New Guidance on NQTL Under the MHPAEA

The recently passed Consolidated Appropriations Act (CAA), in addition to providing additional funding for mental health and substance abuse services, provides guidance and imposes additional reporting and compliance obligations on group health plans and health insurance issuers that provide mental health and/or substance use disorder benefits.

The Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA), as amended by the Affordable Care Act (ACA) and state insurance laws, requires parity between medical and mental health/substance abuse disorder benefits. The parity comes in the form of both quantitative and nonquantitative treatment limitations (NQTLs). Nonquantitative treatment limitations are limitations on benefits that are not tied to specific monetary or visit limits. Such as requiring preauthorization for treatment.

The CAA revises ERISA, the PHSA, and the tax code to require group health plans to formally analyze its compliance with the MHPAEA requirements related to nonquantitative treatment limitations. Plans will now have to document and make analysis available, upon request, to the secretaries of the U.S. Department of Health and Human Services (HHS), the DOL, and the U.S. Department of the Treasury.

The secretaries are charged with issuing guidance with respect to the required analysis within 18 months of the enactment of the bill. If a plan participant were to make a complaint or the secretaries of the agencies suspect a violation, they would request a copy of the plan’s analysis. The CAA also directs the secretaries to request an analysis of at least 20 group health plans per year. Although the secretaries have 18 months to issue final guidance, they would be able to request reports as soon as 45 days after the enactment of the CAA.

Employers that sponsor fully insured health plans will look to the insurance carriers for help and guidance on these matters. Employers that sponsor self-funded group health plans will likely seek out Third Party Administrators (TPAs) or their benefits consultant to assist in the preparation of the analysis.

Among the data these analyses must contain include but are not limited to:

• The specific plan terms regarding the NQTLs and a description of all mental health or substance use disorders and medical or surgical benefits to which each such term applies in each respective benefits classification.
• The factors used to determine that the NQTLs will apply to mental health or substance use disorder benefits and medical or surgical benefits.
• The comparative analyses demonstrating that the processes, strategies, evidentiary standards, and other factors used to apply the NQTLs to mental health or substance use disorder benefits, as written and in operation, are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, and other factors used to apply the NQTLs to medical or surgical benefits in the benefits classification.
• Disclosure of the specific findings and conclusions reached by the group health plan, including any results of the analyses (described above) that indicate that the plan is or is not in compliance with this section.

As part of the act, the applicable regulator must submit a report to Congress that contains those group health plans and issuers that are not in compliance with the MHPAEA. The report will also be available to the public and shared with the states where the group health plan and/or issuer is located. Group health plans will certainly want to avoid being on this publicly available list.