California Law Expands Behavioral Coverage, Could Set Stage for National Change

California has passed a law to improve residents’ access to behavioral health care coverage. It’s a move that could set the stage for nationwide change.

The law in question defines “medical necessity” for mental health and substance use disorder treatment, no longer leaving it up to insurance companies to create their own definitions. California Gov. Gavin Newsom signed the law Sept. 25. 

The goal is to close the loopholes that can allow insurers to deny paying for appropriate behavioral treatment.


Federal and state laws already require insurers to treat behavioral health coverage the same as physical health coverage, but that rarely happens. For example, an insurer can deny coverage for certain behavioral treatments if it doesn’t deem those treatments as “medical necessary.”

But the definition of medical necessity varies by insurer and is frequently overly restrictive.

California State Sen. Scott Wiener, who authored the bill, likened such behavioral denials to telling patients their conditions aren’t yet serious enough to be treated, according to the Associated Press.


“We would never tolerate that with physical health,” Wiener said, as reported by the AP. “Yet we tolerate it with addiction.”

However, starting Jan. 1, when the law goes into effect, that will change. At that point, insurance companies must follow the most recent guidelines from nonprofit professional associations to deem what treatment is medically necessary.

Behavioral health stakeholders and advocates nationwide have celebrated the law for its trailblazing attempt to expand behavioral health coverage in California, the first state to pass such legislation. Now, they hope the rest of the nation will follow suit.

“This law sets a new precedent for all other states to protect patients with a mental illness or substance use disorder,” Patrice A. Harris, former American Medical Association (AMA) president and chair of the AMA Opioid Task Force, said in a statement. “Not having to fight insurance companies to use the generally accepted standards of care for our patients will improve treatment and save lives.”