On its website, the Employee Benefits Security Administration (the “EBSA”) has provided additional guidance, in the form of questions and answers (“Q & As”), on the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (the “Act”). The EBSA says that the Act generally requires employment-based group health plans, that provide group health coverage for mental health/substance use disorders, to maintain parity between such benefits and their medical/surgical benefits. More specifically, the Act and its implementing regulations generally:
• Provide that financial requirements (such as copays and deductibles), and quantitative treatment limitations (such as visit limits), applicable to mental health or substance use disorder benefits can generally be no more restrictive than the requirements or limitations applied to medical/surgical benefits.
• Include requirements to provide for parity for nonquantitative treatment limitations (such as medical management standards).
• Expand the parity requirements of an earlier law, the Mental Health Parity Act of 1996, such that plans may not impose a lifetime or annual dollar limit on mental health or substance use disorder benefits that is lower than the lifetime or annual dollar limit imposed on medical/surgical benefits.
The EBSA notes that more detailed information on the Act’s requirements is available at http://www.dol.gov/ebsa/mentalhealthparity/. The information provided by the Q & As includes the following:
–Interim, final regulations were issued on February 2, 2010 and are generally applicable for plan years beginning after June 30, 2010.
–A health plan may not define mental health coverage as consisting solely of inpatient care benefits. The regulations set forth six classifications of benefits: 1) inpatient, in-network; 2) inpatient, out-of-network; 3) outpatient, in-network; 4) outpatient, out-of-network; 5) emergency care; and 6) prescription drugs. If a plan covers mental health or substance use disorder benefits in one of the six classifications, the plan must provide coverage in all of the classifications in which medical/surgical benefits are available.
–A health plan may use a separate managed behavioral health organization to provide utilization review and other services with respect to mental health and/or substance abuse benefits (sometimes called a carve-out arrangement). The Act requires only that mental health and substance use disorder benefits be covered and managed in a manner that is no more stringent than medical/surgical benefits.
–The Act and its implementing regulations impose mathematical tests for determining whether a financial requirement or quantitative treatment limitation (such as a copay or visit limit) on mental health/substance use disorder benefits is permitted. Nonquantitative treatment limitations, or “NQTLs” (such as medical management standards) are not analyzed the same way. For NQTLs, the regulations provide that under the terms of the plan as written and in practice, any processes, strategies, evidentiary standards, or other factors used by a plan in applying an NQTL to mental health or substance use disorder benefits must be comparable to, and applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in applying the limitation to medical/surgical benefits, unless recognized clinically appropriate standards of care may permit a difference. For more information and guidance regarding NQTLs, see the interim final regulations, as well as the FAQs available at: http://www.dol.gov/ebsa/pdf/faq-aca7.pdf.
–The Act does not apply to employers who have fewer than 51 employees, or to retiree-only plans. There is also an increased cost exemption available to plans whose costs increase by more than a specified amount and who follow guidance issued by the government.