Mandated benefits (also known as “mandated health insurance benefits” and “mandates”) are benefits that are required to cover the treatment of specific health conditions, certain types of healthcare providers, and some categories of dependents, such as children placed for adoption. A number of health care benefits are mandated by either state law, federal law — or in some cases — both. Between the federal government and the states there are upwards of 2000 health insurance mandates.
Although mandates continue to be added as health insurance requirements, they are controversial. Patient advocates claim that mandates help to ensure adequate health insurance protection while others (especially health insurance companies) complain that mandates increase the cost of healthcare and health insurance.
Mandated Health Insurance Benefit Laws
Mandated health insurance laws passed at either the federal or state level usually fall into one of three categories:
- Health care services or treatments that must be covered, such as substance abuse treatment, contraception, in vitro fertilization, maternity services, prescription drugs, and smoking cessation.
- Healthcare providers other than physicians, such as acupuncturists, chiropractors, nurse midwives, occupational therapists, and social workers.
- Dependents and other related individuals, such as adopted children, dependent students, grandchildren, and domestic partners.
The mandated benefit laws most often apply to health insurance coverage offered by employers and private health insurance purchased directly by an individual.
Mandated Insurance Benefits and the Cost of Health Insurance
Most people – whether for or against mandates – agree that mandated health benefits increase health insurance premiums. Depending on the mandated benefit and how that benefit is defined, the increase cost of a monthly premium can increase from less than 1% to more than 5%.
Trying to figure out how a mandated benefit will impact an insurance premium is very complicated. The mandate laws differ from state to state and even for the same mandate, the rules and regulations may vary.
For example: Most states mandate coverage for chiropractors, but the number of allowed visits may vary from state to state. One state may limit the number of chiropractor visits to four each year, while another state may allow up to 12 chiropractor visits each year. Since chiropractor services can be expensive, the impact on health insurance premiums may be greater in the state with the more generous benefit.
Additionally, the lack of mandates could also increase the cost of healthcare and health insurance premiums. If someone who has a medical problem goes without necessary health care because it is not covered by her insurance, she may become sicker and need more expensive services in the future.
Federal Mandated Health Benefits
Federal law includes a number of insurance-related mandates.
COBRA continuation coverage
COBRA provides certain former employees and their dependents the right to continue coverage for a maximum of 18 to 36 months.
Coverage of adoptive children
Certain health plans must provide coverage to children placed with families for adoption under the same conditions that apply to natural children, whether the adoption has become final or not.
Mental health benefits
If a health plan covers mental health services, the annual or lifetime dollar limits must be the same or higher than the limits for regular medical benefits.
Minimum hospital stays for newborns and mothers
Under The Newborns’ and Mothers’ Health Protection Act of 1996, health plans may not limit benefits for any hospital length of stay related to childbirth for the mother or newborn child.
Reconstructive surgery after mastectomy
A health plan must provide someone who is receiving benefits related to a mastectomy with coverage for reconstruction of the breast on which a mastectomy has been performed.
Americans with Disabilities Act (ADA)
Disabled and nondisabled individuals must be provided the same benefits with regard to premiums, deductibles, limits on coverage, and pre-existing condition waiting periods.
Family and Medical Leave Act (FMLA)
Requires an employer to maintain health coverage for the duration of a FMLA leave.
Uniformed Services Employment and Reemployment Rights Act (USERRA)
Gives an employee the right to continuation of health coverage under the employer’s health plans while absent from work due to service in the uniformed services.
Pregnancy Discrimination Act
Health plans maintained by employers who have 15 or more employees must provide the same level of coverage for pregnancy as for other conditions.
State Mandated Health Benefits
The states differ greatly in the number and type of mandated benefits. The state of Idaho has the lowest number of mandates at 17 and Rhode Island has the most with 70.
You can find information about individual state mandates from several sources:
- Your state’s insurance department, which you can access from the website of the National Association of Insurance Commissioners
- The Kaiser Family Foundation website State Health Facts
- Georgetown University Health Policy Institute website Health Insurance Info
Both Sides of the Mandate Controversy
Much has been written about mandated health benefits and good arguments have been made by groups that are opposed to mandates and groups that support mandates. The following sources are a good start for understanding the differing opinions:
- From the Council for Affordable Health Insurance: Health Insurance Mandates in the States 2009
- From the National Women's Law Center: Mandated Insurance Benefit Laws - Important Health Protections for Women and Their Families