This report provides a comparative analysis of the Mental Health Parity and Addiction Equity Act (MHPAEA) enforcement efforts undertaken by the Employee Benefits Security Administration (EBSA) and the Centers for Medicare & Medicaid Services (CMS) under the Consolidated Appropriations Act (CAA).
I. EBSA Enforcement of MHPAEA Under the CAA
EBSA has significantly increased enforcement actions since the CAA’s enactment, requesting comparative analyses for hundreds of Non-Quantitative Treatment Limitations (NQTLs). These actions have led to the removal of barriers to mental health/substance use disorder (MH/SUD) coverage for millions and the reversal of MH/SUD benefit denials.
A. EBSA’s NQTL Enforcement Priorities (November 2021 – July 2022)
EBSA prioritized reviewing NQTLs using enforcement tools provided by the CAA. Six priority areas were identified:
- Prior authorization for inpatient services (in-network and out-of-network).
- Concurrent care review for inpatient and outpatient services (in-network and out-of-network).
- Provider network admission standards (including reimbursement rates).
- Out-of-network reimbursement rate determination methods.
- Exclusions of key MH/SUD treatments (new priority).
- MH/SUD provider network adequacy standards (new priority).
Network adequacy, specifically provider network composition and reimbursement rates, was highly prioritized due to concerns about patients struggling to find in-network MH/SUD providers.
B. EBSA’s NQTL Enforcement Approach
EBSA utilizes plan documents, operational examinations, collaborations with regulatory partners, media reports, litigation, complaints, and advocacy groups to identify potential violations. This targeted approach maximizes limited resources by addressing violations with the greatest impact on beneficiaries.
EBSA focuses on service providers impacting numerous plans. When violations are found, EBSA investigates the service provider’s role in designing and administering the NQTL across all plans they serve. This strategy allows for broader corrective action.
One initiative targets service providers potentially excluding key MH/SUD treatments. EBSA contacts these providers directly to:
- Identify affected plans.
- Determine if a compliant comparative analysis exists.
- Facilitate corrective actions, including policy changes, plan amendments, participant notifications, and claim re-adjudication.
This proactive approach has led to numerous service providers removing potentially impermissible exclusions without requiring individual plan investigations, impacting thousands of plans and millions of participants. EBSA is expanding this initiative to address exclusions of Applied Behavior Analysis (ABA) therapy, Medication-Assisted Treatment (MAT), and nutritional counseling.
C. EBSA Enforcement Results and Impact
1. Results (November 2021 – July 2022)
Corrections were achieved at various stages of the NQTL review process, including:
- NQTL removal.
- Plan document and disclosure changes.
- Amended practices and claims processing.
- Benefit coverage expansion.
- Reduced NQTL scope.
- Submission of compliant comparative analyses.
- Claim re-adjudication and payment of wrongly denied claims.
- Notice to participants regarding claim resubmission opportunities.
During this period, EBSA issued:
- 25 initial letters requesting analyses for 69 NQTLs (57 unique).
- 52 insufficiency letters covering over 100 NQTLs.
- 22 initial determination letters finding violations for 26 NQTLs (20 unique).
- 3 final determination letters finding violations for 3 NQTLs.
Significantly, most corrections were obtained without issuing non-compliance determinations, demonstrating the effectiveness of EBSA’s proactive approach.
2. Cumulative Results (February 2021 – July 2022)
A broader perspective reveals the full scope of EBSA’s enforcement efforts. Since February 2021, EBSA issued:
- 182 initial letters requesting analyses for over 450 NQTLs (over 270 unique).
- 138 insufficiency letters covering over 290 NQTLs.
- 53 initial determination letters finding violations for 76 NQTLs (56 unique).
- 3 final determination letters finding violations for 3 NQTLs.
These efforts resulted in 104 plans/issuers correcting 135 NQTLs, benefiting over 4 million participants in more than 39,000 plans.
3. Status of Unique NQTL Reviews from January 2022 Report
EBSA continues to address the 217 unique NQTLs identified in the January 2022 report. As of July 31, 2022:
- Approximately 127 unique NQTLs are under review.
- Approximately 90 unique NQTLs are either in the correction phase or no longer being pursued due to plan termination, NQTL removal, or resolved concerns.
4. Impact Examples
a. Corrections to Various MH/SUD Benefit NQTLs
- Example 1: A plan excluding MH/SUD residential treatment was found non-compliant. The plan removed the exclusion and reprocessed denied claims.
- Example 2: A plan using an Employee Assistance Program (EAP) as a gatekeeper for MH/SUD services was found non-compliant. The plan ended this practice, amended plan documents, and issued new member cards.
b. Corrections to SUD-Specific NQTLs
- Example 5: A plan excluding methadone treatment for opioid use disorder was found non-compliant. The plan removed the exclusion, reprocessed claims, and paid denied claims.
- Example 6: A service provider discriminatorily denied coverage for drug testing related to MH/SUD treatment. EBSA’s investigation led to the reprocessing of over 3,000 claims and over $1 million in payments to participants and providers.
c. Corrections to NQTLs on ABA Therapy for Autism Spectrum Disorder (ASD)
- Example 8: A plan excluding ABA therapy for ASD removed the exclusion before a formal comparative analysis request was issued.
5. Ongoing Challenges and Future Efforts
While significant progress has been made, ensuring full MHPAEA compliance requires continued effort. EBSA highlights concerns regarding the quality of comparative analyses submitted by plans and issuers. Many analyses lack sufficient detail and data to demonstrate compliance, requiring extensive investigative resources from EBSA.
Sustained effort, plan/issuer cooperation, legislative recommendations, and increased funding are crucial for achieving full parity in MH/SUD benefits.
D. Statutory Reporting Requirements
1. Requests and Non-Compliant Plans
EBSA issued 25 letters requesting analyses for 69 NQTLs (57 unique) during the reporting period. Since April 2021, 182 letters requesting analyses for over 450 NQTLs (over 270 unique) have been issued across 101 investigations.
The following plans received final determinations of non-compliance:
- International Brotherhood of Electrical Workers (IBEW) Local Union No. 126 Health and Welfare Plan
- North Shore Healthcare LLC Health Care Plan
- Pipefitters Union Local No. 537 Health and Welfare Fund
2. Sufficiency of Responses
Most initial comparative analyses were insufficient, lacking required content elements. Common deficiencies include:
- Inadequate explanation of factor application in determining which benefits are subject to NQTLs.
- Lack of demonstration of comparable factor application to MH/SUD and medical/surgical benefits.
- Insufficient explanation of NQTL operation and differences in application.
- Lack of data demonstrating comparable application in operation.
EBSA emphasizes the need for more complete and data-driven comparative analyses in the future.
3. Compliance with Disclosure Requirements
a. Initial Determinations
Since February 2021, EBSA issued 53 initial determinations of non-compliance for 76 NQTLs (56 unique). During the reporting period, 22 initial determinations were issued for 26 NQTLs (20 unique).
b. Enforcement Impact on Access
EBSA’s efforts led to 104 plans/issuers correcting 135 NQTLs, impacting over 4 million participants in over 39,000 plans.
4. Specifications Regarding Sufficiency of Responses
138 insufficiency letters were issued since February 2021, indicating a widespread issue with insufficient comparative analyses.
5. Specifications Regarding Compliance
Three final determinations of non-compliance were issued during the reporting period due to insufficient comparative analyses and impermissible NQTLs.
II. CMS Enforcement of MHPAEA Under the CAA
CMS enforces MHPAEA for issuers in direct enforcement states and non-federal governmental plans in all states. Between March and June 2022, CMS requested 21 comparative analyses.
A. CMS’ NQTL Enforcement Priorities
CMS prioritized prior authorization (13 requests) and concurrent review (7 requests) treatment limitations. A new focus area included prescription drug exclusions for specific conditions.
B. CMS’ NQTL Enforcement Approach
CMS utilized risk-based selection based on prior non-compliance indications and supplemented with random issuer selections. Entrance conferences were introduced to provide early assistance and clarify expectations. Ongoing technical assistance was offered throughout the review process.
C. CMS Enforcement Results and Impact
Plan sponsors and issuers implemented corrective actions based on CMS determinations. Final determinations of non-compliance triggered notification requirements to enrolled individuals.
1. Corrective Actions for Insufficient Comparative Analyses
Corrective actions included providing missing information, documentation, and operational data metrics to support comparative analyses.
2. Corrective Actions for Impermissible Treatment Limitations
Corrective actions included removing limitations, conducting self-audits to assess member impact, and re-adjudicating claims.
D. Statutory Reporting Requirements
1. Summary of Requests and Identification of Non-Compliant Plans and Issuers
21 comparative analyses were requested across 7 NQTLs for Plan Year 2022.
2. CMS’ Findings Regarding Compliance with PHS Act Section 2726(a)
All 21 comparative analyses submitted for Plan Year 2022 were initially insufficient. Seven final determinations of non-compliance were issued for Plan Year 2021 reviews.
a. Examples of Corrective Actions
Corrective actions included improved analysis of operational comparability, providing additional supporting documentation, and demonstrating the stringency of factors.
b. Non-Compliant Plans and Findings
Five plans/issuers received final determinations of non-compliance for Plan Year 2021 due to insufficient comparative analyses and non-comparable NQTL application. These plans/issuers were required to notify enrolled individuals of the non-compliance. All required notifications were completed.
