The new mental health parity law has important limitations and exceptions.

David Rubenzahl, president of the Maxon Company, Irvington, N.Y., a benefit plan administrator, makes that point in an analysis of the new Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008.

The act was folded into H.R. 1424, the bill that served as the vehicle for passage of the Emergency Economic Stabilization Act, and President Bush signed it into law Friday along with EESA.

The federal mental health parity law that has been in effect requires health plans that offer mental health benefits to offer the same amount of coverage for mental health care that they offer for other types of medical care.

Like the old law, the new law does not require health plans to provide mental health benefits at all, Rubenzhal says.

Plans that do offer mental health benefits must offer equity in financial requirements, treatment limits and out-of-network coverage, but there is an opt-out provision for plans that can provide actuarial evidence showing that the act is increasing their costs by at least 2%, Rubenzhal says.

After 1 year, plans can opt out if they show the act increases their costs by 1%, Rubenzhal says.

In some cases, Rubenzhal says, plans that object to the act but cannot show or do not want to show that the act increases their costs could drop mental health coverage.