Last month, the Departments of Labor, Health and Human Services and the Treasury (Departments), issued the highly anticipated final rule under the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). The original text of the MHPAEA requires group health plans to offer mental health and substance use disorder (MH/SUD) care on the same level as medical and surgical health benefits (M/S). These final rules implement the amendments made to the original text of the MHPAEA by the Consolidated Appropriations Act of 2021.
Of the many updates provided under the proposed rule, one of the key provisions carried over in the final rule requires plans and issuers that cover both M/S benefits and MH/SUD benefits and impose non-quantitative treatment limitations (NQTL) on MH/SUD benefits to perform and document a comparative analysis of the design and application of each applicable NQTL containing a specific set of elements as discussed under the final rules. Plans and issuers must make a copy of the comparative analysis available when requested by any applicable State authority, a participant, beneficiary, or enrollee who has received an adverse benefit determination related to MH/SUD benefits, and participants and beneficiaries at any time. Oftentimes, self-insured plans will not have enough data to complete the entire analysis on their own, so it will be important for plan sponsors to have proactive discussions with their TPA on the logistics of completing the analysis prior to the compliance deadline.
Although the Departments will continue to require plans to complete a comparative analysis, the final rules declined to provide an exhaustive list of the NQTLs that should be analyzed, leaving an almost infinite pool of potential NQTLs for plans to consider. The rule instead notes that the Departments intend to provide guidance and additional examples through future reports to Congress. For now, the Departments point plans and issuers towards their reports to Congress that list NQTLS on which the Departments have focused their enforcement efforts or have found the most noncompliance, as well as the 2020 Self Compliance tool that includes an illustrative non-exhaustive list.
In an effort to increase oversight and participation by plan sponsors, the new rules now provide that plan fiduciaries must certify that the Plan has engaged in a “prudent process” to select at least one qualified service provider to complete the plan’s comparative analysis, and, have “satisfied their duty to monitor those service providers as required under part 4 of ERISA with respect to the performance and documentation of such comparative analysis.” This differs from the proposed rule in which a plan fiduciary would have been required to provide certification that the plan was in compliance with the requirements relating to NQTLS under the MHPEA. The update to the final rule notes that as part of the comparative analysis, a plan fiduciary must certify that they have at the very least reviewed the comparative analysis, confirmed and understood the findings, and have taken an active part in the process by seeking assurances from their TPAs and other service providers that the plan’s NQTLs and comparative analysis comply with MHPAEA.
Many of the new substantive requirements in the Final Rule will take effect in January of 2025 for group health plans. However, given the multitude of complex changes, many of the requirements, including the meaningful benefits standard, the prohibition on discriminatory factors and evidentiary standards, the relevant data evaluation requirements, and the related comparative analyses requirements will not require compliance until 2026. Until the applicability date, plans and issuers are required to continue to comply with the existing requirements, including the CAA 2021 amendments to MHPAEA.
Employers sponsoring self-insured medical plans often rely on their TPA to satisfy compliance with the MHPAEA requirements. However, plan sponsors still remain liable not only for the outcome of the analysis, but also for the supervision and selection of the TPAs. Plan sponsors will need to be mindful of their new duties surrounding MHPAEA certification when selecting and negotiating their administrative service agreements for the upcoming year. With the non-exhaustive amount of NQTLs that can be analyzed, it will be important to vet all service providers and their willingness to assist in the reporting process.
We anticipate many challenges and litigation in the near future, but we will continue to provide updates on the new rules as they arise.
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