Health Insurance Marketplaces, Large Employers, Laws, Regulations & FAQs

Final FAQs on Mental Health Parity & Model Disclosure Released

mental health parity talk

Executive Summary

  • Final FAQs released clarifying Nonquantitative Treatment Limitations (NQTL), including a model disclosure form.
  • May not impose NQTL unless the same factors are used in applying those limitations comparable to and no more stringent than factors used for limitation to medical surgical benefits in the same classification. These FAQs address how to evaluate factors used to develop and apply these, including:
    • Exclusions of experimental or investigative treatments,
    • Dosage limits for prescription medications,
    • Step therapy and fail-first policies,
    • Network provider credentialing and reimbursement rates, and
    • Restrictions based on facility type.
  • MHPAEA allows for the exclusion of coverage for specific mental health conditions but beware that other federal and state laws may apply to require coverage, such as the Affordable Care Act (ACA) mandate for Essential Health Benefits (EHB).
  • Model form may be used to request information about the participants’ mental health and substance use disorder benefits and treatment limitations. Use of the model form is optional but disclosure below is required.
  • Must disclose to participants and providers the criteria used for medical necessity determinations, reason for denials and the reminder to include specific information on MHPAEA in Summary Plan Descriptions (SPD) and Summary of Benefits and Coverage (SBC).

Background

The Departments of Labor (DOL), Health and Human Services (HHS) and Internal Revenue Services (IRS), jointly “the Agencies,” finalized the Frequently Asked Questions (FAQs) providing additional guidance on nonquantitative treatment limitations (NQTL) requirements of the Mental Health Parity and Addiction Equity Act (MHPAEA). While the final FAQs and corresponding disclosure model form are largely unchanged from the proposed version, the final FAQs do provide additional clarifications. Highlights can be found below.

FAQs

Nonquantitative Treatment Limitations

An NQTL is generally a limitation, often non-numeric, on the scope or duration of benefits for treatment. In developing and applying an NQTL a plan or issuer may consider a wide array of factors. For example, a plan can consider economic factors, such as high cost growth, or other factors such as the incidence of fraud with respect to services in a particular classification. In applying those factors, the NQTL analysis does not focus on whether the final result (for example, coverage denial rates) is the same for MH/SUD benefits and medical/surgical benefits; instead, compliance depends on parity in development and application of the underlying processes and strategies. There should not be arbitrary or discriminatory differences in how a plan or issuer is applying those processes and strategies to medical/surgical benefits and MH/SUD benefits.

Question 4:     My large group health plan or large group insurance coverage provides benefits for prescription drugs to treat both medical/surgical and MH/SUD conditions but contains a general exclusion for items and services to treat a specific mental health condition, including prescription drugs to treat that condition. Is this permissible under MHPAEA?

Answer 4:       Yes. Generally, MHPAEA requires that treatment limitations imposed on MH/SUD benefits cannot be more restrictive than treatment limitations that apply to medical/surgical benefits. An exclusion of all benefits for a particular condition or disorder, however, is not a treatment limitation for purposes of the definition of “treatment limitations” as set forth in the MHPAEA regulations. The MHPAEA regulations also provide that if a plan or issuer provides benefits for a mental health condition or substance use disorder, benefits for that condition or disorder must be provided in every classification in which medical/surgical benefits are provided. Because the plan or coverage does not provide any MH/SUD benefits for that specific mental health condition in any classification, this exclusion is permissible under MHPAEA.

Mental Health / Substance Use Benefit Disclosures

The MHPAEA final regulations provide express disclosure requirements. Specifically, the criteria for medical necessity determinations with respect to MH/SUD benefits must be made available by the plan administrator or the health insurance issuer to any current or potential participant, beneficiary, or contracting provider upon request. In addition, under MHPAEA, the reason for any denial of reimbursement or payment for services with respect to MH/SUD benefits in the case of any participant or beneficiary must be made available to the participant or beneficiary. In addition to these specific disclosure obligations under MHPAEA, ERISA’s general disclosure obligation in section 104(b) and the accompanying disclosure requirement provides that, for plans subject to ERISA, instruments under which the plan is established or operated must generally be furnished to plan participants within 30 days of request. A document that specifies procedures, formulas, methodologies, or schedules that are applied in determining or calculating a participant’s benefit under the plan constitutes an instrument under which the plan is established or operated.

Question 9: I wish to request information from my ERISA-covered group health plan regarding limitations that may affect my access to MH/SUD benefits. Do the Departments have any materials that may assist me?

Answer 9: Under ERISA, plans are required to provide Summary Plan Descriptions (SPDs) that describe, in terms understandable to the average plan participant, the rights, benefits, and responsibilities of participants and beneficiaries. Plans are also required to provide a Summary of Benefits and Coverage (SBC) that includes, among other elements, a description of the coverage; the exceptions, reductions, and limitations of the coverage and the cost-sharing provisions of the coverage. The Departments encourage participants and beneficiaries to first consult their SBC, as well as their SPD, for information on how their plan covers MH/SUD benefits. If you do not have an SPD or SBC, consider requesting them. Generally, the plan is required to give participants and beneficiaries copies of these documents on request. The Departments also developed a model form that individuals, or their authorized representatives may—but are not required to—use to request information that may affect their MH/SUD benefits. This model form can be used for general requests for information regarding MH/SUD benefits and treatment limitations, such as a request for the relevant portions of the SPD or plan document. This model form can also be used to obtain documentation after an adverse benefit determination involving MH/SUD benefits to support an appeal. Furthermore, plans and issuers may find that making this model disclosure form available to their participants for enrollees may help clarify and streamline requests for information. Use of the form is optional for participants, and plans and issuers may use their own disclosure forms to help facilitate disclosure requests. The model form is set forth at the end of the FAQs discussed herein.

Action Required for Plans Utilizing NQTL

Plan sponsors should work with their carriers and Third-Party Administrators (TPA) to ensure administration of their mental health benefits is in line with this guidance. Ensure the availability of the model request for disclosure form and that disclosures are being provided when denying or applying such limitations for the mental health and substance use disorder benefits.

 

Disclaimer

The Leavitt Group is not a law firm, and cannot provide legal, tax or financial advice. The information herein is provided for your organization’s general background and educational purposes only. You should consult an attorney regarding the application of the information provided herein to your organization’s specific situation in light of your organization’s particular needs.

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