Mental Health Parity and Addictions Equity Act of 2008 The Law and Regulations. Bill Hudock Special Expert – Financing Policy Center for Mental Health Services. What Are The Key Concepts?. Parity – What Is It? Why Does Parity Matter? Who Does The Law/Regulations Cover?
Special Expert – Financing Policy
Center for Mental Health Services
Dictionary – equal or equivalent, at symmetry, not favoring one over another, fairly matched
Parity As A Legal Construct:
A group of State Laws Beginning In the mid 1990s – Over Half of States Have Some Form of Parity Law
1996 Federal Mental Health Parity Act:
Prohibit different annual and lifetime dollar limits
did not extend to substance use
2008 Medicare Improvements for Patients and Providers Act
By 1/1/2014 Phases out higher coinsurance for outpatient mental health care
2008 Federal Mental Health Parity and Addictions Equity Act:
Effective October 3, 2009
Regulations Effective As Policies Renew On/After July 1, 2010
2010 Health Reform Law Expands To Broader Population In 2014
Additional Financial Costs
Annual and Lifetime Maximums on Benefits
Stricter Management of the Benefit
Goal Of Parity Law Is To:
Increase Access To Treatment
Remove Discriminatory Financial Costs
More Equal Treatment For These Medical Conditions
Employer Based Insurance of Groups Over 50 Lives which choose to offer both a mental health or substance use condition benefit as well as medical/surgical benefits
111 Million Covered By Private Employer Plans
29 Million Covered By State and Local Government Plans
Medicaid Managed Care Plans, But Scope Unclear At This Time – 33.4 Million
Union Negotiated Plans and Some Government Plans (not Medicare, VA, Tricare, FEHBP, Medicaid)
Through Health Reform Parity Protections Extended:
Individuals and Small Group Employer Plans Thru Exchanges – 2014 – 25 Million
Newly Eligible Medicaid Recipients Thru Benchmark Plans – 2014 – 16 Million
CHIP Enrollees – 2010 – 40 Million
Who Does The Law and Regulations Cover?
The financial requirements (e.g., deductibles and co-payments) and treatment limitations (e.g., number of visits or days of coverage) that apply to mental health benefits or substance use disorder benefits must be no more restrictive than the predominant financial requirements or treatment limitations that apply to substantially all medical/surgical benefits
Six Categories Are Established for Determination of Parity:
In Network Inpatient
In Network Outpatient
Out of Network Inpatient
Out of Network Outpatient
Regulatory Standards For Determining Parity
MH/SUD benefits may not be subject to any separate cost sharing requirements or treatment limitations that only apply to such benefits
If a group plan provides for out of network medical/surgical benefits, it must provide for out of network mental health and substance use benefits
Standards for medical necessity determinations and reasons for any denial of benefits relating to MH/SUD must be disclosed upon request
Nonquantitative treatment limitations include medical management, step therapy and pre-authorization.
Processes, strategies, evidentiary standards, or other factors used in applying the nonquantitative treatment limitations to MH/SUD benefits to MH/SUD in a classification are comparable to and applied no more stringently than what is applied to medical/surgical benefits except to the extent that recognized clinically appropriate standards of care may permit a difference.
“A group health plan may not impose a nonquantitative treatment limitation with respect to mental health or substance use disorder benefits in any classification unless any processes, strategies, evidentiary standards, or other factors used in applying the nonquantitative treatment limitation to mental health or substance use disorder benefits in the classification are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in applying the limitation with respect to medical surgical/benefits in the classification, except to the extent that recognized clinically appropriate standards of care may permit a difference.”
Medical management standards limiting or excluding benefits based on medical necessity or medical appropriateness, or based on whether the treatment is experimental or investigative;
Formulary design for prescription drugs;
Standards for provider admission to participate in a network, including reimbursement rates;
Plan methods for determining usual, customary, and reasonable charges;
Refusal to pay for higher-cost therapies until it can be shown that a lower-cost therapy is not effective (also known as fail-first policies or step therapy protocols); and
Exclusions based on failure to complete a course of treatment.
Plan limits the number of in network outpatient visits to a mental health provider to 50 per year, but no such limit is applied to most medical/surgical conditions. There are similar limits on physical therapy treatments and chiropractic care.
The plan is in violation. The predominant level of the limitation that applies to substantially all medical/surgical benefits is that there are no limits. The mental health limit is a greater limitation.
NOTE: The law does not require that the limits be the same. It requires that the limits not be more restrictive for mental health and substance use conditions than they are for the predominant limitation that applies to substantially all medical/surgical conditions within each category.
Non Quantitative Treatment Limitation:
A group health plan limits benefits to treatment that is medically necessary. The plan requires concurrent review for inpatient, in-network mental health and substance use disorder benefits but does not require it for any inpatient, in-network medical/surgical benefits. The plan conducts retrospective review for inpatient, in-network medical/surgical benefits.
The plan is in violation because:
Although the same nonquantitative treatment limitation – medical necessity – applies to both mental health and substance use disorder benefits and to medical/surgical benefits for inpatient, in-network services, the concurrent review process does not apply to medical/surgical benefits.
The concurrent review process is not comparable to the retrospective review process. While such a difference might be permissible in certain individual cases based on recognized clinically appropriate standards of care, it is not permissible for distinguishing between all medical/surgical benefits and all mental health or substance use disorder benefits.
Non-Quantitative Treatment Limitation:
A plan generally covers medically appropriate treatments. In determining whether prescription drugs are medically appropriate, the plan automatically excludes coverage for antidepressant drugs that are given a black box warning label by the Food and Drug Administration (indicating the drug carries a significant risk of serious adverse effects).
For other drugs with a black box warning (including those prescribed for other mental health conditions and substance use disorders, as well as for medical/surgical conditions), the plan will provide coverage if the prescribing physician obtains authorization from the plan that the drug is medically appropriate for the individual, based on clinically appropriate standards of care.
The plan is in violation. Although the same nonquantitative treatment limitation – medical appropriateness – is applied to both mental health and substance use disorder benefits and medical/surgical benefits, the plan’s unconditional exclusion of antidepressant drugs given a black box warning is not comparable to the conditional exclusion for other drugs with a black box warning.
Reasons for Denials must be provided
Criteria for Medical Necessity Available Upon Request
Appeals related to Fully Insured Plans can be directed to State Insurance Commissioner
Department of Labor has primary federal responsibility
Call toll- free 1-866-444-EBSA (3272).
CMS has secondary federal responsibility
Call toll-free 1-877-267-2323 extension 6-5511
Illustrate the application of the nonquantitative treatment limitation rule to other features of medical management or general plan design;
Whether and to what extent MHPAEA addresses the “scope of services” or “continuum of care” provided by a group health plan or health insurance coverage;
How to facilitate compliance with the disclosure requirement for medical necessity criteria;
How to facilitate compliance with MHPAEA’s disclosure requirements regarding denials of mental health or substance use disorder benefits; and
Implementing the new statutory requirements for the increased cost exemption under MHPAEA
Lawsuit Sought Injunction – Not Granted co-payments) and treatment limitations (e.g., number of visits or days of coverage) that apply to mental health benefits or substance use disorder benefits must be no more restrictive than the predominant financial requirements or treatment limitations that apply to substantially all medical/surgical benefits
Regulations Effective On Renewal For Plans Beginning on 7/1/10
Good Faith Test Applies From 10/3/09 To Date Regulations Are Effective
5443 Comments Received on Interim Final Regs.
Parity Study – 2012 Report to Congress
Drafting of Additional Guidance and Final Regulations
Advocacy for Expansion or Contraction of Construct of Parity
Next Steps Regarding Parity?
Federal Register / Vol. 75, No. 21 / Tuesday, February 2, 2010 / Rules and Regulations
QUESTIONS co-payments) and treatment limitations (e.g., number of visits or days of coverage) that apply to mental health benefits or substance use disorder benefits must be no more restrictive than the predominant financial requirements or treatment limitations that apply to substantially all medical/surgical benefits