Parity is the Law, says recent Mental Health Guidance (article)

In an on-going effort to ensure compliance with the Mental Health Parity and Addiction Equity Act (MHPAEA), as amended by the 21st Century Cures Act (“Cures Act”), the Departments of Labor, Treasury and Health and Human Services jointly issued several pieces of guidance on April 23, 2018, much of which relates to the changes made by the Cures Act (see Benefit Implications Contained in New Law, Benefit Beat, 1/10/17).

Of particular note, the Cures Act requires additional non-quantitative treatment limitation standards and appropriate disclosure requirements. The newly issued guidance comprised of Proposed FAQs, a report to Congress, an enforcement fact sheet, a self-compliance tool, as well as a revised disclosure template focus, in large part, on these matters.  Following are highlights of this guidance.

Proposed FAQs

As background, the MHPAEA requires mental health services to be treated in a substantially similar manner to all covered medical and surgical services under a health plan, including:

  • Cost-sharing requirements, such as deductibles, co-payments, coinsurance, and out-of-pocket expenses; and,
  • Treatment limitations, such as frequency of treatments, number of visits, days of coverage, or similar plan limits.

Not only does the law apply to quantitative limits, such as financial and treatment limits, but also to non-quantitative limits.  Specifically, plans cannot impose medical management standards on mental health services that would limit or exclude benefits based on medical necessity or appropriateness, or based upon whether the treatment is experimental or investigative that are more stringent than those imposed for covered medical or surgical benefits.  In the Proposed FAQs, by way of example, FAQs 2 and 3 address parity with regard to exclusions for experimental and investigative services under a health plan.  Accordingly, if a plan imposes an experimental or investigational restriction that allows an exception, it cannot include a blanket exclusion for applied behavioral analysis (ABA) therapy to treat certain children with autism spectrum disorder.  Similarly, plans cannot impose a different evidentiary standard or designated rating that is more stringent for mental health benefits than for medical/surgical benefits.  Further, FAQs 4 and 5 address parity with regard to treatment guidelines relating to prescription drug benefits.

Several proposed FAQs address differences relating to a plan’s network standards for purposes of varying levels of step therapy, provider reimbursements, and availability of providers within a network.  The tri-governing agencies emphasize that plan features that apply to medical-surgical benefits must be comparable to those that apply for mental health and substance abuse services.

Proposed FAQs 11 and 12 address the importance of updating plan materials, specifically, provider directories, to ensure current information is available to participants and enrollees.  Under ERISA, if a plan utilizes a network of providers, then its summary plan description (SPD) must contain an up-to-date, accurate, and complete general description of the participating provider network.  The provider directory can be provided as a separate document that accompanies the plan’s SPD as long as it is furnished automatically, without charge and the SPD contains a statement to that effect.  Any changes made to the document can be communicated to participants by way of a summary of material modification.  Similarly, the Affordable Care Act (ACA) requires insurers to make available an up-to-date, accurate, and complete provider directory to enrollees.

Whether required by ERISA or by the ACA, updated provider information can be provided electronically as long as the relevant electronic disclosure methodologies are followed.

Comments on the proposed FAQs are due by June 22, 2018.

Additional guidance included in the package include the following:

  • Updated model disclosure notice.  The Cures Act included a provision that allows plan participants to request information about plan coverage, or solicit information from the plan following an adverse determination of their mental health or substance abuse benefits to support an appeal. The tri-governing agencies released a revised model notice that can used for this purpose. It is not mandatory for individuals to use a notice of this nature, but it allows individuals or their representatives a means in which to solicit benefit information.  Group health plan sponsors or administrators are required to provide the requested information to the individual within 30 days of receipt.
  • MHPAEA Self-Compliance Tool.  Another requirement of the Cures Act is the creation of a self-audit tool to assist plans sponsors and insurers in their efforts to ensure and improve compliance with the MHPAEA.  To this end, the agencies released the Self-Compliance Tool for the MHPAEA that contains an overview of the requirements of the law, together with illustrations of parity, as well as compliance tips.  This document is scheduled to be updated on a biennial basis, as appropriate.
  • An MHPAEA Enforcement Fact Sheet which reflects that in fiscal year 2017, out of 187 investigations where MHPAEA applied, the Department of Labor’s Employee Benefit Security Administration cited 92 violations for MHPAEA noncompliance.  Almost half of the violations related to failure to comply with the provisions that require parity for non-quantitative treatment limit purposes.

As mentioned in last month’s Benefit Beat, there appears to be an uptick in enforcement action by the tri-governing agencies, as well as litigation relating to compliance with these rules.  Taken together with the new package of guidance, plan sponsors should expect continued enforcement of the MHPAEA law.

The information contained in this article is provided as general guidance and may be affected by changes in law or regulation. This article is not intended to replace or substitute for accounting or other professional advice. Please consult a CBIZ professional. This information is provided as-is with no warranties of any kind. CBIZ shall not be liable for any damages whatsoever in connection with its use and assumes no obligation to inform the reader of any changes in laws or other factors that could affect the information contained herein. 

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