On July 25, 2023, HHS, the Department of Labor, and the Department of the Treasury (the Departments) issued proposed rules (Proposed Rules) and other information regarding health plan and issuer compliance with mental health parity requirements. These releases suggest an increasing focus on mental health parity.

Background

The Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Act (MHPAEA) was enacted in 2008 and generally requires that plans and issuers offering group or individual health insurance coverage ensure that any financial requirements (such as coinsurance or copays) and treatment limitations (such as visit limits) that apply to mental health and substance use disorder benefits are no more restrictive than predominant financial requirements or treatment limitations that apply to substantially all medical/surgical benefits in a benefit classification. In addition, MHPAEA prohibits separate limitations that would only apply to mental health and substance use disorder benefits. When MHPAEA was amended by the Consolidated Appropriations Act of 2021, a provision was added that requires plans and issuers to perform and document comparative analyses of the design and application of their non-qualitative treatment limitations (NQTLs) to demonstrate parity and provide those analysis to the Departments or to an applicable state authority upon request. NQTLs generally are plan provisions that impose non-numerical limits on the scope or duration of benefits (such as prior authorization requirements, step therapy, and provider reimbursement rates).

Proposed Rules and Technical Release

The Proposed Rules contain various proposal intended to better protect individuals seeking mental health and substance use disorder benefits and to provide clear guidance to plans and issuers on how to comply with MHPAEA requirements. The Department of Labor’s press release states that the Departments drew from their combined and individual experiences in enforcing MHPAEA and in working with plans and issuers, as well as state regulators. Among other things, the Proposed Rules would:

• Amend the existing NQTL standard to prevent plans and issuers from using NQTLs to place greater limits on access to mental health and substance use disorder benefits as compared to medical/surgical benefits;
• Require plans and issuers to collect and evaluate relevant data in a manner reasonably designed to assess the impact of NQTLs on access to mental health and substance use disorder benefits and medical/surgical benefits;
• Set forth a special rule with regard to network composition;
• Amend existing examples and add new examples on the application of the rules for NQTLs to clarify and illustrate the protections of MHPAEA;
• Set forth the content requirements for NQTL comparative analyses and specify how plans and issuers must make these comparative analyses available to the Departments, as well as to an applicable State authority, and participants, beneficiaries, and enrollees; and
• Implement the sunset provision for self-funded, non-federal governmental plan elections to opt out of compliance with MHPAEA.

Also, on July 25, 2023, the Departments issued Technical Release 2003-01P (Technical Release) requesting comments to inform guidance for proposed data collection and evaluation requirements for NQTLs related to network composition and requesting input on the development of an enforcement safe harbor for plans and issuers that submit data indicating that their networks of mental health and substance use disorder providers are comparable to networks for medical/surgical providers. The Technical Release states that the Departments are particularly concerned about how NQTLs related to network composition affect access to mental health and substance use disorder benefits.

Congressional Report and Fact Sheet

The Departments concurrently released the Second MHPAEA Comparative Analysis Report to Congress (the Report), which is a report required by federal law. The Report includes information on continued enforcement efforts related to NQTLs and the comparative analyses that plans and issuers must provide upon request to show compliance with parity requirements. The Report identifies specific plans and issuers that failed to comply with the applicable requirements of MHPAEA. Of note, the Report indicates that none of the comparative analyses submitted by plans or issuers during the reporting period were initially sufficient to satisfy legal requirements. The Report also notes that many initial responders seemed unprepared to submit their comparative analyses upon request and some plans did not complete or start a comparative analysis until after one was requested.

The Department of Labor and CMS also issued a joint fact sheet (Fact Sheet) on MHPAEA with results for cases closed in Fiscal Year 2022. In the Fact Sheet, the Department of Labor and CMS indicate, that during Fiscal Year 2022, the agencies significantly increased their NQTL enforcement activity in response to requirements imposed on plans and issuers by the Consolidated Appropriations Act of 2021.

The Press Release from the Department of Labor is available here. The Proposed Rules are available here. The Technical Release is available here. The Report to Congress is available here. The enforcement joint fact sheet is available here.