I can't speak to whether or not this is implemented in MAME, but when a console of that generation hit a high enough horizontal resolution (i.e., the Genesis'/Mega Drive's stock 320x224 resolution was enough for this to work too and many Sega games depend on this to render correctly to overcome palette limitations), alternating vertical lines of color would be blended by a CRT to make additional colors that actually didn't exist in the source signal.
In SNES games, this was used for HUD translucency in Jurassic Park and foreground translucency in Kirby's Dreamland 3. Those items are not actually translucent when pumped out of a SNES. It takes the inaccuracy of a CRT to create the intended effect:
Jurassic Park:
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