On April 6, 2015, CMS announced a proposed rule intended to align mental health and substance use disorder benefits for low-income Americans with benefits required of private health plans and insurance.  The proposed rule applies certain provisions of the Mental Health Parity and Addition Equity Act of 2008 (the Act) to Medicaid and Children’s Health Insurance Program (CHIP).  Comments on the proposed rule are due by June 9, 2015.

According to CMS, the Act requires that mental health and substance use disorder benefits be no more restrictive than medical and surgical services.  The Act originally applied to private insurance and health plans and was amended by the Affordable Care Act to extend to individual health insurance coverage.  Although a final rule implementing the Act applicable to group health plans and health insurance issuers was published in 2013, the provisions did not extend to Medicaid managed care organizations (MCOs), Medicaid alternative benefit plans (ABPs), or CHIP.  Therefore, CMS is now proposing to address how the requirements of the Act will apply to MCOs, ABPs, and CHIP.

Among other things, the proposed rule seeks to implement the following measures:

• Ensure that all beneficiaries who receive services through MCOs or under ABPs have access to mental health and substance use disorder benefits regardless of whether services are provided through the managed care organization or another service delivery system.
• Obligate states to include contract provisions requiring compliance with parity requirements in all applicable contracts for certain Medicaid managed care arrangements.
• Require states to make available to the enrollee the reason for any denial of reimbursement or payment for services with respect to mental health and substance use disorder benefits.
• Ensure that plans make available upon request to beneficiaries and contracting providers the criteria for medical necessity determinations with respect to mental health and substance use disorder benefits. 

The acting director for Center for Medicaid and CHIP Services stated in CMS’s press release that, “[t]he proposed rule is a way to advance equity in the delivery of mental health and substance use disorder services. The proposal will support federal and state efforts to promote access to mental health and substance use services as part of broader delivery system reform through the Affordable Care Act.”

The proposed rule was published in the Federal Register on April 10, 2015, and is available here.  CMS’s press release regarding the rule is available here.

Reporter, Juliet M. McBride, Houston, +1 713 276 7448, jmcbride@kslaw.com