Federal Rules Released to Strengthen Mental Health Parity Compliance

July 27, 2023

The federal agencies have released new proposed Mental Health Parity and Addiction Equity Act (MHPAEA) rules to help better ensure people seeking coverage for mental health and substance use disorder (MH/SUD) care can access treatment as easily as people seeking coverage for medical/surgical (M/S) treatment. This parity requirement applies to both financial quantitative treatment limitations (QTLs) like co-pay and dollar limits or limitations on the number of days of treatment, as well as non-quantitative treatment limitations (NQTLs) such as medical necessity requirements, prior authorizations and pre-certification requirements imposed by a group health plan (GHP) or health insurance issuer. GHP sponsors should be aware of the MHPAEA compliance requirements since enforcement related to MHPAEA is a top priority for the federal agencies and the U.S. Department of Labor (DOL) is focused on GHPs for adherence to these complex requirements. See the federal agency MHPAEA webpage for background on the law and enforcement efforts, and this news release issued by the agencies on the newly released guidance. We have outlined herein what employers and plan sponsors need to be aware of related to the MHPAEA and the new proposed regulations.

MHPAEA Background and New Guidance

Enacted in 2008, MHPAEA aims to make sure people seeking MH/SUD care do not face greater barriers to treatment than those faced by people seeking treatment for M/S conditions. Generally, the MHPAEA prohibits private health insurance companies from imposing copayments, prior authorization and other requirements on MH/SUD benefits that are more restrictive than those imposed on M/S benefits. The new proposed rules amend the current MHPAEA final regulations (issued in 2013) and largely focus on requirements related to NQTLs. In conjunction with the release of the proposed rules, we note that the agencies did the following:

• Issued a technical release that requests public feedback on proposed new data collection and evaluation requirements for NQTLs related to network composition and requests input on the development of an enforcement safe harbor for plans/issuers that submit data indicating that their networks of MH/SUD providers are comparable to networks for M/S providers.

• Released the (second) 2023 Comparative Analysis Report to Congress identifying plans/issuers that failed to comply with the Act for the period of November 2021 through July 2022, as well as providing information on the continued enforcement efforts related to NQTLs and also providing a list of common deficiencies in NQTL comparative analyses and examples of how deficiencies have been cured.

• Issued a fact sheet on the MHPAEA enforcement results for cases closed in fiscal year 2022, including the MHPAEA guidance compendium listing guidance the agencies have released on MHP, organized by topic, and focused on certain specific rules with respect to which the agencies have found violations.

• Expressed their commitment to update the Self-Compliance Tool for MHPAEA issued in 2020 to reflect the related/updated guidance.

New Proposed Rules for Collection and Evaluation of Data

The new rules include a new proposed requirement regarding collection and evaluation of data by plans/insurers about the impact of NQTLs on access to MH/SUD benefits and M/S benefits and a related proposed requirement on network composition. If finalized, the proposed rules would:

• Require health plans/insurers to evaluate the patient outcomes to make sure the MH/SUD and M/S benefits are administered equally, including evaluating the health plan’s actual provider network, how much it pays out-of-network providers, and how often prior authorization is required and the rate at which prior authorization requests are denied.

• Provide specific examples that make clear that health plans must use similar factors in setting out-of-network payment rates for MH/SUD providers as they do for M/S providers and that health plans cannot use more restrictive prior authorization, other medical management techniques, or narrower networks that make it harder for people to access MH/SUD benefits than their M/S benefits.

With the proposed rules and technical release, the federal agencies aim to promote changes in network composition and medical management techniques to make MH/SUD provider networks more accessible and create parity in treatment limitations, such as network composition standards and prior authorizations, for people seeking MH/SUD treatment. The end goal appears to be a comparative analysis of safe harbor that would give health plans a list of specific NQTL data to collect. That data would then be used by health plans in their comparative analysis to show that they meet network composition standards.

Proposed Rules Do Not Have Force of Law Until Final Regulations Issued

For now, the agencies are looking for feedback on all aspects of the approach set forth in the proposed rules and the technical release. In the meantime, GHPs still remain subject to the requirements of MHPAEA. Conner Strong & Buckelew will continue to work with our clients to review plan design for MHPAEA issues and analyze and understand the complex requirements of the MHPAEA. See our Update for more on our approach as to next steps for plan sponsor’s consideration for MHPAEA adherence and compliance.  We will provide alerts and updates as new information becomes available. Please contact your Conner Strong & Buckelew account representative toll-free at 1-877-861-3220 with any questions. For a complete list of Legislative Updates issued by Conner Strong & Buckelew, visit our online Resource Center.