News

Last week, the tri-agencies of the Departments of Treasury, Labor, and Health and Human Services (collectively, the Departments) issued a litany of guidance designed to facilitate compliance with the Nonquantitative Treatment Limitation (NQTL) comparative analysis requirements added by the Consolidated Appropriations Act, 2021 (CAA, 2021) as they relate to the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA).

As a quick refresher, MHPAEA is a law first adopted in 2008 which was aimed at ensuring that mental and substance use health care benefits covered by health plans are provided at the same level as physical health care benefits. In other words, plans that provide mental health and/or substance use disorder (MH/SUD) benefits cannot impose more rigorous (i.e., less favorable) benefit limitations on those benefits than on medical/surgical (M/S) benefits. CAA, 2021 added a requirement under the MHPAEA in which plans and health insurance issuers must perform and document comparative analyses of the design and application of their NQTLs to demonstrate parity among MH/SUD and M/S benefits. Further, plans and issuers must  provide those analyses to the Secretaries of the Departments or to an applicable state authority upon request.

The July 2023 voluminous guidance includes several items:

Proposed Regulations

• This lengthy document proposes amendments to the 2013 final regulations implementing MHPAEA and proposes new regulations implementing the NQTL comparative analyses requirements under MHPAEA, as amended by the CAA, 2021. The proposed regulations primarily focus on design and administration of NQTLs.
• Amongst the highlights, the proposed rules would:
  • Amend the existing NQTL standard in a manner intended to prevent plans and issuers from using NQTLs to place greater limits on access to MH/SUD as compared to M/S benefits;
  • Shorten the timeframe for plans and issuers to provide their comparative analyses to 10 business days following receipt of a request for such analyses from the relevant Secretary (or an additional period of time specified by the relevant Secretary);
  • Require plans and issuers to collect and evaluate relevant data in a manner reasonably designed to assess the impact of NQTLs on access to MH/SUD and M/S benefits and consider the impact as part of the comparative analyses;
  • To the extent such data displays material differences in access to MH/SUD benefits as compared to M/S benefits, require plans and issuers to take action to address such differences and ensure parity;
  • Establish a special rule with regard to network composition (see bullet below regarding the Technical Release);
  • Amend existing examples and add new examples on the application of the rules for NQTLs to clarify and illustrate the protections of MHPAEA. Note that treatment for and/or NQTLs applicable to opioid use disorder, eating disorders, autism spectrum disorder (ASD), anxiety, depression, and other mental health conditions and substance use disorders are amongst the conditions subject to heightened scrutiny;
  • Delineate the content requirements for NQTL comparative analyses;
  • Specify how plans and issuers must make these comparative analyses available to the Departments, as well as to an applicable state authority, and participants, beneficiaries, and enrollees;
  • Solicit comments on whether there are ways to improve the coverage of MH/SUD benefits through other provisions of federal law; and
  • Implement the sunset provision for self-funded, non-federal governmental plan elections to opt-out of compliance with MHPAEA, as adopted in the Consolidated Appropriations Act, 2023 (CAA, 2023).
     

Technical Release 2023-01P

• This Technical Release focuses on network adequacy and, more specifically, how NQTLs related to network composition affect access to MH/SUD benefits, given that any such NQTL may impact a participant’s, beneficiary’s, or enrollee’s access to MH/SUD providers.
• The Departments note what is perceived as a “growing disparity” in reimbursement rates between in-network MH/SUD providers and M/S providers, as well as  in access to in-network providers for MH/SUD benefits. Accordingly, in the Technical Release, the Departments request comments to inform future guidance related to the type, form, and manner of data required to be collected and evaluated under the proposed rules, if finalized, and operational instructions on what constitutes relevant data for such NQTLs related to network composition.
• The data that is currently contemplated includes data related to out-of-network utilization, the percentage of in-network providers that are actively submitting claims, time and distance standards, and reimbursement rates.
• The Departments indicated that they are seeking “to identify key metrics that, if satisfied, would demonstrate that a plan’s or issuer’s NQTLs related to network composition do not place greater restrictions on access to MH/SUD benefits than on M/S benefits.”  While many plan sponsors have little insight into or influence over network design or standards, the establishment of key metrics might be welcome to enable plan sponsors a means of vetting network adequacy with their own third-party administrator/administrative services only providers.
• The Technical Release also contemplates a proposed enforcement safe harbor for the required data submissions for NQTLs related to network composition, which, as written, states that plans and issuers who satisfy the terms of the safe harbor (i.e., meet or exceed specific data standards to be identified in future guidance) will not be subject to an enforcement action by the Departments regarding network composition NQTLs for a period of time (which will also be specified in future guidance).
   

July 2023 Report to Congress

• CAA, 2021 requires that the Secretaries of the Departments report to Congress annually on the results of NQTL comparative analyses reviews that they have conducted.
• This July 2023 Report is intended to satisfy the CAA reporting obligation for the second year of implementation (Fiscal Year 2022).
• The July 2023 Report builds on the January 2022 Report to Congress and focuses on the Departments’ enforcement efforts and priorities related to NQTLs. The Departments have identified the following enforcement priorities:
  • Prior authorization requirements for in-network and out-of-network inpatient services;
  • Concurrent care review for in-network and out-of-network inpatient and outpatient services;
  • Standards for provider admission to participate in a network, including reimbursement rates;
  • Out-of-network reimbursement rates (methods for determining usual, customary, and reasonable charges);
  • Exclusions of key treatments for mental health conditions and substance use disorders; and
  • Adequacy standards for MH/SUD provider networks.
• The July 2023 Report contains a discussion of common deficiencies in NQTL comparative analyses submitted by plans and issuers during the applicable reporting period.
• The July 2023 Report also highlights certain information that plans and issuers provided in response to the Departments’ requests for NQTL comparative analyses that either remedied an aspect of an identified deficiency or satisfied the applicable Department’s inquiry into the NQTL altogether.
   

FY 2022 MHPAEA Enforcement Fact Sheet

• This fact sheet summarizes enforcement activity taken by the Employee Benefits Security Administration (EBSA) (the enforcing agency of the Department of Labor) and Centers for Medicare & Medicaid Services (CMS) (the enforcing agency of the Department of Health and Human Services).
• During Fiscal Year 2022, EBSA and CMS significantly increased their NQTL enforcement activity. However, this new fact sheet does not fully capture the results from EBSA’s and CMS’s expanded activity because only closed investigations are disclosed and discussed in the fact sheet, but many of the investigations were ongoing at the end of Fiscal Year 2022.
• The fact sheet nevertheless is helpful in understanding the focus and resources allocated to NQTL enforcement as well as the types of enforcement efforts that the EBSA and CMS have undertaken upon finding  violations of the NQTL rules. Examples include removing treatment exclusions, removing barriers to access treatment, and adjudication of certain claims.

As alluded to above, the new NQTL guidance is dense and contains several areas to revisit. At the top of the list to revisit: (1) potentially improving mental health and substance use disorder treatment provider networks; (2) enhancing data collection efforts to better evaluate the parity in coverage; and (3) ensuring sufficient NQTL comparative analyses are produced. Group health plan sponsors should prepare to swiftly confirm compliance under the newer standards once the regulations are finalized. Moreover, for those plan sponsors who were “waiting” to start their NQTL comparative analyses pending receipt of more guidance or until receipt of a request from the Departments, we now know with certainty that 10 business days will not suffice to prepare anything close to the meaningful and robust analysis expected by the Departments.