Federal Government Publishes Additional Federal Parity Law Guidance
New FAQs and Model Disclosure Request Form Emphasize the Need for Health Plans to Implement Parity Compliance Programs

On September 5, 2019, the federal government issued additional guidance regarding the Mental Health Parity and Addictions Equity Act (MHPAEA). The Frequently Asked Questions (FAQs) guidance provides answers regarding the implementation of MHPAEA, the 21 Century Cures Act, and the SUPPORT for Patient and Communities Act. It also incorporates the much talked about Model Disclosure Request Form by consumer and provider advocates.

The 11 new FAQs primarily focus on non-quantitative treatment limitations (NQTL) and disclosures examples covering a number of mental health/substance use disorder insurance coverage issues including:

  • Experimental/investigational treatment exclusions (such as concerns about excluding applied behavioral analysis as treatment for children with autism)
  • Permissible dosage limits for prescription medications used to treat opioid use disorder
  • The use of “step therapy” and “fail-first” policies
  • Provider reimbursement rates
  • Restrictions based on facility type
  • The need to keep a health plan’s online provider directory up-to-date

The Model Disclosure Request Form (starting on page 16 of the FAQ document) is designed to help insured individuals better understand how their health plan covers mental health/substance use disorder benefits in comparison to medical/surgical benefits. The Form tracks several key parity compliance activities by asking health plans to:

  1. Provide the specific plan language regarding the limitation(s) and identify the medical/surgical and mental health or substance use disorder benefits to which it applies in the relevant benefit classification described in the regulations under MHPAEA;
  2. Identify the factors used in the development of the limitation(s) (examples of factors include, but are not limited to, excessive utilization, recent medical cost escalation, high variability in cost for each episode of care, and safety and effectiveness of treatment);
  3. Identify the sources (including any processes, strategies, or evidentiary standards) used to evaluate the factors identified above. Examples of evidentiary standards include, but are not limited to, the following:
  • Excessive utilization as defined by two standard deviations above average utilization per episode of care;
  • Recent medical cost escalation as defined by medical costs for certain services increasing 10% or more per year for 2 years;
  • High variability in cost per episode of care as defined by episodes of outpatient care being 2 standard deviations higher in total costs than the average cost per episode 20% or more of the time in a 12-month period; and
  • Safety and efficacy of treatment modality as defined by 2 random clinical trials required to establish that a treatment is not experimental or investigative;
  1. Identify the methods and analysis used in the development of the limitation(s); and
  2. Provide any evidence and documentation to establish that the limitation(s) is applied no more stringently, as written and in operation, to mental health and substance use disorder benefits than to medical and surgical benefits.

Recent MHPAEA guidance clarifies that health plans and other covered entities have an obligation to disclose to plan participants and ordering providers the criteria used for medical necessity determinations, reason for denials, and the reminder to include specific information regarding MHPAEA in Summary Plan Descriptions (SPD) and Summary of Benefits and Coverage (SBC).

However, the amount of disclosure regarding the details underpinning an NQTL parity analysis is still a hotly debated subject. In most cases, the insurance industry has recommended a short summary narrative, while many consumer advocates have pushed for all underlying details of any parity comparability analysis.

No matter the level of disclosure, it is becoming more apparent that failure to disclose any details related to a parity analysis upon request is now creating a greater risk management exposure for health plans and other entities, including those that are defined as a fiduciary under the Employee Retirement Income Security Act of 1974 (ERISA), including the health plan sponsor and in many cases, the third-party administrator.

CHQI recently launched the CHQI Mental Health Substance Use Disorder (MH/SUD) Parity Accreditation Program, the nation’s first accreditation standards for health insurers and health benefit administrators to assess compliance with the Mental Health Parity and Addiction Equity Act (MHPAEA). The program includes access to ParityManager™, a comprehensive digital resource designed to help health plans and other organizations build, implement and manage an effective parity compliance program that meets the MHPAEA disclosure requirements.

To learn more about ParityManager™ or the CHQI Mental Health Substance Use Disorder (MH/SUD) Parity Accreditation Program, contact info@chqi.com or 410-756-1300.

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