Mental Health & Autism Health Project Families Seeking Mental Health Residential and Other Related Treatments
The Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA), is a federal law that was enacted in order to address health insurance practices that unfairly limited coverage for mental illness and substance abuse. Generally, the law provides that health insurance companies that offer mental health or substance abuse use disorder benefits cannot impose less favorable benefit limitations on those benefits than they do on medical or surgical benefits.
The Affordable Care Act of 2010 (commonly referred to as Obamacare) expanded the Parity Act to include most individual and small group health plans.
What Is Meant by Parity?
Unfortunately, “parity” does not guarantee that your health insurance company will provide you with excellent mental health or substance abuse benefits. If your health plan is already very limited, it can be very limited on MH/SUD benefits as well. What parity promises is that your insurance company cannot impose limitations on benefits for mental health disorders if it does not impose those same restrictions on substantially all medical or surgical benefits. So for example, if your health insurance policy does not require pre-approval for substantially all outpatient medical and surgical care, it should not require pre-approval for outpatient mental health care, such as ABA therapy, intensive outpatient therapy, and partial hospital mental health care.
Does the Law Apply to Everyone?
Almost. The Parity Act applies to most group health insurance plans, including self-insured and state regulated plans, individual health plans, non-federal government plans, and some Medicaid plans (MCO’s, or Managed Care Organizations and Alternative Benefit Plans). Regulations on how the MHPAEA applies to Medicaid were recently published here. The Federal Employee Benefit Program (FEHB) is subject to MHPAEA through executive order. MHPAEA does not apply to:
- • “Grandfathered” plans that were created and purchased before March 23, 2010
- • Self-funded plans with fewer than 50 employees
- • Some non-Federal government plans may elect to opt out.
- • Plans that receive a temporary exemption based on demonstrated increased costs associated with compliance with the MPHAEA
- • Tri-Care (though this is being currently under assessment)
Benefits That Must Be Covered Equally: Five Major Rules
1. Benefit Classifications: All health care benefits are categorized into six benefit classifications and services for MH/SUD must be at parity with medical/surgical benefits in each of these categories:
- • Out-patient, in-network
- • Out-patient, out-of-network
- • Inpatient, in-network
- • Inpatient, out-of-network
- • Emergency Services
- • Prescription Drugs
For example, if a plan emergency services for medical or surgical care, it must also offer emergency services for MH/SUD.
2. Consumer Cost-Sharing and Treatment Limitations: Consumer cost-sharing such as co-pays, deductibles or co-insurance and treatment limitations cannot be more restrictive or burdensome for MH/SUD than for medical or surgical benefits.
For example, if a health plan allows unlimited outpatient medical visits per year, it cannot limit MH/SUD outpatient visits to a specified amount.
3. Nonquantitative Treatment Limitations: NQTLs applied to MH/SUD can be no more restrictive than treatment limitations applied to substantially all medical and surgical benefits covered by the plan and there are no separate treatment limitations that are applicable only with respect to mental health or substance use disorder benefits.
Some examples of NQTLs may be found here , and include:
- • Prior authorization policies
- • Medical necessity guidelines
- • Formulary design for prescription drugs
- • Fail-first or step-therapy protocols
- • Restrictions based on geographic location, facility type, or provider specialty
For example, a plan cannot exclude coverage for inpatient, out-of-network treatment of substance abuse disorders when obtained outside of the State, if there is no similar exclusion for medical or surgical benefits within the same classification. Similarly, a plan cannot require Joint Commission Accreditation for Mental Health Facilities but not for medical facilities within the same class.
An example of Fail-first/step therapy protocols that we see frequently are denials for residential treatment if clients have not previously tried partial hospital or intensive outpatient. Plans cannot do that if they do not make similar requirements on the medical/surgical side.
The law also states that there are no separate treatment limitations that are applicable only to MH or SUD benefits. Examples of these that we see all the time are exclusions for specific types of evidence based mental health treatments that do not have analogs on the medical/surgical side, including:
- • Behavior heath therapy for autism.
- • Wilderness therapy for people with moderate to severe mental health and substance use conditions.
4. Transparency of Health Plan Information:For any denial of service, the plan must include in writing the reason for the denial (if it is not medically necessary, the plan must say why), and steps on how to appeal. They also must make available to you criteria used in making their decision.
4. Out-of-Network Benefits:Access to out-of-network MH/SUD services cannot be more difficult or restrictive than it is for medical or surgical services.
Warning Signs that Your Insurer May Be Violating Federal Parity Requirements
- • Higher costs or fewer visits for mental health services than for other kinds of health care
- • Requiring pre-authorization (permission) to get mental health care covered, but not requiring this permission of substantially all other types of health care
- • Getting denied mental health services because they are not medically necessary but the plan does not provide information on the medical necessity criteria they used to make this determination
- • Lack of in-network mental health providers taking new patients when there is no shortage of inpatient providers for other healthcare
- • The plan will not cover standard or evidence based mental health treatments which do not have equivalents on the medical/surgical side, such as residential or other “intermediate” forms of therapy.
- • Plan requires “fail-first” or step-therapy protocols (where the patient is required to try a less expensive treatment before being allowed to access a more expensive one) for mental health disorders but not for other health disorders.
- • “Likelihood of Improvement” requirements – For residential treatment of MH/SUD, the plan requires likelihood that the patient will improve
- • Licensure or geographical restrictions applied only to MH/SUD
What Should You Do if You Think Your Plan is Violating Federal Parity Laws?
If you think your health plan is violating the federal parity requirements, it is important to first file a complaint with the plan. The plan typically has 30-45 days to respond, after which you may contact your state health regulator (for fully funded and Medicaid MCO plans), the Department of Labor (for most private self-insured plans), the Department of Health and Human Services (for most non-federal government plans), or the Office of Personnel Management (for FEHB plans). This information should be provided in your plan manual, usually under “how to handle disputes.” If you need help determining where to file your complaint, contact MHAIP.
Recently, a Federal Mental Health Parity Task Force issued a report to the president which included many recommendation on better implementation and enforcement of the Federal Mental Health Parity Act. Here is a new website for consumers to report complaints related exclusively to mental health, which was recommended so that consumers could more easily inform the government of problems.
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