duly licensed physicians and duly licensed practicing psychologists and certified professionals working under the direct supervision of such physicians or psychologists in facilities described in (1) and (2) above and in day/night programs or outpatient treatment facilities licensed after July 1, 1984, under Article 2 of General Statutes Chapter 122C.
Provided, however, that nothing in this subsection shall prohibit any policy or contract of insurance from requiring the most cost effective treatment setting to be utilized by the person undergoing necessary care and treatment for chemical dependency.
	."
Sec. 3.  G.S. 58-51-55 reads as rewritten:
"§ 58-51-55.  No discrimination against the mentally ill and chemically dependent.
(a)	As used in this section, the term:
(1)	'Mental illness' has the same meaning as defined in G.S. 122C-3(21); and
(2)	'Chemical dependency' has the same meaning as defined in G.S. 58-51-50
with a diagnosis found in the Diagnostic and Statistical Manual of Mental Disorders DSM-IV or the International Classification of Diseases ICD/9/CM, or a later edition of those manuals.
(b)	No insurance company licensed in this State under the provisions of Articles 1 through 64 of this Chapter shall, solely because an individual to be insured has or had a mental illness or chemical dependency:
(1)	Refuse to issue or deliver to that individual any policy that affords benefits or coverages for any medical treatment or service for physical illness or injury;
(2)	Have a higher premium rate or charge for physical illness or injury coverages or benefits for that individual; or
(3)	Reduce physical illness or injury coverages or benefits for that individual.
(c)	Nothing in this section prevents any insurance company from excluding from coverage any physical illness or injury or mental illness or chemical dependency which has existed previous to coverage of the individual by the insurance company or from refusing to issue or deliver to that individual any policy because of the underwriting of any physical condition whether or not related to mental illness or chemical dependency.
(d)	This section applies only to group health insurance contracts covering 20 or more employees.
(e)	Every insurer that writes a policy or contract of group or blanket health insurance or group or blanket accident and health insurance that is issued, renewed, or amended on or after January 1, 1996, shall provide to its insureds benefits for the necessary care and treatment of mental illness that are not less favorable than benefits for physical illness generally.  Benefits for treatment of mental illness shall be subject to the same durational limits, dollar limits, deductibles, and coinsurance factors as are benefits for physical illness generally."
Sec. 4.  G.S. 135-40.7A reads as rewritten:
"§ 135-40.7A.  Special provisions for chemical dependency.
(a)	Benefits for treatment of chemical dependency are covered by the Plan and shall be subject to the same deductibles, durational limits, and coinsurance factors as are benefits for physical illness generally.
			(c)	Notwithstanding any other provision of this Part, provisions for benefits for necessary care and treatment of chemical dependency under this Part shall provide for benefit payments for the following providers of necessary care and treatment of chemical dependency:
(1)	The following units of a general hospital licensed under Article 5 of General Statutes Chapter 131E:
a.	Chemical dependency units in facilities licensed after October 1, 1984;
b.	Medical units;
c.	Psychiatric units; and
(2)	The following facilities licensed after July 1, 1984, under Article 2 of General Statutes Chapter 122C:
a.	Chemical dependency units in psychiatric hospitals;
b.	Chemical dependency hospitals;
c.	Residential chemical dependency treatment facilities;
d.	Social setting detoxification facilities or programs;
e.	Medical detoxification facilities or programs; and
(3)	Duly licensed physicians and duly licensed practicing psychologists, certified clinical social workers, certified clinical specialists in psychiatric and mental health nursing, and certified professionals working under the direct supervision of such physicians or psychologists in facilities described in (1) and (2) above and in day/night programs or outpatient treatment facilities licensed after July 1, 1984, under Article 2 of General Statutes Chapter 122C.
Provided, however, that nothing in this subsection shall prohibit the Plan from requiring the most cost effective treatment setting to be utilized by the person undergoing necessary care and treatment for chemical dependency."
Sec. 5.  G.S. 135-40.7B reads as rewritten:
"§ 135-40.7B.  Special provisions for mental health benefits.
(a)	Benefits for the treatment of mental illness are covered by the Plan and shall be subject to the same deductibles, durational limits, and coinsurance factors as are benefits for physical illness generally.
(b)	Notwithstanding any other provision of this Part, the following necessary services for the care and treatment of mental illness shall be covered under this section: allowable institutional and professional charges for inpatient psychiatric care, outpatient psychotherapy, intensive outpatient crisis management, partial hospitalization treatment, and residential care and treatment.  The benefits provided by this section are separate and apart from those provided by G.S. 135-40.7A.
(c)	Notwithstanding any other provisions of this Part, the following providers are authorized to provide necessary care and treatment for mental illness under this section:
(1)	Licensed psychiatrists;
(2)	Licensed or certified doctors of psychology;
(3)	Certified clinical social workers;
(4)	Psychiatric nurse specialists;
(5)	Other social workers under the direct employment and supervision of a licensed psychiatrist or licensed doctor of psychology;
(6)	Psychological associates with a master's degree in psychology under the direct employment and supervision of a licensed psychiatrist or licensed or certified doctor of psychology;
(7)	Licensed psychiatric hospitals and licensed general hospitals providing psychiatric treatment programs; and
(8)	Certified residential treatment facilities, community mental health centers, and partial hospitalization facilities.
(d)	Benefits provided under this section shall be subject to a managed, individualized care component consisting of (i) inpatient utilization review through preadmission and length-of-stay certification for scheduled inpatient admissions and length-of-stay reviews for unscheduled inpatient admissions, and (ii) a network of qualified, available providers of inpatient and outpatient psychiatric treatment psychotherapy.  Where qualified preferred providers of inpatient and outpatient care are reasonably available, use of providers outside of the preferred network shall be subject to a twenty percent (20%) coinsurance rate up to five thousand dollars ($5,000) per fiscal year to be assessed against each covered individual in addition to the general coinsurance percentage and maximum fiscal year amount specified by G.S. 135-40.4 and G.S. 135-40.6."
Sec. 6.  This act becomes effective January 1, 1996, and applies to all policies or contracts issued, renewed, or amended on or after that date.