- On June 24, 2024
The Consolidated Appropriations Act of 2021 amended the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) by requiring every health insurance issuer offering fully insured coverage and group health plan sponsors (aka employers who offer level-funded or self-funded coverage) to analyze their plans for mental health parity compliance. The analyses need to ensure that any non-quantitative treatment limitations (NQTLs) apply no more stringently to mental health and substance use disorder coverage than they do to coverage of medical and surgical treatment and coverage. All plans must evaluate their utilization management practices, formularies, networks, exclusions, and other plan management practices that could impact access to treatment and guarantee they are being applied equally or less strictly to mental health and substance use disorder care compared to other covered services. Plans need to consider how NQTLs affect inpatient and outpatient coverage, both in and out-of-network, emergency care, and prescription drugs. The analysis should examine not just the plan’s underlying written policies but also test the stringency of each NQTL by examining recent claims data and other plan- and product-specific statistics.
The deadline for health insurance carriers and group health plan sponsors to complete their first NQTL analysis was February 10, 2021, or 45 days after the CAA became law. So, carriers and group health plan sponsors who have not created and maintained NQTL analyses are already three years late. However, there is a bit of a wrinkle to the CAA’s mental health parity compliance requirement.
The CAA requirement went into effect so quickly that the federal Department of Labor did not have time to update its MHPAEA rules or prepare any guidance on how groups and health insurers should complete their analyses. The Biden Administration issued some limited guidance in April of 2021, but when the DOL began auditing entities subject to the law, all the groups they reviewed made significant mistakes. So, the Biden Administration released new proposed regulations on what would constitute effective NQTL testing last summer. As a result, many health insurance issuers and sponsors of level-funded and self-funded health plans opted to take a largely wait-and-see approach to preparing and maintaining NQTL analyses.
The Biden Administration has reviewed thousands of stakeholder comments on their proposed measure since September 2024. New mental health parity rules are widely expected to be finalized before the upcoming presidential election. Suffice it to say, if the final MHPAEA regulations look essentially like what was proposed, those rules will place an enormous compliance burden on all employers offering group health insurance coverage benefits. There could be particularly tough responsibilities for employers who provide level-funded or self-funded coverage. However, it is also possible that final rules will reduce the burden on employers who offer self and level-funded coverage and place it more firmly on the health plan vendors who design and carry out most NQTLs on behalf of these plans, like TPAs, network providers, utilization management entities, and pharmacy benefit managers.
From a broker’s perspective, it is essential to remember that CAA’s mental health parity requirements are still in effect. In short order, carriers, group plan sponsors, and health plan vendors will have much more clarity about how to implement them. So, stand ready to help your group clients navigate these rules when released. ExpressLink is here to provide you with the resources and information you need to do it.