In this position paper drafted by the committee on psychopathology of the Group for the Advancement of Psychiatry, the authors discuss merits and disadvantages of three different approaches to equitable coverage of mental illness: coverage for selected psychiatric diagnoses, coverage based on severity of impairment, and coverage of services. They believe that coverage of selected disorders has political appeal but is discriminatory and arbitrary; it is also impractical because clinicians may overdiagnose conditions covered by insurance and underdiagnose excluded conditions. Coverage based on severity of impairment, or disability, has similar limitations. The authors believe services should be the principal basis for coverage, as under general medical insurance. The approach is nondiscriminatory, and costs can be controlled through such means as managed care, changes in the payment system, or benefit design.