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NAMI Testifies On Long-Term Disability Insurance Discrimination Against People With Serious Brain Disorders

Maine And Texas Consider Legislation To End Discriminatory Coverage

Chris Marshall
For Immediate Release
30 Mar 99
Two states have taken an important step in the fight to end discrimination against people with mental illnesses regarding long-term disability benefits. Both Maine and Texas have introduced legislation requiring all long-term disability policies or contracts to provide non-discriminatory coverage for mental illnesses.

The Maine Bill (H.P 1062) was the subject of a public hearing last week before the Maine Banking and Insurance Commission. The Commission voted almost unanimously to send the bill out to study, meaning that the Bureau of Insurance will study the impact of the bill. The study is scheduled for completion prior to the second legislative session next January.

This marks the first time that any state has addressed the widespread discriminatory practice of "capping" long-term disability benefits for mental illnesses. The two bills recently introduced in Texas (H.B. 3097 and 3098) are scheduled for a hearing today.

Most private long-term disability plans are employer provided. Typically, they will cover "physical disorders" (as they define them) through age 65, but will stop making disability payments within 24 months or less after the onset of "mental disorders." This "cap" on mental disorders is a serious problem for people with mental illnesses. Long-term disability policies are designed to replace income that would be lost if a disability prevents the policyholder from working. Policyholders pay premiums with the expectation of an income replacement "safety net" if they should become disabled.

Representing NAMI, Director of Legal Affairs Ron Honberg testified before the Maine Legislature Committee on Banking and Insurance. Dave Sturtevant, Managing Executive Director of NAMI Maine also testified on behalf of NAMI Maine, as did several consumers and family members. Additionally, Bill Trask, a vociferous advocate considered by many to be the driving force behind the bill, provided compelling testimony about his personal experience with discrimination in long-term disability insurance.

In his testimony, Ron Honberg applauded Representative Perry of Bangor and other cosponsors of H.P. 1062 for their commitment to addressing this particular form of discrimination against people with severe mental illnesses. "For people with severe mental illnesses, the loss of long-term disability benefits can impair recovery, lead to loss of home, and hope" Honberg stated.

NAMI’s testimony challenged the arguments offered by insurers to justify the disparity in coverage, categorically refuting any notions that lower coverage for mental illnesses is grounded in either science or economics. It emphasized that in the past twenty years, scientific understanding of the causes and characteristics of mental illnesses has increased significantly. As a result, there is today little debate within the scientific community that these brain disorders are in fact medical in nature – every bit as medical as heart disease, cancer, diabetes, and other disorders affecting organs of the body. Therefore, Honberg concluded, "there is no scientific justification for singling out medical disorders affecting one organ of the body – the brain for lower benefits than medical disorders affecting the heart, pancreas, or lungs."

Additionally, NAMI’s testimony brought to light the fact that there is no data to support the contention of the insurance industry that equitable long-term disability benefits for mental illnesses would be too expensive and would impose unfair cost increases on other policyholders. Insurance companies such as Aetna, Metropolitan Life and UNUM have defended themselves in long-term disability lawsuits by claiming in part that coverage for mental disorders would be easy to abuse and difficult to monitor. However, these companies have never produced any evidence in support of this argument.

NAMI’s testimony concluded by asserting that without alternative plausibleexplanations, widespread limits on coverage of mental illness can be attributed only to one reason – stigma and discrimination. Honberg urged the Committee to lead the way in ending this form of morally reprehensible and pervasive discrimination against people with severe mental illnesses. "Singling out severe mental illnesses for lower benefits in long-term disability policies is equivalent to singling out sickle-cell anemia or breast cancer for lower benefits in these policies. Racial or gender based discrimination of this kind would not be tolerated. Unfounded discrimination based on severe mental illnesses is no less abhorrent and should not be tolerated."

The full text of NAMI’s testimony is available on the NAMI website at