Workers’ Disability Benefits Parity Act of 2025

Bill Number

H.R. 3758

Origin Chamber

House

Congress

119th Congress, Session 1

Policy Area

Health

Status

Introduced

Latest Action

2025-06-05: Referred to the House Committee on Education and Workforce.

Last Updated

2025-07-21T19:44:15Z

AI-Generated Summary

Purpose of the Legislation

The Workers' Disability Benefits Parity Act of 2025 aims to eliminate discrimination in disability benefit plans by requiring equal treatment of disabilities caused by behavioral health conditions (mental health and substance use disorders) compared to those caused by physical health conditions. It builds on findings from a 2023 report by the ERISA Advisory Council, which highlighted how limits like shorter benefit durations hinder access for workers with behavioral health disabilities. Congress expresses that such limits are discriminatory and that benefits should be provided regardless of the disability's cause.

Key Provisions

• Amendments to ERISA (Title I):
• Adds a new Part 9 to ERISA's Subtitle B, defining key terms:
• Disability benefit: Payments for lost earning capacity due to injury or sickness.
• Disability benefit plan: Any employee welfare plan providing such benefits, including through insurance.
• Mental health condition: Non-substance-related disorders listed in WHO's International Classification of Diseases or the American Psychiatric Association's Diagnostic and Statistical Manual (DSM).
• Substance use disorder: Disorders related to psychoactive substance use, as defined in the same sources.
• Requires parity: Plans cannot impose more restrictive limits, exclusions, or restrictions on benefits for mental health or substance use disabilities than for physical ones.
• Mandates that physical health issues caused by a mental health or substance use disability be treated as part of that disability.
• Introduces civil monetary penalties (up to $110 per day per affected participant during noncompliance) for violations, enforced by the Secretary of Labor against plan sponsors, administrators, or others (excluding the plan itself).
• Grants the Secretary authority to collect these penalties.

• Extensions to Governmental Plans and Insurers (Title II):
• Applies similar parity requirements to governmental employee benefit plans (state/local government plans, excluding federal) and insurance issuers offering disability benefits.
• States can enforce against issuers; if a state fails, the Secretary steps in.
• Allows civil penalties similar to ERISA's, plus access to ERISA's broader enforcement tools (e.g., investigations).
• Permits aggrieved individuals to sue in state or federal court for equitable relief (e.g., court orders to fix violations).
• Preserves state laws unless they conflict with the bill's requirements.

• Implementation and Support (Title III):
• Directs the Secretary of Labor to conduct a study (within 18 months of enactment) on costs to plan sponsors for behavioral health disabilities, including actuarial analysis.
• Requires outreach and education for plan sponsors on how duration limits affect access for those with mental health or substance use issues.
• Authorizes the Secretary to issue regulations, guidance, or interim rules as needed.
• Allocates $10 million annually for five years to support implementation.
• Effective date: Applies to plan years starting 18 months after enactment; for plans under collective bargaining agreements ratified before enactment, it starts later (after the agreement ends or 18 months, whichever is later). Plan changes to comply do not count as ending the agreement.

Significant Changes to Existing Law

• New Parity Framework in ERISA: Previously, ERISA (the Employee Retirement Income Security Act of 1974) regulated disability plans but lacked specific rules ensuring equal treatment for behavioral versus physical health disabilities, unlike mental health parity laws for health insurance (e.g., under the Mental Health Parity and Addiction Equity Act). This bill explicitly adds these protections to private-sector plans.
• Enforcement Enhancements: Introduces dedicated civil penalties and expands the Secretary's collection authority under ERISA Section 502. For governmental plans, it creates parallel enforcement outside ERISA, including state roles and private lawsuits.
• Broader Scope: Extends parity to substance use disorders (previously sometimes excluded) and requires treating related physical conditions as part of the core disability, closing gaps in how plans evaluate claims.

Potential Impacts

• On Citizens: Improves access to long-term disability benefits for workers with mental health or substance use disabilities, potentially reducing financial hardship from lost income. An estimated millions could benefit, especially given the ERISA report's findings on widespread duration limits.
• On Government Agencies: The Department of Labor (DOL) gains new enforcement duties, including studies, education, and penalties, supported by dedicated funding. States may need to update oversight of insurers, with federal backup if they fail.
• On Employers and Plans: Plan sponsors (mostly private employers) must revise disability policies, possibly increasing costs (to be studied by DOL). This could raise premiums or administrative burdens but promote fairer benefits.
• On International Relations: No direct impacts; the bill focuses on domestic U.S. employee benefits.

Main Stakeholders Affected

• Workers and Beneficiaries: Primarily those with disabilities from mental health conditions or substance use disorders, who gain stronger protections against discriminatory limits.
• Employers and Plan Sponsors: Private and governmental employers offering disability plans, responsible for compliance and potential cost increases.
• Plan Administrators and Service Providers: Entities managing plans, facing penalties for violations.
• Insurance Issuers: Companies selling disability coverage, required to offer parity-compliant products.
• Government Entities: DOL for federal enforcement and studies; states for regulating issuers and governmental plans.
• Unions and Employees: Covered under collective bargaining agreements, with delayed implementation to avoid disrupting negotiations.

Notable Legal, Constitutional, or Political Implications

• Legal Implications: Strengthens ERISA's framework by aligning disability benefits with existing mental health parity laws, potentially leading to more lawsuits for equitable relief. Civil penalties provide a deterrent, but the bill preserves state laws to avoid federal preemption conflicts (under ERISA's "savings clause"). Definitions tied to evolving WHO/DSM standards may require periodic updates.
• Constitutional Implications: None explicitly raised; the bill operates within Congress's commerce clause authority over employee benefits and does not infringe on free speech, due process, or equal protection.
• Political Implications: Responds directly to the 2023 ERISA Advisory Council report, signaling bipartisan interest in addressing mental health disparities (introduced by Democrats but with broad applicability). It could influence future expansions of parity laws, amid growing national focus on behavioral health post-pandemic, but may face opposition from employers concerned about costs.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. DeSaulnier, Mark [D-CA-10]

Cosponsors (1)

Rep. Scott, Robert C. "Bobby" [D-VA-3]

Recent Actions

• 2025-06-05: Referred to the House Committee on Education and Workforce.
• 2025-06-05: Introduced in House
• 2025-06-05: Introduced in House

Bill Versions

• Workers’ Disability Benefits Parity Act of 2025 — issued 2025-06-05 — PDF (14 pages)