Employee benefit plans are subject to numerous laws the restrict, or at least limit, discrimination within the plans. Many benefit plan nondiscrimination rules focus on whether highly and non-highly compensated employees are receiving equal treatment under those plans; however, the recently enacted Consolidated Appropriations Act, 2021 (CAA) is bringing some attention to an often-overlooked discrimination rule that prohibits group health plans from discriminating with respect to mental health and substance use disorder benefits (MH/SUD benefits).
The nondiscrimination rules on MH/SUD benefits have been around, in their current form, since the Mental Health Parity and Addiction Equity Act (MHPAEA) was enacted in 2008. MHPAEA, in itself, does not require insured and group health plans to provide MH/SUD benefits, but if a plan does provide these benefits, the MHPAEA requires the plans to provide those benefits in parity with medical/surgical benefits. The law does this by prohibiting plans from imposing restrictions and limitations on MH/SUD benefits that are more stringent than the parallel restrictions and limitations that apply to medical/surgical benefits.
The CAA is shining a spotlight on these requirements by requiring insurers and health plans to perform an analysis on a specific type of treatment limitation that is required to be in parity – nonquantitative treatment limitations, or NQTLs. These are treatment limitations that are, in short, not based on numerical limits – i.e., limits that are not specific dollar-based limits or based on a number of visits. Examples of NQTLs include pre-authorization requirements, step-therapy, or fail first requirements.
Specifically, the CAA requires plans and insurers to perform a comparative analysis on NQTLs within the plan and prepare a report on that analysis that must be available upon request from the Department of Labor (DOL), the Department of Health & Human Services (HHS), and the Treasury Department. Although the DOL is required to issue additional guidance on this requirement, the law allows those agencies to request the report from plans and insurers today.
We recommend plans and insurers take the following steps:
- Ask insurers or third-party administrators what steps they are taking to help plans meet these requirements. For example, has the insurer or administrator at least identified provisions or procedures in the plan that may be viewed as NQTLs?
- Consider using the DOL’s tool for MHPAEA self-compliance
- Consider whether revisions to service provider agreements are necessary