Senate Bill 566, titled the Parity Enhancement for Addiction Recovery, revises North Carolina insurance law to strengthen mental health and substance use disorder coverage parity. The bill rewrites G.S. 58-3-220 to require health benefit plans to cover mental health conditions on terms no less favorable than coverage for physical conditions, and it updates the statutory framework to align more closely with federal mental health parity law. It also clarifies that utilization review and medical necessity determinations for mental health conditions, including substance use disorders, must be handled consistently with non-mental-health conditions, and that substance use disorder decisions must rely solely on the most recent American Society of Addiction Medicine criteria.
The bill also makes conforming changes across multiple insurance statutes by replacing older references to “chemical dependency” with “substance use disorder,” repealing several outdated provisions, and updating the treatment of autism spectrum disorder in related insurance definitions. In addition, it directs the State Treasurer and the State Health Plan to review the plan’s utilization review practices and third-party contracts to ensure compliance with the new standards by the next plan year. The bill applies to insurance contracts issued, renewed, or amended on or after October 1, 2025.
Impact
If enacted, the bill would significantly affect North Carolina’s insurance code, especially statutes governing health benefit plans, utilization review, and parity requirements for mental health and addiction treatment. It would impose clearer parity obligations on insurers and the State Health Plan, limit how medical necessity is assessed for substance use disorder treatment, and require the use of ASAM criteria for those determinations. It also updates terminology throughout the General Statutes and repeals several older provisions that are superseded by the new framework.
Sentiment
No committee transcripts or recorded votes were provided, so there is no direct evidence of debate or opposition in the available materials. Based on the bill text and title, the measure appears to be framed as a parity and consumer-protection bill aimed at improving access to addiction recovery services and aligning state law with federal requirements. The overall presentation suggests a policy goal that is likely to be viewed favorably by mental health and addiction treatment advocates.
Contention
The main potential points of contention are likely to involve insurer discretion and the scope of mandated coverage. The bill restricts utilization review by requiring substance use disorder medical necessity determinations to rely solely on ASAM criteria and by requiring parity in the way mental health conditions are reviewed compared with physical conditions. Insurers and utilization review organizations may view these provisions as limiting flexibility or increasing administrative and coverage costs, while supporters are likely to argue that the changes are necessary to prevent discriminatory treatment limitations and to improve access to addiction care.
An Act Concerning The Department Of Mental Health And Addiction Services' Recommendations Regarding Recovery-friendly Language And Various Revisions To Mental Health And Addiction Statutes.