November 20, 1998

The federal Health Care Financing Administration has approved plans by 44 states to expand their health insurance coverage to uninsured children with some form of mental health benefits. At press time, the most recent states approved to implement the State Children's Health Insurance Program (SCHIP) were Virginia, Louisiana, and North Dakota.

Since President Clinton signed the Balanced Budget Act last year authorizing $24 billion for federal matching funds for SCHIP, almost half of the 44 states have chosen to expand their current Medicaid program to cover more uninsured children, according to Hilary Wilson, an associate director of APA's Division of Government Relations.

Mental health benefits provided under Medicaid's Early Periodic Screening, Diagnosis, and Treatment program (EPSDT) include psychotherapy, prescriptions, partial hospitalization, day treatment, emergency care, and crisis programs.

Most of the nine states that have combined an expanded Medicaid program with a state-run health insurance plan, such as New Hampshire's Healthy Kids, will use Medicaid's EPSDT program for mental health benefits, according to Wilson.

A 1997 study funded by the Coalition for Fairness in Mental Illness Coverage, which APA chairs, suggested that Medicaid expansions may be a better option than using private insurance because the mental health benefits are typically more comprehensive and do not have arbitrary limits, Wilson noted.

The remaining 13 states, including Colorado and Nevada, have developed a new children's health insurance plan with some form of mental health benefits. For example, in Colorado neurobiological-based brain disorders are covered the same as other illnesses. For other mental illnesses, children have 45 days of inpatient coverage with no copayment. There is a 20-day limit on outpatient care; families whose income is at 150 percent or less of the poverty income level have a $2 copay, and families above that level have a $5 copayment. Prescription medication is also covered with a copayment.

Nevada provides 20 days of inpatient mental health services with no copayment and 20 outpatient mental health service visits. Mental health services must be authorized by a managed care program and only include evaluation, crisis intervention, and psychotherapy.

"Despite the variations among states in their mental health benefits, services are being expanded to children who were previously ineligible for Medicaid and did not have private insurance, which is a very positive step," said Wilson.

More information on state SCHIP plans approved by HCFA is available at the Web site of the Academy of Child and Adolescent Psychiatry at www.aacap.org/.