The U.S. Department of Labor (DOL) recently announced its first settlement related to violations of the Mental Health Parity and Addiction Equity Act (MHPAEA), a case with UnitedHealthcare, and in doing so reconfirmed that ensuring mental health and substance use disorder parity is one of its highest enforcement priorities.

MHPAEA prohibits group health plans from applying financial requirements and conditions for mental health and substance use disorder benefits less favorable than those in place for medical and surgical services. Congress first enacted mental health parity in 1996 and reinforced it in 2008. Yet, concerns remain, as outlined in this 2019 Milliman report, that enrollees needing mental health and substance use disorder services too often face barriers to accessing needed care. Current concerns stem from restrictions in the way benefits are applied: the non-quantitative treatment limitations (NQTLs), such as prior authorization, step therapy, or “must fail-first” conditions, and provider credentialing requirements which may lead to inadequate network coverage for certain services.

Hence, the December 2021 Consolidated Appropriations Act (CAA) imposed new requirements on group health plans to ensure their compliance. It requires group health plans to perform and document comparative analyses of the design and application of NQTLs to ensure parity. Plan sponsors must be prepared to submit sound evidence of compliance to the secretaries of the Department of Health and Human Services, the DOL, and the Department of the Treasury within 45 days of a request.

The CAA is clear in its intent to hold federal agencies, employers, insurers, and other plan administrators responsible for closing the gap. It requires federal agencies to request detailed comparative analyses from at least 20 group health plans and/or health insurance issuers each year. The agencies are also required to issue a report to Congress each year, and make publicly available information about the comparative analyses, including the names of the group health plans selected, whether the group health plans submitted sufficient information, and whether any of the plans were found not to be in compliance with the MHPAEA. Plans unable to successfully demonstrate parity in the required timeframe are likely to receive a corrective action plan and could be subject to public shaming and financial penalties.

Unlike many of the other provisions of the CAA that affect group health plans, the MHPAEA requirements of plan sponsors under CAA section 203 went into effect on February 10, 2021. The DOL has created a self-compliance tool to support plans and insurance companies in meeting the law’s requirements. However, specific guidance on how to quantify and compare the impact of NQTLs is not yet available. These are expected by June 2022. Your plan administrator, PBM, and consulting partner will also have resources to support you on the path to ensuring and confirming mental health and substance abuse parity in your benefit offering.

Best,

Louise Y. Probst

BHC Executive Director