The Federal Government Signals its Plan to Crack Down on Inadequate Commercial Insurance Coverage of Behavioral Health and Substance Use Disorder Treatment.  

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Background 

Mental Health Parity Addiction Equity Act of 2008 (the “MHPAEA”) was a bipartisan legislation reflecting what Congress saw as a shared public concern: that it is wrong to place a greater burden on people in need of mental health substance use disorder treatment than people in need of medical/surgical treatment.  The purpose of the law was to ensure that insured individuals who seek treatment for mental health conditions or substance use disorders would not face greater barriers to access than they would for coverage of a medical condition or for a surgical procedure.  Although, as of 2020, the law covered 2.5 million private employment-based group health plans, which cover an estimated 133 million participants and beneficiaries, compliance has been woefully inadequate by the insurance industry.  According to the Department of Labor, nearly all insurers audited for compliance could not demonstrate compliance.  Timothy Hauser, Deputy Assistant Secretary for Program Operations of the Employee Benefits Security Administration (“EBSA”), stated: 

“[i]t was surprising to us, and it’s discouraging and disheartening that the analyses were as problematic as they were, and [they] fell short in the sense that there’s too much focus, I think, on papering over problematic practices.  Essentially trying to come up with post hoc rationalizations for the decisions and plan designs that seem to have been made on basis other than just trying to comply with MHPEA. A huge premium being placed on word choice, on coming up with ways to describe fairly disparate practices, using the same words in English, even though substantively the practices are very different…” 

Some examples of MHPAEA violations that insurers have been forced to correct so far include: 

  • Noncoverage of addiction treatment provided through opioid treatment programs (OTPs) 
  • Using an Employee Assistance Program as a gatekeeper for accessing mental health and substance use disorder benefits  
  • Non-coverage of Applied Behavior Analysis (ABA) therapy for treatment of autism spectrum disorder (ASD) 
  • Disparate continued stay and discharge criteria that had applied only to mental health and substance use disorder benefits for inpatient, out-of-network services 

Congressional and Executive Response 

Congress and the Executive Branch are frustrated and disappointed, and responded in 2021 by amending the Consolidated Appropriations Act, 2021 (“CAA 2021”).  Parity enforcement is one of the key components in ensuring behavioral health access for participants and beneficiaries in group health plans and for consumers across insurance markets. Together, EBSA and CMS have made MH/SUD parity and compliance with MHPAEA a top enforcement priority. Proposed Regulations were published on August 3, 2023, to implement changes required by the CAA 2021.   

Our Take: We are pleased that the federal government is taking action to ensure privately insured patients have access and coverage to mental health and substance use disorder treatment.  The federal government received over 9,500 public comments from industry on its proposed rule changes.  This signals to us two important things.  First, if the proposed rules are finalized, it will require insurance companies to expand their in-network coverage of mental health and substance use disorder providers, which may mean increasing reimbursement rates to entice providers to join their network.  Second, the health insurance industry will want to assess and provide commentary on these rules, potentially delaying any final rules and corresponding implementation dates.  Therapy Brands is watching this regulatory action closely and will keep our customers updated on its progress.  For more information, check out the White House briefing https://www.whitehouse.gov/briefing-room/statements-releases/2023/07/25/fact-sheet-biden-harris-administration-takes-action-to-make-it-easier-to-access-in-network-mental-health-care/  

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