House and Senate negotiators have reached agreement on important portions of a long-stalled mental health parity draft bill, but the legislation still lacks a spending offset that would let it move forward.

The agreement deals with two major issues that have long proved nettlesome — whether the legislation would cover specific mental illnesses, and how insurers would be required to pay for out-of-network treatment of mental health care. Negotiators hammered out compromises on these matters in mid-June.

“We’re getting real close on mental health parity—[we] actually have agreement on the policy points,” Anthony Coley, a spokesman for Sen. Edward M. Kennedy , D-Mass., said Friday.

Negotiations had been led by Kennedy and Pete V. Domenici , R-N.M., on the Senate side, and on the House side by Kennedy’s son, Rep. Patrick J. Kennedy , D-R.I., and Rep. Jim Ramstad , R-Minn.

Rep. Kennedy had pushed hard for provisions included in a House bill (HR 1424) to require private health insurers to cover a specific list of mental health and substance abuse conditions. Insurers and business groups had long objected to that proposal, and the White House had as well.

In the compromise, described by lobbyists and aides as a “framework” but still lacking legislative language, that provision is gone. In its place is a requirement for two government studies that will determine if insurers are discriminating against certain conditions, or failing to cover some treatments.

“In effect, there’s a mechanism by which Congress could revisit the issue,” said a mental health lobbyist who outlined the elements of the compromise.

The agreement also resolved how the legislation would treat coverage of mental health treatment that is done out of an insurers network of providers. Under the deal, mental health benefits would be treated the same as other medical benefits — if the insurer offered out-of-network coverage for medical benefits, it would have to offer equal mental health coverage.