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The small business community and state legislators are being sold a bill of goods about the impact of the passage of Timothy's Law, which would prohibit insurers from discriminating against mental illness and chemical dependency in health insurance coverage (parity).

The truth is, according to an October 2003 study by the Commonwealth Fund, nearly 10 million Americans without health insurance, almost 30% of the uninsured, work for huge corporations. These people are largely our retail and service workers at our supermarkets, our big box department stores, and the chain retail stores in malls. They are America's working poor, who are often holding down two low-wage jobs for the purpose of feeding and sheltering themselves and their families. The percentage of uninsured workers at these companies with 500 or more employees actually grew between 1987 and 2001, from 25% to 32%.

The impact of economic change in our nation is part of the cause of the decline in access to employer-sponsored health insurance. Stagnant wage growth at large companies, the decline in manufacturing and decreased unionization contributes about 60% of the loss in insurance coverage.

According to a study by the Texas Insurance Department, done recently enough to include the cost of mental health parity in that state, the total cost of mandated benefits (emergency room services, in-patient maternity, etc.) for Texans make up 6.5% of the total cost of health insurance there. Insurance companies pay health care providers for the treatment they provide.

With that in mind, less than 25 cents (or 25%) of every dollar, an insurance industry figure, paid to providers goes to mental health services. Thus, (25% of 6.5%) it is evident that the cost of parity could not exceed a 1-2% increase in the total cost of an insurance premium. It would therefore be impossible for the cost of insurance to skyrocket because of increased mental health utilization.

Yet, the insurers are running around with 10 year-old studies that ignore the penetration of managed care-mechanisms that will continue to require all treatment, even under Timothy's Law, to be medically necessary. They discount the May 2002 study by PricewaterhouseCoopers of Timothy's Law, which sets the cost of that legislation at $1.26 per member per month. This is in line with all of the studies, all of the experience in other states, all of the experience with the federal health insurance program, indicating that the cost of eliminating discrimination against mental health and chemical dependency is 1-2%.

The federal government's Substance Abuse and Mental Health Services Administration just completed a study of the Vermont parity law, which is the model for Timothy's Law. The experience in Vermont was that some companies actually saved money, and others saw a decrease in inpatient expenses, and small increase in outpatient expenses. Again 1-2%.

We haven't been able to convince the senate, or defeat the arguments of the health insurance industry, that the facts are on our side, credible study after credible study. It sounds like health insurers want to eliminate all mandated benefits. But, they know they can't do that because if insurance was truly useless, would anyone buy it? The solution, according to the health insurers, is to sell people the maximum in minimal coverage they can afford. Under-paid, under-employed, under-insured-the creation of a permanent underclass of working people in America. There is an 85% unemployment rate among people living with serious mental illnesses. People in low wage, dead-end jobs are those considered to be under-employed. Without full coverage in private insurance, people with serious mental illness are destined to be forever un- and under-employed.

People in NYC and the metropolitan suburbs are willing to pay for more inclusive coverage. The truth is it is largely the upstate New York constituency of the NYS Senate Majority that insurers are targeting for underclass status.

The three major health insurers in the Albany area all made a substantial profit for the first half of the year. Yet, they will increase premium costs, and edge up the costs being passed through to people who pay for insurance policies.

Insurance companies don't make the bulk of their profits off of premiums. Their profits (and losses) come from how they invest premium dollars in the financial markets. Insurance companies are among the largest corporate investors, behind pension funds, and when the market declines, as they have over the last three years, insurance companies lose money.

The final truth is that lost productivity and societal cost greatly outweighs any increase from passing Timothy's Law. According to federal estimates, the cost to our economy each year for lost productivity for untreated mental health and chemical dependency needs exceeds $100 billion.

On the most personal level, Tom O'Clair lost more than 800 hours of work trying to help his son. Those 800 hours equal six months of lost work time, over about a four-year period. Eight hundred hours of lost work, or $1.26 a month.

The O'Clairs had to relinquish custody of Timothy into foster care, so he could get the treatment he needed. When a child goes into foster care, they are automatically eligible for Medicaid, and their treatment is paid, not by insurance companies, but by taxpayers--in New York State, it is paid by county property tax payers.

According to a study by the federal government's General Accounting Office (GAO), in states and counties making up approximately ½ the population of our country, 12,700 children went through custody relinquishment in 2001 to obtain needed mental health care. According to the GAO, the cost of these custody relinquishments is hundreds of millions of dollar per year in taxpayer money.

The truth is that our state cannot afford to delay the passage of Timothy's Law any longer.