The Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) requires that group health plans and health insurance issuers offering group or individual health insurance coverage provide Mental Health or Substance Use Disorder (MH/SUD) benefits in parity with medical or surgical (med/surg) benefits. New guidance from the Departments of Labor and Health & Human Services identifies “warning signs” for group health plans that may indicate noncompliance with the MHPAEA. Group health plans should review their plan to ensure that any limitations on the scope or duration of benefits are applied to both MH/SUD and med/surg benefits. The Warning Signs publication can be found here.

Quantitative and Non-Quantitative Treatment Limitations – What are these?

The MHPAEA defines two types of limitations on the scope or duration of benefits for treatment: quantitative treatment limitations (QTLs), and non-quantitative treatment limitations (NQTLs). QTLs are numerical limits on treatment – such as visit limits. NQTLs are non-numerical limits on the scope or duration of treatment – such as pre-authorization requirements.

The parity of MH/SUD and med/surg benefits under a given health plan is determined by compliance with requirements for these limitations, in addition to financial requirements, such as copays. Under MHPAEA regulations, a plan or issuer may not impose an NQTL upon MH/SUD benefits unless the processes, strategies, evidentiary standards, or other factors used in applying the NQTL to MH/SUD benefits are comparable to, and applied no more stringently than, those used in applying the limitation to med/surg benefits in the same classification.

NQTLs Examples:

  • Medical management standards limiting or excluding benefits based on medical necessity or medical appropriateness, or based on whether the treatment is experimental or investigative (including standards for concurrent review)
  • Formulary design for prescription drugs
  • Network tier design
  • Standards for provider admission to participate in a network, including reimbursement rates
  • Plan methods for determining usual, customary, and reasonable charges
  • Fail-first policies or step therapy protocols
  • Exclusions based on failure to complete a course of treatment
  • Restrictions based on geographic location, facility type, provider specialty, and other criteria that limit the scope or duration of benefits for services provided under the plan or coverage

Triggering language:

The new guidance focuses on NQTLs and the identification of provisions that will trigger an inquiry into the parity of the health plan. If a plan contains any of the following types of provisions on MH/SUD benefits, without the same types of provisions on med/surg benefits, a plan or issuer may be imposing an impermissible NQTL. These terms do not automatically violate the MHPAEA, but will require the plan to provide evidence to substantiate compliance, including further review of the strategies, evidentiary standards, or other factors used in applying the NQTL to both MH/SUD and med/surg benefits.

The guidance recommends that group health plans review their policies for the following types of provisions. If these types of limits are applied to MH/SUD benefits, they must also be applied to med/surg benefits, and must be applied to both MH/SUD and med/surg benefits in compliance with the MHPAEA. This is not an exhaustive list. Review the guidance for a complete list of “warning signs.”

  • Plan requires preauthorization for all MH/SUD services
  • Plan states that if the insured is admitted to a mental health or substance abuse facility for non-emergency treatment without prior authorization, insured will be responsible for the cost of services received
  • Plan requires pre-notification or notification ASAP for non-scheduled MH/SUD admissions and reduces benefits 50% if pre-notification is not received
  • Plan requires preauthorization for all inpatient and outpatient treatment of chemical dependency and all inpatient and outpatient treatment of serious mental illness and mental health conditions
  • Plan requires preauthorization or concurrent care review every 10 days for MH/SUD services but not for med/surg services
  • Plan requires preauthorization every three months for pain medications prescribed in connection with MH/SUD conditions
  • For inpatient SUD rehabilitation treatment plan requires a member to first attempt two forms of outpatient treatment, including the intensive outpatient, partial hospital, outpatient detoxification, ambulatory detoxification or inpatient detoxification levels of care
  • Plan only covers services that result in measurable and substantial improvement in mental health status within 90 days
  • For MH/SUD benefits, plan requires a written treatment plan prescribed and supervised by a behavioral health provider
  • Plan excludes services for chemical dependency in the event the covered person fails to comply with the plan of treatment, including excluding benefits for MH/SUD services if a covered individual ends treatment for chemical dependency against the medical advice of the provider
  • Plan excludes residential treatment for chemical dependency
  • Plan imposes a geographical limitation related to treatment for MH/SUD conditions but does not impose any geographical limits on med/surg benefits