How are Fall and 4th Quarter treating all of you, friends? For us working benefit nerd Moms, it is hectic. Between work craziness, back-to-school activities, and reverting into pumpkin spice and sweater-mode, we are a bit overwhelmed. The two of us are constantly pushing ourselves to do too much, and we often hold ourselves to unattainable standards. Fortunately, we try to keep each other from going over the edge. When it all gets to be too much, one of us invariably points to the sign that hangs on Jessica’s office wall with a quote from Voltaire on it—"Don’t let the perfect be the enemy of the good.”
Sometimes we must remind our clients of that saying too, particularly when it comes to Mental Health Parity and Addiction Equity Act (MHPAEA) nonquantitative treatment limitation (NQTL) analyses. As we’ve mentioned before, the Consolidated Appropriations Act of 2021 requires all group health plans subject to the MHPAEA to maintain up-to-date analyses of how their plan develops and applies all its NQTLs (i.e., non-numerically based plan design restrictions like prior authorization requirements, provider reimbursement rates, formulary tiers, and exclusion lists). This report needs to conclude if each individual NQTL was designed and is being applied in parity between medical/surgical (M/S) benefits and mental health/substance use disorder benefits.
Each plan’s analysis needs to show how each NQTL is addressed by the plan in writing and on an operational basis. Put another way, the plan needs to go through all of its plan documents as well as any supplemental written materials provided by any vendor who developed the NQTL and applies it on behalf of the plan (e.g., the PBM in the case of how the formulary is developed and maintained). Each plan also needs operational data or other real-time operational assessments that show how the NQTL plays out daily.
Some of the information needed to perform an analysis is readily accessible to most plan sponsors, but unfortunately not all of it. The first thing required is the summary plan description (SPD), so hopefully, an employer can lay their hands on that! However, most of the information needed for a perfect analysis, particularly for a perfect operational assessment, needs to come from the vendors the plan engages with to perform utilization management, manage its pharmacy benefits, administer its claims, and provide network services, if applicable.
MZQ Consulting has been performing NQTL analyses for self-funded group health plans since the CAA requirements first went into effect in the Winter of 2021. In our experience, some vendors who develop and apply NQTLs on behalf of self-funded groups are ready and willing to provide group-specific data needed to fully analyze operational parity status. Quite a few more only offer: (1) generic descriptions of their operational procedures; (2) summary information they prepared for fully insured group plans, not for the specific self-funded group being analyzed and requesting their own operational data; (3) aggregated data for all groups the vendor serves; (4) incomplete operational measures; or (5) some combination thereof. Then, there are our favorite (kidding) vendors, who either refuse to give our mutual self-funded clients any of their own de-identified data or state that they will only give it to the plan if the client is actively being audited by the Department of Labor.
When a self-funded plan engages with vendors who are less than cooperative regarding MHPAEA compliance, the plan sponsor is often dismayed. The instinct is to ask and ask again for the data, try different sources at the vendor, and wait weeks and months for information that is never going to be delivered. It’s at this point we need to tell our clients that we can’t let the perfect be the enemy of the good. The employer is obligated to perform the analysis of their plan to the best of their ability. If a vendor refuses to cooperate, or only partially cooperates, and the plan cannot make a complete determination of parity status for a particular NQTL as a result, so be it. If the plan reviews what they can regarding their MHPAEA NQTL compliance and documents how they made a reasonable effort to get the outstanding data, then the plan sponsor is meeting their fiduciary responsibility to have a current NQTL analysis on hand.
If a plan has an uncooperative vendor and their NQTL analysis shows that a full evaluation was impossible to complete, then the employer should let their vendor know the results of their analysis and also take the vendor’s noncompliance into consideration when determining their future role with the plan. A group doesn’t necessarily need to fire a less-than-cooperative vendor – there may be very good reasons why a plan decides that it’s in the group’s overall best interest to keep them. For example, maybe that network is the only one in the area that will work with a self-administered union plan. Or, maybe the cost-savings of sticking with a particular PBM is so great for both the employer and plan participants that the plan determines it’s worth it to keep them. If this is the case, the plan should just document how they made their decision, what factors they considered, and why.
Friends, we understand that an NQTL analysis that includes sections without all the data we’d like to see may feel a little less than satisfying. Really, every plan sponsor wants a report proclaiming their company is in perfect compliance with the mental health parity law. As (somewhat) recovering perfectionists, we empathize. However, as compliance professionals who are all about protecting and limiting the liability of our clients, we assure you that having a current analysis performed is better than waiting or not having an analysis at all. If you don’t believe us, we’ll just quote the DOL. "The Appropriations Act expressly requires that plans and issuers now conduct and document comparative analyses of the design and application of NQTLs. Therefore, this process is no longer a “best practice;” it is required.”