A BILL TO BE ENTITLED
AN ACT TO REQUIRE PARITY IN HEALTH INSURANCE COVERAGE FOR MENTAL ILLNESS AND CHEMICAL DEPENDENCY.
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 58‑51‑50 reads as rewritten:
"§ 58‑51‑50.  Coverage for chemical dependency treatment.
(a)	Definitions. – As used in this section, the term:
(1)	'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.
(2)	'Health benefit plan' has the same meaning as in G.S. 58‑3‑167.
(3)	'Insurer' has the same meaning as in G.S. 58‑3‑167.
(b)	Every insurer shall provide in each group health benefit plan 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  limits as are benefits for physical illness generally. For purposes of this subsection, 'limits' includes durational limits, deductibles, coinsurance factors, co‑payments, maximum out‑of‑pocket limits, annual and lifetime dollar limits, and any other dollar limits or fees for covered services.
(b1)	Weighted Average. – If a group health benefit plan contains annual limits, lifetime limits, co‑payments, deductibles, or coinsurance only on selected physical illness and injury benefits, and these benefits do not represent substantially all of the physical illness and injury benefits under the health benefit plan, then the insurer may impose limits on the chemical dependency treatment benefits based on a weighted average of the respective annual, lifetime, co‑payment, deductible, or coinsurance limits on the selected physical illness and injury benefits. The weighted average shall be calculated in accordance with rules adopted by the Commissioner.
(b2)	Case Management. – An insurer may use a case management program for chemical dependency treatment benefits to evaluate and determine medically necessary and medically appropriate care and treatment for each patient, provided that the program complies with rules adopted by the Commissioner. These rules shall ensure that case management programs are not designed to avoid the requirements of this section concerning parity between the benefits for chemical dependency treatment and those for physical illness generally.
(b3)	Medical Necessity. – Nothing in this section prohibits a group health benefit plan from managing the provision of benefits through common methods, including, but not limited to, preadmission screening, prior authorization of services, or other mechanisms designed to limit coverage to services for chemical dependency treatment only to those that are deemed medically necessary.
			
(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  Chapter 131E of the General Statutes:
a.	Chemical dependency units in licensed facilities; 
b.	Medical units;
c.	Psychiatric units; and
(2)	The following facilities or programs licensed  under Article 2 of Chapter 122C of the General Statutes:
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 under Article 2 of Chapter 122C of the General Statutes.
(4)	Duly licensed clinical social workers, duly certified substance abuse professionals, and licensed professional counselors working within the scope of practice in facilities described in subdivisions (1) and (2) of this subsection and in day/night programs or outpatient treatment facilities licensed under Article 2 of Chapter 122C of the General Statutes.
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.
	"
SECTION 2.  G.S. 58‑51‑55 reads as rewritten:
"§ 58‑51‑55.  No discrimination against mentally ill and chemically dependent individuals.
(a)	Definitions. – As used in this section, the term:
(1)	'Mental illness' has the same meaning as defined in G.S. 122C‑3(21), with a mental disorder defined in the Diagnostic and Statistical Manual of Mental Disorders, DSM‑IV, or a subsequent edition published by the American Psychiatric Association, except those mental disorders coded in the DSM‑IV or subsequent edition as substance‑related disorders (291.0 through 292.9 and 303.0 through 305.9) and those coded as 'V' codes.
(2)	'Chemical dependency' has the same meaning as defined in G.S. 58‑51‑50, with a mental disorder defined in the Diagnostic and Statistical Manual of Mental Disorders, DSM‑IV, or subsequent editions of this manual.

(b)	Coverage of Physical Illness. – No insurance company licensed in this State under 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.
										"
SECTION 3.  Article 3 of Chapter 58 of the General Statutes is amended by adding the following new section to read:
"§ 58‑3‑220. Mental illness benefits coverage.
(a)	Mental Health Parity Requirement. – An insurer shall provide in each group health benefit plan benefits for the necessary care and treatment of mental illness that are no less favorable than benefits for physical illness generally. Benefits for treatment of mental illness shall be subject to the same limits as benefits for physical illness generally. For purposes of this subsection, 'limits' includes durational limits, deductibles, coinsurance factors, co‑payments, maximum out‑of‑pocket limits, annual and lifetime dollar limits, and any other dollar limits or fees for covered services.
(b)	Weighted Average. – If a health benefit plan contains annual limits, lifetime limits, co‑payments, deductibles, or coinsurance only on selected physical illness and injury benefits, and these benefits do not represent substantially all of the physical illness and injury benefits under the health benefit plan, then the insurer may impose limits on the mental health benefits based on a weighted average of the respective annual, lifetime, co‑payment, deductible, or coinsurance limits on the selected physical illness and injury benefits. The weighted average shall be calculated in accordance with rules adopted by the Commissioner.
(c)	Case Management. – An insurer may use a case management program for mental illness benefits to evaluate and determine medically necessary and medically appropriate care and treatment for each patient, provided that the program complies with rules adopted by the Commissioner. These rules may ensure only that case management programs are not designed to avoid the requirement of this section for parity between the benefits for mental illness and those for physical illness generally.
(d)	Medical Necessity. – Nothing in this section prohibits a group health benefit plan from managing the provision of benefits through common methods, including, but not limited to, preadmission screening, prior authorization of services, or other mechanisms designed to limit coverage to services for mental illness only to those that are deemed medically necessary.
(e)	Definitions. – As used in this section:
(1)	'Health benefit plan' has the same meaning as in G.S. 58‑3‑167.
(2)	'Insurer' has the same meaning as in G.S. 58‑3‑167.
(3)	'Mental illness' has the same meaning as in G.S. 122C‑3(21), with a mental disorder defined in the Diagnostic and Statistical Manual of Mental Disorders, DSM‑IV, or a subsequent edition published by the American Psychiatric Association, except those mental disorders coded in the DSM‑IV or subsequent edition as substance‑related disorders (291.0 through 292.9 and 303.0 through 305.9) and those coded as 'V' codes."
SECTION 4.  G.S. 58‑65‑75 reads as rewritten:
"§ 58‑65‑75.  Coverage for chemical dependency treatment.
(a)	Definition. – 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)	Chemical Dependency Parity Requirement. – Every group insurance certificate or group subscriber contract under any hospital or medical plan governed by this Article and Article 66 of this Chapter 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 chemical dependency shall be subject to the same limits as are benefits for physical illness generally. For purposes of this subsection, 'limits' includes durational limits, deductibles, coinsurance factors, co‑payments, maximum out‑of‑pocket limits, annual and lifetime dollar limits, and any other dollar limits or fees for covered services.
(b1)	Weighted Average. – If a hospital or medical plan governed by this Article contains annual limits, lifetime limits, co‑payments, deductibles, or coinsurance only on selected physical illness and injury benefits, and these benefits do not represent substantially all of the physical illness and injury benefits under the plan, then the group insurance certificate or group subscriber contract may impose limits on the chemical dependency treatment benefits based on a weighted average of the respective annual, lifetime, co‑payment, deductible, or coinsurance limits on the selected physical illness and injury benefits. The weighted average shall be calculated in accordance with rules adopted by the Commissioner.
(b2)	Case Management. – A group insurance certificate or group subscriber contract may use a case management program for chemical dependency treatment benefits to evaluate and determine medically necessary and medically appropriate care and treatment for each patient, provided that the program complies with rules adopted by the Commissioner. These rules shall ensure that case management programs are not designed to avoid the requirements of this section concerning parity between the benefits for chemical dependency treatment and those for physical illness generally.
(b3)	Medical Necessity. – Nothing in this section prohibits a hospital or medical plan governed by this Article from managing the provision of benefits through common methods, including, but not limited to, preadmission screening, prior authorization of services, or other mechanisms designed to limit coverage to services for chemical dependency treatment only to those that are deemed medically necessary.
			
(d)	Provisions for benefits for necessary care and treatment of chemical dependency in group certificates or group contracts 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 Chapter 131E of the General Statutes:
a.	Chemical dependency units in licensed facilities;
b.	Medical units;
c.	Psychiatric units; and
(2)	The following facilities or programs licensed under Article 2 of Chapter 122C of the General Statutes:
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 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 under Article 2 of Chapter 122C of the General Statutes. 'Duly licensed psychologist' means licensed psychologists who hold permanent licensure and certification as health services provider psychologist issued by the North Carolina Psychology Board.
(4)	Duly licensed clinical social workers, duly certified substance abuse professionals, and licensed professional counselors working within the scope of practice in facilities described in subdivisions (1) and (2) of this subsection and in day/night programs or outpatient treatment facilities licensed under Article 2 of Chapter 122C of the General Statutes.
Provided, however, that nothing in this subsection shall prohibit any certificate or contract from requiring the most cost effective treatment setting to be utilized by the person undergoing necessary care and treatment for chemical dependency.
	"
SECTION 5.  G.S. 58‑65‑90 reads as rewritten:
"§ 58‑65‑90.  No discrimination against mentally ill and chemically dependent individuals.
(a)	Definitions. – As used in this section, the term:
(1)	'Mental illness' has the same meaning as defined in G.S. 122C‑3(21), with a mental disorder defined in the Diagnostic and Statistical Manual of Mental Disorders, DSM‑IV, or a subsequent edition published by the American Psychiatric Association, except those mental disorders coded in the DSM‑IV or subsequent edition as substance‑related disorders (291.0 through 292.9 and 303.0 through 305.9) and those coded as 'V' codes.
(2)	'Chemical dependency' has the same meaning as defined in G.S. 58‑65‑75, with a mental disorder defined in the Diagnostic and Statistical Manual of Mental Disorders, DSM‑IV, or subsequent editions of this manual.

(b)	Coverage of Physical Illness. – No service corporation governed by 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 individual or group subscriber contract in this State that affords benefits or coverage for 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.
										"
SECTION 6.  G.S. 58‑67‑70 reads as rewritten:
"§ 58‑67‑70.  Coverage for chemical dependency treatment.
(a)	Definition. – 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)	Chemical Dependency Requirement. – Every health maintenance organization that writes a health care plan on a group basis and that is subject to this Article shall provide benefits for the necessary care and treatment of chemical dependency that are not less favorable than benefits under the health care plan generally. Benefits for chemical dependency shall be subject to the same limits as are benefits under the health care plan generally. For purposes of this subsection, 'limits' includes durational limits, deductibles, coinsurance factors, co‑payments, maximum out‑of‑pocket limits, annual and lifetime dollar limits, and any other dollar limits or fees for covered services.
(b1)	Weighted Average. – If a group health plan contains annual limits, lifetime limits, co‑payments, deductibles, or coinsurance only on selected physical illness and injury benefits, and these benefits do not represent substantially all of the physical illness and injury benefits under the plan, then the health maintenance organization may impose limits on the chemical dependency treatment benefits based on a weighted average of the respective annual, lifetime, co‑payment, deductible, or coinsurance limits on the selected physical illness and injury benefits. The weighted average shall be calculated in accordance with rules adopted by the Commissioner.
(b2)	Case Management. – A health maintenance organization may use a case management program for chemical dependency treatment benefits to evaluate and determine medically necessary and medically appropriate care and treatment for each patient, provided that the program complies with rules adopted by the Commissioner. These rules shall only ensure that case management programs are not designed to avoid the requirements of this section concerning parity between the benefits for chemical dependency treatment and those for physical illness generally.
(b3)	Medical Necessity. – Nothing in this section prohibits a health maintenance organization from managing the provision of benefits through common methods, including, but not limited to, preadmission screening, prior authorization of services, or other mechanisms designed to limit coverage to services for chemical dependency treatment only to those that are deemed medically necessary.
			
(d)	Provisions for benefits for necessary care and treatment of chemical dependency in group health care plans 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 Chapter 131E of the General Statutes:
a.	Chemical dependency units in licensed facilities;
b.	Medical units;
c.	Psychiatric units; and
(2)	The following facilities or programs licensed under Article 2 of Chapter 122C of the General Statutes:
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 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 under Article 2 of Chapter 122C of the General Statutes.
(4)	Duly licensed clinical social workers, duly certified substance abuse professionals, and licensed professional counselors working within the scope of practice in facilities described in subdivisions (1) and (2) of this subsection and in day/night programs or outpatient treatment facilities licensed under Article 2 of Chapter 122C of the General Statutes.
Provided, however, that nothing in this subsection shall prohibit any plan from requiring the most cost effective treatment setting to be utilized by the person undergoing necessary care and treatment for chemical dependency.
	
(f)	Notwithstanding any other provision of this section or Article, any health maintenance organization subject to this Article that becomes a qualified health maintenance organization under Title XIII of the United States Public Health Service Act shall provide the benefits required under that federal Act, which shall be deemed to constitute compliance with the provisions of this section; and any health maintenance organization may provide that the benefits provided under this section must be obtained through providers affiliated with the health maintenance organization."
SECTION 7.  G.S. 58‑67‑75 reads as rewritten:
"§ 58‑67‑75.  No discrimination against mentally ill and chemically dependent individuals.
(a)	Definitions. – As used in this section, the term:
(1)	'Mental illness' has the same meaning as defined in G.S. 122C‑3(21), with a mental disorder defined in the Diagnostic and Statistical Manual of Mental Disorders, DSM‑IV, or a subsequent edition published by the American Psychiatric Association, except those mental disorders coded in the DSM‑IV or subsequent edition as substance‑related disorders (291.0 through 292.9 and 303.0 through 305.9) and those coded as 'V' codes.
(2)	'Chemical dependency' has the same meaning as defined in G.S. 58‑67‑70, with a mental disorder defined in the Diagnostic and Statistical Manual of Disorders, DSM‑IV, or subsequent editions of this manual.

(b)	Coverage of Physical Illness. – No health maintenance organization governed by this Chapter shall, solely because an individual has or had a mental illness or chemical dependency:
(1)	Refuse to enroll that individual in any health care plan covering 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.
										"
SECTION 8.  G.S. 58‑50‑155 reads as rewritten:
"§ 58‑50‑155.  Standard and basic health care plan coverages.
(a)	Notwithstanding G.S. 58‑50‑125(c), the standard health plan developed and approved under G.S. 58‑50‑125 shall provide coverage for all of the following:
(1)	Mammograms and pap smears at least equal to the coverage required by G.S. 58‑51‑57.
(2)	Prostate‑specific antigen (PSA) tests or equivalent tests for the presence of prostate cancer at least equal to the coverage required by G.S. 58‑51‑58.
(3)	Reconstructive breast surgery resulting from a mastectomy at least equal to the coverage required by G.S. 58‑51‑62.
(4)	For a qualified individual, scientifically proven bone mass measurement for the diagnosis and evaluation of osteoporosis or low bone mass at least equal to the coverage required by G.S. 58‑3‑174.
(5)	Prescribed contraceptive drugs or devices that prevent pregnancy and that are approved by the United States Food and Drug Administration for use as contraceptives, or outpatient contraceptive services at least equal to the coverage required by G.S. 58‑3‑178, if the plan covers prescription drugs or devices, or outpatient services, as applicable. The same exceptions and exclusions as are provided under G.S. 58‑3‑178 apply to standard plans developed and approved under G.S. 58‑50‑125.
(6)	Colorectal cancer examinations and laboratory tests at least equal to the coverage required by G.S. 58‑3‑179.
(7)	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. 58‑3‑220, respectively. The Plan may use a case management program in accordance with G.S. 58‑51‑50 and G.S. 58‑3‑220, respectively.(a1),	(a2) Repealed by Session Laws 1999‑197, s. 2.
(b)	Notwithstanding G.S. 58‑50‑125(c), in developing and approving the plans under G.S. 58‑50‑125, the Committee and Commissioner shall give due consideration to cost‑effective and life‑saving health care services and to cost‑effective health care providers."
SECTION 9.  This act becomes effective January 1, 2008, and applies to health benefit plans that are delivered, issued for delivery, or renewed on and after that date.  For purposes of this act, renewal of a health benefit policy, contract, or plan is presumed to occur on each anniversary of the date on which coverage was first effective on the person or persons covered by the health benefit plan.