The need for parity in health insurance benefits for the mentally and physically disabled: questioning inconsistency between two leading anti-discrimination laws.

• Author: Ritz, Sarah

1. INTRODUCTION II. HISTORY AND PURPOSE OF THE ADA III. THE ADA AND HEALTH INSURANCE A. Textual Analysis of the ADA 1. Title I 2. Title III 3. Title V, The Safe Harbor Provision B. Interpretations of the ADA 1. Disability-Based Distinctions 2. Public Accommodations 3. The Safe Harbor Provision 4. The Narrowing Effect IV. THE ADA's NEW OUTCAST: THE MENTALLY DISABLED A. Allowable Insurance Discrimination Against the Mentally Disabled B. Effects on Health C. Effects on Employment V. A COMPARISON: THE FAIR HOUSING ACT AND THE ADA A. Background of the Fair Housing Act Amendments B. Applications of the FHAA 1. Nondiscrimination Under the FHAA 2. Real Accommodations 3. A Simple Test C. The FHAA and Home Insurance Discrimination V. A GROWING PROBLEM VI. PROPOSAL FOR CHANGE VII. CONCLUSION I. INTRODUCTION

   "We must act ... to retain in and return to the community the mentally ill ... [in order] to restore and revitalize their lives." (1) President John F. Kennedy uttered these words when addressing Congress on the issue of mental illness and mental retardation. (2) Following President Kennedy's suggestion, this country has been less than successful in returning the mentally ill to the community and revitalizing their lives. While some people with mental illness may be seen functioning in and contributing to society on a daily basis, in schools, the workforce and social settings, many are without shelter or a job. While many members of the community believe that persons who are mentally ill are being taken care of and are adequately accommodated and protected by the law, they are not. Persons with mental illness face stigma and severely limited opportunities for medical treatment, which might, if successful, return them to the world that President Kennedy hoped this country would create. Lack of access to basic mental heath care is a significant barrier.

   While at first glance, the law appears to protect persons from being discriminated against because they are disabled, the purpose of this paper is to illustrate that significant discrimination exists in an area where protection is most needed--health insurance. Currently, health insurance providers are permitted to severely limit or even deny health insurance to persons for the sole reason that they have a mental illness, have had a mental illness, or in some extreme cases, at some point believed they had a mental illness. (3) Health insurance providers are permitted to discriminate solely on the basis of disability, while this type of discrimination by employers, housing providers, and the government has been prohibited or strictly limited since the dawn of the discrimination law.

   One in five Americans is affected by mental illness. (4) According to the National Institute of Mental Health ("NIMH"), approximately 22.1% of adult Americans suffer from a mental disorder that would be diagnosable. (5) Approximately 9.5% of the U.S. population aged eighteen and over suffer from a depressive disorder (defined by the NIMH as including major depressive disorder, dysthymic disorder, and bipolar disorder). (6) An estimated 13.3% of Americans aged 18-54 suffer from an anxiety disorder (defined by NIMH as including panic disorder, obsessive compulsive disorder, post-traumatic stress disorder, generalized anxiety disorder, and phobias). (7) Approximately 1.1% of American adults suffer from schizophrenia. (8)

   Untreated mental illness can be devastating, and may interfere with family, employment, and quality of life in general. (9) Despite these dramatic statistics and realities, privately insured Americans are not covered for mental health services on the same terms as they are covered for physical health services. (10) This inferior coverage for mental disabilities severely reduces persons with mental illness ability to access adequate and proper medical care. (11) This lack of proper care further reduces disabled persons ability to hold successful and meaningful places in our society because of unemployment, homelessness, incarceration, and even early death. (12)

   Discriminatory practices by the insurance industry, such as benefit limits (caps) on mental health services coverage, or complete lack of mental health care coverage fuel the disparate treatment of those with mental disabilities. These discriminatory practices have been the subject of much debate, and cases challenging those principles have not fared well in the court system. (13) These insurance practices, which single out persons with mental illness and provide them with little or no benefits for mental health care, violate the terms of the Americans with Disabilities Act ("ADA"), and are inconsistent with other laws that seek to remedy discrimination against the disabled, such as the Fair Housing Act.

   The following sections will discuss the legislative history of disability law with regard to how and why laws protect persons with disabilities. I will discuss the Americans with Disabilities Act, and its legislative history. Then, I will discuss interpretations of the Americans with Disabilities Act and the arguments commonly used for and against mental and physical illness equality in medical insurance coverage. Next, I will provide a comparison of this interpretation with interpretation of the Fair Housing Act. Finally I will suggest continuity and congruence throughout disability law to promote a system that lives up to the goals of disability protections.

2. HISTORY AND PURPOSE OF THE ADA

   Long before the emergence of disability law, there have been advocates for the rights of disabled persons, and recognition of a need for policy to protect disabled individuals. (14) Significant protection for persons with disabilities first surfaced in 1973, seventeen years prior to the passage of the ADA in 1990. (15) In 1973, sections 501,503, and 504 of the Rehabilitation Act were passed. (16) Soon after, in 1975, the predecessor to the Individuals with Disability Education Act ("IDEA") was passed. (17) "These two federal statutes moved disability policy from a philosophy of support and benefits to one of rights." (18)

   Following the Rehabilitation Act and the IDEA, federal statutes were introduced affecting a nondiscrimination policy in voting, (19) air transportation, (20) and housing. (21) Both the statutes regarding air transportation and housing addressed discrimination in the private sector, which was not addressed by the Rehabilitation Act and the IDEA. (22) The Rehabilitation Act and the IDEA were also especially significant because they demonstrated congressional response to judicial decisions, which continued to be the cause of amendments to the statutes during 1970-1990. (23)

   The policy of ensuring that mentally ill are returned to the community could only be effective if incorporated into all aspects of life. (24) Statutes providing protection for students so that they will receive specialized education to prepare them for college and/or the workplace would prove useless if employers were permitted to discriminate against these disabled persons after graduation. (25) Providing a discrimination-free work environment would also be useless if disabled persons still faced barriers in transportation and social interactions, such as eating at restaurants. (26) This being recognized, ADA was passed in 1990 to ensure full participation in society by individuals with disabilities. (27)

   The ADA was enacted "to provide a clear and comprehensive national mandate for the elimination of discrimination against individuals with disabilities." (28) The ADA addresses employment, public services, public accommodations, telecommunication, and various miscellaneous areas, one of which is health insurance. (29)

3. THE ADA AND HEALTH INSURANCE

   Over the last five years, the Supreme Court has been somewhat successful in "disabling" the ADA. From 1999 when the Court adopted a narrow understanding of the class protected by the ADA, (30) to 2001, when the Court held that the ADA's employment title was not valid legislation under section 5 of the Fourteenth Amendment, (31) the protections for the disabled have been narrowed. The narrowing effect continued in 2001-2002 (the "Disabilities Act Term") (32) when an ADA plaintiff's claim failed against the Supreme Court's restrictive interpretations of the ADA. (33) Critics of the Supreme Court's analysis of both the ADA and other disability laws have argued that the Supreme Court simply does not understand that disability rights are civil rights, and that the ADA is a civil rights law. (34) If the ADA were widely considered to be a civil rights law, greater deference would be afforded to it. However, unlike discrimination laws based on race or sex, the Court seems to view disability discrimination law as a product of pity for the less fortunate. (35) Not only is this view a type of discrimination the disabled wish to avoid, but also it has been said that it is the very reason the ADA has been uniquely limited as compared to other civil rights laws. (36)

   One area in which the Court has been successful in limiting disability discrimination protection is in the field of health insurance. (37) The Court Justices have limited the ADA's protections through their interpretation of the statute, prior case law, policy, and arguably, because their personal prejudices against disabled persons. (38) To understand the unique limitations placed, it is useful first to examine the text of the ADA and the analytical framework used by the court in the area of health insurance for all disabled persons.

   1. Textual Analysis of the ADA

      Since the enactment of the ADA, there has been a great deal of litigation surrounding its application to health insurance. (39) Specifically, litigation has focused on whether the ADA prohibits health insurers from discriminating in the types of coverage offered to persons with particular disabilities. (40) The section of the ADA addressing insurance is unclear at best...