Objective: This study examined the prevalence and nature of behavioral heal
th carve-out contracts among Fortune 500 firms in 1997. Methods: A survey w
as conducted of 498 companies that were listed as Fortune 500 funs in 1994
or 1995. A total of 336 firms (68 percent) responded to the survey. Univari
ate analyses were used to analyze prevalence, types, and amounts of covered
services, cost sharing, and benefit limits. A total of 132 firms reported
contracting with managed behavioral health organizations; 124 firms answere
d benefits questions about covered services,, cost-sharing levels, and annu
al and lifetime limits. Results: Most of the plans covered a broad range of
services. Cost sharing was typically required, and for inpatient care it w
as often substantial. Fifteen percent of the films offered mental health be
nefits that were below the limits defined in this study as minimal benefit
levels, and 34 percent offered substance abuse treatment benefits that fell
below minimal levels. The most generous mental health benefits and substan
ce abuse treatment benefits, defined as no limits or a lifetime limit only
of $1 million or more, were offered by 31 percent and 20 percent of the fir
ms, respectively. Conclusions: The carve-out contracts of the Fortune 500 f
irms in this study typically covered a wide range of services, and the bene
fits appeared generous relative to those reported for other integrated and
carve-out plans. However, these benefits generally did not reach the level
of parity with typical medical benefits, nor did they fully protect enrolle
es from the risk of catastrophic expenditures.