On May 12, a federal court granted a request from the Departments of Labor, Health and Human Services, and Treasury (“the Departments”) to pause litigation regarding the 2024 Mental Health Parity & Addiction Equity Act (MHPAEA) final rule while the Departments reconsider whether to modify or rescind the rule through new proposed rulemaking. Then, on May 15, the Departments announced a temporary non-enforcement period for the 2024 MHPAEA final rule that will remain in place until eighteen months after a final court decision is made, giving employers time to comply accordingly. The non-enforcement statement can be found here - https://www.cms.gov/files/document/statement-regarding-enforcement-final-rule-requirements-related-mhpaea.pdf.
While enforcement efforts for the 2024 MHPAEA final rule are paused, employers do not have to comply with the new fiduciary certification requirement, certain new definitions, the requirement to provide meaningful benefits, and the requirement to collect and analyze relevant data as part of the written comparative analysis. However, the Departments have made it clear that the framework for MHPAEA that existed prior to the 2024 MHPAEA final rule is unaffected, including the 2013 MHPAEA final rule, guidance and FAQs issued since the 2013 final rule, and the written comparative analysis for NQTLs added by Congress in the Consolidated Appropriations Act of 2021. Therefore, employers should continue to design and administer their group health plans in accordance with MHPAEA, test their QTLs for parity, and to maintain a current NQTL written comparative analysis in case of agency audit or participant request.
Plans Subject to MHPAEA
MHPAEA applies broadly to all group health plans, but not to excepted benefits or retiree-only plans. The only exception is for small (<50 employees) self-funded or level-funded plans (small fully insured plans required to cover all essential health benefits must comply).
MHPAEA Requirements
MHPAEA does not require plans to provide MH or SUD benefits, but for any plan that does, MH/SUD coverage must be provided in all benefit classifications and must comply with the following requirements within each benefit classification:
As part of claims processing, criteria for medical necessity determinations made under the plan for MH/SUD benefits must be made available upon request. In addition, the reason for any denial of reimbursement or payment for MH/SUD benefits must be made available to the participant or beneficiary. This will generally be handled by the carrier for a fully insured plan and by the TPA for a self-funded plan.
And finally, group health plan sponsors are required to prepare a written comparative analysis documenting compliance for any NQTLs imposed on MH/SUD benefits. The analysis does not need to be submitted annually (or otherwise) but instead must be completed and kept up to date in the employer’s files and provided if requested (e.g., must be provided within 10 days if requested by a federal or state agency, or within 30 days if requested by ERISA plan participants). NOTE: A thorough, compliant comparative analysis cannot be quickly pulled together within the required timeframe, so it is necessary for employers to complete it and have it ready and on file prior to any request.
MHPAEA Enforcement
There is broad bi-partisan support for continuing to improve access to MH/SUD coverage, so employers should coordinate with carriers, TPAs, PBMs and other service providers to review and confirm that financial requirements, QTLs, and NQTLs applicable to MH/SUD benefits meet parity requirements. In addition, employers should engage with their service providers and/or a vendor to document the analysis of whether NQTLs applicable to MH/SUD benefits meet parity requirements not only as written, but also in operation.
In addition to audits, the NQTL written comparative analysis provides another tool to help with enforcement. Keep in mind, the purpose of the comparative analysis is to provide further visibility into whether plans are compliant with MHPAEA. Whether the analysis is determined to be sufficient or not, if an agency audit determines that any financial requirements or treatment limitations do not comply with the parity requirements, the plan may be required to take corrective action (e.g., reprocess claims and refund participants when applicable). In addition, non-compliant plans could be subject to a penalty of up to $100/day per affected individual, and if disclosures and analyses are not provided as required, general ERISA penalties could apply (e.g., up to $110 per day that the failure persists).
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