Update 5/20/2022: Recently, a draft Supreme Court of the United States opinion leaked to press regarding abortion rights (as described further in our blog, Draft Supreme Court Opinion Leak & Impact to Employer Benefit Plans). If finalized in its current form, prior Supreme Court precedent that has historically provided federal constitutional protection of abortion rights would be overturned and states would have the power to pass laws banning or restricting abortion services.
As employers navigate the impact to group health plan coverage and understand what other employee benefit plan options may be available, such as travel reimbursement options for costs related to receiving abortion services, they should be mindful of Mental Health Parity requirements (explained further below). For example, if a plan provides reimbursement for travel related to abortion services, there is potential for a parity issue if travel reimbursement coverage is also not offered for mental health benefits. As such, if an employer is considering plan changes to include expanded coverage and/or travel reimbursement, such coverage should avoid imposing more restrictive non-quantitative treatment limitations on mental health/substance abuse disorder benefits than medical/surgical benefits.
In late January 2022, the Departments of Labor, Health and Human Services, and Treasury (collectively the “Departments”) issued their 2022 Report to Congress, addressing compliance with the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) generally and serving as the disclosure requirement implemented by the Consolidated Appropriations Act, 2021 (CAA). The report summarizes group health plans’ and insurance carriers’ (insurers) compliance with certain aspects of the MHPAEA, namely design and application of non-quantitative treatment limitations (NQTLs).
The MHPAEA prohibits certain group health plans from imposing higher financial requirements (e.g., insurance and copays) or stricter treatment limitations (e.g., frequency of treatment, number of visits, days of coverage) on mental health and substance use disorder (MH/SUD) benefits as compared to medical/surgical benefits. Among its requirements, plans and issuers are prohibited from imposing more restrictive non-quantitative treatment limitations (NQTLs) on MH/SUD benefits than medical/surgical claims.
Late in 2020, the CAA amended the MHPAEA, requiring group health plans that offer MH/SUD benefits (and impose NQTLs) to perform and document a comparative analysis on the design and application of NQTLs on MH/SUD benefits (effective since February 10, 2021). In conjunction with this requirement, the DOL must provide a report to Congress annually addressing comparative analyses for NQTLs and MHPAEA compliance generally. For more information on the comparative analysis requirement, see our blog post Guidance Released on the New Mental Health Parity Comparative Analysis Requirements.
Highlights of the 2022 Report to Congress
The report summarizes the DOL and HHS’s recent MHPAEA enforcement efforts and in doing so, provides awareness of the overall MHPAEA ongoing compliance issues. Highlights from the report are as follows:
- The top NQTLs of which a comparative analysis was requested included:
- Preauthorization or precertification requirements;
- Network provider admission standards;
- Concurrent care review; and
- Limitations on applied behavior analysis or treatment for autism spectrum disorder.
- All comparative analyses submitted to both the DOL and HHS were insufficient. Examples of the insufficiencies included:
- Not preparing the comparative analysis until requested by the DOL;
- Lack of supportive evidence and proper explanation beyond conclusory statements;
- Formatting the comparative analysis using two columns (one for MH/SUD benefits; the other for medical/surgical) – the DOL was critical of this approach as it lacked proper explanation;
- NQTL requested was not specifically addressed; and
- Not demonstrating methods, analyses, or other evidence illustrating that NQTLs were no more stringently applied to MH/SUD benefits as they were applied to medical/surgical.
- Approximately 40% of plans and insurers requested additional time to submit the comparative analysis, with some employers explaining the extension was needed due to a mistaken belief that their TPA was handling this requirement.
Of note, in response to determinations of noncompliance, plans’ and insurers’ corrective action included removing exclusions for ABA therapy, medication-assisted treatment for opioid use disorder, and nutritional counseling for certain conditions, in addition to removing blanket precertification requirements and criteria limiting coverage for MH/SUD benefits.
In addition, the report explained that the Departments have increased staff significantly to better enforce MHPAEA requirements. Similarly, the Departments recommend that Congress impose civil monetary penalties for parity violations and amend ERISA to: (1) provide participants and beneficiaries the ability to recover penalties for parity violations, and (2) provide authority to pursue third parties that provide services to group health plans for parity violations.
While this report does not impose any new requirements for employers, the content is critical in achieving and maintaining compliance with MHPAEA. The report reinforces MHPAEA requirements while alerting employers of common NQTL plan design issues and insufficiencies in both the format and substance of the comparative analysis requirement. Employers should review the report’s guidance in detail and apply the Departments’ findings when implementing plan designs that impose NQTLs and when navigating the new comparative analysis requirement. To that end, as the DOL has repeatedly indicated that MHPAEA compliance is an enforcement priority, employers should ensure they are performing and documenting a comparative analysis to show compliance with MHPAEA or, alternatively, have a plan in place with their carrier (if fully insured) or third-party administrator (if self-insured or level funded) to perform and provide this analysis if requested by plan participants, the DOL, or state agencies.
- 2022 MHPAEA Report to Congress
- 2021 MHPAEA Enforcement Fact Sheet
- The Department of Labor MHPAEA Self-Compliance Tool
- FAQs About Mental Health and Substance Use Disorder Parity Implementation and the Consolidated Appropriations Act, 2021
- Sequoia Forewords:
Disclaimer: This content is intended for informational purposes only and should not be construed as legal, medical or tax advice. It provides general information and is not intended to encompass all compliance and legal obligations that may be applicable. This information and any questions as to your specific circumstances should be reviewed with your respective legal counsel and/or tax advisor as we do not provide legal or tax advice. Please note that this information may be subject to change based on legislative changes. © 2022 Sequoia Benefits & Insurance Services, LLC. All Rights Reserved