September 10, 2024

Yesterday the Departments of Labor (DOL), Health and Human Services (HHS), and federal Treasury released a final rule regarding mental health and substance use parity, Requirements Related to the Mental Health Parity and Addiction Equity Act (MHPAEA).

The federal agencies will host a briefing on this final rule Wednesday, September 11th at 12PM Eastern. To join, use this link to register by September 10th.

This rule builds on and implements MHPAEA, providing additional protections against non-quantitative treatment limitations (NQTLs) for mental health and substance use disorder benefits as compared to medical/surgical (M/S) benefits. Examples of NQTLs include prior authorization requirements and standards related to network composition. The Departments note that the final rule will clarify and provide additional information needed for plans and issuers to meet their obligations under MHPAEA and for the Departments and states to enforce those obligations.

Highlights from the newly issued rule include:

• Comparative Analyses: Codification requiring health plans and issuers to conduct comparative analyses to measure the impact of NQTLs, consistent with MHPAEA, as amended by the Consolidated Appropriations Act, 2021.
• Prohibition on Discriminatory Factors: Prohibiting plans from using biased or non-objective information and sources that systematically, negatively impact access to mental health and substance use disorder services when applying and designing NQTLs.
• Data Evaluation Requirements: The requirement to evaluate data related to NQTLs placed on mental health and substance use disorder care and make changes if data suggest that they do not allow for adequate access to care.
• Sunset of MHPAEA Opt-Out: Implementation of the sunset provision for self-funded non-Federal governmental plan elections to opt out of complying with MHPAEA.
• Meaningful Benefits: Requirement that if a plan or coverage provides any benefits for a mental health or substance use condition in any benefits classification, it must provide meaningful benefits for that condition in every classification in which meaningful M/S benefits are provided.
• Definitions: Amendment to the terms “medical/surgical benefits,” “mental health benefits,” and “substance use disorder benefits” by removing a reference to state guidelines. The final rule maintains current provisions that if a plan or coverage defines what is or is not a mental health or substance use condition, the definition would need to be consistent with the most current version the International Classification of Diseases (ICD) or the Diagnostic and Statistical Manual of Mental Disorders (DSM). Definitions for the following terms are also included:
  • “Evidentiary standards” are any evidence, sources, or standards that a plan or issuer considered or relied upon in designing or applying a factor with respect to an NQTL.
  • “Factors” are all information, including processes and strategies (but not evidentiary standards), that a plan or issuer considered or relied upon to design an NQTL or to determine whether or how the NQTL applies to benefits under the plan or coverage.
  • “Processes” are actions, steps, or procedures that a plan or issuer uses to apply an NQTL.
  • “Strategies” are practices, methods, or internal metrics that a plan or issuer considers, reviews, or uses to design an NQTL.

The final rule applies to group health plans and health insurance issuers offering group and individual health insurance coverage. The applicability date for group health plans and group health insurance coverage generally is on the first plan year beginning on or after January 1, 2025. However, the meaningful benefits standard, the prohibition on discriminatory factors and evidentiary standards, the relevant data evaluation requirements, and the related requirements in the provisions for comparative analyses apply on the first day of the first plan year beginning on or after January 1, 2026. 

The final rules apply to health insurance issuers offering individual health insurance coverage for policy years beginning on or after January 1, 2026.  The rules also apply to grandfathered and non-grandfathered individual health insurance coverage for policy years beginning on or after Jan. 1, 2026.  On Sept. 19, 2024, DOL will hold a compliance assistance webinar and join Treasury and HHS in providing future guidance on the rules.  Until the applicability date, plans and issuers are required to continue to comply with the existing requirements, including the CAA, 2021 amendments to MHPAEA.

The final rule will become effective 60 days after publication in the Federal Register. Additional information can be found in DOL’s news release here, factsheet here, and DOL’s one-pager for providers here.

Finally, CMS is also issuing a set of Medicaid and CHIP parity compliance tools, for public comment here, that include a set of templates and instructional guides to help state agencies document compliance with MHPAEA requirements in their Medicaid managed care programs, Medicaid alternative benefit plans, and CHIP. These tools are designed to standardize, streamline, and strengthen these documentation and review processes. Comments are due on October 29, 2024.