Senate Bill S50004

                                 BILL NUMBER:  S50004

 TITLE OF BILL :

An act to amend chapter 748 of the laws of 2006, enacting "Timothy's
law", in relation to eliminating the expiration and repeal thereof


 PURPOSE :

This bill would make permanent Chapter 748 of the Laws of2006
("Timothy's Law").

 SUMMARY OF PROVISIONS :

Section 1 of the bill would amend section 8 of Chapter 748 of the Laws
of 2006 to repeal the expiration date.

Section 2 of the bill would provide for an immediate effective date.

 EXISTING LAW :

Chapter 748 of the Laws of2006 contains the provisions of Timothy's
Law, which: (1) requires group health insurance policies to provide a
minimum of 30 inpatient days and 20 outpatient visits for the
treatment of mental health conditions ("30/20 benefit"); (2) requires
              

large group health insurance policies (more than 50 employees or
members) to provide coverage for adults and children diagnosed with
biologically based mental illness (BBMI) and children diagnosed with
serious emotional disturbances (SED) on par with coverage provided for
other health conditions; and (3) requires the Insurance Department, in
consultation with the Office of Mental Health, to study the
effectiveness of mental health parity and report these findings.
Timothy's Law took effect on January 1, 2007, and sunsets on December
31, 2009.

Chapter 502 of the Laws of 2007 made technical amendments to Timothy's
Law to correct, for example: (1) unintended limitations on mental
health benefits; (2) use of terminology that does not reflect
insurance industry standards; and (3) inconsistent application to the
various types of entities writing health insurance coverage.

 JUSTIFICATION :

Mental illness affects one in four adults in the United States each
year. Studies have shown that one in ten individuals experience an
illness serious enough to impair functioning at home, school or work.
Despite its prevalence, mental illness often goes untreated. Recent
research concludes that the average age of onset of a mental illness
is 14 years of age, and that there is an average delay of nine years
from the onset of symptoms until the initial receipt of care. Delays
in receiving care often are due to a failure to recognize symptoms,
the stigma of seeking care, challenges in finding care, a fragmented
delivery system and the lack of insurance coverage.

In recent years, the costs associated with mental illness have ranked
ahead of cancer and heart disease. Many of these costs are
attributable to the lack of timely, quality care. Untreated mental
illness results in a higher number of individuals in prison or
participating in disability programs, receiving excess emergency and
long term health care, and facing homelessness, school failure and
suicide. In addition, major mental disorders cost the nation at least
$193 billion annually in lost earnings alone, according to a 2008
study funded by the National Institute of Mental Health.


Timothy's Law required the Superintendent of Insurance, in
consultation with the Office of Mental Health, to report on the
results of a study evaluating the costs under Timothy's Law of
providing the required coverage, the number of policyholders and group
contract holders which have elected to purchase mental health coverage
required to be made available under Timothy's Law (BBMI/SED benefits
in the small group market) and a comparison of the type and number of
illnesses for which coverage has been provided. Findings from the
study include: (1) access to 30120 mental health benefits with cost
sharing levels equal to those for other health benefits provided under
the same policies increased from 42% to 100% in the combined large and
small group markets; (2) access to coverage for biologically based
mental illnesses in adults and children and coverage for serious
emotional disturbances in children beyond the 30120 benefit increased
from 9.6% to 43.7% in the small group market and 11% to 100% in the
large group market; and (3) the 30/20 benefit increased monthly costs
in the small group market by approximately $1.04 per member per month,
amounting to 1/2 of 1% of total costs.

On October 3, 2008, as part of the Emergency Economic Stabilization
Act of 2008 (H.R.  1424) Congress passed and the President signed into
law the Paul Wellstone and Pete Domenici Mental Health Parity and
Addiction Equity Act of 2008. This Act does not mandate that employers
provide coverage for mental health benefits. However, those large
employer groups (more than 50 employees) that do provide mental health
benefits must do so in full parity with other medical benefits.
Timothy's Law mandates a minimum set of mental health benefits for all
employers. If Timothy's Law is allowed to sunset, many New Yorkers
could be left without mental health coverage if employers choose not
to purchase coverage with mental health benefits.

Timothy's Law has been successful in helping more New Yorkers receive
mental health benefits critical to ensuring their success at work, in
school and at home. Making Timothy's Law permanent will ensure that
New Yorkers continue to receive the quality mental health benefits
they need.

 BUDGET IMPLICATIONS :

This bill is not anticipated to have an additional impact on State
finances. A subsidy for providing the 30/20 benefit for small
employers is continued in the 2009-2010 enacted State budget at
approximately $100 million.

 LOCAL FISCAL IMPLICATIONS :

This bill would apply to local governments in the same way that it
would apply to any other employer. As this bill would simply make
permanent a current provision of law that is scheduled to sunset,
there would be no additional fiscal impact to local governments.

 EFFECTIVE DATE :
This bill would take effect immediately.