Category Archives: Mental Health Parity

Mental Health Parity Enforcement

On January 25th, 2022 the Tri-agencies released their 2022 annual report to congress on the Mental Health Parity and addiction equity act. Here is a little bit of background. In 2021 the Consolidated Appropriations Act (CAA), amended the MHPAEA to enforce requirements on health insurers and groups health plan issuers to “perform and document” comparative analysis on their non-quantitative treatment limitations (NQTLs). This amendment also directed the Department of Labor (DOL), Health and Human Services (HHS) and the Treasury to issue requests to group health plans and health insurance issuers for comparative analysis and supporting documentation. The Tri-agencies also issue their annual report detailing their conclusions on MHPAEA compliance each year. The following is a summation of the key enforcement results under the CAA. All results are explained in further detail in the report: The centers for Medicare & Medicaid Services (CMS) issued 15 letters in 2021 to three separate states. The EBSA issued 156 letters to plans and issuers requesting comparative analysis for 216 unique NQTLS. None of the comparative analysis reviewed to date have contained sufficient information upon initial receipt. Here are some common deficiencies: Conclusions lacking supporting evidence or detailed explanations; Failure to document comparative analysis before designing and applying for the NQTL; Document provided without adequate explanation; Lack of meaningful comparison or meaningful analysis; Failure to identify the specific MH/SUD and medical/surgical benefits affected by an NQTL; Failure to identify all factors; Lack of supporting detail about the identified factors; Failure to demonstrate compliance of an NQTL as applied; CMS has issued 19 insufficiency letters identifying deficiencies in the comparative analysis and has requested additional information. The EBSA has issued 80 insufficiency letters. The EBSA has issued 30 initial determination letters finding 48 NQTLs imposed on MH/SUD benefits lacking parity. 26 plans so far have agreed to make changes to their plans. Click on the link below for the full report: 2022 MHPAEA Report to Congress

Mental Health Civil Penalties + to Budget

Civil Monetary Penalties for Mental Health Parity Violations on plan sponsors or plan administrators was added to the pending budget reconciliation measure. There are SIGNIFICANT LOBBYING efforts happening right now around this topic, and example of which is included below. The Biden administration also has made mental health parity enforcement a high priority, going so far as to ask Congress for additional authority to fine violators, including employers. Here is an example of what we are talking about.

Aetna Class-Action Lawsuit, Mental Health

The complaint alleges that Aetna imposes a set of overly restrictive criteria to determine which residential treatment facilities are covered. The complaint, which was filed this week in U.S. District Court in the Central District of California, alleges that Aetna illegally denied claims for mental health residential treatment services. The complaint alleges that Aetna imposes a set of internally developed criteria to determine which residential treatment facilities receive coverage that are far more restrictive than generally accepted professional standards to “minimize the number of claims accepted and thereby maximizing Aetna’s own profits,” according to the lawsuit. “Unfortunately, in administering the Aetna Plans, Aetna treats mental health as less important than physical health,” the plaintiff said in the complaint. Aetna said in a letter that it was denying coverage because the facility is not accredited by an agency such as The Joint Commission, the Committee on Accreditation of Rehabilitation Facilities, the American Osteopathic Association’s Healthcare Facilities Accreditation Program or the Council on Accreditation. “This class action claims that Aetna is not following the law because it is imposing more stringent standards for mental health providers to receive coverage than for some hospitalizations,” said attorney for the plaintiff Brian Adesman. “The standards they are using and the requirements for mental health facilities don’t exist for surgical benefits or physical health benefits. Our client appealed it, and each time Aetna came back and said `you don’t meet the requirements’ and refused to cover the cost.”

“Substantially All” and “Predominant” Tests

Note: A plan applies different copays to some of its outpatient, in-network medical/surgical benefits. What copay can the plan apply to outpatient, in-network MH/SUD benefits? Step 1 –“Substantially All” Test –using a reasonable method, the plan projects plan payments to be $50 million. The plan projects plan payments for benefits that are subject to a copay to be $40 million. Because $40 million is greater than 2/3 of $50 million, a copay may be applied to MH/SUD benefits. Step 2 –“Predominant” Test –The plan applies a $35 copay to some of its med./surg. benefits, and a $20 copay to other benefits. Using the same reasonable method as in the “Substantially All” Test, the plan projects plan costs of $25 million for the benefits to which the $35 copay applies and $15 million for the benefits to which the $20 copay applies. The $35 copay is the predominant copay because it applies to more than half of the med./surg. benefits subject to a copay. Conclusion: The plan may impose any level of a copay for outpatient, in-network MH/SUD benefits that is no more restrictive than the $35 copay.

Will NQTL Require Reporting?

One of the biggest questions currently outstanding is will the DOL require plan sponsors to annual report their Comparative Analysis to them on an annual basis? The answer is … we don’t know yet, but some confidential sources have indicated that it is a good likelihood. The DOL has made enforcement of Mental Health and Substance Abuse Parity a top focus beginning February 10th, 2021. The Department of Labor, Treasury and HHS are tasked with developing a reporting process for the information to be submitted and evaluated for compliance, which is expected by the summer of 2022. Self-insured plans should take steps now to work with the TPA or carrier to ensure NQTLs for mental health/substance use disorder benefits are in parity with covered medical/surgical benefits. Stay tuned for more information as it becomes available. Contact us with questions in the meantime.

DOL Initial MHPAEA Enforcement Focus

The Department of Labor DOL has listed enforcement of MHPAEA compliance as a top priority starting in 2021. It is important to note that the DOL’s goal is compliance, not penalties. In the DOL audits and reviews to come, they have identified four specific NQTLs that are the highest priority. This is NOT to say that the entire comparative analysis is not important. Rather, these items should simply be at the top of the list for analysis: Prior authorization requirements for in-network and out-of-network inpatient services Concurrent review for in-network and out-of-network inpatient and outpatient services Standards for provider admission to a network, including reimbursement rates Out-of-network reimbursement rates, including plan methods for determining usual, customary, and reasonable charges. Plans should still perform and document analyses for all NQTLs imposed. The initial focus on the four specified NQTLs does not limit the agencies’ authority to request or review different or additional NQTL analyses.