Mental Health Parity and Addiction Equity Act of 2008
The Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA), as amended by the Affordable Care Act, generally requires that coverage for mental health/substance use disorder be no more restrictive than coverage for medical surgical services. The Department of Insurance and Financial Services (DIFS), in conjunction with the Departments of Labor (DOL) and Health and Human Services (HHS), is responsible for overseeing compliance with the mental health/substance use disorder parity requirements among group and individual health plans.
- What is MHPAEA?
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/substance use disorder benefits and medical surgical benefits.
- What is Parity?
Parity means that financial cost-sharing requirements for mental health/substance use disorder benefits (such as deductibles, copayments, coinsurance, and out-of-pocket limitations) must be comparable to those for medical surgical. Parity also applies to rules regarding care management (authorization for treatment) and treatment limitations.
Although benefits may differ across plans, parity requires that the processes related to plan benefit determinations be comparable. The ACA contributed to parity by eliminating annual and lifetime dollar limits for mental health/substance use disorder benefits.
- What type of health insurance policies and plans are required to provide mental health benefits?
MHPAEA protections extend to most health plans, including self-insured and fully insured:
- Individual health plans issued on and off 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 mental health/substance use disorder benefits. Any plan that offers mental health/substance use disorder coverage must comply with MHPAEA.
- What are some of the protections under MHPAEA?
MHPAEA requires that insurers meet mental health parity standards in two areas: quantitative limits and non-quantitative limits.
- Plans must apply comparable financial requirements (such as copay, coinsurance, deductible) for mental health/substance use disorder and medical surgical care.
- The number of outpatient visits or inpatient days covered must be comparable for mental health/substance use disorder and medical surgical care.
- Prior authorization requirements for mental health/substance use disorder services must be comparable to or less restrictive than those for medical surgical services.
These standards are applied according to classifications of benefits:
- Inpatient / in-network
- Inpatient / out-of-network
- Outpatient / in-network
- Outpatient / out-of-network
- Emergency care
- Prescription drugs
- What are Quantitative Treatment Limits (QTL)?
QTLs can be measured numerically. Health insurers generally cannot impose a financial requirement (such as copays, coinsurance, deductible) or a QTL (such as the number of outpatient visits or inpatient days covered) on mental health/substance use disorder benefits that are more restrictive than the financial requirement or QTL that apply to most – but not all – medical surgical benefits in the same classification.
For example: It’s acceptable to impose a $20 copay for a mental health visit and a $10 copay for a primary care visit, as long as the copay for most of the medical surgical services covered by your plan is $20 or more.
- What are Non-Quantitative Treatment Limitations (NQTL)?
NQTLs are processes, strategies, evidentiary standards, or other criteria that limit the scope or duration of benefits for services provided under the plan. Certain utilization reviews, prior authorization and plan provisions may only be applied to mental health/substance use disorder benefits if they are comparable to or less restrictive than those for medical surgical services.
NQTLs include, but are not limited to:
- Medical management standards limiting or excluding benefits based on medical necessity, medical appropriateness, or based on whether the treatment is experimental or investigative (including standards for concurrent review).
- Formulary design for prescription drugs.
- Network tier design.
- Fail-first policies or step therapy protocols. For example: Refusal to pay for higher-cost therapies until it can be shown that a lower-cost therapy is not effective.
- Exclusions based on failure to complete a course of treatment.
- Restrictions based on geographic location, facility type, provider specialty, and other criteria that limit the scope or duration of benefits for services provided under the plan or coverage.
It is important to note that the NQTL provisions referred to above are not prohibited outright; but are prohibited if they are applied more stringently to mental health/substance use disorder benefits than to medical surgical benefits.
- Are all Mental Health/Substance Use Disorder diagnoses covered by MHPAEA?
MHPAEA applies to all mental health/substance use disorder diagnoses that are covered by a health plan. However, a health plan is allowed to specifically exclude certain diagnoses – whether those diagnoses are considered to be in the medical surgical or mental health/substance use disorder treatment area. Any exclusions based on diagnosis must be contained in your plan’s Summary of Benefits (SOB) or Certificate of Coverage. If you are unsure, contact your insurance company.
- Why do I need a prior authorization to get the treatment my physician recommends?
Prior-authorization systems are put in place so the health insurer can determine whether a health care service, treatment plan, or prescription drug meets the plans medical necessity guidelines before receiving service.
Your health insurer may want to consult with the treating physician to discuss your medical records, nature of your symptoms, how long they have been treating you and current medical management.
- Who can I call if I have more questions about mental health parity and whether my insurance company is complying with MHPAEA?
Consumers who have additional questions about their insurance situation, or who are concerned their plan is not in compliance with MHPAEA, may contact the Department of Insurance and Financial Services (DIFS) for assistance at 877-999-6442.
Complaints can be submitted in the following ways:
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