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Archive for November, 2013

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AMHCA Hails Release of Final Mental Health Parity Regulations

On Friday, Nov. 8, a landmark event for mental health coverage and benefits occurred: The federal government issued a long-awaited “final rule” dictating that mental health benefits offered by health plans be covered equal to general health benefits. The final rule provides the specific clarity needed to move forward in implementing mental health parity.

Parity Rally 2008
The push for mental health parity has a long history. At a March 2008 rally for mental health parity on the steps of the U.S. Capitol, then House Majority Leader Steny Hoyer (D-Md.) is at the podium. Flanking him are, from left, former Rep. Jim Ramstad (R-Minn.), former Rep. Patrick Kennedy (D-R.I.), former First Lady Rosalynn Carter, and then Speaker of the House Nancy Pelosi (D-Calif.). AMHCA was represented at the rally by Beth Powell (not shown), then director of public policy and professional issues.
The government’s action was essentially the final aspect of implementing The Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA), which was signed into law by President Bush in 2008.The federal law generally prevents group health plans and health insurance issuers that provide mental health and substance use disorder (MH/SUD) benefits from imposing less favorable benefit limitations on those benefits than on medical/surgical coverage. The final parity rule—which also applies to policies marketed and sold through the health insurance exchanges under the Affordable Care Act (ACA)—is a milestone because it recognizes how integral mental health is to overall health. It also goes a long way to ending discrimination and stigma toward people with mental health and substance abuse disorders. Passage of the ACA, which dramatically expands coverage to uninsured people with mental health conditions, has ushered in a new era for behavioral health care. The ACA contains an essential health benefits package that includes MH/SUD benefits next to hospitalization, and outpatient and prescription drug benefits, and these benefits are at parity with medical and surgical benefits. Under the ACA, individuals will be able to secure health insurance coverage with a robust mental health benefits package that must be equal to medical benefits. Clinical mental health counselors (CMHCs)—who provide services such as screening and diagnostic services for adults, children, families, and couples as well as group counseling and therapy—will enjoy the same benefits as other general health-care practitioners. Specific consumer protections in the final rule include:
  • Ensuring that parity applies to intermediate levels of care received in residential treatment or intensive outpatient settings;
  • Clarifying the scope of the transparency required by health plans, including the disclosure rights of plan participants, to ensure compliance with the law;
  • Clarifying that parity applies to all plan standards, including geographic limits, facility-type limits, and network adequacy; and
  • Eliminating the provision that allowed insurance companies to make an exception to parity requirements for certain benefits based on “clinically appropriate standards of care,” which clinical experts advised was not necessary and was confusing and open to potential abuse.

History and Summary of MHPAEA Protections

The Mental Health Parity Act of 1996 (MHPA) provided that large group health plans cannot impose annual or lifetime dollar limits on mental health benefits that are less favorable than any such limits imposed on medical/surgical benefits. The MHPAEA preserves the MHPA protections and added significant new protections, such as extending the protections to substance use disorders. Although the law requires equivalence in the way MH/SUD and medical/surgical benefits are treated with respect to annual and lifetime dollar limits, financial requirements, and treatment limitations, MHPAEA does not require large group health plans and their health insurance issuers to cover MH/SUD benefits. The law’s requirements applied only to large group health plans and their health insurance issuers that choose to include MH/SUD benefits in their benefit packages. However, with the passage of the Affordable Care Act and the inclusion of an essential health benefits package that includes behavioral health benefits, the vast majority of Americans will now have health insurance coverage that includes mental health and substance abuse benefits.

Key Provisions of the Nov. 8 Final Rule

  • Insurers’ financial limits on mental health conditions (co-payments, deductibles, and other out-of-pocket expenses) must be equal to those for general health conditions. The rule also makes it clear that treatment visits for mental illness and substance abuse have no greater limitations than for other medical conditions.
  • Insurers must use equitable criteria to make decisions about care. For example, insurers cannot use criteria for denying or limiting inpatient psychiatric treatment that are more stringent than criteria used for other forms of inpatient medical treatment.Moreover, health plans must disclose the “processes, strategies, evidentiary standards, and other factors used by the health plan to determine whether and to what extent a benefit that is subject to a Non-Quantitative Treatment Limitation (NQTL) be comparable and applied no more stringently for MH/SUD than for medical/surgical.”
  • Insurers must be forthright and transparent about the criteria they use to approve or deny care. This is fundamentally important for individuals and families to navigate the complexities of insurance.The criteria for medical necessity determinations must be made available to any current or potential enrollee or contracting provider on request. MHPAEA also requires that the reason for denial of coverage or reimbursement must be made available on request. New disclosure requirements in the final rule will require plans to provide written documentation within 30 days of how their processes, strategies, evidentiary standards, and other factors used to apply an NQTL were imposed on both medical/surgical and MH/SUD benefits. Also, during the appeals process, health plans must provide the insured, free of charge, with any new or additional evidence that the health plan considered, relied on, or generated in connection to a claim.
  • Finally, parity explicitly applies not only to medical treatment, but also to vital services and supports essential for many in recovery—including rehabilitative services, case management, and residential treatment.For example, if a health plan classifies care in skilled nursing facilities or rehabilitation hospitals as an inpatient benefit, then the health plan must likewise treat any covered care in residential treatment facilities for mental health or substance use disorders as an inpatient benefit. In addition, if a health plan treats home health-care as an outpatient benefit, then any covered intensive outpatient mental health or substance use disorder services and partial hospitalization must be considered outpatient benefits as well.

Praise for Parity

SebeliusSeveral key federal officials extolled the virtues of the final parity rule. “This final rule breaks down barriers that stand in the way of treatment and recovery services for millions of Americans,” said HHS Secretary Kathleen Sebelius (shown at right). “Building on these rules, the Affordable Care Act is expanding mental health and substance use disorder benefits and parity protections to 62 million Americans. This historic expansion will help make treatment more affordable and accessible.” “Americans deserve access to coverage for mental health and substance use disorders that is on par with medical and surgical care,” said Treasury Secretary Jacob J. Lew. “These rules mark an important step in ending the disparities that exist in insurance plans, and will provide families nationwide with critical coverage and protections that fulfill their health needs.” “New efforts are under way to expand coverage to the millions of Americans who have lacked access to affordable treatment for mental and substance use disorders,” said Labor Secretary Thomas E. Perez. “These rules will increase access to mental health and substance abuse treatment, prohibit discriminatory practices, and increase health plan transparency. Ultimately, they’ll provide greater opportunities for affordable, accessible, effective treatment to Americans who need it.”

Exceptions Remain to the MHPAEA Final Rule and Requirements.

MHPAEA requirements do not apply to:
  • Small private employers who have 50 or fewer employees.
  • Large group health plans that are exempt from MHPAEA based on their increased cost. Large group health plan sponsors that make changes to comply with MHPAEA and incur an increased cost of at least two percent in the first year that MHPAEA applies to the plan (the first plan year beginning after Oct. 3, 2009) or at least one percent in any subsequent plan year (generally, plan years beginning after Oct. 3, 2010) may apply for an exemption from MHPAEA based on their increased cost.If such a cost is incurred, the plan is exempt from MHPAEA requirements for the plan year following the year the cost was incurred. Subsequently, the plan sponsors must notify the plan beneficiaries that MHPAEA does not apply to their coverage. These exemptions last one year. After that, the plan is required to comply again; however, if the plan incurs an increased cost of at least one percent in that plan year, the plan could claim the exemption for the following plan year.
  • Self-funded, non-federal governmental employers who opt out of the MHPAEA requirements. Non-federal governmental employers who provide self-funded group health plan coverage to their employees (coverage that is not provided through an insurer) may elect to exempt their plan (opt out) from the requirements of MHPAEA by following the Procedures & Requirements for HIPAA Exemption Election. They must also issue a notice of opt-out to enrollees at the time of enrollment and on an annual basis. Thereafter, the employer must also file the opt-out notification with the Centers for Medicare and Medicaid Services (CMS).

Further Guidance on Government Payment Programs Still Needed

Several key behavioral health issues remain that will need to be resolved and many details still need to be clarified. AMHCA is concerned that the federal government has not yet indicated how parity requirements apply to managed-care health plans offered through Medicaid and the Children’s Health Insurance Program (CHIP). The ACA calls for parity in several of these plans as well. The Department of Health and Human Services has promised that it will issue guidance on this important topic in the near future. This is critically important because millions of people living with mental illness are covered through these plans.   Find this article and others like it at http://www.amhca.org/news/amhca.aspx
Joel E. Miller
AMHCA Executive Director & CEO
11/12/13

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