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Mental Health Parity and Addiction Equity Act

The ‘Meaningful Benefit’ Requirement for NQTLs Under the Proposed MHPAEA Regulations

by Alden Bianchi | Sep 13, 2023 | Employee Benefits, Health and Welfare Plans, Mental Health Parity and Addiction Equity Act

In previous posts, we reported on proposed regulations under the Mental Health Parity and Addiction Equity Act (MHPAEA) issued by the Departments of Labor, Health and Human Services, and the Treasury (collectively, the Departments). More recently, we turned our attention to the treatment of non-quantitative treatment limitations (NQTLs), i.e., non-numeric benefit coverage limits that must be no more restrictive for mental health and substance use disorder (MH/SUD) benefits than for medical surgical (M/S) benefits. This blog post focuses on the proposed regulations’ “meaningful benefit” requirement.

Current law contains the now familiar rule that says if a plan (or health insurance issuer) provides MH/SUD benefits in any classification, those benefits must be provided in every classification in which M/S benefits are provided. (“Classifications” for this purpose include inpatient, out-of-network; inpatient, in-network; outpatient, out-of-network; outpatient, in-network; emergency care and prescription drugs.) But current law says nothing about which MH/SUD benefits must be provided in any classification. A plan or issuer might, for example, be able to comply by offering a single limited benefit for MH/SUD disorders or conditions in one or more classifications.

The proposed regulations add a requirement that plans and issuers must provide “meaningful benefits” for the treatment of MH/SUD disorders or conditions. While the term “meaningful benefit” is not defined, the proposed regulations offer two examples:

Autism Spectrum Disorder (ASD)

A plan that covers treatment for ASD, including outpatient, out-of-network developmental evaluations, but excludes all other benefits for outpatient treatment for ASD, including applied behavior analysis (ABA). (ABA therapy is one of the primary treatments for children with ASD.) The plan covers the full range of outpatient treatments and treatment settings for medical conditions and surgical procedures when provided on an out-of-network basis. The failure to cover ABA therapy violates the “meaningful benefits” requirement in the outpatient, out-of-network classification.

Eating Disorders

A plan covers diagnosis and treatment for eating disorders but specifically excludes coverage for nutrition counseling to treat eating disorders, including in the outpatient, in-network classification. (Nutrition counseling is one of the primary treatments for eating disorders.) The plan generally provides benefits for the primary treatments for medical conditions and surgical procedures in the outpatient, in-network classification. The exclusion of coverage for nutrition counseling results in the failure of the “meaningful benefits” requirement for the treatment of eating disorders in the outpatient, in-network classification.

The Departments invite comments on how to define “meaningful benefits” and on whether there might be other potential alternatives. Would it be more practical, for example, to require plans and issuers to provide “substantial coverage” of MH/SUD benefits or benefits for the “primary or most common or frequent types of treatment for a covered condition or disorder” in each classification in which M/S are provided? Violations of the “meaningful benefits” requirement would, under the proposal, constitute an MHPAEA parity violation, which would allow the Department of Labor to order the plan or issuer not to impose the NQTL unless (and until) the plan or issuer demonstrates compliance.

The ‘Data Evaluation Requirement’ for NQTLs Under the Newly Proposed MHPAEA Regulations

by Alden Bianchi | Sep 7, 2023 | Employee Benefits, Health and Welfare Plans, Mental Health Parity and Addiction Equity Act

Last week’s post examined the “no more restrictive” requirement that would apply to non-quantitative treatment limitations (NQTLs) set out in recently proposed regulations under the Mental Health Parity and Addiction Equity Act (MHPAEA). (Our description of the proposed regulations is available here.) The proposed regulations deal principally with NQTLs, which are non-numeric benefit coverage limits that must be no more restrictive for mental health and substance use disorder (MH/SUD) benefits than for medical surgical (M/S) benefits. We previously claimed that “if adopted in final form [the proposed regulations] would vastly complicate compliance by group health plans and health insurance issuers with an already challenging set of mental health parity rules.” Our views have not changed.

The proposed regulations would, if adopted, impose a series of new requirements on NQTLs that include a “data evaluation requirement.” This new requirement would provide that the plan or issuer designing and applying an NQTL collect and evaluate relevant data to assess the impact of the NQTL on access to MH/SUD and M/S benefits. The plan or issuer would also consider whether the NQTL, in operation, complies with the mental health parity rules. The specific type, form, and manner of data collection and evaluation will be the subject of future guidance. (A technical release accompanied the proposed regulations, described here, which invites comment and suggests a possible, narrow safe harbor.)

The proposed regulations establish two new network-related rules governing NQTLs:

For NQTLs not involving network composition, a material difference in the metrics/data gathering for the NQTL as applied to MH/SUD and M/S benefits would be considered a strong indicator of a violation.
For NQTLs involving network composition, a violation is deemed to occur if the relevant data shows material differences in access to in-network MH/SUD benefits as compared to in-network M/S benefits.

The proposed regulations would make compliance depend on outcomes. This position represents a significant shift in, if not an outright reversal of, existing law. Under the 2013 final MHPAEA regulations, outcomes are not determinative of compliance. Rather, comparability turns on the application of processes, strategies, evidentiary standards and other design-based factors. Compliance under current law thus turns on an examination of inputs, not outcomes. While the proposed regulations include exceptions for professional medical/clinical standards and for standards to detect fraud, waste and abuse, the preamble to the proposed regulations advises that “these exceptions should be narrowly tailored.”

The ‘No More Restrictive’ Requirement for NQTLs Under the Proposed MHPAEA Regulations

by Alden Bianchi | Aug 29, 2023 | Employee Benefits, Health and Welfare Plans, Mental Health Parity and Addiction Equity Act

We previously reported on proposed regulations under the Mental Health Parity and Addiction Equity Act (MHPAEA). If adopted in final form, these regulations would vastly complicate compliance by group health plans and health insurance issuers with an already challenging set of mental health parity rules.

The proposed regulations deal principally with non-quantitative treatment limitations (NQTLs), i.e., non-numeric benefit coverage limits that must be no more restrictive for mental health and substance use disorder (MH/SUD) benefits than for medical surgical (M/S) benefits. Examples of NQTLs include prior authorization requirements, concurrent review, standards for provider admission, Rx formulary design, and fail-first policies or step therapy protocols.

The proposed regulations set out new requirements on NQTLs that include a three-part test consisting of a “no more restrictive” requirement, a “design and application” requirement and a “data evaluation requirement.” There is also a new meaningful benefit requirement, under which plans and issuers must provide meaningful benefits for MH/SUD treatment where the plan also provides a corresponding M/S benefit. With perhaps the exception of the “design and application” requirement, each of these requirements represents a major new compliance obligation on the part of plans and issuers.

This blog post focuses on the “no more restrictive” requirement. Future posts will examine the other requirements.

MHPAEA regulates aggregate lifetime and annual dollar limits, financial requirements, and treatment limitations. (The Affordable Care Act bars lifetime and annual dollar limits on essential health benefits (EHBs). Under MHPAEA, plans and issuers may not be able to impose lifetime and annual dollar limits on MH/SUD benefits that are not EHBs.) Treatment limitations are subdivided into quantitative treatment limitations (QTLs) (e.g., number of days or visits covered) and NQTLs.

The 2013 final MHPAEA regulations apply numerical standards testing to financial requirements and QTLs. These final regulations also adopted six classifications of benefits for this purpose: inpatient, in-network; inpatient, out-of-network; outpatient, in-network; outpatient, out-of-network; emergency care; and prescription drugs. To comply, a financial requirement or QTL imposed on an MH/SUD benefit must be no more restrictive than the predominant financial requirement or QTL that applies to substantially all M/S benefits in a classification. For this purpose:

Substantially all” means that the financial limitation or QTL applies to at least two-thirds of all M/S benefits in the classification; and
“Predominant” means the level of financial requirement or QTL that applies to more than one-half of the M/S benefits in the relevant classification.

The 2013 final regulations largely rely on a subjective analysis of the processes, strategies, evidentiary standards, and other factors used in the application of NQTLs. The proposed regulations retain this subjective standard and layer on a quantitative “no more restrictive” requirement. As proposed, NQTLs would be subject to numerical standards testing similar to the current law testing that applies to financial requirements and NQTLs. While the “substantially all” prong would not change, some minor modifications would be made to the “predominant” prong. Under the proposed regulations, when testing NQTLs, the term “predominant” [...]

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Treasury, DOL and HHS Issue Landmark Mental Health Parity Proposed Rule

by Alden Bianchi, Sarah Raaii and Jacob Mattinson | Aug 8, 2023 | Employee Benefits, Health and Welfare Plans, Mental Health Parity and Addiction Equity Act

The US Departments of the Treasury, Labor, and Health and Human Services (the Departments) recently issued much-anticipated proposed regulations under the Mental Health Parity and Addiction Equity Act (MHPAEA) to better ensure that health plans allow access to mental health or substance use disorder benefits as easily as medical or surgical benefits. The proposed regulations reiterate the Departments’ focus on mental health parity and underscore the importance of compliance for health plan sponsors. They also come after many plans have been subject to audit by the Departments which focused heavily on MHPAEA compliance, leaving plan sponsors frustrated at the lack of guidance and inconsistent application of MHPAEA.

Mental Health Parity, Quantitative Treatment Limitations, Employee Assistance Plans and the End of the COVID-19 Emergency

by Jacob Mattinson, Sarah Raaii, Alden Bianchi and Teal Trujillo | Mar 29, 2023 | Employee Benefits, Health and Welfare Plans, Mental Health Parity and Addiction Equity Act

The Biden administration has announced its intention to end the COVID-19 National Emergency (NE) and the COVID-19 Public Health Emergency (PHE) on May 11, 2023 (read our series introduction for more information). Among other things:

The NE and the PHE modified the rules governing financial requirements and quantitative treatment limitations under the Mental Health Parity and Addiction Equity Act (MHPAEA). The end of the NE and the PHE will require modifications to group health plans’ and health insurance issuers’ MHPAEA testing as it relates to financial requirements and quantitative treatment limits. The NE and the PHE also affect the design and operation of some employee assistance plans (EAPs).
The NE and the PHE allowed plan sponsors to expand coverage under excepted benefit EAPs in certain respects without risking their status as the Health Insurance Portability and Accountability Act (HIPAA)-excepted benefits.

MHPAEA

MHPAEA requires that the financial requirements (such as coinsurance and copays) and quantitative treatment limits (such as visit limits) imposed on mental health or substance use disorder (MH/SUD) benefits cannot be more restrictive than the predominant financial requirements and treatment limitations that apply to substantially all medical/surgical benefits in a particular benefit classification. During the public health emergency period, group health plans and health insurance issuers were permitted to disregard certain items and services related to testing for the detection of SARS-CoV-2, the virus that causes COVID-19, when performing the “substantially all” and “predominant” tests. Absent this relief, the costs of covering COVID-19 testing items and services without cost-sharing would be the amounts allocated to medical/surgical benefits, thereby putting group health plans and health insurance issuers at risk of running afoul of MHPAEA quantitative treatment limits.

From and after the end of the PHE, group health plans and health insurance issuers must include the cost of covering COVID-19 tests, either diagnostic or over-the-counter, or testing-related services, when calculating MHPAEA quantitative treatment limits.

Action Items: Employers should revisit their MHPAEA compliance testing to ensure that the coverage of COVID-19 tests is properly accounted for in applying the relevant quantitative treatment limits. There is, however, no longer a requirement that a group health plan or health insurance issuer cover these services without charge.

EMPLOYEE ASSISTANCE PLANS

The end of the NE and the PHE could have various impacts on EAPs depending on the specific plan design. Employers may, for example, see a spike in the need for mental health support that could be met through EAP services. While the pandemic may be winding down, the mental health impacts of the past three years may continue for by many employees. Employers may need to continue to offer mental health services and resources through their EAPs, and potentially explore expanding mental health services through an EAP or otherwise, to support employees who are struggling with anxiety, depression or other mental health issues related to the pandemic.

Particular attention is required in the case of excepted benefit EAPs. Excepted benefit EAPs do not provide minimum essential coverage for Affordable Care [...]

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New Mental Health Parity and Addiction Equity Act Guidance from the DOL

by McDermott Will & Emery | Jun 28, 2016 | Health and Welfare Plans, Labor, Mental Health Parity and Addiction Equity Act

The US Department of Labor (DOL) has provided guidance on health plan provisions that could trigger a violation of the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA), as amended by the Affordable Care Act. The DOL provided particular examples broken down by categories of plan provisions relating to coverage of mental health (MH)/substance use disorder (SUD) benefits which should trigger careful analysis of coverage for medical (med)/surgical med/surg) benefits to ensure compliance with the MHPAEA’s provisions regarding parity of non-quantitative treatment.

Read the full article.