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Commissioner Lara acts to enforce recently signed landmark state mental health and substance use parity law

News: 2020 Press Release

For Release: December 9, 2020
Media Calls Only: 916-492-3566
Email Inquiries: cdipress@insurance.ca.gov
Commissioner Lara acts to enforce recently signed landmark state mental health and substance use parity law

SAN FRANCISCO, Calif. — Today Insurance Commissioner Ricardo Lara issued a Notice to all health insurance companies in California informing them of their obligation to comply with landmark changes to the California Mental Health Parity Act following the recent enactment of Senate Bill 855, authored by Senator Scott Wiener. Under the new law, health insurance must cover health care services that are medically necessary to diagnose, prevent, and treat all mental health conditions, as well as substance use disorders, equal to coverage provided for other medical conditions.

“Mental health and substance use disorders are now rightfully covered along with other medical conditions,” said Insurance Commissioner Ricardo Lara. “The pandemic is exposing a greater need for mental health services and substance use continues to rise. My department will guarantee insurance companies provide fair and equal access to coverage for Californians who need this vital care.”

In addition to expanding coverage to all mental health conditions and substance use disorders, Senate Bill 855 requires health insurance companies to adhere to the same standards of care that are followed by addiction and mental health care providers. Health insurance must cover all medically necessary care for mental health and substance use disorders and can no longer limit coverage for treatment in ways that conflict with prevailing standards of care.
“SB 855 is a long overdue step to ensure mental health parity in California,” said Senator Scott Wiener (D-San Francisco), author of SB 855. “I want to thank Insurance Commissioner Lara for his action to ensure that insurance companies comply with the law as soon as it goes into effect. As a state, we have a responsibility to act quickly and decisively to help people suffering from mental illness and substance use disorder, and we can’t wait until they’re in crisis to allow them to get help. January 1st, 2021 will be an exciting day for our state – California will be a nationwide leader in mental health parity, as this law is the most expansive in the country. And people can finally get the help they need without insurance roadblocks.”

The requirements of Senate Bill 855 will take effect on January 1, 2021. Due to the significant expansion in coverage required by this chaptered bill, today’s Notice advises insurers to submit their health insurance policies to the Department for a compliance review by December 31, 2020.

"The Steinberg Institute appreciates the department's and Commissioner Lara's comprehensive approach to mental health parity," said Sacramento Mayor Darrell Steinberg, founder of the Steinberg Institute, which co-sponsored SB 855. "This notice requires health insurers to step up and become a larger piece of the solution to Californians' simmering mental health challenges, which have been compounded by a pandemic, high unemployment, and anxiety about fires and racial injustice.”

"I applaud Commissioner Lara for his strong support in the enactment of Senate Bill 855 and for moving quickly to increase access to care," said former U.S. Rep. Patrick J. Kennedy, founder of The Kennedy Forum, which also co-sponsored SB 855. "At a time of rapidly escalating mental health and addiction challenges, his actions will save lives."

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Media note:



The California Department of Insurance, established in 1868, is the largest consumer protection agency in California. Insurers collect $340 billion in premiums annually in California. Since 2011 the California Department of Insurance received more than 1,000,000 calls from consumers and helped recover over $469 million in claims and premiums. Please visit the Department of Insurance website at www.insurance.ca.gov. Non-media inquiries should be directed to the Consumer Hotline at 800-927-4357. Teletypewriter (TTY), please dial 800-482-4833.

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