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North Carolina passes autism insurance reform legislation

September 29, 2015

Raleigh, NC −  The North Carolina General Assembly has approved legislation to require certain health plans to cover the screening, diagnosis and treatment of autism and now heads to Governor McCrory’s desk.

S.676 was sponsored by Senators Tom Apodaca and Joyce Krawiec. When signed, the bill will become effective July 1, 2016 and apply to insurance contracts renewed on or after that date.

 “This is truly a banner day for all families in the state, as North Carolina becomes the 43rd state to require health insurance to cover life-changing treatment for individuals with autism,” said Lorri Unumb, Esq. Vice President, State Government Affairs for Autism Speaks.  “On behalf of the entire North Carolina autism community, we want to thank Senator Apodaca and Representative Chuck McGrady for working so hard to make this bill a reality.”

Treatment coverage will include the following, when determined to be medically necessary: therapeutic care (including OT, PT and ST); psychiatric care; psychological care; pharmacy care; and adaptive behavior treatment, which includes Applied Behavior Analysis and may be limited to $40,000 per year (adjustable for inflation) and age 18. 

The health plans subject to the bill include large group plans (plans sold to employers with 100+ employees); Grandfathered plans (plans sold to individuals and small groups that have been in effect and essentially unchanged since March of 2010); and transitional or grandmothered plans (plans sold to individuals and small groups that are not grandfathered but were in effect prior to 2014.)

With the passage of S.676, several segments of the market are now required to cover treatment for autism.  The State Employee Health Plan, covering more than 600,000 individuals, added ABA coverage in January of this year. S.676 requires coverage in certain parts of the commercial market, reaching approximately 600,000 individuals.  And progress in the self-funded market has seen the addition of ABA coverage in several NC-based corporations, including Bank of America and other noteworthy companies that will be announcing ABA coverage soon for 2016.  

Prior to this week’s passage, Senate Bill 676 had remained in the House Rules Committee for several months while parties discussed the mental health parity implications of the bill.  In the end, S.676 still removes autism from the definition of “mental illness” in the state’s mental health parity law, but it also specifically applies the standards of the federal mental health parity law to the coverage.

Earlier this year, North Carolina enacted House Bill 556, ABLE legislation that allows families to set up tax-exempt 529A savings accounts for disability-related expenses. Read more here.

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