Pennsylvania Adds Autism Coverage as a Mandated Insurance Benefit

Published September 1, 2008

Pennsylvania Gov. Ed Rendell (D) has signed legislation requiring coverage for autism be included in all health insurance policies sold within the state.

The new law raises to 39 the total number of treatments and conditions required by law to be included in every health insurance policy sold in Pennsylvania.

When the law takes effect in July 2009, insurers will be required to cover $36,000 in diagnosis and treatment coverage for autism. Patients requiring treatments that exceed the $36,000 limit will be eligible for state Medicaid reimbursements to cover the extra expense.

Because the state has mandated the inclusion of autism coverage regardless of need, consumers whose families do not face the challenges of autism will have to pay the same higher premium as policyholders dealing with the condition.

Premiums Will Rise

Currently, children with autism can enroll in the state’s Medicaid program, which is managed by the Department of Public Welfare and spends about $185 million annually on medical assistance programs for residents under age 21 with autism.

Under the new law, those children would be transferred from the Medicaid program into private health plans. That could reduce state spending by about $13 million in the first year of implementation, but insurance premiums will rise across the board as a result.

Pennsylvania is now one of eight states with laws requiring insurance reimbursements for autism diagnosis and treatment, according to Autism Speaks, an advocacy group.

Nina Wall-Cote, director of the Pennsylvania welfare department’s Bureau of Autism Services, said, “There is definitely a move nationally to usher this type of legislation through.”

Mandates Raise Costs

Analysts point out adding another coverage to the panoply of mandated treatments raises health insurance costs by forcing all citizens to pay for coverages the majority might never want or need.

In addition, at a time when states are more aware than ever of the number of uninsured within their borders, the decision to add more mandated coverages doesn’t make much sense, said Michael Tanner, a senior fellow at the Cato Institute.

“Government regulation that drives up the cost of health insurance is a significant factor in denying health insurance to the working poor,” Tanner said. “If government were to mandate that the only car anyone could own was a Lexus, it wouldn’t be long before the poor lacked transportation. Sometimes people have to drive a Kia.”

“State-imposed mandates force people to pay for more insurance coverage than they want or need, and in effect place a legal ban on low-cost, economy-model insurance,” said Paul Guppy, research director at the Washington Policy Institute. “It’s like a hotel market with all Hiltons and Sheratons, but no Motel 6.”

Jeff Emanuel ([email protected]) is The Heartland Institute’s research fellow for health care policy and managing editor of Health Care News.

For more information …

Pennsylvania House Bill 1150:

Pennsylvania Senate Bill 550:

“Health Mandates in the States 2008,” Council for Affordable Health Insurance: