The Mental Health Parity and Addiction Equity Act of 2008

The Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) is a federal law requiring health plans to apply similar financial and treatment limits to mental health and substance use disorder (MH/SUD) benefits and medical/surgical benefits. 

Does MHPAEA apply to my health plan?
MHPAEA typically applies to most health plans, including self-insured and fully insured:

  • Individual health plans, including plans issued through the Health Insurance Marketplace
  • Large group health plans, including private and public-sector employers with more than 50 employees (certain self-insured governmental plans may opt out)

The Patient Protection and Affordable Care Act (ACA) requires small group plans to provide MH/SUD coverage as essential health benefits.  Any plan that offers MH/SUD coverage must comply with MHPAEA.

What parity means to you
Parity is defined as the quality or state of being equal or equivalent. The ACA contributed to parity by eliminating annual and lifetime dollar limits for MH/SUD benefits. When applied to MHPAEA, parity means that financial requirements, such as deductibles, copayments, coinsurance, and out-of-pocket limitations (quantitative treatment limitations) must be comparable for medical/surgical benefits as well as MH/SUD benefits. Parity also applies to rules regarding care management, authorization for treatment, and treatment limitations, also known as non-quantitative treatment limitations.

Different types of treatment limitations
Health plans are permitted to impose treatment limits; however, limits for MH/SUD benefits must be similar to the limits placed on medical/surgical services.  It does not mean that services for MH/SUD benefits should be covered in the exact same way. 

Below are two examples of how treatment limitations may show up in your health plan.

Quantitative treatment limits
Quantitative treatment limits (QTLs) can be measured numerically, such as limits on the frequency of treatment, number of visits, days of coverage, or other similar limits on the scope or duration of health benefits. 

Examples of QTLs include different copayment amounts, out-of-pocket restrictions, and separate deductibles or other cost-sharing requirements for medical/surgical and MH/SUD benefits. 

MHPAEA also addresses how to measure parity for QTLs.  Health plans cannot impose QTLs on MH/SUD benefits that are more restrictive than the “predominant” requirement that applies to “substantially all” medical/surgical benefits in the same classification.

The six classifications are:

  1. Inpatient in-network
  2. Inpatient out-of-network
  3. Outpatient in-network
  4. Outpatient out-of-network
  5. Emergency care
  6. Prescription drugs 

Intermediate levels of service (e.g., skilled nursing, home health, residential treatment for substance use disorders) must also be treated consistently between medical/surgical benefits and MH/SUD benefits and placed in the same classification for both.

Non-quantitative treatment limits
Since non-quantitative treatment limitations (NQTLs) apply differently than QTLs, MHPAEA applies a separate parity requirement. NQTLs are non-numerical restrictions, such as requiring prior authorization on only MH/SUD benefits, separate formulary design and step therapy protocols for prescription drugs treating MH/SUD, and different reimbursement rates for medical/surgical and MH/SUD providers. 

The parity rule for NQTLs is any processes, strategies, evidentiary standards or other factors in applying the NQTLs to MH/SUD benefits must be comparable to, and applied no more stringently than, those processes, strategies, evidentiary standards or other factors used in applying the NQTLs to medical/surgical benefits in the same classification. 

What are my benefits?
To find the MH/SUD benefits under your health plan, refer to your Summary of Benefits and Coverage (SBC).  This is an easy-to-understand summary about your benefit levels and coverage and is required to be provided to you.  If you need a copy of this document, contact your health carrier.   

The SBC will explain the financial requirements (whether a copayment is applied and if prior authorization is required) for an in-network mental health office visit and identify if there are benefits for an out-of-network provider. 

(Please click on the graphic below to enlarge it.)
MHPAEA Compliant Summary of Benefits and Coverage

You can find more detailed information about your benefits in your health plan, also known as a health insurance policy, certificate of coverage, or certificate of insurance.  These are the health plan materials you received from your health carrier explaining the insurance coverage you purchased.

To ensure the provider you are planning to visit is covered by your health plan, you may consider contacting your health carrier or visiting the provider directory on your health carrier’s website. 

Prior authorization and other commonly used health insurance terms can be found on DIFS’ Glossary of Health Coverage Terms

I don’t think my plan has parity
DIFS reviews individual and group health plans to ensure compliance with all laws, rules, and regulations.  If you are concerned your health plan is not in compliance with MHPAEA or need to file a complaint, please contact DIFS at 877-999-6442 or visit our website to file a complaint.

I disagree with the way my health plan processed my claim
Health Insurance What To Do When Things Go Wrong video

If your health carrier has denied, reduced, or terminated a health care service and you disagree with their decision, you have the right to file an appeal or grievance through your health carrier’s internal formal grievance process.  The Health Coverage Grievances and Appeals page of DIFS’ website explains your rights under Michigan law.   

 

MH/SUD claims are often denied for clinical reasons, such as “the treatment isn’t medically necessary,” or for administrative reasons, such as “the service provider is out-of-network.”
If the claim was denied because the health carrier determined the service was not medically necessary, you have the right to know the criteria they used to make the decision.  The definition of medical necessity should be included in your health plan.  You can also find a typical definition on our Glossary of Health Coverage Terms .   

Mental health resources

Other helpful links: