On January 29, 2010, the Department of Health and Human Services, the Department of the Treasury, and the Department of Labor jointly issued interim final regulations implementing the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (the “MHP Act”).
The MHP Act applies to plans sponsored by employers with 50 or more employees, including self-insured and fully insured plans. The MHP Act does not mandate that a plan provide mental health or substance use disorder benefits. Rather, if a plan provides medical or surgical benefits and mental health or substance use disorder benefits, it must comply with the MHP Act’s parity provisions.
Employers, union-sponsored group health plans and insurers must review and possibly update their group health plans to comply with the expanded MHP Act regulations.
Parity in Financial Requirements
As mentioned above, under the MHP Act, any covered group health plan that includes mental health or substance use disorder benefits along with standard medical or surgical benefits generally cannot apply more limited benefit restrictions than those that apply to medical or surgical benefits. Financial requirements (such as deductibles, copayments, coinsurance and out-of-pocket limitations) applicable to mental health or substance use disorder benefits can be no more restrictive than the “predominant” financial requirements applied to “substantially all” medical or surgical benefits under a plan. The MHP Act regulations provide that the “predominant/substantially all” test applies to six classifications of benefits on a classification-by-classification basis. That is, the regulations state that if a group health plan provides coverage for mental health or substance use disorder benefits in any one or more of the six categories, it must be on par with the medical and surgical benefits offered in that category.
Parity in Treatment Limitations
Similar to the financial requirements under the MHP Act, treatment limitations (such as limits on the frequency of treatment, number of visits, days of coverage, or other similar limits on the scope or duration of treatment) applicable to mental health or substance use disorder benefits can be no more restrictive than the predominant treatment limitations applied to substantially all medical or surgical benefits under a group health plan.
While the MHP Act was generally effective for plan years beginning after October 4, 2009 (January 1, 2010 for calendar year plans), the MHP Act regulations are effective on April 5, 2010, and applicable to plan years beginning on or after July 1, 2010 (January 1, 2011 for calendar year plans). For purposes of enforcement, government agencies will take into account good-faith efforts to comply with a reasonable interpretation of the MHP Act requirements with respect to violations that occur before the regulations’ effective date.
Therefore, group health plans and insurers should begin reviewing their plans to ensure that their plan designs comply with the MHP Act’s regulations upon its effective date (in most cases, January 1, 2011). Your SGR Executive Compensation and Employee Benefits counsel can assist you with this process or answer your questions on the potential impact of the MHP Act regulations on your group health plan.