Rule2024-20612
Requirements Related to the Mental Health Parity and Addiction Equity Act
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
September 23, 2024
Effective
November 22, 2024
Issuing agencies
Treasury DepartmentInternal Revenue ServiceLabor DepartmentEmployee Benefits Security AdministrationHealth and Human Services Department
Abstract
This document sets forth final rules amending regulations implementing the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) and adding new regulations implementing the nonquantitative treatment limitation (NQTL) comparative analyses requirements under MHPAEA, as amended by the Consolidated Appropriations Act, 2021 (CAA, 2021). Specifically, these final rules amend the existing NQTL standard to prohibit group health plans and health insurance issuers offering group or individual health insurance coverage from using NQTLs that place greater restrictions on access to mental health and substance use disorder benefits as compared to medical/surgical benefits. As part of these changes, these final rules require plans and issuers to collect and evaluate relevant data in a manner reasonably designed to assess the impact of NQTLs on relevant outcomes related to access to mental health and substance use disorder benefits and medical/surgical benefits and to take reasonable action, as necessary, to address material differences in access to mental health or substance use disorder benefits as compared to medical/surgical benefits. These final rules also amend existing examples and add new examples on the application of the rules for NQTLs to clarify and illustrate the requirements of MHPAEA. Additionally, these final rules set forth the content requirements for NQTL comparative analyses and specify how plans and issuers must make these comparative analyses available to the Department of the Treasury (Treasury), the Department of Labor (DOL), and the Department of Health and Human Services (HHS) (collectively, the Departments), as well as to an applicable State authority, and to participants, beneficiaries, and enrollees. Finally, HHS finalizes regulatory amendments to implement the sunset provision for self-funded non-Federal governmental plan elections to opt out of compliance with MHPAEA, as adopted in the Consolidated Appropriations Act, 2023 (CAA, 2023).
Full Text
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[Federal Register Volume 89, Number 184 (Monday, September 23, 2024)]
[Rules and Regulations]
[Pages 77586-77751]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-20612]
[[Page 77585]]
Vol. 89
Monday,
No. 184
September 23, 2024
Part II
Department of the Treasury
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Internal Revenue Service
Department of Labor
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Employee Benefits Security Administration
Department of Health and Human Services
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26 CFR Part 54
29 CFR Part 2590
45 CFR Parts 146 and 147
Requirements Related to the Mental Health Parity and Addiction Equity
Act; Final Rule
Federal Register / Vol. 89 , No. 184 / Monday, September 23, 2024 /
Rules and Regulations
[[Page 77586]]
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DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 54
[TD 10006]
RIN 1545-BQ29
DEPARTMENT OF LABOR
Employee Benefits Security Administration
29 CFR Part 2590
RIN 1210-AC11
DEPARTMENT OF HEALTH AND HUMAN SERVICES
45 CFR Parts 146 and 147
[CMS-9902-F]
RIN 0938-AU93
Requirements Related to the Mental Health Parity and Addiction
Equity Act
AGENCY: Internal Revenue Service, Department of the Treasury; Employee
Benefits Security Administration, Department of Labor; Centers for
Medicare & Medicaid Services, Department of Health and Human Services.
ACTION: Final rules.
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SUMMARY: This document sets forth final rules amending regulations
implementing the Paul Wellstone and Pete Domenici Mental Health Parity
and Addiction Equity Act of 2008 (MHPAEA) and adding new regulations
implementing the nonquantitative treatment limitation (NQTL)
comparative analyses requirements under MHPAEA, as amended by the
Consolidated Appropriations Act, 2021 (CAA, 2021). Specifically, these
final rules amend the existing NQTL standard to prohibit group health
plans and health insurance issuers offering group or individual health
insurance coverage from using NQTLs that place greater restrictions on
access to mental health and substance use disorder benefits as compared
to medical/surgical benefits. As part of these changes, these final
rules require plans and issuers to collect and evaluate relevant data
in a manner reasonably designed to assess the impact of NQTLs on
relevant outcomes related to access to mental health and substance use
disorder benefits and medical/surgical benefits and to take reasonable
action, as necessary, to address material differences in access to
mental health or substance use disorder benefits as compared to
medical/surgical benefits. These final rules also amend existing
examples and add new examples on the application of the rules for NQTLs
to clarify and illustrate the requirements of MHPAEA. Additionally,
these final rules set forth the content requirements for NQTL
comparative analyses and specify how plans and issuers must make these
comparative analyses available to the Department of the Treasury
(Treasury), the Department of Labor (DOL), and the Department of Health
and Human Services (HHS) (collectively, the Departments), as well as to
an applicable State authority, and to participants, beneficiaries, and
enrollees. Finally, HHS finalizes regulatory amendments to implement
the sunset provision for self-funded non-Federal governmental plan
elections to opt out of compliance with MHPAEA, as adopted in the
Consolidated Appropriations Act, 2023 (CAA, 2023).
DATES:
Effective date: These regulations are effective on November 22,
2024.
Applicability date: See the SUPPLEMENTARY INFORMATION section for
information on the applicability dates.
FOR FURTHER INFORMATION CONTACT: William Fischer, Internal Revenue
Service, Department of the Treasury, at 202-317-5500; Beth Baum or
David Sydlik, Employee Benefits Security Administration, Department of
Labor, at 202-693-8335; David Mlawsky, Centers for Medicare & Medicaid
Services, Department of Health and Human Services, at 410-786-6851.
SUPPLEMENTARY INFORMATION:
I. Background
America continues to experience a mental health and substance use
disorder crisis affecting people across all demographics, with
marginalized communities disproportionately impacted.\1\ The COVID-19
pandemic exacerbated the crisis, but its effects have continued post-
pandemic.\2\ From August 19, 2020, to February 1, 2021, the percentage
of adults exhibiting symptoms of an anxiety or a depressive disorder
rose from 36.4 percent to 41.5 percent.\3\ In 2022, there were an
estimated 15.4 million adults aged 18 or older in the United States
with a serious mental illness and nearly one in four adults (59.3
million) living with any mental illness.\4\
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\1\ Kaiser Family Foundation (2022), Five key findings on mental
health and substance use disorders by race/ethnicity, <a href="https://www.kff.org/mental-health/issue-brief/five-key-findings-on-mental-health-and-substance-use-disorders-by-race-ethnicity/">https://www.kff.org/mental-health/issue-brief/five-key-findings-on-mental-health-and-substance-use-disorders-by-race-ethnicity/</a>.
\2\ American Psychological Association (2023), Stress in
America<SUP>TM</SUP> 2023: A nation grappling with psychological
impacts of collective trauma, <a href="https://www.apa.org/news/press/releases/2023/11/psychological-impacts-collective-trauma">https://www.apa.org/news/press/releases/2023/11/psychological-impacts-collective-trauma</a>.
\3\ Vahratian, A., Blumberg, S.J., Terlizzi, E.P., Schiller,
J.S. (2021), Symptoms of Anxiety or Depressive Disorder and Use of
Mental Health Care Among Adults During the COVID-19 Pandemic--United
States, Aug. 2020-Feb. 2021, MMWR Morb Mortal Wkly Rep 2021;70:490-
494, <a href="https://www.cdc.gov/mmwr/volumes/70/wr/mm7013e2.htm">https://www.cdc.gov/mmwr/volumes/70/wr/mm7013e2.htm</a>.
\4\ SAMHSA (2023), Key substance use and mental health
indicators in the United States: Results from the 2022 National
Survey on Drug Use and Health (HHS Publication No. PEP23-07-01-006,
NSDUH Series H-58), <a href="https://www.samhsa.gov/data/report/2022-nsduh-annual-national-report">https://www.samhsa.gov/data/report/2022-nsduh-annual-national-report</a>.
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Additionally, in 2022, nearly 54.6 million people aged 12 or older
were classified as needing treatment for substance use, but only about
24 percent of those people received any treatment, according to the
Substance Abuse and Mental Health Services Administration's (SAMHSA)
National Survey on Drug Use and Health (NSDUH).\5\ The unmet need for
treatment for substance use disorders has been even greater among
racial minorities and other marginalized communities. Between 2019 and
2021, median monthly overdose deaths among persons aged 10-19 years
increased 109 percent; and deaths involving illicitly manufactured
fentanyl increased 182 percent.\6\ In 2021, American Indian and Alaskan
Native men aged 15-34 had an age-adjusted death rate caused by drug
overdoses of 42 per 100,000 people, compared to 20.5 age-adjusted
deaths per 100,000 people during the same time period in 2018.\7\ Non-
Hispanic Black or African American men aged 35-64 had an age-adjusted
death rate caused by drug overdoses of 61.2 per 100,000 people; an
increase from 30.6 deaths per 100,000 people during the same time
period in 2018.\8\
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\5\ Ibid.
\6\ Tanz, L.J., Dinwiddie, A.T., Mattson, C.L., O'Donnell, J.,
Davis, N.L. (2022), Drug Overdose Deaths Among Persons Aged 10-19
Years--United States, July 2019-Dec. 2021. MMWR Morb Mortal Wkly Rep
2022;71:1576-1582, <a href="https://www.cdc.gov/mmwr/volumes/71/wr/mm7150a2.htm">https://www.cdc.gov/mmwr/volumes/71/wr/mm7150a2.htm</a>.
\7\ Han, B., Einstein, E.B., Jones, C.M., Cotto, J., Compton,
W.M., Volkow, N.D. (2022), Racial and Ethnic Disparities in Drug
Overdose Deaths in the US During the COVID-19 Pandemic, JAMA Netw
Open, 5(9):e2232314, DOI:10.1001/jamanetworkopen.2022.32314, <a href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC9490498/">https://www.ncbi.nlm.nih.gov/pmc/articles/PMC9490498/</a>. Age-adjusted death
rates are death rates that control for the effects of differences in
population age distributions.
\8\ Ibid.
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Following the COVID-19 pandemic, employers highlighted that they
have responded to the impact of the pandemic on the mental health and
substance use disorder crisis by offering more comprehensive benefits,
including
[[Page 77587]]
mental health support. According to a report published in 2021, ``about
three in four large employers and two in four small/medium employers
report that they offer at least one type of mental health support for
employees.'' \9\ In a recent survey, 87 percent of large employers
stated that access to mental health care was a top priority, and
another survey found that ``the number of in-network behavioral health
providers has increased by an average of 48 percent in 3 years among
commercial health plans.'' \10\ Group health plans and health insurance
issuers have taken steps to ensure mental health parity is reflected in
their benefit designs and to educate participants, beneficiaries, and
enrollees \11\ about MHPAEA's requirements, by reaching out to members,
expanding telehealth availability, expanding behavioral health provider
networks, integrating behavioral health with physical health care, and
working to reduce stigmatization of seeking treatment.
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\9\ Coe, E., Cordina, J., Enomoto, K., Mandel, A., Stueland, J.
(2021), National Surveys Reveal Disconnect Between Employees and
Employers Around Mental Health Need, McKinsey & Company, <a href="https://www.mckinsey.com/industries/healthcare/our-insights/national-surveys-reveal-disconnect-between-employees-and-employers-around-mental-health-need">https://www.mckinsey.com/industries/healthcare/our-insights/national-surveys-reveal-disconnect-between-employees-and-employers-around-mental-health-need</a>.
\10\ America's Health Insurance Plans (AHIP), Health Insurance
Providers Facilitate Broad Access to Mental Health Support (Aug.
2022), <a href="https://ahiporg-production.s3.amazonaws.com/documents/Mental-Health-Survey-July-2022-FINAL.pdf">https://ahiporg-production.s3.amazonaws.com/documents/Mental-Health-Survey-July-2022-FINAL.pdf</a>.
\11\ Consistent with the proposed rules, these final rules apply
directly to group health plans or health insurance coverage offered
by an issuer in connection with a group health plan, and apply to
individual health insurance coverage by cross-reference through 45
CFR 147.160, which currently provides that the requirements of 45
CFR 146.136 apply to health insurance coverage offered by a health
insurance issuer in the individual market in the same manner and to
the same extent as to health insurance coverage offered by a health
insurance issuer in connection with a group health plan in the large
group market. As noted later in this preamble, HHS is finalizing an
amendment to 45 CFR 147.160 to also include a cross-reference to 45
CFR 146.137 to similarly extend the new comparative analysis
requirements to individual health insurance coverage in the same
manner and to the same extent as group health insurance coverage.
For simplicity, this preamble generally refers only to the
applicability to group health plans and health insurance coverage
offered in connection with a group health plan and to participants
and beneficiaries enrolled in such a plan or coverage, but
references to participants and beneficiaries should also be
considered to include enrollees in the individual market, unless
otherwise specified.
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Despite these efforts, disparities in coverage between mental
health and substance use disorder benefits and medical/surgical
benefits have grown. In the preamble to the proposed rules,\12\ the
Departments cited a 2019 Milliman report \13\ that found a growing
disparity in the utilization of out-of-network behavioral health care
providers relative to out-of-network medical/surgical care providers. A
recent study by RTI International \14\ found that out-of-network use
was 3.5 times higher for all behavioral health clinician office visits
than for all out-of-network medical/surgical clinician office visits;
in addition, the study noted that these disparities in out-of-network
use for behavioral health office visits compared to medical/surgical
office visits have remained large and, according to the study, are not
fully attributable to behavioral health provider shortages. The study
concluded that these results demonstrate the need for more robust
parity enforcement.
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\12\ 88 FR 51552, 51554 (Aug. 3, 2023).
\13\ Melek, S., Davenport, S., Gray, T.J. (2019), Addiction and
mental health vs. physical health: Widening disparities in network
use and provider reimbursement, Milliman, 6, <a href="https://assets.milliman.com/ektron/Addiction_and_mental_health_vs_physical_health_Widening_disparities_in_network_use_and_provider_reimbursement.pdf">https://assets.milliman.com/ektron/Addiction_and_mental_health_vs_physical_health_Widening_disparities_in_network_use_and_provider_reimbursement.pdf</a>.
\14\ Mark, T.L., Parish, W. (2024), Behavioral health parity--
Pervasive disparities in access to in-network care continue, RTI
International, <a href="https://dpjh8al9zd3a4.cloudfront.net/publication/behavioral-health-parity-pervasive-disparities-access-network-care-continue/fulltext.pdf">https://dpjh8al9zd3a4.cloudfront.net/publication/behavioral-health-parity-pervasive-disparities-access-network-care-continue/fulltext.pdf</a>.
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RTI concluded that its analyses of the most recent, comprehensive
private insurance claims data
reveal material differences in access to mental health and substance
use disorder benefits as compared to medical/surgical benefits, as
reflected in much greater use of out-of-network providers. . . .
These disparities indicate that behavioral health networks are
clearly inadequate and signal potential noncompliance with the NQTL
requirements of MHPAEA.\15\
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\15\ Id. at 46.
These final rules aim to strengthen consumer protections consistent
with MHPAEA's fundamental purpose--to ensure that individuals in group
health plans or with group or individual health insurance coverage who
seek treatment for covered mental health conditions or substance use
disorders do not face greater burdens on access to benefits for those
conditions or disorders than they would face when seeking coverage for
the treatment of a medical condition or a surgical procedure.\16\ As
highlighted in the preamble to the proposed rules,\17\ such barriers
are particularly problematic when the benefits that the plan or issuer
purports to make available and that individuals reasonably expect to be
covered are not in fact covered. To the extent these barriers
disproportionately limit access to mental health or substance use
disorder benefits, such practices contravene MHPAEA's statutory
language, which requires that the financial requirements and treatment
limitations applicable to mental health or substance use disorder
benefits be ``no more restrictive'' than the predominant requirements
and limitations applicable to substantially all medical/surgical
benefits.\18\ The Departments' enforcement efforts have shown that such
barriers persist more than 15 years after MHPAEA's enactment.\19\ These
final rules are critical to addressing barriers to access to mental
health and substance use disorder benefits.
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\16\ In a floor statement, Representative Patrick Kennedy (D-
RI), one of the chief architects of MHPAEA, made the case for its
passage on the grounds that ``access to mental health services is
one of the most important and most neglected civil rights issues
facing the Nation. For too long, persons living with mental
disorders have suffered from discriminatory treatment at all levels
of society.'' 153 Cong. Rec. S1864-5 (daily ed. Feb. 12, 2007). Cf.
H. Rept. 110-374, part 3 (Mar. 4, 2008), <a href="https://www.congress.gov/congressional-report/110th-congress/house-report/374">https://www.congress.gov/congressional-report/110th-congress/house-report/374</a> (``The purpose
of H.R. 1424, the `Paul Wellstone Mental Health and Addiction Equity
Act of 2007' is to have fairness and equity in the coverage of
mental health and substance-related disorders vis-a-vis coverage for
medical and surgical disorders.'').
\17\ 88 FR 51552 (Aug. 3, 2023).
\18\ Internal Revenue Code (Code) section 9812(a)(3)(A),
Employee Retirement Income Security Act of 1974 (ERISA) section
712(a)(3)(A), and Public Health Service Act (PHS Act) section
2726(a)(3)(A).
\19\ See, e.g., 2022 MHPAEA Report to Congress (Jan. 2022),
<a href="https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2022-realizing-parity-reducing-stigma-and-raising-awareness.pdf">https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2022-realizing-parity-reducing-stigma-and-raising-awareness.pdf</a>; 2023 MHPAEA Comparative
Analysis Report to Congress (July 2023), <a href="https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2023-mhpaea-comparative-analysis.pdf">https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2023-mhpaea-comparative-analysis.pdf</a>.
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The problems persist notwithstanding the Departments' unprecedented
commitment to advance parity for mental health and substance use
disorder benefits in recent years, as reflected through increased
enforcement efforts and the Departments' work with interested parties
to help them understand and comply with MHPAEA's requirements.\20\ To
promote compliance, the Departments have provided extensive guidance
and compliance assistance materials, especially with respect to
NQTLs,\21\ yet disparities still persist.
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\20\ More information on the Departments' enforcement efforts
and guidance issued under MHPAEA is available at <a href="https://www.dol.gov/agencies/ebsa/laws-and-regulations/laws/mental-health-and-substance-use-disorder-parity/tools-and-resources">https://www.dol.gov/agencies/ebsa/laws-and-regulations/laws/mental-health-and-substance-use-disorder-parity/tools-and-resources</a> and <a href="https://www.cms.gov/marketplace/private-health-insurance/mental-health-parity-addiction-equity">https://www.cms.gov/marketplace/private-health-insurance/mental-health-parity-addiction-equity</a>.
\21\ As discussed in more detail later in this preamble, NQTLs
are generally non-numerical limits on the scope or duration of
treatment, such as prior authorization requirements, step therapy,
and standards related to network composition.
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In 1996, Congress enacted the Mental Health Parity Act of 1996
(MHPA 1996), which required parity in aggregate
[[Page 77588]]
lifetime and annual dollar limits for mental health benefits and
medical/surgical benefits for group health plans and health insurance
coverage offered in connection with such plans.\22\ These mental health
parity provisions were codified in Code section 9812, ERISA section
712, and PHS Act section 2705.\23\ Congress expanded on these efforts
in 2008 with the enactment of MHPAEA,\24\ which amended Code section
9812, ERISA section 712, and PHS Act section 2705 by adding
requirements for plans and issuers related to financial requirements
and treatment limitations and made further amendments to the existing
mental health parity provisions, including provisions to apply the
mental health parity requirements to substance use disorder benefits.
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\22\ Public Law 104-204, 110 Stat. 2874 (Sept. 26, 1996). The
Departments published interim final rules implementing MHPA 1996 at
62 FR 66932 (Dec. 22, 1997).
\23\ The Departments published interim final rules implementing
MHPA 1996 at 62 FR 66932 (Dec. 22, 1997).
\24\ Sections 511 and 512 of the Tax Extenders and Alternative
Minimum Tax Relief Act of 2008 (Division C of Pub. L. 110-343, 122
Stat. 3765 (Oct. 3, 2008)).
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The Affordable Care Act (ACA) \25\ reorganized, amended, and added
to the provisions of part A of title XXVII of the PHS Act relating to
group health plans and health insurance issuers in the group and
individual markets. The ACA added section 715(a)(1) to ERISA and
section 9815(a)(1) to the Code to incorporate the provisions of part A
of title XXVII of the PHS Act into ERISA and the Code, and to make them
applicable to group health plans and health insurance issuers providing
health insurance coverage in connection with group health plans. The
PHS Act sections included by these references are sections 2701 through
2728. The ACA extended MHPAEA to apply to individual health insurance
coverage and redesignated MHPAEA in the PHS Act as section 2726.\26\
Additionally, section 1311(j) of the ACA applies PHS Act section 2726
to qualified health plans \27\ in the same manner and to the same
extent as it applies to health insurance issuers and group health
plans. The ACA also included a requirement for coverage of mental
health and substance use disorder services, including behavioral health
treatment, as a category of essential health benefits (EHB).\28\ HHS'
EHB regulations require health insurance issuers offering non-
grandfathered health insurance coverage in the individual and small
group markets to comply with MHPAEA and its implementing regulations to
satisfy the requirement to cover ``mental health and substance use
disorder services, including behavioral health treatment,'' as part of
EHB.\29\
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\25\ References to the Affordable Care Act or ACA include the
Patient Protection and Affordable Care Act (Pub. L. 111-148, 123
Stat. 3028) enacted on March 23, 2010, and the Health Care and
Education Reconciliation Act of 2010 (Pub. L. 111-152, 124 Stat.
1029) enacted on March 30, 2010.
\26\ The requirements of MHPAEA generally apply to both
grandfathered and non-grandfathered health plans. See section 1251
of the ACA and its implementing regulations at 26 CFR 54.9815-1251,
29 CFR 2590.715-1251, and 45 CFR 147.140. Under section 1251 of the
ACA, grandfathered health plans are exempted only from certain ACA
requirements enacted in Subtitles A and C of Title I of the ACA. The
provisions extending MHPAEA requirements to individual health
insurance coverage and requiring that qualified health plans comply
with MHPAEA are not included in these sections. However, because
MHPAEA requirements apply to health insurance coverage offered in
the small group market only through the requirement to provide EHB,
which does not apply to grandfathered health plans, the requirements
of MHPAEA do not apply to grandfathered health plans offered in the
small group market.
\27\ A qualified health plan is a health insurance plan that is
certified by a health insurance exchange that it meets certain
minimum standards established under the ACA and described in subpart
C of 45 CFR part 156. See 45 CFR 155.20.
\28\ Section 1302 of the ACA requires non-grandfathered health
plans in the individual and small group markets to cover EHB, which
include items and services in the following ten benefit categories:
(1) ambulatory patient services; (2) emergency services; (3)
hospitalization; (4) maternity and newborn care; (5) mental health
and substance use disorder services, including behavioral health
treatment; (6) prescription drugs; (7) rehabilitative and
habilitative services and devices; (8) laboratory services; (9)
preventive and wellness services and chronic disease management; and
(10) pediatric services, including oral and vision care. See 45 CFR
156.115 for description of the benefits a health plan must provide
to provide EHB.
\29\ Section 1302(b)(1)(E) of the ACA; 45 CFR 156.115(a)(3).
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The Departments published a request for information soliciting
comments on issues under MHPAEA \30\ and subsequently issued interim
final regulations to implement the requirements of MHPAEA.\31\ After
considering the comments, the Departments published the 2013 final
regulations.\32\ As detailed in the preamble to the proposed rules, in
the years after the 2013 final regulations were published, the
Departments provided extensive guidance and compliance assistance
materials to the regulated community, State regulators, and other
interested parties to facilitate the implementation and enforcement of
MHPAEA, including the 2020 MHPAEA Self-Compliance Tool,\33\ which
provided a basic framework for plans and issuers to assess whether
their NQTLs satisfy MHPAEA's parity requirements.\34\
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\30\ 74 FR 19155 (Apr. 28, 2009).
\31\ 75 FR 5410 (Feb. 2, 2010).
\32\ 78 FR 68240 (Nov. 13, 2013).
\33\ See Self-Compliance Tool for the Mental Health Parity and
Addiction Equity Act (MHPAEA) (2020), <a href="https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/self-compliance-tool.pdf">https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/self-compliance-tool.pdf</a>.
\34\ 88 FR 51552, 51555-56 (Aug. 2, 2023).
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The CAA, 2021 was enacted by Congress on December 27, 2020,\35\ and
amended MHPAEA, in part, by expressly requiring group health plans and
health insurance issuers that provide both medical/surgical benefits
and mental health or substance use disorder benefits to perform and
document comparative analyses of the design and application of NQTLs
that apply to mental health or substance use disorder benefits. The
statute also requires plans and issuers to make their analyses
available to the Departments or applicable State authorities, upon
request, effective February 10, 2021. Additionally, the CAA, 2021 sets
forth a process by which the Departments must evaluate the requested
NQTL comparative analyses and enforce the comparative analyses
requirements and requires the Departments to submit annually to
Congress and make publicly available a report summarizing the
comparative analyses requested for review by the Departments.\36\
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\35\ Section 203 of title II of Division BB of the CAA, 2021,
Public Law 116-260, 134 Stat. 1182 (Dec. 27, 2020).
\36\ The report must state, in part, whether each plan or issuer
that submitted a comparative analysis upon request submitted
sufficient information to permit review; whether and why the
Departments determined the plan or issuer is in compliance with
MHPAEA; the specific information each plan or issuer needed to
submit to allow for a review of its comparative analysis; and, for
each plan or issuer the Departments determined not to be in
compliance, specifications of the actions that the plan or issuer
must take to come into compliance. See Code section
9812(a)(8)(B)(iv), ERISA section 712(a)(8)(B)(iv), and PHS Act
section 2726(a)(8)(B)(iv).
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To help plans and issuers comply with the amendments to MHPAEA made
by the CAA, 2021, the Departments issued Frequently Asked Questions
(FAQs) About Mental Health and Substance Use Disorder Parity
Implementation and the Consolidated Appropriations Act, 2021 Part 45
(FAQs Part 45).\37\ As detailed in the preamble to the proposed rules,
these FAQs provided initial guidance to plans and issuers on these
amendments to MHPAEA.\38\ Additionally, as required
[[Page 77589]]
by the CAA, 2021, the Departments provided reports to Congress on the
NQTL comparative analyses reviews conducted by the Departments.\39\
These reports highlighted that nearly all of the comparative analyses
reviewed by the Departments during the relevant time periods contained
insufficient information to support a finding of compliance upon
initial receipt and reflected common insufficiencies.
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\37\ FAQs about Mental Health and Substance Use Disorder Parity
Implementation and the Consolidated Appropriations Act, 2021 Part 45
(Apr. 2, 2021), <a href="https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-45.pdf">https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-45.pdf</a> and <a href="https://www.cms.gov/cciio/resources/fact-sheets-and-faqs/downloads/mhpaea-faqs-part-45.pdf">https://www.cms.gov/cciio/resources/fact-sheets-and-faqs/downloads/mhpaea-faqs-part-45.pdf</a>.
\38\ 88 FR 51552, 51562 (Aug. 3, 2023).
\39\ Ibid.
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Building on the lessons learned from implementing and enforcing
MHPAEA, as well as the guidance provided in FAQs Part 45, on August 3,
2023, the Departments published proposed rules to amend existing MHPAEA
regulations at 26 CFR 54.9812-1, 29 CFR 2590.712, and 45 CFR 146.136;
\40\ to add a proposed new regulation at 26 CFR 54.9812-2, 29 CFR
2590.712-1, and 45 CFR 146.137 in order to codify minimum standards for
developing NQTL comparative analyses; and to codify HHS-only amendments
to implement the sunset provision for self-funded non-Federal
governmental plan elections to opt out of compliance with MHPAEA. On
September 28, 2023, the Departments extended the comment period that
was set to expire on October 2, 2023, by 15 days to October 17, 2023,
to give interested parties additional time to review the proposed rules
and submit comments.\41\
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\40\ 88 FR 51552 (Aug. 3, 2023). On July 25, 2023, DOL, in
collaboration with HHS and the Treasury, also issued Technical
Release 2023-01P. The Technical Release set out principles and
sought public comment to inform future guidance with respect to the
application of the proposed data collection and evaluation
requirements to NQTLs related to network composition and a potential
time-limited enforcement safe harbor for plans and issuers that
include data in their comparative analyses that demonstrate they
meet or exceed all the thresholds identified in future guidance with
respect to NQTLs related to network composition. The Departments
encouraged interested parties to submit their comments consistent
with the instructions contained in it separate from any comments
they submitted in response to the proposed rules. The Departments
are considering these comments separately and these final rules do
not respond to those comments. Plans and issuers would be allowed
adequate time to conform to any future guidance on the type, form,
and manner of collection and evaluation for the relevant data
required under the final rules.
\41\ 88 FR 66728 (Sept. 28, 2023).
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The Departments received 9,503 comments that were submitted during
the comment period \42\ in response to the proposed rules from a wide
variety of interested parties, including private citizens; consumer and
advocacy organizations; employers, employee organizations, and other
plan sponsors; Federal, State, and local officials; health care
providers and facilities and health systems; health insurance issuers;
service providers, including managed behavioral health organizations
(MBHOs), third-party administrators (TPAs), and pharmacy benefit
managers (PBMs); trade and professional associations; and researchers.
Many commenters provided detailed feedback on multiple aspects of the
proposed rules and in response to various specific comment
solicitations included in the preamble to the proposed rules and the
request for information.
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\42\ The comment period for the proposed rules was extended by
15 days to October 17, 2023.
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In general, many commenters supported the proposed rules, because
they would formalize and, according to these commenters, provide
greater clarity on what health plans and issuers must do to comply with
MHPAEA. Some commenters highlighted that the existing rules were
insufficient and that the proposed rules were timely and necessary to
strengthen MHPAEA and ensure fair access to mental health and substance
use disorder care. Commenters highlighted the importance of the
proposed rules to participants, beneficiaries, and enrollees, including
children, teens, young adults, and others living with mental health
conditions and substance use disorders. Several other commenters,
however, expressed either opposition or concern regarding the proposed
rules. Several commenters stated that the proposed rules would increase
health plan and issuer costs and reduce treatment quality. A few
commenters recommended the Departments withdraw the proposed rules and
initiate a new rulemaking process after additional input from
interested parties.
After reviewing the comments received during the comment period,
the Departments are finalizing the proposed rules, with some changes in
response to comments as described in more detail later in this
preamble, to ensure that participants, beneficiaries, and enrollees can
access the mental health and substance use disorder care they need
without facing greater restrictions than when accessing medical and
surgical care, consistent with the fundamental purpose of MHPAEA. These
final rules provide additional clarity to plans and issuers on how to
comply with MHPAEA's requirements and, as a result, will strengthen the
protections of MHPAEA. As highlighted earlier in this preamble, since
the 2013 final regulations, the Departments repeatedly sought input
from interested parties on MHPAEA's requirements; therefore, the
Departments decline to withdraw the proposed rules or initiate a new
rulemaking process after soliciting additional input from interested
parties. As explained throughout this preamble, the amendments made by
these final rules are faithful to MHPAEA's parity requirements and
sensitive to the flexibility plans and issuers have in designing
benefits for group health plans and health insurance coverage.\43\
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\43\ The Departments note that impacts on plan and issuer costs
are discussed in more detail in the regulatory impact analysis,
later in this preamble.
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Among other things, these final rules:
<bullet> Make clear that MHPAEA requires that individuals will not
face greater restrictions on access to mental health and substance use
disorder benefits as compared to medical/surgical benefits.
<bullet> Reinforce that health plans and issuers cannot use NQTLs,
such as prior authorization and other medical management techniques,
standards related to network composition, or methodologies to determine
out-of-network reimbursement rates, for mental health and substance use
disorder benefits, that are more restrictive than the predominant NQTLs
applied to substantially all medical/surgical benefits in the same
classification.
<bullet> Require plans and issuers to collect and evaluate data and
take reasonable action, as necessary, to address material differences
in access to mental health and substance use disorder benefits as
compared to medical/surgical benefits, where the relevant data suggest
that the NQTL contributes to material differences in access.
<bullet> Codify the requirement in MHPAEA, as amended by the CAA,
2021, that health plans and issuers conduct comparative analyses to
measure the impact of NQTLs. This includes evaluating standards related
to network composition, out-of-network reimbursement rates, and medical
management and prior authorization NQTLs.
<bullet> Prohibit plans and issuers from using discriminatory
information, evidence, sources, or standards that systematically
disfavor or are specifically designed to disfavor access to mental
health and substance use disorder benefits when designing NQTLs.
<bullet> Implement the sunset provision for self-funded non-Federal
governmental plan elections to opt out of compliance with MHPAEA.
As a result, the Departments anticipate that these final rules will
result in changes in network composition and medical management
techniques related to mental health and substance use disorder care,
more robust mental health and substance use disorder provider networks,
and fewer
[[Page 77590]]
and less restrictive prior authorization requirements for individuals
seeking mental health and substance use disorder care, as well as
provide additional clarity and information needed for plans and issuers
to meet their obligations under MHPAEA and for the Departments and
States to enforce those obligations.
II. Overview of the Final Rules--Departments of the Treasury, Labor,
and HHS
The Departments are issuing these final rules to ensure that
individuals with mental health conditions and substance use disorders
can benefit from the full protections afforded to them under MHPAEA,
while offering clear guidance to plans and issuers on how to comply
with MHPAEA's requirements. These final rules amend certain provisions
of existing MHPAEA regulations at 26 CFR 54.9812-1, 29 CFR 2590.712,
and 45 CFR 146.136 to incorporate new and revised definitions of key
terms, as well as to specify the steps that plans and issuers must take
to meet their obligations under MHPAEA. These final rules also add new
regulations at 26 CFR 54.9812-2, 29 CFR 2590.712-1, and 45 CFR 146.137
codifying minimum standards for developing NQTL comparative analyses to
assess whether an NQTL, as written and in operation, complies with
MHPAEA's requirements and setting forth the content elements of
comparative analyses and the period for plans and issuers to respond to
a request from the Departments to submit their comparative analyses.
Additionally, in these final rules, HHS finalizes an amendment to 45
CFR 147.160 to specify that the final regulations at 45 CFR 146.137
apply to individual health insurance coverage offered by a health
insurance issuer in the same manner and to the same extent that the
regulations apply to health insurance coverage offered by a health
insurance issuer in connection with a group health plan in the large
group market.\44\ Consistent with the existing text at 45 CFR
147.160(a), HHS is also extending the same requirements and framework
outlined in the amendments to 45 CFR 146.136 in these final rules to
individual health insurance coverage in the same manner and to the same
extent as the amendments that apply to group health insurance coverage.
Finally, HHS is finalizing amendments to 45 CFR 146.180 to reflect the
sunset of the election option for self-funded non-Federal governmental
plans to opt out of compliance with MHPAEA, consistent with changes
made by the CAA, 2023 to PHS Act section 2722(a)(2).\45\
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\44\ Non-grandfathered health insurance coverage offered by a
health insurance issuer in connection with a group health plan in
the small group market is required to comply with the requirements
under PHS Act section 2726 to satisfy the requirement to provide
coverage for mental health and substance use disorder services,
including behavioral health treatment, as part of EHB, and as such
will also be required to comply with the comparative analysis
requirements finalized under 45 CFR 146.137. See 45 CFR
156.115(a)(3).
\45\ Division FF, title I, subtitle C, chapter 3, section 1321,
Public Law 117-328, 136 Stat. 4459 (Dec. 29. 2022).
---------------------------------------------------------------------------
A. Amendments to Existing Regulations at 26 CFR 54.9812-1, 29 CFR
2590.712, and 45 CFR 146.136
1. Purpose Section--26 CFR 54.9812-1(a)(1), 29 CFR 2590.712(a)(1), and
45 CFR 146.136(a)(1)
In the preamble to the proposed rules, the Departments stated that
the fundamental purpose of the MHPAEA statute, the 2013 final
regulations, and the proposed rules is to ensure that participants and
beneficiaries in a group health plan or in group health insurance
coverage offered by a health insurance issuer that offers mental health
or substance use disorder benefits are not subject to greater
restrictions when seeking those benefits than when seeking medical/
surgical benefits under the terms of the plan or coverage. The
Departments also stated that the fundamental purpose of MHPAEA should
serve as the guiding principle for plans and issuers as they work to
comply with the requirements of the law and its implementing
regulations. Accordingly, the Departments proposed to add a purpose
section to the regulations, specifying this fundamental purpose, and
that MHPAEA and its implementing regulations should be interpreted in a
manner that is consistent with this purpose.
Many commenters supported the addition of the purpose section and
the principles it addressed, including the goal of increasing access to
mental health and substance use disorder benefits, to ensure equal
treatment for mental health and substance use disorder benefits and
medical/surgical benefits. A few commenters expressed opposition to the
proposed purpose section, arguing that its language goes beyond the
intent of MHPAEA (as Congress did not direct the Departments to provide
a purpose in regulations, either initially or in later amendments).
The purpose section is important to highlight the overall goals of
MHPAEA and to emphasize that the provisions of the 2013 final
regulations, as amended by these final rules, should be interpreted in
light of these goals. Congress provided authority to the Departments to
``promulgate such regulations as may be necessary or appropriate to
carry out the provisions of'' chapter 100 of the Code, part 7 of ERISA,
and title XXVII of the PHS Act, including MHPAEA.\46\ MHPAEA was
enacted to address barriers to access to mental health and substance
use disorder benefits as compared to medical/surgical benefits. These
final rules implement MHPAEA's requirements and provide clarifying text
to promote compliance with the law. The Departments are finalizing the
purpose section as proposed, with minor changes in response to
comments.
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\46\ See Code section 9833, ERISA section 734, and PHS Act
section 2792.
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Several commenters requested that the reference to ``generally
comparable'' medical/surgical benefits in the proposed purpose section
be revised to refer to the classification of benefits. These commenters
noted that, consistent with the 2013 final regulations, evaluation of a
plan's or issuer's MHPAEA compliance is assessed within the relevant
classification of benefits, and that use of the term ``comparable,''
which is used in the 2013 final regulations and amendments made to
MHPAEA by the CAA, 2021 with respect to requirements for NQTLs, is
confusing and should be revised.
The Departments agree with commenters who noted that use of the
term ``comparable'' can be confusing when used in this context, because
compliance with the requirements for financial requirements,
quantitative treatment limitations, and NQTLs has historically been
determined within one of the six classifications of benefits.\47\
Therefore, these final rules remove the reference to ``generally
comparable'' medical/surgical benefits and instead specify that plans
and issuers must not design or apply financial requirements and
treatment limitations that impose a greater burden on access (that is,
are more restrictive) to mental health or substance use disorder
benefits under the plan or coverage than they impose on access to
medical/surgical benefits in the same classification of benefits. The
[[Page 77591]]
Departments are finalizing the purpose section without any other
substantive changes, but with a few minor clarifications to ensure that
terms are used consistently with and accurately describe other parts of
these final rules.
---------------------------------------------------------------------------
\47\ The six classifications of benefits listed at 26 CFR
54.9812-1(c)(2)(ii)(A), 29 CFR 2590.712(c)(2)(ii)(A), and 45 CFR
146.136(c)(2)(ii)(A) include inpatient, in-network; inpatient, out-
of-network; outpatient, in-network; outpatient, out-of-network;
emergency care, and prescription drugs. Special rules for multi-
tiered prescription drug benefits, multiple network tiers, and
permissible sub-classifications for office visits, separate from
other outpatient services, are addressed at 26 CFR 54.9812-
1(c)(3)(iii), 29 CFR 2590.712(c)(3)(iii), and 45 CFR
146.136(c)(3)(iii).
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2. Meaning of Terms--26 CFR 54.9812-1(a)(2), 29 CFR 2590.712(a)(2), and
45 CFR 146.136(a)(2)
a. Medical/Surgical Benefits, Mental Health Benefits, and Substance Use
Disorder Benefits
Under the statute and the 2013 final regulations, the term
``medical/surgical benefits'' means benefits for medical or surgical
services as defined under the terms of the plan or health insurance
coverage but does not include mental health or substance use disorder
benefits. The 2013 final regulations further provide that the term must
be defined in accordance with applicable Federal and State law, and
that any condition defined by the plan or coverage as being or as not
being a medical/surgical condition must be defined to be consistent
with generally recognized independent standards of current medical
practice (for example, the most current version of the International
Classification of Diseases (ICD) or State guidelines).
The proposed rules generally retained the first sentence of the
2013 final regulations' definition of ``medical/surgical benefits,''
\48\ but amended the definition to provide that, notwithstanding this
first sentence, any condition or procedure defined by the plan or
coverage as being or not being a medical condition or surgical
procedure must be defined consistent with generally recognized
independent standards of current medical practice (for example, the
most current version of the ICD). Further, the proposed rules stated
that, to the extent that generally recognized independent standards of
current medical practice do not address whether a condition or
procedure is a medical condition or surgical procedure, plans and
issuers may define the condition or procedure as medical/surgical
benefits, as long as such definitions are in accordance with applicable
Federal and State law. The Departments also proposed to remove the
reference to State guidelines in the definition of the term in the 2013
final regulations, both to make the definitions more consistent with
the statute, and to minimize situations where differences between
generally recognized independent standards of current medical practice
and State guidelines create conflicts and improperly limit protections
under MHPAEA.
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\48\ Under the 2013 final regulations, the term ``medical/
surgical benefits'' means benefits with respect to items or services
for medical conditions or surgical procedures, as defined under the
terms of the plan or health insurance coverage and in accordance
with applicable Federal and State law, but does not include mental
health or substance use disorder benefits. 26 CFR 54.9812-1(a), 29
CFR 2590.712(a), and 45 CFR 146.136(a).
---------------------------------------------------------------------------
The Departments also proposed to make similar changes to the
definitions of ``mental health benefits'' and ``substance use disorder
benefits'' by amending the first sentence of each definition and
removing the references to State guidelines, consistent with the
changes described above for ``medical/surgical benefits.'' \49\ For
purposes of the requirement that any condition or disorder defined by
the plan or coverage as being or not being a mental health condition
must be defined to be consistent with generally recognized independent
standards of current medical practice, the proposed rules stated that
the plan's or coverage's definition must include all conditions covered
under the plan or coverage, except for substance use disorders, that
fall under any of the diagnostic categories listed in the mental,
behavioral, and neurodevelopmental disorders chapter (or equivalent
chapter) of the most current version of the ICD or that are listed in
the most current version of the American Psychiatric Association (APA)
Diagnostic and Statistical Manual of Mental Disorders (DSM). Similarly,
the proposed rules stated that the plan's or coverage's definition of
``substance use disorder benefits'' must include all disorders covered
under the plan or coverage that fall under any of the diagnostic
categories listed as a mental or behavioral disorder due to
psychoactive substance use (or equivalent category) in the mental,
behavioral, and neurodevelopmental disorders chapter (or equivalent
chapter) of the most current version of the ICD or that are listed as a
Substance-Related and Addictive Disorder (or equivalent category) in
the most current version of the DSM. The proposed rules solicited
comments on whether any additional clarification is needed on how State
law may interact with the proposed amended definitions of ``medical/
surgical benefits,'' ``mental health benefits'' and ``substance use
disorder benefits.''
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\49\ Consistent with the statute and the 2013 final regulations,
the Departments note that references to ``mental health and
substance use disorder benefits'' and ``mental health or substance
use disorder benefits'' throughout these final rules are intended to
have the same meaning as the terms ``mental health benefits'' and
``substance use disorder benefits'' in combination.
---------------------------------------------------------------------------
In general, many commenters supported modifying these key
definitions in existing MHPAEA regulations by specifying that, to be
consistent with generally recognized independent standards of current
medical practice, the terms of the plan or coverage must accord with
appropriate chapters of the ICD or DSM. Many commenters generally
supported requiring plans and issuers to follow the ICD or DSM,
reasoning that both are generally accepted, peer-reviewed, nonprofit
professional standards for diagnosis and descriptions of medical
conditions, mental health conditions, and substance use disorders, and
that following these authoritative and comprehensive diagnostic tools
promotes uniform and standard application of MHPAEA to mental health
conditions and substance use disorders. Several commenters noted that
these changes would significantly improve clarity and would increase
access to care, especially for intellectual and neurodevelopmental
disorders, including dementia and autism spectrum disorder (ASD).
Another commenter recommended clarifying whether plans and issuers are
required to consider both the ICD and the DSM in categorizing benefits
for the purposes of the proposed rules. One commenter added that the
Departments' proposal to align and clarify the definitions of ``mental
health benefits'' and ``substance use disorder benefits'' would ensure
parity between the relevant terms and protect the application of MHPAEA
for conditions and disorders recognized under independent standards of
current medical practice. Another commenter expressing support reasoned
that the proposed amendments would clearly specify how mental health
conditions and substance use disorders must be defined for MHPAEA
compliance purposes and minimize contradictions with State guidelines
that now limit MHPAEA protections. The commenter also remarked that
self-insured plans frequently include language from State-level
mandated benefit requirements prevalent in the plan's geographic area
that may not be MHPAEA-compliant.
Several commenters supported the removal of any reference to State
guidelines to prevent situations in which contradictions between
Federal and State guidelines would result in a loss of protections
under MHPAEA. One commenter wrote that State law definitions often
predate MHPAEA, may conflict with ICD and DSM standards, and should not
be the operable standard, while others stated that State
[[Page 77592]]
guidelines should not be given precedence over Federal regulations to
ensure that MHPAEA's protections are not subverted. However, one
commenter urged that the Departments continue allowing plans and
issuers to use State guidelines to inform the definitions of ``medical/
surgical benefits,'' ``mental health benefits,'' and ``substance use
disorder benefits,'' regardless of whether State law is consistent with
generally recognized independent standards of current medical practice.
The commenter noted that independent standards of medical practice vary
and change over time and are not established with the same intents and
purposes as State laws. The commenter also stated that States have been
the traditional regulators of health insurance issuers when it comes to
interpretive and enforcement matters, even for coverage issues subject
to Federal law (such as the ACA and MHPAEA). Another commenter
supported the clarification that, when the DSM or ICD does not indicate
whether a condition or disorder is a mental health condition or
substance use disorder, plans and issuers may define the condition or
disorder in accordance with applicable Federal and State law.
In the proposed rules, the Departments noted that, to the extent
applicable State law or generally recognized independent standards of
current medical practice define a condition or disorder as a mental
health condition or substance use disorder, plans and issuers must
treat all benefits for the condition or disorder as mental health
benefits or substance use disorder benefits, respectively, for purposes
of analyzing parity and ensuring compliance with MHPAEA. To better
understand interested parties' concerns in implementing this
requirement, the Departments solicited comments on potential challenges
in applying MHPAEA to all benefits for a mental health condition or
substance use disorder where a specific item or service can be
furnished for both medical conditions or surgical procedures and mental
health conditions or substance use disorders, and whether additional
clarifications or modifications to the proposed definitions are
necessary.
In response to this comment solicitation, commenters identified
several instances in which an individual with a mental health or
substance use disorder diagnosis may need a particular treatment for
that condition or disorder that may also be provided to treat a medical
condition. For example, ASD \50\ might be treated with speech and
occupational therapy, which is also used to treat some medical
conditions. Additionally, an eating disorder might require medical
nutrition therapy, which could also be used to treat a medical
condition (such as for the treatment of obesity or diabetes). Moreover,
with respect to benefits for prescription drugs, a commenter noted that
claims for reimbursement generally do not include diagnosis
information. Some commenters explained that many specific prescription
drugs are prescribed for mental health conditions and substance use
disorders, as well as for medical/surgical conditions, and including
diagnosis information would require a range of different entities and
interested parties to change their current practice. Commenters also
recommended several methods under which the rules could allow plans and
issuers to characterize items and services as medical/surgical
benefits, mental health benefits, or substance use disorder benefits.
One commenter suggested items and services be characterized as either
mental health benefits, substance use disorder benefits, or medical/
surgical benefits based on the condition or disorder being treated.
Similarly, another commenter suggested that items and services be
characterized as mental health benefits or substance use disorder
benefits when a claim's primary diagnosis is a mental health condition
or substance use disorder, respectively, as that diagnosis is driving
the treatment provided. Alternatively, several commenters suggested the
rules could be aligned with existing Centers for Medicare & Medicaid
Services (CMS) guidance on MHPAEA compliance for Medicaid and the
Children's Health Insurance Program (CHIP) so that plans and issuers
could use a ``reasonable method'' for defining services commonly used
to treat both medical conditions and mental health conditions or
substance use disorders, for example, by using the plan's or issuer's
annual claims experience to determine its spending on the service in
question.\51\
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\50\ As discussed later in this preamble, the Departments stated
in the proposed rules and reiterate in these final rules that ASD is
a mental health condition for purposes of MHPAEA.
\51\ CMS, Frequently Asked Questions: Mental Health and
Substance Use Disorder Parity Final Rule for Medicaid and CHIP (Oct.
11, 2017), Q4, <a href="https://www.medicaid.gov/federal-policy-guidance/downloads/faq101117.pdf">https://www.medicaid.gov/federal-policy-guidance/downloads/faq101117.pdf</a>.
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After reviewing comments received from interested parties, the
Departments are finalizing the definitions of ``medical/surgical
benefits,'' ``mental health benefits'' and ``substance use disorder
benefits'' as proposed. While plans and issuers have some discretion in
defining mental health benefits and substance use disorder benefits,
this discretion must be exercised in a manner that comports with
generally recognized independent standards of current medical practice,
and the definitions in these final rules include sufficient safeguards
to protect against defining a benefit in a manner that could result in
limitations on access to mental health or substance use disorder
benefits that are more restrictive than those applicable to medical/
surgical benefits. Further, while the Departments acknowledge the
concern that independent standards of current medical practice change
over time and may not have been established with the same intents and
purposes as State law or State guidelines, such standards better ensure
that plans and issuers define mental health conditions and substance
use disorders in a manner consistent with the purposes of MHPAEA. The
Departments agree with one commenter's concern that some State laws, in
particular, might predate MHPAEA. As a result, such State laws might
not offer the same safeguards to access to mental health or substance
use disorder benefits as MHPAEA. The Departments also note that plans
and issuers are required to ensure that the definitions used in the
plan or coverage are consistent with the appropriate chapters of the
most current version of either the ICD or the DSM.
Additionally, while States generally are the traditional regulators
of health insurance issuers, with respect to MHPAEA, the Departments
are not persuaded that this necessitates permitting plans and issuers
to use definitions of ``medical/surgical benefits,'' ``mental health
benefits'' and ``substance use disorder benefits'' that are solely tied
to applicable State law or guidelines. The definitions of ``medical/
surgical benefits,'' ``mental health benefits,'' and ``substance use
disorder benefits'' in these final rules preserve the ability of plans
and issuers to use applicable Federal and State law to inform their
definitions, but only to the extent that those laws are consistent with
generally recognized independent standards of current medical
practice.\52\
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\52\ The final rules also permit plans and issuers to use
applicable Federal and State law to inform their definitions to the
extent generally recognized independent standards of current medical
practice do not address whether a condition or disorder is a medical
condition, surgical procedure, mental health condition, or substance
use disorder.
---------------------------------------------------------------------------
These final rules do not make any changes to the proposed
definitions to specifically address how plans and
[[Page 77593]]
issuers should apply MHPAEA where a specific item or service may be
used to treat both medical conditions or surgical procedures as well as
mental health conditions or substance use disorders. These final rules,
like the proposed rules and the 2013 final regulations, require plans
and issuers to continue to characterize items and services as medical/
surgical benefits, mental health benefits, or substance use disorder
benefits based on the condition or disorder being treated. This
interpretation is the most appropriate reading of the definitions of
medical/surgical benefits, mental health benefits, and substance use
disorder benefits, consistent with the statute and the purpose of
MHPAEA. The Departments note that the existing CMS mental health and
substance use disorder parity guidance for Medicaid and CHIP identified
by several commenters addresses long-term services and supports
provided through Medicaid and CHIP, not items and services covered by
group health plans and health insurance coverage. The Departments
reiterate that, if a plan (or coverage) defines a condition or disorder
as a mental health condition or substance use disorder, plans and
issuers subject to these final rules must treat all benefits for the
condition or disorder as mental health benefits or substance use
disorder benefits, respectively, for purposes of compliance with
MHPAEA. The Departments decline to adopt the alternative methods
suggested by commenters that plans and issuers might use to
characterize items and services as medical/surgical benefits, mental
health benefits, or substance use disorder benefits, as they may be
insufficient to ensure consistency with generally recognized
independent standards of current medical practice and in accordance
with applicable State and Federal law. Furthermore, while the
Departments acknowledge the particular challenges with respect to
prescription drug benefits due to the lack of diagnostic information on
claims for reimbursement, these final rules, similar to the 2013 final
regulations, provide plans and issuers enough flexibility to make
decisions about how to classify items and services, including
prescription drugs, as either mental health benefits, substance use
disorder benefits, or medical/surgical benefits.
To provide guidance to plans and issuers on how to ensure that they
define benefits consistent with generally recognized independent
standards of current medical practice, the proposed rules proposed
separate definitions of the ICD and DSM. Specifically, the Departments
proposed that the ICD would be defined as the World Health
Organization's International Classification of Diseases adopted by HHS
through 45 CFR 162.1002 or successor regulations, and the DSM would be
defined as the APA's Diagnostic and Statistical Manual of Mental
Disorders. The proposed definitions also specified, for purposes of the
definition, which version of the ICD or DSM is the most current as of a
particular date. This was intended to provide clarity on when a plan or
issuer would be required to begin to rely on a new version of the ICD
or DSM after it is released and allow sufficient time after the
adoption of an updated version of the ICD or DSM for a plan or issuer
to update the terms of its plan or coverage to be consistent with any
changes made from the previous version. The proposed definitions stated
that the most current version of the ICD or DSM, respectively, would be
the version applicable no earlier than the date that is 1 year before
the first day of the applicable plan year; however, the proposed rules
would permit the use of an updated version before the plan or issuer is
required to use it. Finally, in recognition of the fact that future
versions of the ICD or DSM may include revisions to the categories of
conditions or disorders or chapters listed in the proposed amended
definitions for ``mental health benefits'' and ``substance use disorder
benefits,'' the proposed amended definitions referred to ``equivalent
categories'' and ``equivalent chapters.''
The Departments received several comments on the proposed
definitions of the terms ``ICD'' and ``DSM,'' with some commenters
suggesting alternatives to the language identifying the most current
versions of the DSM and ICD. One commenter suggested specifying that if
a new version of the DSM or ICD is published in the middle of a plan
year, then plans and issuers must use the updated version by the start
of the next plan year. One commenter suggested that the most current
version of an independent standard should encompass any version
commonly in use among providers, and any version used in the most
recent claims experience available to plans and issuers.
The Departments are finalizing the definition of ``ICD'' as
proposed, with clarifications with respect to the most current version
of the ICD. Specifically, under these final rules, the most current
version of the ICD as of November 22, 2024, the effective date of these
final rules, is the International Classification of Diseases, 10th
Revision, Clinical Modification adopted for the period beginning on
October 1, 2015, through HHS regulations at 45 CFR 162.1002 (or
successor regulations).\53\ Any subsequent version of the ICD adopted
through 45 CFR 162.1002 (or successor regulations) after November 22,
2024, will be considered the most current version beginning on the
first day of the plan year that is one year after the date the
subsequent version is adopted.
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\53\ These HHS regulations implement section 212 of the
Protecting Access to Medicare Act of 2014 by setting compliance
dates for the 10th Revision of the ICD for diagnosis and procedure
coding.
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The Departments are also finalizing the definition of ``DSM'' as
proposed, with similar clarifications, which note that the most current
version as of November 22, 2024, the effective date of these final
rules, is the Diagnostic and Statistical Manual of Mental Disorders,
Fifth Edition, Text Revision published in March 2022. A subsequent
version of the DSM published after November 22, 2024, will be
considered the most current version beginning on the first day of the
plan year that is one year after the date the subsequent version is
published (as the DSM is published, rather than made applicable).
Consistent with this clarification, if a new version of the DSM is
published in the middle of a plan year, plans and issuers will have at
least one full year before they are required to use the updated version
with respect to a plan year. For example, if a new version of the DSM
is published on August 1, 2025, for a calendar year plan, that version
of the DSM would be the most current version with respect to the plan
year beginning on January 1, 2027.
It is important to provide specificity with regard to the relevant
versions of the ICD and DSM instead of allowing the use of multiple
versions, as suggested by commenters, to ensure that plans and issuers
do not select a version that restricts access to mental health and
substance use disorder benefits in a manner that is more restrictive
than access to medical/surgical benefits. Because the Departments
understand that the ICD and DSM are both broadly utilized by providers
and facilities, as well as plans and issuers, and were referenced in
the 2013 final regulations, these final rules continue to rely on such
standards.
Finally, the preamble to the proposed rules noted that interested
parties requested that the Departments confirm whether specific
conditions are mental health conditions for purposes of MHPAEA.
Consistent with the 2013 final regulations and section 13007 of
[[Page 77594]]
the 21st Century Cures Act (Cures Act),\54\ the Departments confirmed
in the proposed rules that eating disorders, such as anorexia nervosa,
bulimia nervosa, and binge-eating disorder, are mental health
conditions under generally recognized independent standards of current
medical practice.\55\ Similarly, the proposed rules made clear that,
for purposes of MHPAEA, ASD is a mental health condition under
generally recognized independent standards of current medical
practice.\56\ Therefore, benefits for these disorders are considered
mental health benefits, and subject to the protections of MHPAEA and
its implementing regulations, including these final rules.
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\54\ Public Law 114-255, 130 Stat. 1033 (Dec. 13, 2016). Section
13007 of the Cures Act states that, if a plan or an issuer offering
group or individual health insurance coverage provides coverage for
eating disorder benefits, including residential treatment, such
group health plan or health insurance issuer shall provide such
benefits consistent with the requirements of MHPAEA.
\55\ See, e.g., DSM Disorders (5th ed.), Section II: Diagnostic
Criteria and Codes, Feeding and Eating Disorders; ICD-10, Chapter V:
Mental and behavioral disorders, Code F50: Eating disorders.
\56\ DSM (5th ed.), Section II: Diagnostic Criteria and Codes,
Autism Spectrum Disorder.
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The Departments also solicited comments on other specific mental
health conditions or substance use disorders that may warrant
additional clarification for purposes of analyzing parity and ensuring
compliance with MHPAEA. The Departments received only a few comments in
response, including a request to clarify whether gender dysphoria is a
mental health condition. Because the most current versions of both the
ICD and DSM include gender dysphoria as a mental health condition as of
the time of the issuance of these final rules, benefits for this
condition are currently subject to the protections of MHPAEA and its
implementing regulations, consistent with the framework described
earlier in this preamble.\57\
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\57\ DSM (5th ed.), Section II: Diagnostic Criteria and Codes,
Gender Dysphoria; ICD-10, Chapter V: Mental and behavioural
disorders, Code F64: Gender identity disorders.
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b. Processes, Strategies, Evidentiary Standards, and Factors
The proposed rules included proposed new definitions of terms used
in paragraph (c)(4)(i) of the 2013 final regulations, which states that
a plan or issuer may not impose an NQTL with respect to mental health
or substance use disorder benefits in any classification unless, under
the terms of the plan (or health insurance coverage) as written and in
operation, any ``processes,'' ``strategies,'' ``evidentiary
standards,'' or other ``factors'' used in applying the NQTL to mental
health or substance use disorder benefits in the classification are
comparable to, and are applied no more stringently than, those used in
applying the limitation with respect to medical/surgical benefits in
the same classification. These terms and the corresponding standard
were incorporated into MHPAEA's statutory language in the amendments
made by the CAA, 2021.\58\ Because the Departments heard from
interested parties prior to the issuance of the proposed rules that it
can be difficult to determine what constitute relevant processes,
strategies, evidentiary standards, and other factors, the Departments
proposed definitions of these terms and included an illustration of the
interaction of the definitions of these terms in the preamble to the
proposed rules. The illustration described how a plan might rely on
various combinations of processes, strategies, evidentiary standards,
and other factors in designing and applying an NQTL, and gave examples
of each term. The Departments also solicited comments on the proposed
definitions, including any alternate definitions or additional
clarifications that should be considered.
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\58\ Code section 9812(a)(8)(A), ERISA section 712(a)(8)(A), and
PHS Act section 2726(a)(8)(A).
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In general, many commenters supported the proposed definitions of
these key terms, which they described as foundational to the
development of sufficient comparative analyses and necessary to hold
plans and issuers accountable for discriminatory NQTLs. Several
commenters described widespread misinterpretation by plans and issuers
of the meaning of these key terms. Other commenters wrote that the
proposed definitions would help clarify the difference between
``factors'' and ``evidentiary standards,'' and draw a clear distinction
between ``strategies'' and ``processes,'' which relate, respectively,
to plans' and issuers' approaches to the design of an NQTL, and to
their application of an NQTL. Other commenters stated that the
definitions of these terms should clearly distinguish between each
component of a plan's or issuer's required comparative analysis and
assign each step of the analysis to a particular component of the
comparative analysis. Additionally, a commenter requested more specific
examples of processes and evidentiary standards, and the differences
between factors and evidentiary standards. One commenter stated that
the proposed definitions are not coherent as applied to network
contracting activities, development of reimbursement methodologies, or
most other network composition NQTLs. This commenter claimed that there
is no algorithmic approach to decision making that can be documented
and requested the Departments to provide guidance on how the many
activities involved in constructing provider networks and provider
reimbursements across different plan types, service settings, and
reimbursement methodologies should be categorized.
As stated in the preamble to the proposed rules, the proposed
definitions for the terms ``processes,'' ``strategies,'' ``evidentiary
standards,'' and ``factors'' are intended to further clarify how to
properly apply and distinguish between these terms, and to help
facilitate proper comparisons between the design and application of
NQTLs to medical/surgical benefits and mental health and substance use
disorder benefits in the same classification, compliance with the
requirements related to NQTLs, and the development of sufficient
comparative analyses, as required under the CAA, 2021 and these final
rules. The definitions in these final rules improve clarity and add
specificity to the terms used in MHPAEA, as amended by the CAA, 2021,
to reduce misinterpretations, and are consistent with the requirements
in these final rules that set forth the manner in which plans and
issuers are required to perform and document comparative analyses,
discussed later in this preamble. The Departments also provide
additional guidance on how plans and issuers must comply with the
provisions of these final rules with respect to NQTLs related to
network composition,\59\ later in this preamble.
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\59\ The term ``NQTLs related to network composition'' generally
refers to the NQTLs listed in 26 CFR 54.9812-1(c)(4)(ii)(D), 29 CFR
2590.712(c)(4)(ii)(D), and 45 CFR 146.136(c)(4)(ii)(D) of these
final rules: standards related to network composition, including but
not limited to standards for provider and facility admission to
participate in a network or for continued network participation,
including methods for determining reimbursement rates, credentialing
standards, and procedures for ensuring the network includes an
adequate number of each category of provider and facility to provide
services under the plan or coverage.
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The Departments note that nothing in these final rules requires an
``algorithmic'' decision making process; however, plans and issuers
must perform and document their comparative analyses as required under
26 CFR 54.9812-2, 29 CFR 2590.712-1, and 45 CFR 146.137 to show that
the processes, strategies, evidentiary standards, and other factors
used in designing or applying an NQTL to mental health and substance
use
[[Page 77595]]
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 in designing or applying
the NQTL to medical/surgical benefits in the relevant classification.
Additionally, anything used by a plan or issuer to design or apply an
NQTL should be considered a process, strategy, evidentiary standard, or
factor (or information, evidence, sources, or standards on which a
factor or evidentiary standard is based), consistent with the
Departments' broad interpretation of these terms.
Under the proposed rules, the Departments proposed that evidentiary
standards generally would not be considered factors, but instead would
be considered or relied upon in designing or applying a factor. The
Departments noted that, although the framework established in the 2013
final regulations treated the terms within the phrase ``processes,
strategies, evidentiary standards, and other factors'' as having
overlapping meanings (and the term ``other factors'' was utilized as a
catch-all), the CAA, 2021 added to MHPAEA other references to factors
and evidentiary standards that indicate Congress meant to distinguish
between them.\60\ The Departments requested comments on this approach
to defining evidentiary standards separately from factors, including
whether there are any circumstances under which an evidentiary standard
should also be considered a factor under the framework outlined in the
proposed rules, but did not receive any specific comments on this
issue. Therefore, under these final rules, consistent with the proposed
rules, evidentiary standards are not considered to be factors.
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\60\ The preamble to the proposed rules noted that, for example,
Code section 9812(a)(8)(A)(iii), ERISA section 712(a)(8)(A)(iii),
and PHS Act section 2726(a)(8)(A)(iii) refer to the evidentiary
standards that are used for the factors to determine that an NQTL
will apply to benefits, and those provisions go on to distinguish
between factors and any other sources or evidence relied upon to
design or apply an NQTL. See 88 FR 51552, 51567 (Aug. 3, 2023).
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The proposed rules provided that the term ``evidentiary standards''
would mean any evidence, sources, or standards that a plan or issuer
considered or relied upon in designing or applying a factor with
respect to an NQTL, including specific benchmarks or thresholds. The
proposed definition further provides that evidentiary standards may be
empirical, statistical, or clinical in nature, and include sources
acquired or originating from an objective third party, such as
recognized medical literature, professional standards and protocols
(which may include comparative effectiveness studies and clinical
trials), published research studies, payment rates for items and
services (such as publicly available databases of the ``usual,
customary, and reasonable'' rates paid for items and services), and
clinical treatment guidelines. The proposed definition also provides
that evidentiary standards would include internal plan or issuer data,
such as claims or utilization data or criteria for assuring a
sufficient mix and number of network providers, and benchmarks or
thresholds, such as measures of excessive utilization, cost levels,
time or distance standards, or network participation percentage
thresholds.
One commenter recommended not including specific benchmarks or
thresholds and professional standards and protocols in the definition
of the term ``evidentiary standards.'' The commenter noted that many
plans and issuers do not define their evidentiary standards numerically
and that finalizing the definition as proposed could require plans and
issuers to do so, thereby compelling plans and issuers not to use
relevant, critical data in the development of their NQTLs. The
commenter also remarked that including professional standards and
protocols in the definition would require plans and issuers to
incorporate potentially unproven medical guidance as a standard to
dictate mental health or substance use disorder benefits, which could
override common medical management practices. The commenter added that,
if the reference to professional standards and protocols is retained,
the Departments should clarify that the definition of ``evidentiary
standards'' does not imply that all professional standards and
protocols must be referenced or that benchmarks or thresholds are
required to be applied to professional standards and protocols.
The Departments are finalizing the definition of ``evidentiary
standards'' as proposed. The definition is consistent with the use of
the term by Congress in the amendments made to MHPAEA by the CAA, 2021.
The definition of the term ``evidentiary standards'' does not require
plans and issuers to define their evidentiary standards numerically,
nor does it imply that all professional standards and protocols must be
referenced or that benchmarks or thresholds are required to be applied
to professional standards and protocols (for example, where the
standards are qualitative in nature). However, to the extent these
types of evidentiary standards are used to design or apply an NQTL,
they must be analyzed for compliance with MHPAEA. The list of examples
of evidentiary standards included in the definition is not intended to
be exhaustive, nor are any of the evidentiary standards listed required
to be considered or relied upon in designing or applying a factor with
respect to an NQTL.
In the proposed rules, the Departments proposed that the definition
of the term ``factors'' be read broadly, so that factors are all
information, including processes and strategies (but not evidentiary
standards), that a plan or issuer considered or relied upon to design
an NQTL or to determine whether or how the NQTL applies to benefits
under the plan or coverage. The Departments noted that by defining the
term ``factor'' broadly, the Departments' intention was to capture any
information used to design or apply an NQTL (other than evidentiary
standards), regardless of whether a plan or issuer believes that
information could also be characterized as a ``process'' or a
``strategy,'' as those terms were proposed to be defined. The
Departments proposed that the term ``factors'' includes information
(but not evidentiary standards) that the plan or issuer considered but
rejected, consistent with previous guidance on MHPAEA in the context of
the documents or plan information the Departments consider relevant to
a compliance determination.\61\ The proposed definition also provided
examples of factors, which include, but are not limited to, provider
discretion in determining diagnosis or type or length of treatment;
clinical efficacy of any proposed treatment or service; licensing and
accreditation of providers; claim types with a high percentage of
fraud; quality measures; treatment outcomes; severity or chronicity of
condition; variability in the cost of an episode of treatment; high
cost growth; variability in cost and quality; elasticity of demand; and
geographic location.
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\61\ See FAQs About Affordable Care Act Implementation Part 31,
Mental Health Parity Implementation, and Women's Health and Cancer
Rights Act Implementation, Q9 (Apr. 20, 2016), <a href="https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-31.pdf">https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-31.pdf</a> and <a href="https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-31">https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-31</a>, which states that a
plan must provide documents and plan information to a participant or
beneficiary, or their authorized representative, including the
specific underlying processes, strategies, evidentiary standards,
and other factors (including, but not limited to, all evidence)
considered by the plan (including factors that were relied upon and
were rejected) in determining that the NQTL will apply to a
particular mental health and substance use disorder benefit or any
medical/surgical benefits within the benefit classification at
issue.
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[[Page 77596]]
With respect to the ``broad'' reading of the term ``factor,'' a
commenter stated that the proposed definition subsumes ``processes''
and ``strategies,'' and suggested eliminating or clarifying this
distinction with additional guidance. The commenter also remarked that
the broad definition of ``factor'' would make the multiple steps in a
comparative analysis less distinguishable, and the requirement that
plans identify, define, and describe the use of every factor in the
design or application of an NQTL unworkably expansive. A few commenters
remarked that the breadth of the definition of ``factor'' makes it
unclear how a plan or issuer would demonstrate that a factor is
unbiased or not discriminatory for the purposes of the comparative
analyses and recommended narrowing the definition of ``factor'' to
distinguish it from evidentiary standards, processes, and strategies,
and instead use the term to describe the basis for the plan's or
issuer's application of an NQTL. Another commenter recommended not
including information that the plan or issuer considered but rejected
in the definition of factors, because it is not illustrative of the
ultimate value of the mental health or substance use disorder benefit
or the plan's or issuer's compliance with MHPAEA's NQTL standards. The
commenter stated that the actual design of the benefit and how it
translates to payments, denials, and reimbursement should substantiate
whether the benefit design complies with parity requirements, without
examining extraneous information on considerations early in the
benefit's development process. A commenter suggested the Departments
include an example of what the Departments would consider a complete
definition of a factor and information about how to specify the weight
assigned to factors.
The Departments are finalizing the definition of the term
``factor'' as proposed. The definition and list of examples of factors
in the definition contained in these final rules are sufficiently
detailed to provide context to plans and issuers in identifying
factors, including by distinguishing evidentiary standards from factors
and acknowledging that factors other than processes and strategies,
which are types of factors, may exist. Under the 2013 final
regulations, plans and issuers were permitted to utilize a wide array
of factors in designing and applying their NQTLs to mental health and
substance use disorder benefits provided they were comparable to, and
applied no more stringently than, those utilized to design and apply
NQTLs to medical/surgical benefits. Similarly, the CAA, 2021 did not
limit what factors plans and issuers could use to design and apply
their NQTLs, but instead required that these factors be identified and
analyzed in the comparative analyses.
As noted in the preamble to the proposed rules, taking into account
not only the factors that the plan or issuer relied upon, but also
those that were considered but ultimately rejected in the definition of
factors, is consistent with previous guidance on MHPAEA, namely because
it is a factor that a plan or issuer uses in designing and applying an
NQTL. The Departments recognize that the language used in the proposed
rules, which included factors that were considered and rejected, rather
than those that are relied upon and rejected, could be interpreted as
including a broader set of information than prior guidance, which had
interpreted ``considered'' to include ``factors that were relied upon
and were rejected.'' The Departments did not intend to broaden the set
of information included as a factor, and agree with the commenter who
questioned the utility of providing information that was considered
early in the design process but rejected. However, the Departments
affirm that taking into account information that the plan or issuer
relied upon and rejected in the definition of factors is necessary to
analyze compliance with MHPAEA.
In the proposed rules, the Departments proposed to define
``processes'' and ``strategies'' as types of factors, and to clarify
the differences between the two terms as they relate to the design and
application of an NQTL. Specifically, the Departments proposed defining
``processes'' as relating to the application of an NQTL, while
``strategies'' would relate to the design of an NQTL. After review of
the comments, the Departments continue to be of the view that the best
read of the statutory text (as well as the 2013 final regulations) is
that processes and strategies are types of factors, rather than
components of a factor to be separately evaluated.
The Departments proposed to define ``processes'' to mean actions,
steps, or procedures that a plan or issuer uses to apply an NQTL,
including actions, steps or procedures established by the plan or
issuer as requirements in order for a participant or beneficiary to
access benefits, including through actions by a participant's or
beneficiary's authorized representative or a provider or facility.
Under the proposed rules, processes include, but are not limited to:
prior authorization procedures, provider referral requirements, and the
development and approval of a treatment plan. The proposed definition
also provided that processes include the specific procedures used by
staff or other representatives of a plan or issuer (or the service
provider of a plan or issuer) to administer the application of NQTLs,
such as how a panel of staff members applies the NQTL (including the
qualifications of staff involved, number of staff members allocated,
and time allocated), consultations with panels of experts in applying
the NQTL, and reviewer discretion in adhering to criteria hierarchy
when applying an NQTL.
A commenter expressed appreciation for the proposed rules' intent
and requested the Departments to include more specific examples of
``processes.'' Another commenter stated that the proposed definition
for ``processes'' is too broad and focuses only on the end result of
access to benefits, which the commenter stated is inconsistent with the
Departments' previous guidance and regulations, and recommended
narrowing the definition to focus on the operational application of any
requirements.
After reviewing comments, the Departments are finalizing the
definition of the term ``processes,'' with minor changes so that the
examples of processes more clearly illustrate the way the action, step,
or procedure is used to apply an NQTL.\62\ While the Departments
decline to add examples to the definition, these modifications will add
clarity to the definition in these final rules.\63\ The Departments
note that the final definition of the term does not focus only on the
end result of access to benefits, but also includes the operational
application of an NQTL, as evidenced by the framing of the definition
in terms of actions, steps, or procedures used to apply an NQTL. For
example, prior authorization processes include the procedures
established by a plan or issuer for a review to determine how a
specific request for prior authorization should be granted or denied.
Concurrent review processes include the procedures established by a
plan or issuer for a review to determine whether a specific request
should be
[[Page 77597]]
granted or denied, such as when peer-to-peer review is required.
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\62\ The Departments are also finalizing a non-substantive
modification so that the definition more closely parallels the
definition of ``strategies.''
\63\ For example, these final rules clarify that provider
referral requirements are processes if they are used to determine
when and how a participant or beneficiary may access certain
services. Similarly, the development and approval of a treatment
plan are processes if they are used in a concurrent review process
to determine whether a specific request should be granted or denied.
---------------------------------------------------------------------------
The proposed rules proposed to define ``strategies'' as practices,
methods, or internal metrics that a plan or issuer considers, reviews,
or uses to design an NQTL, and included examples of strategies. The
proposed definition of strategies included the following examples: the
development of the clinical rationale used in approving or denying
benefits; deviation from generally accepted standards of care; the
selection of information (such as from medical or clinical guidelines)
deemed reasonably necessary to make a medical necessity determination;
reliance on treatment guidelines or guidelines provided by third-party
organizations; and rationales used in selecting and adopting certain
threshold amounts, professional protocols, and fee schedules. The
proposed definition of strategies also specifically included: the
creation and composition of the staff or other representatives of a
plan or issuer (or the service provider of a plan or issuer) that
deliberates, or otherwise makes decisions, on the design of NQTLs,
including the plan's or issuer's decisions related to qualifications of
staff involved; number of staff members allocated, and time allocated;
breadth of sources and evidence considered; consultations with panels
of experts in designing the NQTL; and the composition of the panels
used to design an NQTL.
One commenter supported the inclusion in the definition of
``strategies'' of practices that involve ``deviations from generally
accepted standards of care.'' Several commenters also recommended that
the Departments include actions to detect or prevent and prove fraud,
waste, and abuse in the definitions of either or both ``processes'' and
``strategies,'' rather than including those actions as a stand-alone
exception from the NQTL requirements in the final rules. Another
commenter appreciated the clear distinction made in the proposed
definitions of processes and strategies and stated that they would
appreciate if these distinctions tracked with separate steps in the
comparative analyses.\64\
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\64\ The content elements of comparative analyses are addressed
later in this preamble.
---------------------------------------------------------------------------
The Departments are generally finalizing the definition of the term
``strategies'' with some minor changes to the examples to add
specificity. The definition of the term ``strategies'' in these final
rules includes examples of strategies used to design an NQTL, such as
the method of determining whether and how to deviate from generally
accepted standards of care in concurrent reviews; rationales used in
selecting and adopting certain threshold amounts to apply an NQTL;
professional standards and protocols to determine utilization
management standards; and fee schedules used to determine provider
reimbursement rates, used as part of an NQTL. The Departments note
that, once a plan or issuer uses a strategy to design an NQTL, that
design also may result in the establishment or use of processes to
apply the NQTL.
While the Departments acknowledge comments suggesting that actions
to detect or prevent and prove fraud, waste, and abuse be defined as
either ``processes'' or ``strategies,'' and acknowledge that such
actions certainly could constitute either processes or strategies
(depending on whether the action is undertaken to design or apply the
NQTL), the Departments decline to add a specific reference to actions
to detect or prevent and prove fraud, waste, and abuse to the relevant
definitions, as the proposed exception for standards to detect or
prevent and prove fraud, waste, and abuse is not being finalized, as
discussed later in this preamble.\65\ However, the Departments are
providing additional language to explain what constitutes a standard to
detect or prevent and prove fraud and abuse (also referred to as
``fraud and abuse measures'') later in this preamble and how such
standards must comply with MHPAEA under these final rules.
---------------------------------------------------------------------------
\65\ The proposed rules referred to fraud, waste, and abuse.
However, as explained later in this preamble, the Departments agree
with commenters that the term ``waste'' can be construed in a manner
that is overly broad. Thus, in these final rules, when discussing
the exception in the proposed rules for NQTLs that are narrowly and
reasonably designed to detect or prevent and prove fraud, waste, and
abuse, while minimizing the impact on access to appropriate mental
health and substance use disorder benefits, this preamble refers to
``fraud, waste, and abuse measures.'' When discussing provisions of
this final rule related to carefully circumscribed measures
reasonably and appropriately designed to detect or prevent and prove
fraud and abuse, this preamble refers to ``fraud and abuse
measures.''
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c. Treatment Limitations
The Departments proposed to amend the definition of ``treatment
limitations'' to clarify that the illustrative list of NQTLs to which
the definition refers is non-exhaustive and to amend the last sentence
to state that a ``complete'' (rather than ``permanent'') exclusion of
all benefits for a particular condition or disorder is not a treatment
limitation for purposes of the definition. In the preamble to the
proposed rules, the Departments noted that, while NQTLs are generally
defined as treatment limitations that are not expressed numerically,
the application of an NQTL in a numerical way does not modify its
nonquantitative character simply because the NQTL sometimes involves
numerical standards, and such NQTLs would still be evaluated in
accordance with the rules for NQTLs under the statute and implementing
regulations.
Several commenters supported the Departments' amendment to the
definition of ``treatment limitation'' to specify that ``a complete
exclusion of all benefits for a particular condition or disorder is not
a treatment limitation for purposes of this definition,'' rather than
retaining the reference in the 2013 final regulations to a
``permanent'' exclusion. These commenters stated that the proposed
definition more clearly specifies that a plan or issuer can exclude a
particular condition or service without creating an NQTL, but that in
doing so, the exclusion must be total. The commenters suggested the
Departments include specific examples of permissible exclusions and
impermissible exclusionary language. Other commenters expressed concern
that the proposed definition of ``treatment limitation'' is too broad
and argued that the proposed definition would lead to increased
uncertainty in determining which common plan practices could constitute
an NQTL. One commenter stated that if there is no comparable medical or
surgical treatment limitation, there is nothing to compare a treatment
limitation on a mental health or substance use disorder benefit to, and
that therefore such a limitation on the mental health or substance use
disorder benefit is not subject to parity requirements. Several
commenters recommended adopting a consistent and exhaustive definition
for determining whether a medical management technique is a treatment
limitation.
The Departments are finalizing the definition of ``treatment
limitation'' as proposed, with minor modifications to add an example of
an NQTL. As reflected in the definition, medical management techniques
are NQTLs if they limit the scope or duration of treatment. While the
definition as amended is broad, plans and issuers have great latitude
in the types of limitations that they may impose, and the Departments
understand that plans and issuers do in fact impose a broad range of
limitations on the scope or duration of treatment. In enacting MHPAEA
and the amendments to MHPAEA contained in the CAA, 2021, Congress did
not prohibit the use of these limitations for mental health and
substance use disorder benefits, but
[[Page 77598]]
required that plans and issuers ensure that NQTLs satisfy the statutory
requirements that (1) any treatment limitations imposed on mental
health and substance use disorder benefits are no more restrictive than
the predominant treatment limitations imposed on substantially all
medical/surgical benefits; (2) that no treatment limitations be imposed
only with respect to mental health and substance use disorder benefits;
and (3) that plans and issuers perform and document comparative
analyses of the design and application of NQTLs. Because of the broad
range of treatment limitations that plans and issuers may impose,
combined with the freedom that plans and issuers have to design their
own unique limitations, the Departments cannot provide a comprehensive
and exhaustive list of all limitations, as further explained later in
this preamble.
The Departments note that if a plan or issuer applies a treatment
limitation to mental health and substance use disorder benefits where
medical/surgical benefits are not subject to a comparable treatment
limitation in the same classification, the plan or issuer would violate
MHPAEA because it must not apply separate treatment limitations only to
mental health and substance use disorder benefits. Further, the
Departments have stated that, if a plan or issuer provides any benefits
for a mental health condition or substance use disorder but excludes
benefits for items or services for that condition or disorder in a
classification in which it provides medical/surgical benefits, such an
exclusion of a benefit for a condition or disorder that is otherwise
covered is a treatment limitation because it is a limit on the scope or
duration of treatment offered.\66\ While the Departments decline to
provide additional examples of permissible exclusions and impermissible
exclusionary language in these final rules, examples of such exclusions
and language have been provided in guidance and in the Departments'
reports to Congress.
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\66\ See 75 FR 5410, 5413 (Feb. 2, 2010).
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3. Nonquantitative Treatment Limitations--26 CFR 54.9812-1(c)(4), 29
CFR 2590.712(c)(4), and 45 CFR 146.136(c)(4)
In the proposed rules, the Departments proposed changes designed to
better ensure that plans and issuers do not design and implement NQTLs
that impose greater restrictions on access to mental health and
substance use disorder benefits as compared to medical/surgical
benefits. The Departments proposed to add requirements that apply to
NQTLs with respect to mental health and substance use disorder
benefits, to ensure that plans and issuers do not impose a greater
burden on participants and beneficiaries accessing those benefits than
the burden imposed on participants and beneficiaries accessing medical/
surgical benefits, while preserving the ability of plans and issuers to
impose NQTLs to the extent they are consistent with generally
recognized independent professional medical or clinical standards or
legitimate and narrowly designed standards related to fraud, waste, and
abuse. Subject to those two narrow exceptions for those types of NQTLs,
the proposed rules provided that plans and issuers would not be
permitted to impose an NQTL on mental health or substance use disorder
benefits unless they satisfied all of the following three requirements:
(1) the NQTL is no more restrictive as applied to mental health and
substance use disorder benefits than to medical/surgical benefits (also
referred to as the no more restrictive requirement); (2) the plan or
issuer satisfies requirements related to the design and application of
the NQTL (also referred to as the design and application requirements);
and (3) the plan or issuer collects, evaluates, and considers the
impact of relevant data on access to mental health and substance use
disorder benefits relative to access to medical/surgical benefits; and
subsequently takes reasonable action, as necessary, to address any
material differences in access shown in the data to ensure compliance
with MHPAEA (also referred to as the relevant data evaluation
requirements).
Specifically, under the no more restrictive requirement, the
proposed rules specified that a plan or issuer may not apply any NQTL
to mental health or substance use disorder benefits in any
classification that is more restrictive, as written or in operation,
than the predominant NQTL that applies to substantially all medical/
surgical benefits in the same classification. This requirement was
intended to ensure that the implementing regulations more closely
mirrored the statutory language in Code section 9812(a)(3)(A), ERISA
section 712(a)(3)(A), and PHS Act section 2726(a)(3)(A).
The proposed rules outlined a four-prong test for a plan or issuer
to determine compliance with the no more restrictive requirement.
Specifically, this provision would have required plans and issuers to
determine: (1) the portion of plan payments for medical/surgical
benefits subject to an NQTL in a classification; (2) whether the NQTL
applies to substantially all medical/surgical benefits in the
classification; (3) if the NQTL applies to substantially all medical/
surgical benefits in the classification, the predominant variation of
the NQTL that applies to substantially all medical/surgical benefits in
the classification; and (4) whether the NQTL, as applied to mental
health and substance use disorder benefits in the classification, is
more restrictive than the predominant variation of the NQTL as applied
to substantially all medical/surgical benefits.
The second proposed requirement for NQTLs, the design and
application requirements, retained the requirements for NQTLs from the
2013 final regulations focused on the processes, strategies,
evidentiary standards, and other factors used to apply an NQTL, with a
proposed modification to better align the rules with the statute's
focus on the design of an NQTL in addition to its application. In
addition, the Departments proposed to prohibit plans and issuers from
relying upon any factor or evidentiary standard if the information,
evidence, sources, or standards on which the factor or evidentiary
standard was based discriminates against mental health or substance use
disorder benefits as compared to medical/surgical benefits.
The third requirement for NQTLs under the proposed rules, the
relevant data evaluation requirements, proposed to require plans and
issuers to collect and evaluate relevant outcomes data and take
reasonable action to address material differences in access between
mental health and substance use disorder benefits and medical/surgical
benefits as necessary to ensure compliance, in operation, with MHPAEA.
This requirement also included a proposed special rule for NQTLs
related to network composition.
The proposed rules stated that, if a plan or issuer fails to meet
any of the three requirements under the proposed rules with respect to
an NQTL in a classification, the NQTL would violate MHPAEA and, as a
result, could not be imposed on mental health or substance use disorder
benefits in the classification without changes to the terms of the plan
or coverage, or the way the NQTL is designed or applied, to ensure
compliance with MHPAEA.
The Departments proposed two limited exceptions to some of the
requirements for NQTLs, consistent with the Departments' intention to
avoid interference with a plan's or issuer's attempts to ensure that
NQTLs imposed with respect to benefits for
[[Page 77599]]
treatment of mental health conditions or substance use disorders are
consistent with generally accepted independent professional medical or
clinical standards of care (also referred to as independent
professional medical or clinical standards) or are narrowly and
reasonably designed to detect or prevent and prove fraud, waste, and
abuse, while minimizing the impact on access to appropriate mental
health and substance use disorder benefits (also referred to as fraud,
waste, and abuse measures). The Departments proposed to exempt NQTLs
qualifying for the exception for independent professional medical or
clinical standards from compliance with the no more restrictive
requirement, the prohibition on discriminatory factors and evidentiary
standards, and the relevant data evaluation requirements. The
Departments proposed to exempt NQTLs qualifying for the exception for
fraud, waste, and abuse measures from compliance with the no more
restrictive requirement and the prohibition on discriminatory factors
and evidentiary standards, but not the relevant data evaluation
requirements.
Finally, the Departments proposed to make clear that a plan or
issuer that has received a final determination of noncompliance under
the comparative analysis review process established by the CAA, 2021,
including a final determination of noncompliance based on failure to
provide a sufficient comparative analysis, would also be in violation
of the substantive requirements that apply to NQTLs under MHPAEA, as
determined by the Departments. Upon such a determination, the proposed
rules would permit the Departments to direct the plan or issuer to not
impose the NQTL that is the subject of the comparative analysis, unless
and until the plan or issuer can demonstrate compliance or take
appropriate action to remedy the violation.
The Departments requested comments on all aspects of these proposed
amendments, including the exceptions to the proposed rules regarding
NQTLs. Many commenters expressed support for these provisions of the
proposed rules as a whole, as a means of achieving increased access to
mental health and substance use disorder benefits by targeting NQTLs
that otherwise impede access. Other commenters expressed support for
the proposed rules' enhanced specificity with respect to the
requirements for imposing NQTLs, with one commenter also indicating
that the proposals would help State insurance regulators better enforce
MHPAEA and clarify plans' and issuers' compliance obligations.
However, other commenters expressed the view that these provisions
of the proposed rules were complex, ambiguous, confusing, subject to
interpretation, or difficult to operationalize, which they argued could
lead to substantial uncertainty for plans and issuers attempting to
comply. Commenters also stated that it may be impossible for plans or
issuers to meet the proposed mathematical substantially all and
predominant tests as applied to NQTLs, leading them to eliminate
necessary utilization management tools. Some commenters also indicated
that these provisions of the proposed rules could lead to inconsistent
application of NQTLs across plans administered by the same TPA or
issuer, which could result in administrative complexity and cause
confusion for consumers and providers. Other commenters highlighted
that the proposed requirements would significantly increase the cost of
administering plans and health insurance coverage. One commenter
indicated that some plans might consider excluding all treatments or
services for a particular mental health condition or substance use
disorder as a result of the additional burdens imposed by the
substantially all and predominant tests, if finalized as proposed. Some
commenters also stated that the additional proposed requirements for
NQTLs do not add value beyond distinctions already captured by the
design and application requirements included in the 2013 final
regulations, with some commenters stating those additional requirements
go beyond MHPAEA's statutory requirements. Comments specific to each of
the three requirements and two exceptions proposed at 26 CFR 54.9812-
1(c)(4)(i), (ii), and (iv); 29 CFR 2590.712(c)(4)(i), (ii), and (iv);
and 45 CFR 146.136(c)(4)(i), (ii), and (iv) are discussed in greater
detail later in this preamble.
The Departments acknowledge the concerns expressed by commenters
and, in response to comments, the Departments are finalizing a modified
framework that is still intended to prevent plans and issuers from
designing and applying NQTLs that impose greater burdens on access to
mental health and substance use disorder benefits as compared to
medical/surgical benefits, while limiting uncertainty, increases in
cost, operational difficulty, and unintended consequences. These final
rules streamline the proposed rules' general requirements to eliminate
redundancies and add clarity for plans and issuers in a manner that
remains consistent with the statutory text of MHPAEA, while also
ensuring participants and beneficiaries will not face greater
restrictions on access to mental health and substance use disorder
benefits as compared to medical/surgical benefits.
These final rules do not finalize the language of the proposed ``no
more restrictive'' requirement, as discussed in more detail later in
this preamble, and instead incorporate the statutory requirements of
Code section 9812(a)(3)(A), ERISA section 712(a)(3)(A), and PHS Act
section 2726(a)(3)(A) as the overall general rule for NQTLs in 26 CFR
54.9812-1(c)(4), 29 CFR 2590.712(c)(4), and 45 CFR 146.136(c)(4).
Specifically, these final rules state that, consistent with the
fundamental purpose of MHPAEA, a group health plan (or health insurance
coverage offered by an issuer in connection with a group health plan)
may not impose any NQTL with respect to mental health or substance use
disorder benefits in any classification that is more restrictive, as
written or in operation, than the predominant NQTL that applies to
substantially all medical/surgical benefits in the same classification.
However, as discussed later in this preamble, the Departments are
declining to finalize the proposed four-prong test for the no more
restrictive requirement, which was proposed to determine compliance
with statutory requirements as they apply to NQTLs.\67\ Rather, to
demonstrate compliance with the no more restrictive requirement, which
is now the general rule for NQTLs, a plan or issuer is required under
these final rules to satisfy (1) the design and application
requirements and (2) the relevant data evaluation requirements, each of
which the Departments are finalizing with modifications, as discussed
in more detail later in this preamble. Additionally, the Departments
are not finalizing the exceptions set forth in the proposed rules, but
have added language to these final rules to explain how plans and
issuers should analyze and account for independent professional medical
or clinical standards and fraud and abuse measures in designing and
applying their NQTLs. Finally, the Departments are finalizing a
provision providing that, depending on the relevant facts and
circumstances, the Departments or an applicable State authority may
direct a plan or issuer that has received a final determination of
noncompliance under the comparative analysis review process
[[Page 77600]]
established by the CAA, 2021 to not apply an impermissible NQTL.
---------------------------------------------------------------------------
\67\ Code section 9812(a)(3)(A), ERISA section 712(a)(3)(A), and
PHS Act section 2726(a)(3)(A).
---------------------------------------------------------------------------
a. Requirement That NQTLs Be No More Restrictive for Mental Health
Benefits and Substance Use Disorder Benefits--26 CFR 54.9812-1(c)(4),
29 CFR 2590.712(c)(4), and 45 CFR 146.136(c)(4)
Through the proposed mathematical substantially all and predominant
tests for NQTLs as part of the no more restrictive requirement, the
Departments proposed to require plans and issuers to follow similar
steps to those that apply when analyzing parity with respect to
financial requirements or quantitative treatment limitations under the
2013 final regulations (referred to in this preamble as the proposed
mathematical substantially all and predominant tests). As noted in the
proposed rules, the steps in the proposed mathematical substantially
all and predominant tests would have involved determining the portion
of plan payments for medical/surgical benefits subject to an NQTL in a
classification; whether the NQTL applies to substantially all medical/
surgical benefits in the classification; if the NQTL applies to
substantially all medical/surgical benefits in the classification, the
predominant variation of the NQTL that applies to substantially all
medical/surgical benefits in the classification; and whether the NQTL,
as applied to mental health and substance use disorder benefits in the
classification, is more restrictive than the predominant variation of
the NQTL, as applied to substantially all medical/surgical benefits.
Many commenters generally supported application of the proposed
mathematical substantially all and predominant tests to NQTLs, with
some indicating that the tests would provide additional clarity,
eliminate subjectivity, assist regulators, and result in compliance
improvements. Many of these commenters also stated that the statute
clearly supports the tests, as it requires treatment limitations to be
``no more restrictive'' than the predominant treatment limitations that
apply to substantially all medical/surgical benefits. Other commenters
generally opposed the inclusion of the substantially all and
predominant tests for NQTLs as part of the no more restrictive
requirement. Some of these commenters stated that the proposed
mathematical substantially all and predominant tests are a reversal of
policy from the 2013 final regulations and are inconsistent with
congressional intent, because Congress codified the design and
application requirements from the 2013 final regulations in the CAA,
2021. These commenters highlighted that the Departments had stated
previously that they understood NQTLs could not be easily quantified
and that the Departments had not sufficiently explained their change in
interpretation under the proposed rules.
Some commenters expressed general concerns that NQTLs are
inherently unquantifiable, arguing that the proposal would result in
unworkable standards or arbitrary outcomes that could prohibit plans
and issuers from using evidence-based medical guidelines or other
relevant factors specific to the item or service under consideration.
Commenters also raised concerns that imposition of the proposed
mathematical substantially all and predominant tests on certain types
of NQTLs that are not commonly utilized for medical/surgical benefits
may lead to some types of legitimate NQTLs no longer being permitted
with respect to mental health and substance use disorder benefits.
Specifically, several of these commenters contended that the proposed
mathematical substantially all and predominant tests, as proposed,
would result in the elimination of plans' and issuers' ability to
impose certain NQTLs with respect to mental health and substance use
disorder benefits, such as step therapy, prior authorization, and
concurrent review, which they posited would negatively impact the
quality and cost of care. Some commenters also cited potential
negative, unintended consequences of the application of the proposed
mathematical substantially all and predominant tests, as proposed,
including patient safety concerns; impacts on health outcomes, quality,
and affordability; and a chilling effect on access improvements and
innovation. Further, some commenters expressed concern with the
increased costs associated with complying with the proposed
mathematical substantially all and predominant tests, with some stating
that this increased burden would not be offset by any resulting
increase in access to mental health and substance use disorder benefits
for participants and beneficiaries.
Several commenters expressed confusion as to how these tests, as
proposed, would be applied in practice and highlighted the need for
more detail. Specifically, some commenters stated that these proposed
provisions lack clarity in how the tests apply to certain types of
NQTLs (including those related to network composition), and the
potential consequences of enforcement of these requirements. Many
commenters provided specific comments and feedback on aspects of each
part of the substantially all and predominant tests included in the
proposed rules, as discussed later in this preamble, and highlighted
ambiguities and challenges operationalizing the proposed quantitative
testing requirements with respect to NQTLs.
Under the first prong of the proposed mathematical substantially
all and predominant tests, plans and issuers would have been required
to determine the portion of plan payments for medical/surgical benefits
in the classification expected to be subject to the NQTL based on the
dollar amount of all plan payments for medical/surgical benefits in the
classification expected to be paid under the plan or coverage for the
plan year (or the portion of the plan year after a change in benefits
that affects the applicability of the NQTL). The proposed rules stated
that, for purposes of this determination, any reasonable method could
be used to determine the dollar amount expected to be paid under a plan
for medical/surgical benefits.
The Departments received many comments on the proposed requirement
that the plan or issuer determine the portion of plan payments for
medical/surgical benefits expected to be subject to an NQTL in the
benefit classification. Several commenters indicated that the
determination of the dollar amount of all plan payments for medical/
surgical benefits expected to be paid may be an inappropriate measure
altogether because NQTLs like medical management, assessments related
to medical necessity, experimental/investigational treatment
exclusions, prior authorization requests, and provider network
admission standards are not generally attached to claims. Some
commenters highlighted that self-insured plan sponsors may face
challenges in obtaining a complete and reliable set of plan-level
claims data, and accordingly, would have limited data to use to assess
individual NQTLs, or would incur additional costs.
After determining the portion of plan payments for medical/surgical
benefits in the classification expected to be subject to the NQTL, the
Departments proposed that, under the second prong, plans and issuers
would be required to determine whether the NQTL applies to
substantially all medical/surgical benefits in the classification,
based on the dollar amount of all plan payments for medical/surgical
benefits in the classification expected to be paid under the plan for
the plan year. Under the proposed rules, an NQTL would be considered to
apply to substantially all medical/surgical benefits in a
[[Page 77601]]
classification if it applies to at least two-thirds of all medical/
surgical benefits in that classification. Under the proposed rules,
whether the NQTL applies to at least two-thirds of all medical/surgical
benefits would be determined without regard to whether the NQTL was
triggered based on a particular factor or evidentiary standard.\68\ The
proposed rules further provided that if an NQTL does not apply to at
least two-thirds of all medical/surgical benefits in a classification,
that NQTL would not be permitted to be applied to mental health or
substance use disorder benefits in that classification.
---------------------------------------------------------------------------
\68\ For example, if a plan or issuer applies a general
exclusion for all benefits in a classification that are for
experimental or investigative treatment, and defines experimental or
investigative treatment to be treatments with less than a certain
number of peer-reviewed studies demonstrating efficacy, under the
proposed rules, the exclusion would be treated as applying to all of
the benefits in the classification--not just those that may be
subject to the general exclusion for experimental or investigative
treatment because they lack the requisite number of peer-reviewed
studies (that is, those that actually triggered the NQTL based on
the evidentiary standard). 88 FR 51552, 51570 (Aug. 3, 2023).
---------------------------------------------------------------------------
The Departments received many comments regarding this prong of the
proposed mathematical substantially all and predominant tests. As
mentioned earlier in this preamble, many commenters stated that, in
practice, a numerical ``substantially all'' determination would be
difficult to apply and assess for NQTLs for many reasons, including
because they are often not quantifiable, and there are more medical/
surgical items and services (and associated benefits) than there are
mental health and substance use disorder items and services.
Additionally, commenters highlighted that plans and issuers already
experience difficulty in obtaining data from service providers and
would have difficulty in determining which NQTLs apply to at least two-
thirds of medical/surgical benefits in a classification. Some
commenters predicted that, if the Departments finalize the
substantially all and predominant tests as proposed, plans and issuers
might increase the application of NQTLs to medical/surgical benefits to
meet the two-thirds threshold.
Further, some commenters requested that the Departments specify and
provide examples showing how to apply the substantially all test to
NQTLs that are not associated with plan payments, such as prescription
drug formularies and network composition standards. One commenter
highlighted that it is difficult to calculate the amount of plan
payments expected to be paid for prescription drugs subject to an NQTL.
Another commenter urged the Departments to clarify the determination of
whether an NQTL applies regardless of whether the NQTL was triggered.
For example, this commenter highlighted that insurers might state that
prior authorization ``applies'' to all benefits in a classification
where a benefit is considered or evaluated under the various factors
for determining whether to apply prior authorization, even if the
benefit ultimately is determined to not be subject to prior
authorization based on the application of factors and evidentiary
standards.
In addition, in the proposed rules, the Departments solicited
comments on whether plans and issuers maintain systems capable of
determining, under the proposed mathematical substantially all and
predominant tests, whether an NQTL applies to substantially all
medical/surgical benefits in a classification, and the administrative
burden that would be associated with such determinations. Several
commenters highlighted that it would be difficult to comply with the
substantially all and predominant tests as proposed, including because
the requisite data may be housed in different parts of a plan's or
issuer's organization. One commenter emphasized that current
administrative systems would need to be adapted, and plans and issuers
would need to hire additional staff or service providers to be able to
perform the analysis that would be required under the proposed
mathematical substantially all and predominant tests.
Under the proposed rules, if a plan or issuer determined that an
NQTL applies to substantially all medical/surgical benefits in a
classification, the third prong of the test would require a plan or
issuer to determine the predominant variation of the NQTL that is
applied to substantially all medical/surgical benefits subject to the
NQTL in the classification. The Departments proposed that the term
``predominant'' would, for this purpose, mean the most common or most
frequent variation of an NQTL within a benefit classification.
The Departments received many comments regarding this part of the
proposed tests. Numerous commenters stated that this aspect of the
substantially all and predominant tests is unworkable. Some commenters
noted that, with a lack of guidance on how to identify all the
variations of a particular NQTL (especially those that are complex and
nuanced), the proposed rules may not be feasible for plans, issuers,
and regulators to apply in real-life situations. Several commenters
stated that, while financial requirements and quantitative treatment
limitations will have only a few different variations, NQTLs are
multifactorial and each difference could be considered a different
variation, or even a separate NQTL. For example, some of these
commenters highlighted that prior authorization or concurrent review
may take varied forms: an admission that requires advance prior
authorization; an admission that requires notification but no clinical
review; a nonclinical review based on predetermined standards; a first-
level or nurse clinical review; a second-level or physician clinical
review; and a peer-to-peer clinical review. These commenters noted that
some processes may be automated or manual, some may be handled by
vendors or directly by the plan or issuer, and some may have multiple
utilization management systems within all of the aforementioned
categories. Another commenter highlighted that a plan or regulator
could conceivably determine that ``variations'' include a wide range of
aspects, such as the credentials of the reviewer, the type or source of
clinical criteria applied, the timing of the review (for example,
urgent vs. nonurgent), the modality of authorization submission (for
example, via electronic health record vs. fax or pdf form), among
others. As a result, these commenters stated that determining how to
identify the predominant variation of an NQTL may not be feasible
without additional clarifications. Many commenters requested that the
Departments provide a definition of the term ``variation'' and an
explanation of how to determine whether a variation exists, as well as
additional guidance and examples illustrating when an NQTL has no
variation and when an NQTL has multiple variations (beyond variations
based on numerical distinctions). These commenters also noted that,
under the proposed rules, the predominant variation may only apply to a
small percentage of medical/surgical services or items in the
applicable benefit classification.
Lastly, under the fourth prong, the proposed rules provided that an
NQTL applied to mental health or substance use disorder benefits cannot
be more restrictive than the predominant variation of the NQTL applied
to substantially all medical/surgical benefits in the same
classification. Under the proposed rules, for this purpose, an NQTL
would be considered restrictive if it imposes conditions, terms, or
requirements that limit access to benefits under the terms of the plan
or coverage. For this purpose,
[[Page 77602]]
conditions, terms, or requirements would include, but not be limited
to, those that compel an action by or on behalf of a participant or
beneficiary to access benefits or limit access to the full range of
treatment options available for a condition or disorder under the plan.
As discussed later in this preamble, the Departments also proposed that
an NQTL applied to mental health or substance use disorder benefits in
any classification would not be considered to violate the no more
restrictive requirement if the NQTL impartially applies independent
professional medical or clinical standards or fraud, waste, and abuse
measures, that meet specific requirements.
Some commenters supported this approach to the ``more restrictive''
part of the test in the proposed rules because, according to these
commenters, it provided a more concrete and less subjective standard.
Other commenters emphasized, as discussed earlier in this preamble,
that the proposed mathematical substantially all and predominant tests,
which provide a quantitative basis for comparison, are unworkable for
NQTLs and administratively burdensome. Many of these commenters
requested that, if the proposed mathematical substantially all and
predominant tests are finalized, the Departments provide extensive and
detailed implementation guidance to assist plans and issuers in
complying with what the commenters characterized as this challenging
framework. Another commenter suggested that the Departments establish a
safe harbor for plans and issuers from the substantially all and
predominant tests for any variation in NQTL outcomes data driven by
State law or regulation.
The Departments appreciate the detailed comments received on all
aspects of the proposed mathematical substantially all and predominant
tests, including comments particular to each aspect of the proposed
four-prong test. The Departments acknowledge that many commenters
expressed concerns that applying to NQTLs the same proposed
mathematical substantially all and predominant tests that are
applicable to financial requirements or quantitative treatment
limitations may be difficult to operationalize and could be unworkable.
The Departments acknowledge that this framework was first developed for
financial requirements and quantitative treatment limitations, where
there are relatively clear and limited numbers of variations, and that
the framework might be impractical or impossible for NQTLs, which
differ in how they are designed and applied to various benefits.
At the same time, the Departments agree with commenters who stated
that applying the statutory no more restrictive requirement to NQTLs
under the proposed rules would assist regulators tasked with enforcing
MHPAEA's requirements and result in overall compliance improvements by
formalizing and providing greater clarity on what plans and issuers
must do to comply with MHPAEA. The Departments also agree with
commenters who emphasized the importance of the statutory requirement
that plans and issuers shall ensure that the treatment limitations they
impose on mental health and substance use disorder benefits generally
are no more restrictive than those they impose on medical/surgical
benefits. The proposed rules made clear that the incorporation of this
statutory language into regulations is key to ensuring that people
seeking mental health and substance use disorder treatment do not face
a greater burden on access to benefits for such treatment than on
access to benefits for medical treatment and surgical procedures, a
premise that is central to MHPAEA.
After reviewing all the comments on the proposed four prongs of the
no more restrictive requirement, the Departments have sought to address
many of the workability concerns expressed by commenters, while
honoring statutory requirements. Specifically, due to concerns raised
by the commenters, the Departments are declining to finalize the
proposed mathematical substantially all and predominant tests for
NQTLs, which would have based these determinations on the dollar amount
of all plan payments for medical/surgical benefits expected to be paid,
similar to the steps that apply when analyzing parity with respect to
financial requirements or quantitative treatment limitations under the
2013 final regulations. These final rules address commenters'
operability and feasibility concerns with respect to the proposed
mathematical substantially all and predominant tests, while continuing
to set forth a standard for parity compliance that is grounded in
MHPAEA's statutory text and is also sufficiently flexible to account
for the unique and nonquantifiable nature of NQTLs. As noted later in
this preamble, these final rules retain the focus on the design and
application of NQTLs, including with respect to relevant outcomes
measures, to ensure that NQTLs are no more restrictive in the context
of mental health and substance use disorder benefits than in the
context of medical/surgical benefits.
Therefore, these final rules do not finalize the provisions
proposed under 26 CFR 54.9812-1(c)(4)(i)(A) through (E), 29 CFR
2590.712(c)(4)(i)(A) through (E), and 45 CFR 146.136(c)(4)(i)(A)
through (E). Instead, consistent with MHPAEA's express statutory
requirement,\69\ the Departments are finalizing under 26 CFR 54.9812-
1(c)(4), 29 CFR 2590.712(c)(4), and 45 CFR 146.136(c)(4) the general
rule that, consistent with the fundamental purpose of MHPAEA, a group
health plan (or health insurance coverage offered by an issuer in
connection with a group health plan) may not impose any NQTL with
respect to mental health or substance use disorder benefits in any
classification that is more restrictive, as written or in operation,
than the predominant NQTL that applies to substantially all medical/
surgical benefits in the same classification. Through this requirement,
the Departments reiterate the importance of promoting the goals of the
statute and ensuring that individuals have access to the mental health
and substance use disorder benefits under their plan or coverage in a
way that is not more restrictive than their access to the medical/
surgical benefits under their health coverage. For this purpose,
consistent with the fundamental purpose of MHPAEA, an NQTL is more
restrictive than the predominant NQTL that applies to substantially all
medical/surgical benefits in the same classification if the plan or
issuer fails to satisfy the design and application requirements at 26
CFR 54.9812-1(c)(4)(i), 29 CFR 2590.712(c)(4)(i), and 45 CFR
146.136(c)(4)(i) or the relevant data evaluation requirements at 26 CFR
54.9812-1(c)(4)(iii), 29 CFR 2590.712(c)(4)(iii), and 45 CFR
146.136(c)(4)(iii). Accordingly, plans and issuers must ensure that the
processes, strategies, evidentiary standards, and other factors used to
design and apply an NQTL to mental health or substance use disorder
benefits are comparable to, and applied no more stringently than, the
processes, strategies, evidentiary standards, and other factors used to
design and apply the NQTL for medical/surgical benefits, including by
ensuring that the information, evidence, sources, or standards on which
factors and evidentiary standards are based are not biased and are
objective. Additionally, plans and issuers must comply with the
relevant data evaluation requirements,
[[Page 77603]]
including by collecting and evaluating relevant data, determining
whether the data suggest an NQTL contributes to material differences in
relevant outcomes related to access to mental health and substance use
disorder benefits as compared to medical/surgical benefits, and if
material differences in relevant outcomes related to access exist,
taking reasonable action, as necessary, to address the material
differences to ensure compliance, in operation, with 26 CFR 54.9812-
1(c)(4), 29 CFR 2590.712(c)(4), and 45 CFR 146.136(c)(4). Absent
compliance with both the design and application requirements and the
relevant data evaluation requirements with respect to an NQTL, which
are addressed in more detail later in this preamble, a plan or issuer
fails to comply with Code section 9812(a)(3)(A)(ii), ERISA section
712(a)(3)(A)(ii), and PHS Act section 2726(a)(3)(A)(ii), as applicable,
and may not impose the NQTL with respect to mental health or substance
use disorder benefits. These requirements, taken together, require a
plan to consider and evaluate an NQTL's design, application, and
resulting outcomes to ensure that an NQTL is not more restrictive, as
written or in operation, than the predominant NQTL that applies to
substantially all medical/surgical benefits in the same classification.
---------------------------------------------------------------------------
\69\ Code section 9812(a)(3)(A), ERISA section 712(a)(3)(A), and
PHS Act section 2726(a)(3)(A).
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These final rules also include a few technical changes to this
language, including relocation of the reference to 26 CFR 54.9812-
1(a)(1), 29 CFR 2590.712(a)(1), and 45 CFR 146.136(a)(1) from the
beginning of the general rule of the design and application
requirements to the beginning of the regulatory requirements for NQTLs
at 26 CFR 54.9812-1(c)(4), 29 CFR 2590.712(c)(4), and 45 CFR
146.136(c)(4), to make clear that plans and issuers should consider the
fundamental purpose of MHPAEA in complying with all parts of the
requirements for NQTLs. Additionally, the Departments are incorporating
the phrase ``may not impose'' from the beginning of the proposed
regulatory requirements for NQTLs, to make clear that this standard
applies both to the design and application of NQTLs. The Departments
are also replacing the word ``applied'' with ``applies'' in the clause
describing ``the predominant NQTL that applies to substantially all
medical/surgical benefits in the same classification.'' This adjustment
from past to present tense is intended to clarify that plans and
issuers should evaluate compliance with MHPAEA with respect to NQTLs
that are currently imposed under the plan or coverage, rather than just
those that might have been imposed at some point in the past.
b. Requirements Related to Design and Application of the NQTL--26 CFR
54.9812-1(c)(4)(i), 29 CFR 2590.712(c)(4)(i), and 45 CFR
146.136(c)(4)(i)
The Departments proposed to redesignate the requirement at 26 CFR
54.9812-1(c)(4)(i), 29 CFR 2590.712(c)(4)(i), and 45 CFR
146.136(c)(4)(i) in the 2013 final regulations as paragraph
(c)(4)(ii)(A) and amend it to align with the Departments'
interpretation that a plan or issuer may not impose an NQTL with
respect to mental health or substance use disorder benefits in any
classification unless, under the terms of the plan (or health insurance
coverage) as written and in operation, any processes, strategies,
evidentiary standards, or other factors used in designing and applying
(as compared to only applying, as under the 2013 final regulations) the
NQTL to mental health and substance use disorder benefits are
comparable to, and are applied no more stringently than those used in
designing and applying the limitation with respect to medical/surgical
benefits in the classification. To codify this interpretation, and for
consistency with the statutory language added by the CAA, 2021, the
Departments proposed to revise the regulatory text to make this
requirement with respect to designing the NQTL explicit.
Some commenters generally supported the proposed design and
application requirements as part of an overall framework for evaluating
compliance with MHPAEA's requirements with respect to NQTLs. Some
commenters indicated that they have encountered barriers in identifying
whether plans and issuers comply with MHPAEA's requirements, and this
proposal would help them identify whether the plan or issuer is
compliant with respect to the design and application of NQTLs. Other
commenters generally opposed the proposed changes to the design and
application requirements. One commenter also stated that the design and
application requirements would not improve benefit quality and would
also constitute an impermissible retroactive application of the
regulation in the case of regulated entities that were not required to
comply with MHPAEA when they designed their benefit plans.
With respect to commenters' concern that the design and application
requirements would not improve benefit quality, the Departments
anticipate that greater clarity with respect to these requirements,
including the definitions of the terms ``processes,'' ``strategies,''
``evidentiary standards,'' and ``factors'' under these final rules, as
discussed earlier in this preamble, will help plans and issuers assess
their compliance and remedy any parity violations, which will result in
improved benefit quality overall. The Departments also disagree with
the concern expressed by commenters that the design and application
requirements impermissibly apply to plans and issuers that were not
required to comply with MHPAEA when they designed their benefit plans.
As stated earlier in this preamble, this provision codifies the
Departments' longstanding interpretation of the design and application
requirements and the CAA, 2021 amendments to the MHPAEA statute. The
CAA, 2021 amendments apply generally to plans and issuers that offer
both medical/surgical benefits and mental health or substance use
disorder benefits and impose NQTLs on mental health or substance use
disorder benefits. Congress did not exempt plans or issuers whose plans
or benefit designs predated these requirements, and the Departments
similarly did not take such an approach in implementing the 2010
interim final regulations or the 2013 final regulations. In fact, as
described in more detail later in this preamble, Congress included a
provision in the CAA, 2023 that sunsets the option for self-funded non-
Federal governmental plans to elect to opt out of compliance with
respect to MHPAEA, so that plans that previously were exempt from the
requirements as a result of an opt-out election will no longer be able
to make such an election.
The Departments are finalizing as proposed the general rule with
respect to the design and application requirements for NQTLs, with a
few minor amendments. Accordingly, this provision clarifies that to
satisfy these requirements, a plan or issuer must consider, as part of
its assessment of an NQTL's compliance with the no more restrictive
requirement, whether any processes, strategies, evidentiary standards,
or other factors used in designing and applying the NQTL to mental
health or substance use disorder benefits in the classification are
comparable to, and are applied no more stringently than those used in
designing and applying the limitation with respect to medical/surgical
benefits in the classification. By requiring processes, strategies,
evidentiary standards, or other factors used to be comparable to and
applied no more stringently than, the design and application
requirements
[[Page 77604]]
of these final rules give meaning to the statutory terms
``substantially all'' and ``predominant.'' By making explicit in these
final rules the Departments' interpretation of the design and
application requirements, and codifying the requirements of the CAA,
2021, this provision will help plans and issuers better understand
their MHPAEA compliance obligations with respect to NQTLs, by
emphasizing that, as written and in operation, the design of an NQTL is
equally relevant as how it is applied. The design and application
requirements of these final rules will also ensure that plans and
issuers do not place greater burdens on access to mental health and
substance use disorder benefits as compared to medical/surgical
benefits.
The Departments note that a plan or issuer must comply with the
relevant requirements under these final rules with respect to NQTLs
applicable to mental health or substance use disorder benefits once the
final rules become applicable to the plan or coverage, including with
respect to any NQTLs that were developed and imposed when a plan or
issuer was not subject to MHPAEA and that continue to be imposed after
the applicability date. However, these final rules are not applicable
to an NQTL imposed with respect to mental health or substance use
disorder benefits for any such prior period of time (including a period
when MHPAEA was not applicable).
In these final rules, the Departments are codifying the design and
application requirements at 26 CFR 54.9812-1(c)(4)(i)(A), 29 CFR
2590.712(c)(4)(i)(A), and 45 CFR 146.136(c)(4)(i)(A), rather than as
proposed at 26 CFR 54.9812-1(c)(4)(ii)(A), 29 CFR
2590.712(c)(4)(ii)(A), and 45 CFR 146.136(c)(4)(ii)(A) because, as
discussed earlier in this preamble, these final rules structure the
design and application requirements as part of the statutory no more
restrictive requirement, rather than as a unique prong of the three
requirements for NQTLs included in the proposed rules. In addition, the
Departments are making a technical correction by amending the
regulatory text to refer to health insurance coverage, rather than an
issuer, to generally use consistent terminology throughout the
regulations. Finally, as noted earlier in this preamble, these final
rules move the reference to 26 CFR 54.9812-1(a)(1), 29 CFR
2590.712(a)(1), and 45 CFR 146.136(a)(1) from the beginning of the
general rule of the design and application requirements to the
beginning of the regulatory requirements for NQTLs at 26 CFR 54.9812-
1(c)(4), 29 CFR 2590.712(c)(4), and 45 CFR 146.136(c)(4).
Prohibition on Discriminatory Factors and Evidentiary Standards
The proposed rules would add a new provision that, for purposes of
determining comparability and stringency under the design and
application requirements of proposed 26 CFR 54.9812-1(c)(4)(ii)(A), 29
CFR 2590.712(c)(4)(ii)(A), and 45 CFR 146.136(c)(4)(ii)(A), plans and
issuers would be prohibited from relying upon any factor or evidentiary
standard if the information, evidence, sources, or standards on which
the factor or evidentiary standard is based discriminate against mental
health or substance use disorder benefits as compared to medical/
surgical benefits. The proposed rules stated that information would be
considered to discriminate against mental health or substance use
disorder benefits if it is biased or not objective, in a manner that
results in less favorable treatment of mental health or substance use
disorder benefits, based on all the relevant facts and circumstances.
Such relevant facts and circumstances would include, but not be limited
to, the source of the information, the purpose or context of the
information, and the content of the information. Therefore, under the
proposed rules, plans and issuers would not be permitted to rely on
information that reflects bias, as those factors or evidentiary
standards would be discriminatory.
For this purpose, the Departments stated in the proposed rules that
information resulting in the less favorable treatment of mental health
and substance use disorder benefits without legitimate justification or
that is otherwise not objective would be considered to be biased and to
discriminate against mental health and substance use disorder benefits.
When determining which information, evidence, sources, or standards
should inform the factors or evidentiary standards used to design or
apply an NQTL, plans and issuers would not be permitted under the
proposed rules to use information, evidence, sources, or standards if
they are biased in favor of imposing greater restrictions on access to
covered mental health and substance use disorder benefits or not
objective, based on all the relevant facts and circumstances. The
Departments also proposed that impartially applied independent
professional medical or clinical standards and fraud, waste, and abuse
measures that meet specific requirements would qualify for an exception
and would not be considered to discriminate against mental health or
substance use disorder benefits.
Additionally, in the preamble to the proposed rules the Departments
noted that the proposed prohibition on discriminatory factors and
evidentiary standards would prohibit plans and issuers from relying on
historical plan data or other historical information from a time when
the plan or coverage was not subject to MHPAEA or was in violation of
MHPAEA's requirements, where the use of such data results in less
favorable treatment of mental health and substance use disorder
benefits. The Departments provided an example illustrating that a plan
or issuer would not be permitted to calculate reimbursement rates based
on historical data on total plan spending for each specialty that is
divided between mental health and substance use disorder providers and
medical/surgical providers, when the total spending by the plan was
based on a time period when the plan or coverage was not subject to
MHPAEA or was in violation of MHPAEA, if the data result in less
favorable treatment of mental health and substance use disorder
benefits. Consequently, under the framework in the proposed rules,
plans and issuers could not use such data to develop a factor or
evidentiary standard for the design or application of an NQTL to mental
health or substance use disorder benefits. The proposed rules stated,
to the extent a plan or issuer relies on any factor or evidentiary
standard that discriminates against mental health or substance use
disorder benefits, or any information, evidence, sources, or standards
that inform such factors or evidentiary standards to design and apply
NQTLs, the plan or issuer would violate the prohibition on
discriminatory factors and evidentiary standards set forth in proposed
26 CFR 54.9812-1(c)(4)(ii)(B), 29 CFR 2590.712(c)(4)(ii)(B), and 45 CFR
146.136(c)(4)(ii)(B).
Many commenters expressed general support for this provision of the
proposed rules. For example, one commenter noted that the prohibition
on discriminatory factors and evidentiary standards would more
effectively protect against the inappropriate application of NQTLs
that, although appearing to be compliant with MHPAEA as written, have a
disproportionately negative effect on access to mental health and
substance use disorder benefits. Some commenters also indicated that
the proposed provision is consistent with the text and purpose of
MHPAEA, as well as the ACA, and favored a broad interpretation
[[Page 77605]]
of the requirement to address particular examples of discrimination by
plans and issuers, to which some of them expressly cited. Other
commenters expressed opposition to the proposed prohibition on
discriminatory factors and evidentiary standards. Some of these
commenters stated that the proposal would be administratively
burdensome, and it would be difficult for plans and issuers to
operationalize due to ambiguity and inherent subjectivity. Some
commenters opposed to the proposed prohibition stated that it is
duplicative of the proposed relevant data evaluation requirements.
These commenters thought the prohibition on discriminatory factors and
evidentiary standards should be eliminated as superfluous, because the
required evaluation of outcomes data under the proposed rules is
intended to ensure that factors are applied no more stringently to
mental health and substance use disorder benefits than medical/surgical
benefits and do not result in a material difference in access.
Some commenters expressed concern that the proposed requirement
that information must not be biased and must be objective (which is
based on facts and circumstances) is too subjective, can only be
determined retroactively (yet must be applied prospectively), and is
too difficult to apply for plans or issuers to be certain of
compliance. One commenter requested clarification on the documentation
and evidence required to demonstrate the absence of bias. Another
commenter expressed concern that plans may not have the ability to
prove that information is unbiased and objective.
One commenter stated that it is unclear whether the Departments
intend to focus on the factors and evidentiary standards themselves or
on the effects of using those factors and standards. Some commenters
assumed that whether a factor or evidentiary standard is discriminatory
would be based on an evaluation of outcomes, and that therefore any
disparity in outcomes data could be viewed as use of a discriminatory
factor or evidentiary standard. These commenters requested examples of
outcomes that would demonstrate compliance. In addition, many
commenters requested examples of discriminatory factors and evidentiary
standards and of nondiscriminatory information and data sources.
Several commenters requested the Departments to make clear that plans
and issuers may not establish compliance by relying on a fee schedule
used by Medicare, although another commenter requested that plans and
issuers be able to access a safe harbor if they paid above-Medicare
rates.
After considering commenters' feedback, the Departments are
finalizing the prohibition on discriminatory factors and evidentiary
standards with modifications. As the Departments stated in the preamble
to the proposed rules this provision will help address the concern that
various factors and evidentiary standards that plans and issuers have
relied on to design NQTLs with respect to mental health or substance
use disorder benefits might themselves discriminate against mental
health and substance use disorder benefits by treating them in a less
favorable manner. At the same time, the Departments acknowledge
commenters' concerns about potential ambiguities in the proposed
prohibition on discriminatory factors and evidentiary standards,
questions about whether this provision is duplicative of other parts of
the proposed rules, and confusion about how to operationalize the
prohibition.
In response to these concerns, and to assist plans and issuers in
complying with the prohibition on discriminatory factors and
evidentiary standards in these final rules, the Departments have
modified the prohibition by providing additional clarity regarding what
it means for information, evidence, sources, or standards to be
``biased or not objective.'' The final rules both clarify the
prohibition in a manner to ensure that it can be applied prospectively
and revise it to expressly provide that potentially biased or not
objective information, evidence, sources, or standards can be
corrected, cured, or supplemented, and then relied upon by a plan or
issuer to inform a factor or evidentiary standard that is not
discriminatory. The Departments also provide additional examples of
discriminatory factors and evidentiary standards later in this
preamble.
First, with respect to the general prohibition on discriminatory
factors and evidentiary standards, these final rules at 26 CFR 54.9812-
1(c)(4)(i)(B), 29 CFR 2590.712(c)(4)(i)(B), and 45 CFR
146.136(c)(4)(i)(B) \70\ provide that, for purposes of determining
comparability and stringency under 26 CFR 54.9812-1(c)(4)(i)(A), 29 CFR
2590.712(c)(4)(i)(A), and 45 CFR 146.136(c)(4)(i)(A), a plan (or health
insurance coverage) may not rely upon discriminatory factors and
evidentiary standards to design an NQTL to be imposed on mental health
or substance use disorder benefits. The Departments intend that the
focus of this prohibition be specifically on the design of NQTLs, to
further distinguish the prohibition on discriminatory factors and
evidentiary standards from the relevant data evaluation requirements.
These final rules provide the necessary clarity for plans and issuers
to determine whether information, evidence, sources, or standards are
biased or not objective, and if so, cannot be used as the basis for a
factor or evidentiary standard used to design an NQTL applicable to
mental health or substance use disorder benefits.
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\70\ As noted earlier in this preamble, the Departments are
codifying the design and application requirements (including the
prohibition on discriminatory factors and evidentiary standards) at
26 CFR 54.9812-1(c)(4)(i), 29 CFR 2590.712(c)(4)(i), and 45 CFR
146.136(c)(4)(i), rather than as proposed at 26 CFR 54.9812-
1(c)(4)(ii), 29 CFR 2590.712(c)(4)(ii), and 45 CFR
146.136(c)(4)(ii), because these final rules structure the design
and application requirements as part of the no more restrictive
requirement, rather than as a unique prong of the 3-part test
proposed in the proposed rules.
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Specifically, these final rules state that a factor or evidentiary
standard is discriminatory if the information, evidence, sources, or
standards on which the factor or evidentiary standard are based are
biased or not objective in a manner that discriminates against mental
health or substance use disorder benefits as compared to medical/
surgical benefits. This language is similar to that included under
proposed 26 CFR 54.9812-1(c)(4)(ii)(B), 29 CFR 2590.712(c)(4)(ii)(B),
and 45 CFR 146.136(c)(4)(ii)(B) but adds the phrase ``is biased or not
objective in a manner that,'' preceding the word ``discriminates.''
This phrase, in conjunction with the other changes to the prohibition
on discriminatory factors and evidentiary standards discussed later in
this preamble, was modified in response to comments and is intended to
help clarify that a plan or issuer is expected to assess whether the
information, evidence, sources, or standards on which each factor or
evidentiary standard are based are biased or not objective in a manner
that discriminates against mental health or substance use disorder
benefits as compared to medical/surgical benefits. This analysis is
distinct from the final rules' requirement to compare the comparability
and stringency of factors and evidentiary standards used to design and
apply an NQTL.
Second, the Departments are finalizing a modified version of the
provision originally proposed under 26 CFR 54.9812-1(c)(4)(ii)(B)(3),
29 CFR 2590.712(c)(4)(ii)(B)(3), and 45 CFR 146.136(c)(4)(ii)(B)(3) as
26 CFR 54.9812-1(c)(4)(i)(B)(1), 29 CFR 2590.712(c)(4)(i)(B)(1), and 45
CFR 146.136(c)(4)(i)(B)(1) of these final rules. This provision of the
proposed rules
[[Page 77606]]
provided that information is considered to discriminate against mental
health or substance use disorder benefits if it is biased or not
objective, in a manner that results in less favorable treatment of
mental health or substance use disorder benefits, based on all the
relevant facts and circumstances. As mentioned earlier in this
preamble, the Departments received many comments opposing this
provision as proposed, including comments expressing confusion as to
how it is different from the relevant data evaluation requirements,
questions regarding the kind of documentation and evidence needed to
show compliance, and concern that it is subjective and difficult to
operationalize.
The prohibition on discriminatory factors and evidentiary standards
is intended to work together with the other provisions of these final
rules, including the relevant data evaluation requirements. Like all
the provisions of these final rules, the provision further implements
the statutory requirement that NQTLs be no more restrictive with
respect to mental health or substance use disorder benefits than the
predominant limitations applicable to substantially all medical/
surgical benefits. The test specifically focuses on the importance of
ensuring that the factors and evidentiary standards relied upon by
plans and issuers in designing NQTLs do not have built-in biases (at
the time NQTLs are designed) against mental health or substance use
disorder benefits as compared to medical/surgical benefits. To the
extent plans and issuers rely upon factors and evidentiary standards to
design NQTLs that systematically disfavor access or are specifically
designed to disfavor access to mental health and substance use disorder
benefits, the resultant NQTLs are more restrictive with respect to
mental health or substance use disorder benefits than for medical/
surgical benefits.
The Departments note that a factor or evidentiary standard may be
based on or include information that solely relates to medical/surgical
benefits (and is silent or without corollary with respect to mental
health or substance use disorder benefits). Such a factor or
evidentiary standard is not considered discriminatory for this purpose.
For example, a plan can reasonably rely on a source of information on
the clinical efficacy of a treatment or service to inform a factor used
to design a medical management NQTL, even though that source does not
address the clinical efficacy of any treatment of any mental health
conditions or substance use disorders, without violating the
prohibition on discriminatory factors and evidentiary standards.
However, the use of such factor or evidentiary standard must comply
with the design and application requirements, as described earlier in
this preamble.
In response to comments to provide additional clarity, the final
rules elaborate on the meaning of the phrase ``biased and not objective
in a manner that discriminates against mental health or substance use
disorder benefits.'' Specifically, these final rules provide that
information, evidence, sources, or standards are considered to be
biased or not objective in a manner that discriminates against mental
health or substance use disorder benefits as compared to medical/
surgical benefits if, based on all the relevant facts and
circumstances, they systematically disfavor access or are specifically
designed to disfavor access to mental health or substance use disorder
benefits as compared to medical/surgical benefits.
For purposes of determining whether information, evidence, sources,
or standards are considered to be biased or not objective under these
final rules, relevant facts and circumstances may include, but are not
limited to, the reliability of information, evidence, sources, or
standards, including any underlying data and the independence of the
information, evidence, sources, and standards relied upon. The
Departments note that internal data or information, such as claims
data, would generally not be considered independent, but would not
necessarily be considered discriminatory on that basis alone. In the
Departments' view, independence is a relevant fact and circumstance for
determining whether information, evidence, sources, or standards are
considered to be biased or not objective. For example, a standard that
is created or funded by the plan or issuer, or its service provider,
would likely lack independence compared to a standard created by an
impartial third party or governmental entity, and might require strong
indicators of reliability in order to demonstrate that it is objective
and unbiased. Additionally, relevant facts and circumstances include
the analyses and methodologies employed to select the information,
evidence, sources, or standards, and the consistency of their
application; and any known safeguards deployed to prevent reliance on
skewed data or metrics when determining whether they are biased or not
objective. The Departments note that these final rules only provide
examples, and not a comprehensive list, of relevant facts and
circumstances that indicate information, evidence, sources, or
standards are biased or not objective. Because plans and issuers rely
on myriad factors and evidentiary standards to design NQTLs for their
own unique benefit designs, this evaluation necessarily will be
specific to the particular plan or coverage.
Under these final rules, information, evidence, sources, and
standards are not considered biased or not objective for purposes of
the prohibition on discriminatory factors and evidentiary standards, if
a plan or issuer has taken steps necessary to address the bias or lack
of objectivity by correcting, curing, or supplementing the information,
evidence, sources, or standards that would have been biased or not
objective in the absence of such steps. If information, evidence,
sources, or standards are corrected, cured, or supplemented, they may
be used by plans and issuers as the basis for factors and evidentiary
standards used to design an NQTL.
Several commenters asked about the use of a fee schedule used by
Medicare and CMS-set standards, such as network time and distance
standards, by a plan or issuer to inform plan design. For example, some
plans use the Medicare Physician Fee Schedule \71\ to establish base
rates for in-network physician services. The Departments do not
consider fee schedules used by Medicare and standards set by CMS to be
biased or not objective, as defined under these rules, when used as the
basis for a factor or evidentiary standard to design an NQTL such as
reimbursement rate methodology.
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\71\ The Medicare Physician Fee Schedule is developed by CMS. To
develop the Medicare Physician Fee Schedule, CMS utilizes
recommendations from an independent assessment by a multi-specialty
body and other market-based information sources, as well as
independent assessment by CMS medical officers, to develop proposed
relative value units for each physician service. CMS then engages in
notice and comment rulemaking, including consideration of public
comments, before establishing payment rates for specific services.
Furthermore, CMS has made, and continues to make, numerous
adjustments to the underlying methodology to increasingly ensure
appropriate reimbursement for services paid under the Medicare
Physician Fee Schedule, including behavioral health services. See,
e.g., Medicare and Medicaid Programs; CY 2024 Payment Policies Under
the Physician Fee Schedule and Other Changes to Part B Payment and
Coverage Policies; Medicare Shared Savings Program Requirements;
Medicare Advantage; Medicare and Medicaid Provider and Supplier
Enrollment Policies; and Basic Health Program, 88 FR 78818 (Nov. 16,
2023).
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The Departments note, however, that the mere use of the Medicare
Physician Fee Schedule, for example, as one type of information,
evidence, source, or standard that informs a factor used to design an
NQTL does not automatically
[[Page 77607]]
render the NQTL permissible. For example, in most cases, a plan would
be unable to justify a reimbursement rate methodology that paid
physicians in medical/surgical specialties 125 percent of the Medicare
Physician Fee Schedule rate and that paid physicians in mental health
and substance use disorder specialties 75 percent of the Medicare
Physician Fee Schedule rate.
The Departments received several comments in support of the example
included in the preamble to the proposed rules that illustrated the
prohibition on plans' and issuers' reliance on historical plan data or
other historical information from a time when the plan or coverage was
not subject to MHPAEA, or not compliant with MHPAEA. Some commenters
recognized that many plans and issuers have used their own historical
data from a time when their plan or coverage was not subject to MHPAEA
and have benefited from historic inequities in benefit structures that
MHPAEA sought to prohibit. One commenter requested that this example be
codified in the regulatory text of the final rules. The Departments
agree that the example illustrating how the prohibition on
discriminatory factors and evidentiary standards applies to the use of
historical data and information to design an NQTL should be clearly set
forth in the regulation text at 26 CFR 54.9812-1(c)(4)(ii)(B)(2), 29
CFR 2590.712(c)(4)(ii)(B)(2), and 45 CFR 146.136(c)(4)(ii)(B)(2). To
ensure compliance with this standard, plans and issuers that utilize
historical data or information from a time when their plan or coverage
was not subject to, or not compliant with, MHPAEA should ensure that
the use of such data and information (for example, in cost calculations
and controls) for mental health and substance use disorder benefits
does not include, as a baseline, years when financial requirements and
treatment limitations that would have been impermissible under MHPAEA
were imposed on such benefits (unless they take steps to correct, cure,
or supplement the data or information, as discussed earlier in this
preamble).
Some commenters provided other examples that they recommended
including as illustrations of discriminatory factors and evidentiary
standards in these final rules, including prior authorization for a
prescription of buprenorphine to treat opioid use disorder (OUD)
requiring additional licensure or certification for mental health and
substance use disorder providers that is not required of similar
medical/surgical providers; subjecting mental health and substance use
disorder claims to different fraud, waste, and abuse processes, or
requiring more documentation, than for medical/surgical claims; not
covering nutrition counseling for the treatment of eating disorders
while covering it for medical conditions; and requiring that mental
health and substance use disorder claims and appeals be filed with a
TPA, but not making this clear to enrollees, nor properly coordinating
operations between the plan/issuer and TPA.
However, many of these examples focus on the use of a factor to
apply an NQTL to mental health and substance use disorder benefits in a
manner that is not comparable or is more stringent than the use of the
factor to apply an NQTL to medical/surgical benefits, or focus on the
NQTL itself (rather than the discriminatory factor or evidentiary
standard). The prohibition on discriminatory factors and evidentiary
standards in these final rules, however, focuses on the information,
evidence, sources, and standards that inform the factors and
evidentiary standards used to design an NQTL. Factors and evidentiary
standards that incorporate or otherwise rely on underlying data or
information that systematically disfavor access or are specifically
designed to disfavor access to mental health or substance use disorder
benefits place a greater burden on access to such benefits. Therefore,
these final rules prohibit the use of any factor or evidentiary
standard to design an NQTL if the underlying information, evidence,
sources, and standards are themselves biased or not objective in a
manner that discriminates against mental health or substance use
disorder benefits as compared to medical/surgical benefits, unless the
plan or issuer takes steps to correct, cure, or supplement the
information, evidence, sources and standards to address the bias or
lack of objectivity.
These final rules set forth a general rule to determine which
specific factors and evidentiary standards (and the information,
evidence, sources, and standards on which they are based) might or
might not be biased and not objective in a manner that discriminates
against mental health or substance use disorder benefits as compared to
medical/surgical benefits. The Departments have provided new examples
in these final rules illustrating the prohibition on discriminatory
factors and evidentiary standards, which are discussed later in this
preamble. The Departments acknowledge that these examples are not
exhaustive and may provide additional examples in future guidance.
Finally, as discussed in greater detail later in this preamble, the
Departments are not finalizing the exceptions to the prohibition on
discriminatory factors and evidentiary standards for independent
professional medical or clinical standards and fraud, waste, and abuse
measures. However, these final rules expressly clarify at 26 CFR
54.9812-1(c)(4)(i)(B)(3), 29 CFR 2590.712(c)(4)(i)(B)(3), and 45 CFR
146.136(c)(4)(i)(B)(3) that generally recognized independent
professional medical or clinical standards and fraud and abuse measures
that minimize the negative impact on access to appropriate mental
health and substance use disorder benefits are not information,
evidence, sources, or standards that are biased or not objective in a
manner that discriminates against mental health or substance use
disorder benefits as compared to medical/surgical benefits.
The Departments recognize that commenters requested specificity as
to what qualifies as independent professional medical or clinical
standards. To ensure that they are not biased and are objective,
independent professional medical or clinical standards should reflect
the standards of care and clinical practice that are generally
recognized in relevant clinical specialties across a range of settings
of care and should be transparent. For example, sources that include
such standards could be peer-reviewed scientific studies and medical
literature, formal published recommendations of Federal Government
agencies, drug labeling approved by the United States Food and Drug
Administration (FDA), and recommendations of relevant nonprofit health
care provider professional associations and specialty societies,
including, but not limited to, patient placement criteria and clinical
practice guidelines. Additionally, fraud and abuse measures should be
reliably established through unbiased and objective data and narrowly
tailored in a manner that minimizes the negative impact on access to
appropriate mental health and substance use disorder benefits.
These final rules also clarify that plans and issuers that rely on
independent professional medical or clinical standards or fraud and
abuse measures must comply with the general rule of the design and
application requirements at 26 CFR 54.9812-1(c)(4)(i)(A), 29 CFR
2590.712(c)(4)(i)(A), and 45 CFR 146.136(c)(4)(i)(A). If such a
standard or measure is used as an NQTL, the plan or issuer also must
comply with the relevant data evaluation requirements at 26 CFR
54.9812-1(c)(4)(iii), 29 CFR
[[Page 77608]]
2590.712(c)(4)(iii), and 45 CFR 146.136(c)(4)(iii) in these final
rules.
c. Illustrative, Non-Exhaustive List of NQTLs--26 CFR 54.9812-
1(c)(4)(ii), 29 CFR 2590.712(c)(4)(ii), and 45 CFR 146.136(c)(4)(ii)
The proposed rules proposed to move the illustrative, non-
exhaustive list of NQTLs from 26 CFR 54.9812-1(c)(4)(ii), 29 CFR
2590.712(c)(4)(ii), and 45 CFR 146.136(c)(4)(ii) to 26 CFR 54.9812-
1(c)(4)(iii), 29 CFR 2590.712 (c)(4)(iii), and 45 CFR
146.136(c)(4)(iii) and make several minor changes to this list. First,
the Departments proposed amendments to make clear that this
illustrative list of NQTLs is non-exhaustive and that there are
additional NQTLs not captured in the list. The Departments also
proposed to amend the illustrative, non-exhaustive list of NQTLs to
replace ``[s]tandards for provider admission to participate in a
network, including reimbursement rates'' with ``standards related to
network composition, including, but not limited to, standards for
provider and facility admission to participate in a network or for
continued network participation, including methods for determining
reimbursement rates, credentialing standards, and procedures for
ensuring the network includes an adequate number of each category of
provider and facility to provide covered services under the plan or
coverage.'' Additionally, the Departments proposed to amend the
description of the illustrative NQTL ``plan methods for determining
usual, customary, and reasonable charges'' to encompass a broader range
of methods for determining out-of-network rates, such as allowed
amounts; usual, customary, and reasonable charges; or application of
other external benchmarks for out-of-network rates. Finally, the
Departments proposed to add a specific reference to prior authorization
requirements as an example of a medical management standard limiting or
excluding benefits based on medical necessity or medical
appropriateness, consistent with Example 1 in 26 CFR 54.9812-
1(c)(4)(iii), 29 CFR 2590.712(c)(4)(iii), and 45 CFR 146.136(c)(4)(iii)
of the 2013 final regulations.
Some commenters supported the clarification in the proposed rules
that the illustrative list is non-exhaustive and that there are
additional NQTLs not included in the list. In general, many commenters
found the list to be helpful for plans and issuers to identify NQTLs.
Some of these commenters pointed out that the non-exhaustive nature of
the list would allow new NQTLs developed by plans and issuers to fall
under the scope of the requirements in these final rules. One commenter
also noted that the definition of an NQTL is sufficiently clear such
that an exhaustive list would not be needed to put plans or issuers on
notice of their compliance obligations.
Other commenters requested that the Departments instead provide an
exhaustive list of NQTLs to eliminate uncertainty, promote consistency,
and clarify plans' and issuers' compliance obligations. Several of
these commenters suggested that the Departments update such an
exhaustive list as new NQTLs are identified and allow adequate time for
plans and issuers to come into compliance with respect to such NQTLs.
Other commenters advocated for an approach where an exhaustive list of
NQTLs would also represent the scope of NQTLs for which the relevant
Secretary could request a comparative analysis. Some of these
commenters requested that to the extent the relevant Secretary
requested a comparative analysis for an NQTL not on the list, plans and
issuers be provided with additional time to respond.
The Departments agree with the commenter generally stating that the
definition of an NQTL under 26 CFR 54.9812-1(a), 29 CFR 2590.712(a),
and 45 CFR 146.136(a), in addition to the non-exhaustive, illustrative
list of NQTLs, is sufficient to put plans and issuers on notice that a
given plan provision would fall under the definition of an NQTL.
Therefore, the Departments are finalizing as proposed the clarification
that this illustrative list of NQTLs is non-exhaustive.
The Departments decline to provide an exhaustive list of NQTLs, as
requested by commenters, in these final rules; however, as described
further below, the Departments may consider issuing separate guidance
to add additional examples if needed. Plans and issuers, rather than
the Departments, are best positioned to initially identify NQTLs,
including any NQTLs that plans and issuers newly implement as their
plan or coverage designs evolve over time. MHPAEA does not limit the
scope of NQTLs that plans and issuers may impose on mental health and
substance use disorder benefits. However, for any NQTLs applicable to
such benefits, a plan or issuer must comply with MHPAEA and its
implementing regulations. Any exhaustive list of NQTLs published by the
Departments would likely lag behind those actually utilized by plans
and issuers due to this information gap, along with the wide
variability in NQTLs that exist now and could exist in the future.
Furthermore, while some commonalities exist, plans and issuers
generally do not use uniform nomenclature to refer to their medical
management techniques or other NQTLs, making the task of identifying an
exhaustive list difficult, if not impossible.
An exhaustive list of NQTLs that does not include the full scope of
NQTLs utilized by plans and issuers at any given time would undermine
the fundamental purpose of MHPAEA and these final rules. While the
Departments acknowledge and have considered plans' and issuers'
requests for a finite list of NQTLs for which the Departments may
request comparative analyses, the exhaustive nature of such a list
would leave open a compliance loophole by incentivizing plans and
issuers to wait to evaluate, document, and address compliance for an
NQTL that is newly developed or has not come to the attention of the
Departments. The approach some commenters suggested to expressly limit
the comparative analysis requirement under 26 CFR 54.9812-2, 29 CFR
2590.712-1, and 45 CFR 146.137 to only those NQTLs identified in an
exhaustive list is similarly untenable due to a foreseeable mismatch
between the NQTLs included on such an exhaustive list, and those
utilized by plans and issuers over time, particularly where the
Departments may receive a complaint or have reason to believe there may
be a potential violation. The Departments recognize the desire of plans
and issuers to have a list of NQTLs on which the Departments will focus
their enforcement efforts. The Departments highlight that the most
recent reports to Congress on MHPAEA contain lists of the NQTLs on
which the Departments have focused their enforcement efforts, and the
NQTLs the Departments have mostly commonly found to be
noncompliant.\72\ Additionally, the 2020 MHPAEA Self-Compliance Tool
includes an illustrative, non-exhaustive list of NQTLs.\73\ The
statute, however, requires the Departments to request
[[Page 77609]]
comparative analyses from a plan or issuer for any NQTL that involves
potential violations of MHPAEA or complaints regarding noncompliance
with MHPAEA that concern NQTLs. To limit the Departments to requesting
comparative analyses for only certain NQTLs identified in a list would
not only be inconsistent with the statute but would also limit the
ability of the Departments to dynamically respond to new NQTLs that
plans and issuers design and apply that may restrict participant and
beneficiary access to mental health and substance use disorder benefits
as compared to medical/surgical benefits.
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\72\ See, e.g., 2022 MHPAEA Report to Congress (Jan. 2022), pg.
13, 19-20, <a href="https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2022-realizing-parity-reducing-stigma-and-raising-awareness.pdf">https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2022-realizing-parity-reducing-stigma-and-raising-awareness.pdf</a>; 2023
MHPAEA Comparative Analysis Report to Congress (July 2023), pg. 47-
48, 55-56, <a href="https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2023-mhpaea-comparative-analysis.pdf">https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2023-mhpaea-comparative-analysis.pdf</a> and <a href="https://www.cms.gov/cciio/resources/forms-reports-and-other-resources#mental-health-parity">https://www.cms.gov/cciio/resources/forms-reports-and-other-resources#mental-health-parity</a>.
\73\ See Self-Compliance Tool for the Mental Health Parity and
Addiction Equity Act (MHPAEA) (2020), <a href="https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/self-compliance-tool.pdf">https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/self-compliance-tool.pdf</a>.
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Additionally, allowing plans and issuers to categorically have
additional time to assemble a comparative analysis for NQTLs that are
not on a finite list of NQTLs, as requested by commenters, would also
be inconsistent with the statutory requirement that, without exception,
plans and issuers perform and document such comparative analyses of
NQTLs applicable to mental health or substance use disorder benefits,
beginning 45 days after the enactment of the CAA, 2021, and would
result in the post-hoc justifications addressed with the CAA, 2021's
enactment.\74\ The Departments nonetheless acknowledge commenters'
requests for additional guidance about plan provisions that would be
considered to be NQTLs and intend to provide additional examples of
NQTLs through future reports to Congress, updates to the 2020 MHPAEA
Self-Compliance Tool, and other guidance.
---------------------------------------------------------------------------
\74\ Code section 9812(a)(8)(A), ERISA section 712(a)(8)(A), and
PHS Act section 2726(a)(8)(A).
---------------------------------------------------------------------------
The Departments received a handful of comments on the proposed
expansion of the illustrative list's description of standards for
provider admission to participate in a network, including reimbursement
rates, to also refer to standards for provider and facility admission
to participate in a network or for continued network participation,
including methods for determining reimbursement rates, credentialing
standards, and procedures for ensuring the network includes an adequate
number of each category of provider and facility to provide covered
services under the plan or coverage. Some commenters supported these
proposed amendments to ensure that patients have an adequate provider
network. Others suggested that parity requirements for provider
networks should address the administrative burden and credentialing
requirements on providers when joining networks, which may limit
network adequacy. The Departments are finalizing this amendment as
proposed. The Departments agree with commenters who stated that MHPAEA
applies to credentialing standards, as well as the procedures to join a
network, and note that methods for determining reimbursement rates,
credentialing standards, and procedures for ensuring the network
includes an adequate number of each category of provider and facility
to provide services under the plan or coverage are intended to be
interpreted broadly, consistent with the fundamental purpose of MHPAEA.
Because these final rules do not retain the proposed mathematical
substantially all and predominant tests, the illustrative list appears
in these final rules at 26 CFR 54.9812-1(c)(4)(ii), 29 CFR
2590.712(c)(4)(ii), and 45 CFR 146.136(c)(4)(ii) instead of 26 CFR
54.9812-1(c)(4)(iii), 29 CFR 2590.712(c)(4)(iii), and 45 CFR
146.136(c)(4)(iii) as in the proposed rules.
d. Required Use of Outcomes Data and Special Rule for NQTLs Related to
Network Composition--26 CFR 54.9812-1(c)(4)(iii), 29 CFR
2590.712(c)(4)(iii), and 45 CFR 146.136(c)(4)(iii)
In the proposed rules, the Departments proposed to amend the 2013
final regulations to add a requirement that, when designing and
applying an NQTL, a plan or issuer must collect and evaluate relevant
data in a manner reasonably designed to assess the impact of the NQTL
on access to mental health and substance use disorder benefits and
medical/surgical benefits, and consider the impact as part of the
plan's or issuer's analysis of whether the NQTL, in operation, complies
with the proposed no more restrictive requirement and the design and
application requirements. The proposed rules included the general types
of data that plans and issuers would have to collect and evaluate with
regard to all NQTLs and additional data sets that would have to be
collected and evaluated for NQTLs related to network composition
standards. To the extent the relevant data collected and evaluated by
the plan or issuer show material differences in access to mental health
benefits and substance use disorder benefits as compared to medical/
surgical benefits, under the proposed rules, the differences would be
considered a strong indicator that the plan or issuer violated the
proposed rules. In these instances, a plan or issuer would be required
to take reasonable action to address any material differences in access
as necessary to ensure compliance, in operation, with proposed 26 CFR
54.9812-1(c)(4)(i) and (ii), 29 CFR 2590.712(c)(4)(i) and (ii), and 45
CFR 146.136(c)(4)(i) and (ii), and would also be required to document
the action that has been or is being taken by the plan or issuer to
mitigate any material differences in access in the plan's or issuer's
comparative analysis for the NQTL in that classification.
Additionally, the Departments noted in the preamble to the proposed
rules their concerns about standards related to network composition and
other related NQTLs. Specifically, the Departments noted that network
composition is the result of the design and application of myriad NQTLs
and is informed by various processes, strategies, evidentiary
standards, and other factors, many of which interact in complex ways.
The Departments also expressed concern that NQTLs related to network
composition inherently impact a participant's or beneficiary's access
to mental health and substance use disorder benefits. Accordingly, the
proposed rules included a special rule applicable to NQTLs related to
network composition. Specifically, under the proposed rules, when
designing and applying one or more NQTLs related to network composition
standards, a plan or issuer would fail to meet the requirements of
proposed 26 CFR 54.9812-1(c)(4)(i) and (ii), 29 CFR 2590.712(c)(4)(i)
and (ii), and 45 CFR 146.136(c)(4)(i) and (ii), in operation, if the
relevant data show material differences in access to in-network mental
health benefits and substance use disorder benefits as compared to in-
network medical/surgical benefits in a classification.
The Departments also proposed that plans and issuers would not be
required to comply with the relevant data evaluation requirements for
NQTLs that impartially apply independent professional medical or
clinical standards. However, proposed 26 CFR 54.9812-1(c)(4)(iv)(D), 29
CFR 2590.712(c)(4)(iv)(D), and 45 CFR 146.136(c)(4)(iv)(D) did not
provide a comparable exception for fraud, waste, and abuse measures, as
the Departments stated these tools, while important, are more likely to
result in NQTLs that improperly restrict access to mental health or
substance use disorder benefits and therefore the impact of those NQTLs
should be assessed.
In General
The Departments received many comments expressing general support
for the proposal to require plans and issuers to collect and evaluate
relevant data to assess an NQTL's impact on
[[Page 77610]]
access to mental health and substance use disorder benefits and
medical/surgical benefits, including the proposed requirement related
to data for network composition NQTLs. These commenters noted that the
data collection and evaluation requirements would promote transparency
and compliance with MHPAEA, stating that collecting and evaluating
outcomes data is essential to assessing in-operation compliance and
that plans and issuers had failed to conduct and share such analyses.
Other commenters noted that col
[…truncated; see source link]Indexed from Federal Register on September 23, 2024.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.