On January 29, the Internal Revenue Service, the Employee Benefits Security Administration and the Centers for Medicare & Medicaid Services together released interim final regulations and proposed regulations under the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008.
The Act, which became law on October 3, 2008, applies to insured health plans and group health plans sponsored by businesses with 50 or more employees that offer mental health and/or substance use disorder benefits. The Act requires covered plans to handle mental health and/or substance use disorder benefits in the same way that they handle medical and surgical benefits with respect to costs and access to care. The interim final regulations list six classifications of benefits that are subject to the parity and equity requirements, including: (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.
The interim final regulations provide that medical and surgical care and mental health and substance use disorder care must be treated equally for purposes of out-of-pocket costs, benefit limits and practices such as prior authorization and utilization review. For example, an insurance policy or a group health plan may not impose separate deductibles for medical/surgical services and mental health care, and it may not apply one out-of-pocket maximum to medical/surgical services and a different out-of-pocket maximum to mental health care. Any such deductible or maximum must encompass both types of care.
Under the regulations, new disclosure rules require covered group health plans to (1) make available to interested parties the criteria for medically necessary determinations for mental health or substance abuse disorder benefits and (2) provide, upon request, the reasons for any benefit denials.
The regulations apply for plan years beginning on or after July 1.