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901 | RA analysis in the same way they send comments in response to these proposed rules (for example, through the www.regulations.gov website), including as part of a comment responding to the broader NPRM. PRA Addressee: Address requests for copies of the ICR to James Butikofer, Office of Research and Analysis, U.S. Department of Labor, Employee Benefits Security Administration, 200 Constitution Avenue NW, Room N-5718, Washington, DC 20210; ebsa.opr@dol.gov. (https://www.reginfo.gov/public/do/PRAMain). Readers should note that the PRA requires a non-incremental analysis of information collections, and hence the overall summary of the paperwork burden estimates in this section includes the entire on-going burden imposed by information collections required by MHPAEA, the CAA, and subsequent guidance. The incremental hour and cost burdens of these proposed rules are discussed in detail below. For a full discussion of all burden related to this information collection please see the supporting statement which is part of the ICR available at https://www.reginfo.gov/public/do/PRAMain . 2.1.1. Amendment to Existing MHPAEA Regulations (29 CFR 2590.712; 26 CFR 54.9812-1) The proposed amendments to the existing MHPAEA regulations would add new definitions, amend existing definitions, specify new requirements related to NQTLs, amend existing examples of NQTLs, and add new examples of NQTLs, providing clarity to interested parties. The proposed amendments would also specify that mental health and substance use disorder definitions must be consistent with generally recognized independent standards of current medical practice and would add more specificity as to what conditions or disorders plans and issuers would be required to treat as mental health and substance use conditions or disorders. 2.1.2. New Regulation (29 CFR 2590.712-1; 26 CFR 54.9812-2) These proposed rules set more specific content and data requirements for the NQTL comparative analyses required by MHPAEA as amended by the CAA, 2021, clarify when the comparative analyses need to be performed, and outline the timeframes and process for plans and issuers to provide their comparative analyses to the Departments or applicable State authority upon request. These proposed rules would also require plans and issuers to collect and evaluate relevant data as part of each comparative analysis, including but not limited to claims denials, data relevant to NQTLs as required by State law or private accreditation standards, utilization rates, network adequacy metrics, and provider reimbursement rates, in fulfillment of the existing requirement that they evaluate and document their evaluation as part of the analysis of the application of NQTLs related to network composition and provider reimbursement. For the purpose of this analysis, it is assumed that health insurance issuers would fulfill the data request for fully insured group health plans. This burden is accounted for under HHS’ OMB Control number 0938-1393 and is discussed later in this document. It is also assumed that TPAs and other service providers would fulfill the requirements for the vast majority of self-insured group health plans. 2.1.3. Burden Estimates for Both Existing Requirements and Proposed Requirements The Departments estimate that there are approximately 250,000 ERISA self-insured group health plans with 50 or more participants that are affected by these proposed rules. 277 The Departments believe that the number of self-insured group health plans that actually perform the analysis themselves and incur the full estimated compliance costs may be much smaller. The Departments analyzed 2020 Form 5500 Schedule C (Service Provider Information) filings of self-insured health plans and determined that 89 percent of those plans indicated that they contracted with a TPA. 278 Self-insured group health plans could fulfill the requirements with the help of TPAs and other service providers. To the extent self-insured plans use plan designs provided by TPAs or service providers responsible for nearly identical fully insured plans, those TPAs or service providers could utilize the analysis already performed for those fully insured plans, while helping these self-insured plans comply with the requirements. The Departments assume that most self-insured health plans would utilize service providers to perform the analysis and that only 11 percent 279 (27,499) of the affected self-insured group health plans, primarily the |
902 | -insured plans comply with the requirements. The Departments assume that most self-insured health plans would utilize service providers to perform the analysis and that only 11 percent 279 (27,499) of the affected self-insured group health plans, primarily the largest, would need to conduct the analyses themselves for their plan specific design. 280 The Departments request comments on the percent of self-insured group health plans that would rely on analyses that TPAs and other service providers have already performed for their other plans, thus reducing estimated burden on plans. The Departments expect that even these numbers may overestimate the number of self-insured plans that would perform the analysis themselves, without assistance from TPAs or service providers. For example, in DOL’s review of comparative analyses, which has focused on self-funded plans, the reliance on insurance companies, TPAs, and other service providers for much or all of the work has been nearly universal. As noted above, this is not surprising because of the outsized role insurance companies, TPAs and other service providers tend to play in designing the plans, administering the networks, managing claims, providing plan services, maintaining and holding the data relevant to the comparative analyses, and driving MHPAEA compliance or noncompliance. Non-grandfathered, fully insured ERISA plans with less than 50 participants that are subject to MHPAEA under the Essential Health Benefits (EHB) requirements of the Affordable Care Act are likely to have their issuers prepare their comparative analyses. Issuers can take advantage of economies of scale by preparing the required documents for those plans purchasing coverage. HHS has jurisdiction over issuers and therefore is accounting for this portion of the burden in their analysis, in addition to the burden related to non-Federal governmental plans. Accordingly, this analysis considers only the burden associated with ERISA self-insured group health plans, which are under the jurisdiction of the DOL and Treasury. These proposed rules require that group health plans offering group health insurance coverage must make a comparative analysis available upon request by DOL. The CAA, 2021 requires DOL to collect no fewer than 20 comparative analyses per year, but it also provides that DOL shall request that a group health plan or issuer submit the comparative analyses for plans that involve potential MHPAEA violations or complaints regarding noncompliance with MHPAEA that concern NQTLs, and any other instances in which the DOL determines appropriate. Based on its prior experience and current funding, DOL expects to request 100 comparative analyses each year. 281 To provide DOL with their comparative analyses and associated documentation, DOL estimates, based on internal discussion, it would take a total of five hours for plans, with one hour for a general or operations manager and four hours for a business operations specialist. This would result in a total hour burden of 500 hours with an equivalent cost burden of $57,222 in each year. 282 These proposed rules require that a plan or issuer document the action that has been or is being taken by the plan or issuer to mitigate any material differences in access to mental health and substance use disorder benefits as compared to medical/surgical benefits, as required in the demonstration of comparability and stringency in operation requirement in § 2590.712-1(c)(5)(iv) of these proposed rules. To meet the format, content, data, and documentation requirements for the comparative analysis, DOL expects that plans preparing their own comparative analyses would on average annually perform four NQTL analyses across benefit classifications, based on DOL’s experience in reviewing comparative analyses, and assumes that each NQTL analysis would require 20 hours in the first year, with 4 hours for a general or operations manager and 16 hours for a business operations specialist. 283 In the first year, this results in a total hour burden of 2,199,921 hours with an equivalent cost burden of $251,767,736. 284 Once the comparative analyses are performed or documented, plans would need to update the analyses when making changes to the terms of the plan or coverage, including changes to the way NQTLs are applied to mental health and substance use disorder benefits. In subsequent years, DOL estimates it would take a total of 10 hours annually per NQTL to update the analyses, with 2 hours for a general or operations manager and 8 hours for a business operations specialist. In subsequent years, this results in a total hour burden of 1,099, |
903 | a total of 10 hours annually per NQTL to update the analyses, with 2 hours for a general or operations manager and 8 hours for a business operations specialist. In subsequent years, this results in a total hour burden of 1,099,960 hours with an equivalent cost burden of $125,883,822. 285 These proposed rules would also require plans and issuers to make the comparative analyses and other applicable information required by the CAA, 2021 available upon request to participants and beneficiaries in plans subject to ERISA and to participants, beneficiaries, and enrollees in all non-grandfathered group health plans and non-grandfathered group or individual health insurance coverage upon request in connection with an appeal of an adverse benefit determination. The Departments estimate that each plan would l receive one request per covered health plan annually and that plans would annually incur a burden of five minutes for a clerical worker to prepare and send the comparative analyses to each requesting participant or beneficiary. This results in an hour burden of 158,192 hours with an equivalent cost of $10,037,282. 286 DOL also assumes that 58.2 percent of requests would be delivered electronically, resulting in a de minimis cost. 287 The remaining 41.8 percent of requests would be mailed, the cost of postage for a 3-ounce letter is $1.14. The annual cost burden to mail the comparative analyses to the participants and beneficiaries is $1,499,693. 288 2.1.4. Recordkeeping Requirement The Departments posit that plans and issuers already maintain records as part of their regular business practices. Further, ERISA section 107 includes a general six-year retention requirement. For these reasons the Departments estimate a minimal additional burden. The Departments estimate that, on average, any additional recordkeeping requirements would take clerical personnel five minutes annually. This results in an hour burden of 158,192 hours with an equivalent cost of $10,037,282. 289 2.1.5. Overall Summary In summary, the total burden, including that associated with prior requirements and by these proposed rules, has a three-year average hour burden of 1,883,110 hours with an equivalent cost of 205,897,135 and a cost burden of $2,182,094. A summary of paperwork burden estimates follows: Type of Review : Revision Agency : Employee Benefits Security Administration, U.S. Department of Labor; Internal Revenue Service, U.S. Department of the Treasury. Title : MHPAEA Notices OMB Control Number : 1210-0138 Affected Public : Businesses or other for-profits, Not-for-profit institutions. Estimated Number of Respondents : 2,646,306 Estimated Number of Annual Responses : 2,646,306 Frequency of Response : Annual Estimated Total Annual Burden Hours : 1,883,110 (941,555 for DOL, 941,555 for Treasury) Estimated Total Annual Burden Cost : $2,182,094 ($1,091,047 for DOL, $1,091,047 for Treasury) 2.2. Paperwork Reduction Act - Department of HHS As part of its continuing effort to reduce paperwork and respondent burden, HHS conducts a preclearance consultation program to allow the general public and Federal agencies to comment on proposed and continuing collections of information in accordance with the Paperwork Reduction Act of 1995 (PRA). 290 This helps to ensure that the public understands HHS’s collection instructions, respondents can provide the requested data in the desired format, reporting burden (time and financial resources) is minimized, collection instruments are clearly understood, and HHS can properly assess the impact of collection requirements on respondents. Currently, HHS is soliciting comments concerning the proposed (revised) information collection request (ICR) included in the Non-Quantitative Treatment Limitation Analyses and Compliance Under MHPAEA and the proposed (revised) ICR included in the Compliance with Individual and Group Market Reforms under title XXVII of the Public Health Service Act. To obtain a copy of either ICR, contact the PRA addressee shown below or go to https://www.RegInfo.gov . HHS has submitted a copy of these proposed rules to OMB in accordance with 44 U.S.C. 3507(d) for review of its information collections. HHS and OMB are particularly interested in |
904 | ://www.RegInfo.gov . HHS has submitted a copy of these proposed rules to OMB in accordance with 44 U.S.C. 3507(d) for review of its information collections. HHS and OMB are particularly interested in comments that: Evaluate whether the collection of information is necessary for the functions of the agency, including whether the information will have practical utility; Evaluate the accuracy of the agency’s estimate of the burden of the collection of information, including the validity of the methodology and assumptions used; Enhance the quality, utility, and clarity of the information to be collected; and Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology (e.g., permitting electronically delivered responses). Commenters may send their views on HHS PRA analysis in the same way they send comments in response to the NPRM as a whole (e.g., through the www.regulations.gov website), including as part of a comment responding to the broader NPRM. To obtain copies of the supporting statement and any related forms for the proposed collections, please visit CMS’s website at https://www.cms.gov/Regulations-and-Guidance/Legislation/PaperworkReductionActof1995/PRA-Listing. 2.2.1. Amendments to Existing MHPAEA Regulations (45 CFR 146.136) The proposed amendments to the existing MHPAEA regulations would add new definitions, amend existing definitions, clarify the rules for NQTLs, amend existing examples of NQTLs, and add new examples of NQTLs, providing clarity to the regulated community. The proposed amendments would also clarify that mental health and substance use disorder definitions must be consistent with generally recognized standards of care and would add more specificity as to what conditions or disorders plans and issuers would be required to treat as mental health conditions and substance use disorders. 2.2.2. New Regulations (45 CFR 146.137) These proposed rules set forth content and data requirements for the NQTL comparative analyses required by MHPAEA as amended by the CAA, 2021, clarify when the comparative analyses need to be performed, and outline the timeframes and process for plans and issuers to provide their comparative analyses to the Departments or an applicable State authority upon request. These proposed rules would also require plans and issuers to collect and evaluate relevant data as part of each comparative analysis, including but not limited to claims denials, data relevant to NQTLs as required by State law or private accreditation standards, utilization rates, network adequacy metrics, and provider reimbursement rates, in fulfillment of the existing requirement that they evaluate and document their evaluation as part of the analysis of the application of NQTLs related to network composition and provider reimbursement. As discussed above, HHS enforces applicable provisions of Title XXVII of the PHS Act, including the provisions added by MHPAEA, with respect to health insurance issuers offering group and individual health insurance coverage in States that elect not to enforce or fail to substantially enforce MHPAEA or another PHS Act provision and therefore HHS is accounting for this portion of the burden in their analysis, in addition to accounting for the burden on sponsors of non-Federal governmental plans. 2.2.3. Burden Estimates for Both Existing Requirements and Proposed Requirements Issuers offering individual or group health insurance coverage usually have multiple products offered in multiple States. HHS estimates a total of 476 issuers offering individual and group health coverage nationwide, with 1,500 issuer/State combinations offering coverage in multiple States. These proposed rules require that health insurance issuers offering group health insurance coverage make their comparative analyses available upon request by HHS. The CAA, 2021 requires HHS to collect not fewer than 20 comparative analyses per year, but it also provides that HHS shall request that a group health plan or issuer submit the comparative analyses for plans that involve potential MHPAEA violations or complaints regarding noncompliance with MHPAEA that concern NQTLs, and any other instances in which HHS determines appropriate. Thus, HHS expects to request at least 20 comparative analyses each year. HHS estimates that to provide the comparative analyses and associated documentation, it would take a total of 5 hours for each plan or issuer, with 1 hour for a general or operations |
905 | appropriate. Thus, HHS expects to request at least 20 comparative analyses each year. HHS estimates that to provide the comparative analyses and associated documentation, it would take a total of 5 hours for each plan or issuer, with 1 hour for a general or operations manager and 4 hours for a business operations specialist. This would result in a total hour burden of 100 hours with an equivalent cost burden of $11,444 in each year. 291 HHS seeks comment on the average number of NQTLs for plans offered by non-Federal governmental plans and issuers. These proposed rules would require that issuers document the action that has been or is being taken by the issuer to mitigate any material differences in access to mental health and substance use disorder benefits as compared to medical/surgical benefits, as required by 45 CFR 146.137(c)(5)(iv). To meet the proposed new content and data, and documentation requirements for the comparative analyses, HHS expects that each issuer will on average annually perform 8 NQTL comparative analyses, based on the Departments’ experience in reviewing comparative analyses, and assumes that each NQTL comparative analysis would require 20 hours in the first year, with 4 hours for a general or operations manager and 16 hours for a business operations specialist. In the first year, this would result in a total hour burden of 240,000 hours with an equivalent cost burden of $27,466,560. 292 Once the comparative analyses are performed or documented, issuers would need to update the analyses when making changes to the terms of the plan or coverage, including changes to the way NQTLs are applied to mental health and substance use disorder benefits. In subsequent years, HHS estimates it would take a total of 10 hours annually to update the analyses, with 2 hours for a general or operations manager and 8 hours for a business operations specialist. In subsequent years, this would result in a total hour burden of 120,000 hours with an equivalent cost burden of $13,733,280. 293 Sponsors of self-funded, non-Federal governmental plans are responsible for performing and documenting their NQTL comparative analyses. HHS estimates that there are 33,076 self-funded, non-Federal governmental health plans. 294 To meet the proposed new, content, data, and documentation requirements for NQTL comparative analyses, HHS expects that each plan sponsor would on average annually perform 4 NQTL analyses and assumes that each NQTL comparative analysis would require a total of 20 hours in the first year, with 4 hours for a general or operations manager and 16 hours for a business operations specialist. In the first year, this would result in a total hour burden of 2,646,080 hours with an equivalent cost burden of $302,827,980. 295 Once the comparative analyses are performed or documented, plan sponsors would need to update the analyses when making changes to the terms of the plan or coverage, including changes to the way NQTLs are applied to mental health and substance use disorder benefits. In subsequent years, HHS estimates it would take a total of 10 hours annually to update the analyses, 2 hours for a general or operations manager and 8 hours for a business operations specialist. In subsequent years, this would result in a total hour burden of 1,323,040 hours with an equivalent cost burden of approximately $151,413,990. 296 These proposed rules would also require plans and issuers to make the comparative analyses and other applicable information required by the CAA, 2021 available upon request to participants and beneficiaries in plans subject to ERISA and to participants, beneficiaries, and enrollees in all non-grandfathered group health plans and non-grandfathered group or individual health insurance coverage upon request in connection with an appeal of an adverse benefit. HHS estimates that each non-Federal governmental plan and each issuer would receive one request annually and that plans and issuers would annually incur a burden of 5 minutes for a clerical worker to prepare and send the comparative analyses to each requesting participant, beneficiary, or enrollee. This would result in a total burden of approximately 7,636 hours annually with an equivalent cost of approximately $484,504. 297 HHS also assumes that 58.2 percent of requests would be delivered electronically, resulting in a de minimis cost. 298 The remaining 41.8 percent of requests would be mailed, and the cost of postage for a 3-ounce letter is $1.14. The annual cost burden |
906 | percent of requests would be delivered electronically, resulting in a de minimis cost. 298 The remaining 41.8 percent of requests would be mailed, and the cost of postage for a 3-ounce letter is $1.14. The annual cost burden to mail the comparative analyses to the participants and beneficiaries would therefore be approximately $72,386. 299 2.2.4. Recordkeeping Requirement HHS posits that plans and issuers already maintain records as part of their regular business practices. HHS therefore estimates a minimal additional burden associated with these proposed rules. HHS estimates that each non-Federal governmental plan and issuer would annually incur a burden of 5 minutes, on average, for clerical personnel to meet the additional recordkeeping requirements, resulting in a total burden of approximately 7,636 hours annually with an equivalent cost of approximately $484,504. 300 HHS will revise the information collection approved under OMB Control Number 0938-1393 to account for this burden. 301 2.2.5. ICRs Regarding the Self-Funded, Non-Federal Governmental Plan Opt-Out Provisions (45 CFR 146.180) 2.2.5.1. Notice to Federal Government of Self-Funded, Non-Federal Governmental Plan Opt-Out: Plan Burden Reduction - Preparation and Processing of Opt-Out Election Notice The proposed amendments to implement the CAA, 2023 provision that sunsets the MHPAEA opt-out election for sponsors of self-funded, non-Federal governmental plans would eliminate the need for sponsors to submit a notice to the Federal Government regarding their plan’s opt-out election (or, for sponsors of multiple plans, their plans’ opt-out elections), as long as the sponsors do not elect to permissibly opt out of other requirements. 302 Based on the HIPAA opt-out filings, HHS estimates that the sponsors of 185 plans would no longer be required to submit a notice to the Federal Government regarding their plan’s opt-out election (or, for sponsors of multiple plans, notices regarding their plans’ opt-out elections). Previously, HHS estimated that for each self-funded, non-Federal governmental plan whose sponsor has elected to opt out of the requirements, a compensation and benefits manager would need 15 minutes annually to fill out and electronically submit the model notification form to HHS, with an equivalent cost of approximately $34. 303 Therefore, these proposed amendments would result in a total annual burden reduction (related to the need to submit a notice to the Federal Government) for sponsors of 185 plans of 46 hours (at a wage rate of $137.64 per hour), with an equivalent annual cost savings of approximately $6,331. 304 These proposed amendments would also generate cost savings for the Federal Government, as HHS would no longer have to process the opt-out notices submitted by plan sponsors. The processing of the opt-out notices is performed by an HHS employee. The average salary of the employee who completes this task, which includes the locality pay adjustment for the area of Washington-Baltimore-Arlington, is $53.67 per hour for a GS-13, step 1 employee. 305 HHS estimates that on average it takes an HHS employee 15 minutes to process an opt-out notice submitted by a plan sponsor, with an equivalent cost of approximately $13. Because sponsors of 185 plans in total would no longer be required to submit a notice to the Federal Government on behalf of their plan(s), this proposed provision would therefore result in a total annual burden reduction for the Federal Government of 46 hours, with equivalent annual cost savings of approximately $2,469. 306 2.2.5.2. Notice to Plan Participants of Self-Funded, Non-Federal Governmental Plan Opt-Out: Plan Burden Reduction - Preparation and Processing of Opt-Out Election Notice The proposed amendments to implement the CAA, 2023 provision that sunsets the MHPAEA opt-out election for sponsors of self-funded non-Federal governmental plans would also eliminate the need for those sponsors to prepare and disseminate an opt-out notice to plan participants regarding their plan sponsors’ opt-out election, as long as the sponsors do not elect to permissibly opt out of other requirements. Previously, HHS estimated that for each self-funded, non-Federal governmental plan whose sponsor has elected to opt out of the requirements, an administrative assistant would need 15 minutes |
907 | as the sponsors do not elect to permissibly opt out of other requirements. Previously, HHS estimated that for each self-funded, non-Federal governmental plan whose sponsor has elected to opt out of the requirements, an administrative assistant would need 15 minutes to develop and update the HHS standardized disclosure statement annually, with an equivalent cost of approximately $10. Therefore, this proposed provision would result in a total annual burden reduction (related to the need to prepare and disseminate opt-out notices to plan participants) for sponsors of 185 plans of 46 hours (at a wage rate of $41.74), with an equivalent annual cost savings of approximately $1,920. 307 Further, self-funded, non-Federal governmental plan sponsors would no longer be required to print and mail the opt-out notice to plan participants and would therefore no longer incur costs associated with this requirement. As noted earlier in this section 1.5.1, HHS estimates that there are approximately 253 participants in each self-funded, non-Federal governmental plan, and therefore approximately 46,863 notices 308 would no longer have to be printed and mailed. Because plan sponsors would no longer need to print the 1-page notice (at an estimated cost of $0.05 per page), plan sponsors would experience a total cost savings of approximately $2,343. 309 The burden related to HIPAA opt-outs is currently approved under OMB Control Number 0938-0702. 310 HHS will update the information collection to account for this burden reduction. 2.2.6. Overall Summary In summary, the total new burden imposed by these proposed rules regarding NQTL comparative analyses and compliance, has a three-year average hour burden of approximately 1,939,425 hours with an equivalent cost of approximately $221,176,812 and a total cost burden of approximately $72,386. The proposed amendments to implement the CAA, 2023 provision that sunsets the MHPAEA opt-out election for sponsors of self-funded, non-Federal governmental plans would result in an annual burden reduction of approximately 92 hours with an equivalent annual cost savings of approximately $8,251. A summary of the change in paperwork burden estimates follows: Type of Review : Revision Agency : Centers for Medicare & Medicaid Services, U.S. Department of Health and Human Services. Title : Non-Quantitative Treatment Limitation Analyses and Compliance Under MHPAEA OMB Control Number : 0938-1393 Affected Public : Businesses or other for-profits, Not-for-profit institutions, State, Local, or Tribal Governments Estimated Number of Respondents : 91,626 Estimated Number of Annual Responses : 91,626 Frequency of Response : Annual Estimated Total Annual Burden Hours : 1,939,425 Estimated Total Annual Burden Cost : $72,386 Title : Requirements for Compliance with Individual and Group Market Reforms under Title XXVII of the Public Health Service Act OMB Control Number : 0938-0702 Affected Public : State, Local, or Tribal Governments Estimated Number of Respondents : (185) Estimated Number of Annual Responses : (185) Frequency of Response : Annual Estimated Total Annual Burden Hours : (92) Estimated Total Annual Burden Cost : ($2,343) Note: Numbers in parentheses denote a burden reduction. 3. Regulatory Flexibility Act The Regulatory Flexibility Act (RFA) 311 imposes certain requirements with respect to Federal rules that are subject to the notice and comment requirements of section 553(b) of the Administrative Procedure Act 312 and are likely to have a significant economic impact on a substantial number of small entities. Unless an agency determines that a proposal is not likely to have a significant economic impact on a substantial number of small entities, section 603 of the RFA requires the agency to present an initial regulatory flexibility analysis of the proposed rule. The Departments have limited data to determine if these proposed amendments would have a significant impact on a substantial number of small entities. The Departments have prepared this initial regulatory flexibility analysis and request data or other information it would need to make a determination. The Departments request data or information on the number of plans and issuers that are not conducting adequate comparative analyses and how the proposed additional guidance would result in better compliance and access to those benefits. 3.1. Need for and Objectives of the Rule As documented in the 2022 MHPAEA Report to Congress and the 2023 MHPAEA Report |
908 | comparative analyses and how the proposed additional guidance would result in better compliance and access to those benefits. 3.1. Need for and Objectives of the Rule As documented in the 2022 MHPAEA Report to Congress and the 2023 MHPAEA Report to Congress, 313 the Departments found that none of the NQTL comparative analyses they reviewed upon initial receipt contained sufficient information and documentation. The proposed amendments to the existing MHPAEA regulations would clarify existing definitions, add new definitions of key terms, require plans and issuers to determine which NQTLs apply to substantially all medical/surgical benefit classifications and what variation of a given NQTL is the predominant (that is, most common or frequent) variation, ensure that the application of the parity requirements to NQTLs is no more restrictive for mental health and substance use disorder benefits than for medical/surgical benefits, and provide additional examples of the application of MHPAEA to NQTLs to improve the understanding and ability of the regulated community to comply with MHPAEA. The proposed amendments would also clarify that mental health and substance use disorder definitions must be consistent with generally recognized independent standards of current medical practice and would add more specificity as to what plans and issuers must treat as mental health conditions or substance use disorders. These proposed rules would amend existing guidance, set more specific content requirements for comparative analyses required by the CAA, 2021, clarify when a comparative analysis needs to be performed and for which NQTLs, and outline the process for plans and issuers to provide their comparative analyses to the Departments upon request. These proposed rules would also require plans and issuers to collect and evaluate relevant data with each comparative analysis requested by the Departments, including but not limited to claims denials, data relevant to NQTLs as required by State law or private accreditation standards, utilization rates, network adequacy metrics, and provider reimbursement rates, in fulfillment of the existing requirement that they evaluate and document their evaluation as part of the analysis of the application of NQTLs related to network composition and provider reimbursement. The data would be further defined in future guidance, which will allow the Departments to adjust the data requirements as needed to account for enforcement experience and industry trends. The Departments also anticipate that future guidance would also set forth an enforcement safe harbor for NQTLs related to network composition for plans and issuers that meet certain standards with the data they submit. The Departments expect that these proposed rules would result in plans and issuers having a better understanding of the MHPAEA requirements with respect to NQTLs. These proposed rules would also improve the manner in which parity is measured, compared, and demonstrated by plans and issuers. The Departments believe these proposed rules and future guidance would improve the compliance of plans and issuers with these requirements, resulting in greater access to and utilization of treatment for mental health and substance use disorders, as intended by MHPAEA. 3.2. Affected Small Entities For purposes of analysis under the RFA, DOL considers employee benefit plans with fewer than 100 participants to be small entities. The basis of this definition is found in section 104(a)(2) of ERISA, which permits the Secretary of Labor to prescribe simplified annual reports for plans that cover fewer than 100 participants. Under section 104(a)(3) of ERISA, the Secretary may also provide for exemptions or simplified annual reporting and disclosure for welfare benefit plans. Pursuant to the authority of section 104(a)(3), DOL has previously issued (see 29 CFR 2520.104–20, 2520.104–21, 2520.104–41, 2520.104–46, and 2520.104b–10) simplified reporting provisions and limited exemptions from reporting and disclosure requirements for small plans, including unfunded or insured welfare plans, that cover fewer than 100 participants and satisfy certain requirements. While some large employers have small plans, small plans are maintained generally by small employers. Thus, the Departments believe that assessing the impact of these proposed rules on small plans is an appropriate substitute for evaluating the effect on small entities. The definition of small entity considered appropriate for this purpose differs, however, from a definition of small business based on size standards promulgated by the Small Business Administration (SBA) pursuant to the Small Business Act. As discussed in subsection 1.5.1 of the RIA, these |
909 | for this purpose differs, however, from a definition of small business based on size standards promulgated by the Small Business Administration (SBA) pursuant to the Small Business Act. As discussed in subsection 1.5.1 of the RIA, these proposed rules would affect all small ERISA-covered group health plans, including fully-insured group health plans and self-insured group health plans, as well as small health insurance issuers and non-Federal governmental plans. The Departments estimate that these proposed rules would affect approximately 114,200 fully insured plans with 50 to 100 participants, 314 and approximately 1,488,000 fully insured, non-grandfathered plans with less than 50 participants. 315 The Departments also estimate that approximately 38,000 self-insured group health plans with 50 to 100 participants would be affected by these proposed rules. 316 The Departments estimate that approximately 27,000 self-insured group health plans would not utilize a service provider, and would incur the cost directly, 317 and the other self-insured health plans would utilize service providers to perform the analysis. The largest would need to conduct the analyses themselves for their plan-specific design. Finally, the Departments estimate that approximately 14,400 non-Federal governmental health plans would be affected by these proposed rules, of which the majority of plans are assumed to be large. 318 As discussed in subsection 1.5.3 of the RIA, these proposed rules would also affect health insurance issuers. The Departments estimate that these proposed rules would affect 476 health insurance issuers providing mental health and substance use disorder benefits in the group and individual health insurance markets, with 1,500 issuer/State combinations offering coverage in multiple States. 319 Health insurance issuers are generally classified under the North American Industry Classification System (NAICS) code 524114 (Direct Health and Medical Insurance Carriers). According to SBA size standards, entities with average annual receipts of $47 million or less are considered small entities for this NAICS code. 320 The Departments expect that few, if any, insurance companies underwriting health insurance policies fall below these size thresholds. Based on data from medical loss ratio (MLR) annual report submissions for the 2021 MLR reporting year, approximately 87 out of 483 issuers of health insurance coverage nationwide had total premium revenue of $47 million or less. 321 However, it should be noted that over 77 percent of these small companies belong to larger holding groups, and many, if not all, of these small companies, are likely to have non-health lines of business that would result in their revenues exceeding $47 million. To produce a conservative estimate, for the purposes of this analysis, the Departments assume 8.6 percent, 322 or 129 issuer/State combinations are considered small entities. 323 The proposed amendments to implement the CAA, 2023 provision that sunsets the MHPAEA opt-out election would affect sponsors of self-funded, non-Federal governmental plans, some of which might be small entities. As noted in section 1.10 of this RIA, the extent to which these plans are out of compliance is unknown, and the costs for them to come into compliance are expected to vary from plan to plan. HHS seeks comments on the number of small entities that would be impacted by the implementation of the sunset provision and the potential effects on small entities. 3.3. Impact of the Rule 3.3.1. Amendments to Existing MHPAEA Regulation (26 CFR 54.9812-1, 29 CFR 2590.712, 45 CFR 146.136) The proposed amendments to the existing MHPAEA regulations would clarify existing definitions, add new definitions, require plans and issuers to determine which NQTLs apply to substantially all medical/surgical benefit classifications and what level or variation of a given NQTL is the most common or frequent, ensure that the application of NQTLs is generally no more restrictive for mental health and substance use disorder benefits than for medical/surgical benefits, and provide additional examples of the application of MHPAEA to NQTLs to improve the understanding and ability of the regulated community to comply with MHPAEA. The proposed amendments would also clarify that mental health benefits and substance use disorder benefits must be defined to be consistent with generally recognized independent standards of current medical practice and would add more specificity as to what plans and issuers must treat as mental health conditions or substance use disorders. |
910 | would also clarify that mental health benefits and substance use disorder benefits must be defined to be consistent with generally recognized independent standards of current medical practice and would add more specificity as to what plans and issuers must treat as mental health conditions or substance use disorders. The Departments believe that the proposed amendments might cause small plans and issuers to revise their policies and remove treatment limitations. Therefore, small plans and issuers could incur costs to revise plan provisions which may result in increased costs from expanded utilization of mental health and substance use disorder services. The Departments face uncertainty in quantifying these costs as they cannot estimate the increase in utilization and which particular services may see the largest increase in utilization. 3.3.2. New Regulations (26 CFR 54.9812-2, 29 CFR 2590.712-1, and 45 CFR 146.137 and 146.180) These proposed rules would amend existing guidance, set more specific content requirements for comparative analyses required by the CAA, 2021, clarify when the comparative analysis needs to be performed and for which NQTLs, and outline the timeframes and process for plans and issuers to provide their comparative analyses to the Departments upon request. Participants, beneficiaries, and enrollees may also request the comparative analyses at any time. These proposed rules would also require plans and issuers to collect and evaluate relevant data as part of each comparative analysis, including but not limited to claims denials, data relevant to NQTLs as required by State law or private accreditation standards, utilization rates, network adequacy metrics, and provider reimbursement rates, in fulfillment of the existing requirement that they evaluate and document their evaluation as part of the analysis of the application of NQTLs related to network composition and provider reimbursement. The Departments believe that plans and issuers would incur costs in collecting, preparing, and analyzing the data. The Departments request comments on whether plans and issuers already collect and examine this data. Additionally, in these proposed rules, HHS proposes regulatory amendments to implement the provision in the CAA, 2023 that sunsets the election option for self-funded, non-Federal governmental plans to opt out of requirements under MHPAEA. In the first year, the Departments estimate that self-insured group health plans and health insurance issuers would incur an incremental per-entity cost of approximately $5,600 and $5,800, respectively associated with these proposed rules and amendments. In the subsequent years, the Departments estimate that self-insured group health plans and health insurance issuers would both incur an incremental per-entity cost of approximately $1,900 associated with these proposed rules and amendments. The Departments note that these per-entity costs are the average costs, and these costs are expected to vary by plan or issuer depending on the number of NQTL analyses performed. 3.4. Duplicate, Overlapping, or Relevant Federal Rules There are no duplicate, overlapping, or relevant Federal rules. 4. Special Analyses – Department of the Treasury Pursuant to the Memorandum of Agreement, Review of Treasury Regulations under Executive Order 12866 (June 9, 2023), tax regulatory actions issued by the IRS are not subject to the requirements of section 6 of Executive Order 12866, as amended. Therefore, a regulatory impact assessment is not required. Pursuant to section 7805(f) of the Code, these regulations have been submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on their impact on small business. 5. Unfunded Mandates Reform Act Title II of the Unfunded Mandates Reform Act of 1995 requires each Federal agency to prepare a written statement assessing the effects of any Federal mandate in a proposed or final agency rule that may result in an expenditure of $100 million or more (adjusted annually for inflation with the base year 1995) in any 1 year by State, local, and Tribal governments, in the aggregate, or by the private sector. 324 In 2023, that threshold is approximately $177 million. For purposes of the Unfunded Mandates Reform Act, as well as Executive Order 12875, 325 this proposal includes Federal mandates that the Departments expect would result in such expenditures by State, local, or Tribal governments, or the private sector. UMRA requires that regulations including such Federal mandates provide a qualitative and quantitative assessment of the anticipated costs and benefits of the regulations. For the purposes of these proposed rules, the RIA shall meet |
911 | , local, or Tribal governments, or the private sector. UMRA requires that regulations including such Federal mandates provide a qualitative and quantitative assessment of the anticipated costs and benefits of the regulations. For the purposes of these proposed rules, the RIA shall meet this obligation. 6. Federalism Statement Executive Order 13132 outlines fundamental principles of federalism, and requires the adherence to specific criteria by Federal agencies in the process of their formulation and implementation of policies that have “substantial direct effects” on the States, the relationship between the Federal Government and States, or on the distribution of power and responsibilities among the various levels of government. 326 Federal agencies promulgating regulations that have federalism implications must consult with State and local officials and describe the extent of their consultation and the nature of the concerns of State and local officials in the preamble to these proposed rules. In the Departments’ view, these proposed rules could have federalism implications because they would have direct effects on the States, on the relationship between the Federal Government and the States, and on the distribution of power and responsibilities among various levels of government. These proposed rules could also have federalism implications because the Departments propose to remove the reference to State guidelines in the definition of medical/surgical benefits, mental health benefits, and substance use disorder benefits, and amend the definition to provide that any condition or procedure defined by the plan or coverage as being or not being a medical condition or surgical procedure, mental health condition, or substance use disorder must be defined to be consistent with generally recognized independent standards of current medical practice, such as the ICD or DSM. Finally, these proposed rules could have federalism implications because the implementation of the CAA, 2023 provision that sunsets the MHPAEA opt-out election would require State and local government sponsors of self-funded plans that currently opt out of requirements under MHPAEA to come into compliance. In general, through section 514, ERISA supersedes State laws to the extent that they relate to any covered employee benefit plan, and preserves State laws that regulate insurance, banking, or securities. While ERISA prohibits States from regulating a plan as an insurance or investment company or bank, the preemption provisions of section 731 of ERISA and section 2724 of the PHS Act (implemented in 29 CFR 2590.731(a) and 45 CFR 146.143(a)) apply so that the MHPAEA requirements are not to be “construed to supersede any provision of State law which establishes, implements, or continues in effect any standard or requirement solely relating to health insurance issuers in connection with individual or group health insurance coverage except to the extent that such standard or requirement prevents the application of a requirement” of MHPAEA. The conference report accompanying HIPAA indicates that this is intended to be the “narrowest” preemption of State laws. (See House Conf. Rep. No. 104-736, at 205, reprinted in 1996 U.S. Code Cong. & Admin. News 2018.) States may continue to apply State law requirements except to the extent that such requirements prevent the application of the MHPAEA requirements that are the subject of this rulemaking. State insurance laws that are more stringent than the Federal requirements are unlikely to “prevent the application of” MHPAEA and be preempted. Accordingly, States have significant latitude to impose requirements on health insurance issuers that are more restrictive than the Federal law. Throughout the process of developing these proposed rules, to the extent feasible within the specific preemption provisions of HIPAA as it applies to MHPAEA, the Departments have attempted to balance the States’ interests in regulating health insurance issuers, and Congress’ intent to provide uniform minimum protections to consumers in every State. By doing so, it is the Departments’ view that they have complied with the requirements of Executive Order 13132. The Departments welcome input from affected States regarding this assessment. List of Subjects 26 CFR Part 54 Excise taxes, Pensions, Reporting and recordkeeping requirements. 29 CFR Part 2590 Continuation coverage, Disclosure, Employee benefit plans, Group health plans, Health care, Health insurance, Medical child support, Reporting and recordkeeping requirements. 45 CFR Part 146 Health care, Health insurance, Reporting and recordkeeping requirements. 45 CFR Part 147 Aged, Citizenship and naturalization, Civil rights, Health care, |
912 | Health care, Health insurance, Medical child support, Reporting and recordkeeping requirements. 45 CFR Part 146 Health care, Health insurance, Reporting and recordkeeping requirements. 45 CFR Part 147 Aged, Citizenship and naturalization, Civil rights, Health care, Health insurance, Individuals with disabilities, Intergovernmental relations, Reporting and recordkeeping requirements, Sex discrimination. Douglas W. O’Donnell, Deputy Commissioner for Services and Enforcement, Internal Revenue Service. Lisa M. Gomez, Assistant Secretary, Employee Benefits Security Administration, Department of Labor. Xavier Becerra, Secretary, Department of Health and Human Services . DEPARTMENT OF THE TREASURY Internal Revenue Service Accordingly, the Treasury Department and the IRS propose to amend 26 CFR part 54 as follows: PART 54 – PENSION EXCISE TAXES 1 . The authority citation for part 54 continues to read in part as follows: Authority: 26 U.S.C. 7805 * * * 2. Amend § 54.9812-1 by: a. Redesignating paragraph (a) as paragraph (a)(2) and adding paragraphs (a) heading and (a)(1); b. In newly redesignated paragraph (a)(2): i. Revising the introductory text; ii. Adding the definitions of “DSM,” “Evidentiary standards,” “Factors,” and “ICD” in alphabetical order; iii. Revising the definitions of “Medical/surgical benefits” and “Mental health benefits”; iv. Adding the definitions of “Processes” and “Strategies” in alphabetical order; and v. Revising the definitions of “Substance use disorder benefits” and “Treatment limitations”; c. Revising paragraphs (c)(1)(ii), (c)(2)(i), and (c)(2)(ii)(A) introductory text; d. In paragraph (c)(2)(ii)(C), designating Examples 1 through 4 as paragraphs (c)(2)(ii)(C)( 1 ) through ( 4 ) and revising newly designated paragraphs (c)(2)(ii)(C)( 1 ) through ( 4 ); e. Adding paragraphs (c)(2)(ii)(C)( 5 ) and ( 6 ); f. Revising paragraphs (c)(3)(i)(A), (C), and (D); g. In paragraph (c)(3)(iii), adding introductory text; h. Revising paragraphs (c)(3)(iii)(A) and (B), (c)(3)(iv), (c)(4), (d)(3), (e)(4), and (i)(1); and i. Adding paragraph (j). The revisions and additions read as follows: § 54.9812-1 Parity in mental health and substance use disorder benefits. (a) Purpose and meaning of terms —(1) Purpose . This section and § 54.9812-2 set forth rules to ensure parity in aggregate lifetime and annual dollar limits, financial requirements, and quantitative and nonquantitative treatment limitations between mental health and substance use disorder benefits and medical/surgical benefits, as required under Code section 9812. A fundamental purpose of Code section 9812, this section, and § 54.9812-2 is to ensure that participants and beneficiaries in a group health plan that offers mental health or substance use disorder benefits are not subject to more restrictive lifetime or annual dollar limits, financial requirements, or treatment limitations with respect to those benefits than the predominant dollar limits, financial requirements, or treatment limitations that are applied to substantially all medical/surgical benefits covered by the plan, as further provided in this section and § 54.9812-2. Accordingly, in complying with the provisions of Code section 9812, this section, and § 54.9812-2, plans 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 and substance use disorder benefits under the plan than they impose on access to generally comparable medical/surgical benefits. The provisions of Code section 9812, this section, and § 54.9812-2 should be interpreted in a manner that is consistent with the purpose described in this paragraph (a)(1). (2) Meaning of terms . For |
913 | benefits. The provisions of Code section 9812, this section, and § 54.9812-2 should be interpreted in a manner that is consistent with the purpose described in this paragraph (a)(1). (2) Meaning of terms . For purposes of this section and § 54.9812-2, except where the context clearly indicates otherwise, the following terms have the meanings indicated: * * * * * DSM means the American Psychiatric Association’s Diagnostic and Statistical Manual of Mental Disorders. For the purpose of this definition, the most current version of the DSM is the version that is applicable no earlier than on the date that is 1 year before the first day of the applicable plan year. Evidentiary standards are any evidence, sources, or standards that a group health plan considered or relied upon in designing or applying a factor with respect to a nonquantitative treatment limitation, including specific benchmarks or thresholds. 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; internal plan 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. Factors are all information, including processes and strategies (but not evidentiary standards), that a group health plan considered or relied upon to design a nonquantitative treatment limitation, or to determine whether or how the nonquantitative treatment limitation applies to benefits under the plan. Examples of factors include, but are not limited to: provider discretion in determining a 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. * * * * * ICD means the World Health Organization’s International Classification of Diseases adopted by the Department of Health and Human Services through 45 CFR 162.1002. For the purpose of this definition, the most current version of the ICD is the version that is applicable no earlier than on the date that is 1 year before the first day of the applicable plan year. Medical/surgical benefits means benefits with respect to items or services for medical conditions or surgical procedures, as defined under the terms of the group health plan and in accordance with applicable Federal and State law, but does not include mental health benefits or substance use disorder benefits. Notwithstanding the preceding sentence, any condition or procedure defined by the plan as being or as 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). To the extent generally recognized independent standards of current medical practice do not address whether a condition or procedure is a medical condition or surgical procedure, plans may define the condition or procedure in accordance with applicable Federal and State law. Mental health benefits means benefits with respect to items or services for mental health conditions, as defined under the terms of the group health plan and in accordance with applicable Federal and State law, but does not include medical/surgical benefits or substance use disorder benefits. Notwithstanding the preceding sentence, any condition defined by the plan as being or as not being a mental health condition must be defined consistent with generally recognized independent standards of current medical practice. For the purpose of this definition, to be consistent with generally recognized independent standards of current medical practice, the definition must include all conditions covered under the plan, 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 DSM. To the extent generally recognized independent standards of current medical practice do not address whether a condition is a mental health condition, plans may define the condition in accordance with applicable Federal and State law. Process |
914 | that are listed in the most current version of the DSM. To the extent generally recognized independent standards of current medical practice do not address whether a condition is a mental health condition, plans may define the condition in accordance with applicable Federal and State law. Processes are actions, steps, or procedures that a group health plan uses to apply a nonquantitative treatment limitation, including actions, steps, or procedures established by the plan 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. Processes include but are not limited to: procedures to submit information to authorize coverage for an item or service prior to receiving the benefit or while treatment is ongoing (including requirements for peer or expert clinical review of that information); provider referral requirements; and the development and approval of a treatment plan. Processes also include the specific procedures used by staff or other representatives of a plan (or the service provider of a plan) to administer the application of nonquantitative treatment limitations, such as how a panel of staff members applies the nonquantitative treatment limitation (including the qualifications of staff involved, number of staff members allocated, and time allocated), consultations with panels of experts in applying the nonquantitative treatment limitation, and reviewer discretion in adhering to criteria hierarchy when applying a nonquantitative treatment limitation. Strategies are practices, methods, or internal metrics that a plan considers, reviews, or uses to design a nonquantitative treatment limitation. Examples of strategies include but are not limited to: the development of the clinical rationale used in approving or denying benefits; deviation from generally accepted standards of care; the selection of information 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. Strategies also include the creation and composition of the staff or other representatives of a plan (or the service provider of a plan) that deliberates, or otherwise makes decisions, on the design of nonquantitative treatment limitations, including the plan’s decisions related to the 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 nonquantitative treatment limitation; and the composition of the panels used to design a nonquantitative treatment limitation. Substance use disorder benefits means benefits with respect to items or services for substance use disorders, as defined under the terms of the group health plan and in accordance with applicable Federal and State law, but does not include medical/surgical benefits or mental health benefits. Notwithstanding the preceding sentence, any disorder defined by the plan as being or as not being a substance use disorder must be defined consistent with generally recognized independent standards of current medical practice. For the purpose of this definition, to be consistent with generally recognized independent standards of current medical practice, the definition must include all disorders covered under the plan 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. To the extent generally recognized independent standards of current medical practice do not address whether a disorder is a substance use disorder, plans may define the disorder in accordance with applicable Federal and State law. Treatment limitations include limits on benefits based on the frequency of treatment, number of visits, days of coverage, days in a waiting period, or other similar limits on the scope or duration of treatment. Treatment limitations include both quantitative treatment limitations, which are expressed numerically (such as 50 outpatient visits per year), and nonquantitative treatment limitations, which otherwise limit the scope or duration of benefits for treatment under a plan. (See paragraph (c)(4)(iii) of this section for an illustrative, non-exhaustive list of nonquantitative treatment limitations.) A complete exclusion of all benefits for a particular condition or disorder, however, is not a treatment limitation for purposes of this definition. * * * * * (c) * * * (1) * * * (ii) Type of financial requirement or treatment limitation . When reference is made in this paragraph (c) to a |
915 | not a treatment limitation for purposes of this definition. * * * * * (c) * * * (1) * * * (ii) Type of financial requirement or treatment limitation . When reference is made in this paragraph (c) to a type of financial requirement or treatment limitation, the reference to type means its nature. Different types of financial requirements include deductibles, copayments, coinsurance, and out-of-pocket maximums. Different types of quantitative treatment limitations include annual, episode, and lifetime day and visit limits. See paragraph (c)(4)(iii) of this section for an illustrative, non-exhaustive list of nonquantitative treatment limitations. * * * * * (2) * * * (i) General rule . A group health plan that provides both medical/surgical benefits and mental health or substance use disorder benefits may not apply any financial requirement or treatment limitation to mental health or substance use disorder benefits in any classification that is more restrictive than the predominant financial requirement or treatment limitation of that type applied to substantially all medical/surgical benefits in the same classification. Whether a financial requirement or treatment limitation is a predominant financial requirement or treatment limitation that applies to substantially all medical/surgical benefits in a classification is determined separately for each type of financial requirement or treatment limitation. A plan may not impose any financial requirement or treatment limitation that is applicable only with respect to mental health or substance use disorder benefits and not to any medical/surgical benefits in the same benefit classification. The application of the rules of this paragraph (c)(2) to financial requirements and quantitative treatment limitations is addressed in paragraph (c)(3) of this section; the application of the rules of this paragraph (c)(2) to nonquantitative treatment limitations is addressed in paragraph (c)(4) of this section. (ii) * * * (A) In general . If a plan provides any benefits for a mental health condition or substance use disorder in any classification of benefits described in this paragraph (c)(2)(ii), benefits for that mental health condition or substance use disorder must be provided in every classification in which medical/surgical benefits are provided. For purposes of this paragraph (c)(2)(ii), a plan providing any benefits for a mental health condition or substance use disorder in any classification of benefits does not provide benefits for the mental health condition or substance use disorder in every classification in which medical/surgical benefits are provided unless the plan provides meaningful benefits for treatment for that condition or disorder in each such classification, as determined in comparison to the benefits provided for medical/surgical conditions in the classification. In determining the classification in which a particular benefit belongs, a plan must apply the same standards to medical/surgical benefits and to mental health or substance use disorder benefits. To the extent that a plan provides benefits in a classification and imposes any separate financial requirement or treatment limitation (or separate level of a financial requirement or treatment limitation) for benefits in the classification, the rules of this paragraph (c) apply separately with respect to that classification for all financial requirements or treatment limitations (illustrated in examples in paragraph (c)(2)(ii)(C) of this section). The following classifications of benefits are the only classifications used in applying the rules of this paragraph (c), in addition to the permissible sub-classifications described in paragraph (c)(3)(iii) of this section: * * * * * (C) * * * ( 1 ) Example 1 —( i ) Facts . A group health plan offers inpatient and outpatient benefits and does not contract with a network of providers. The plan imposes a $500 deductible on all benefits. For inpatient medical/surgical benefits, the plan imposes a coinsurance requirement. For outpatient medical/surgical benefits, the plan imposes copayments. The plan imposes no other financial requirements or treatment limitations. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 1 ) ( Example 1 ), because the plan has no network of providers, all benefits provided are out-of-network. Because inpatient, out-of-network medical/surgical benefits are subject to separate financial requirements from outpatient, out-of-network medical/surgical benefits, the rules of this paragraph (c) apply separately with respect to any financial requirements and treatment limitations, including the deductible, in each classification. ( 2 ) Example 2 —( i |
916 | from outpatient, out-of-network medical/surgical benefits, the rules of this paragraph (c) apply separately with respect to any financial requirements and treatment limitations, including the deductible, in each classification. ( 2 ) Example 2 —( i ) Facts . A plan imposes a $500 deductible on all benefits. The plan has no network of providers. The plan generally imposes a 20 percent coinsurance requirement with respect to all benefits, without distinguishing among inpatient, outpatient, emergency care, or prescription drug benefits. The plan imposes no other financial requirements or treatment limitations. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 2 ) ( Example 2 ), because the plan does not impose separate financial requirements (or treatment limitations) based on classification, the rules of this paragraph (c) apply with respect to the deductible and the coinsurance across all benefits. ( 3 ) Example 3 —( i ) Facts . Same facts as in paragraph (c)(2)(ii)(C)( 2 )( i ) of this section ( Example 2 ), except the plan exempts emergency care benefits from the 20 percent coinsurance requirement. The plan imposes no other financial requirements or treatment limitations. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 3 ) ( Example 3 ), because the plan imposes separate financial requirements based on classifications, the rules of this paragraph (c) apply with respect to the deductible and the coinsurance separately for benefits in the emergency care classification and all other benefits. ( 4 ) Example 4 —( i ) Facts . Same facts as in paragraph (c)(2)(ii)(C)( 2 )( i ) of this section ( Example 2 ), except the plan also imposes a preauthorization requirement for all inpatient treatment in order for benefits to be paid. No such requirement applies to outpatient treatment. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 4 ) ( Example 4 ), because the plan has no network of providers, all benefits provided are out-of-network. Because the plan imposes a separate treatment limitation based on classifications, the rules of this paragraph (c) apply with respect to the deductible and coinsurance separately for inpatient, out-of-network benefits and all other benefits. ( 5 ) Example 5 —( i ) Facts . A plan generally covers treatment for autism spectrum disorder (ASD), a mental health condition, and covers outpatient, out-of-network developmental evaluations for ASD but excludes all other benefits for outpatient treatment for ASD, including applied behavioral analysis (ABA) therapy, when provided on an out-of-network basis. The plan generally covers the full range of outpatient treatments and treatment settings for medical conditions and surgical procedures when provided on an out-of-network basis. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 5 ) ( Example 5 ), the plan violates the rules of this paragraph (c)(2)(ii). Because the plan only covers one type of benefit for ASD in the outpatient, out-of-network classification and excludes all other benefits for ASD in the classification, but generally covers the full range of medical/surgical benefits in the classification, it fails to provide meaningful benefits for treatment of ASD in the classification. ( 6 ) Example 6 —( i ) Facts . A plan generally covers diagnosis and treatment for eating disorders, a mental health condition, but specifically excludes coverage for nutrition counseling to treat eating disorders, including in the outpatient, in-network classification. Nutrition counseling is one of the primary treatments for eating disorders. The plan generally provides benefits for the primary treatments for medical/surgical conditions in the outpatient, in-network classification. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 6 ) ( Example 6 ), the plan violates the rules of this paragraph (c)(2)(ii). The exclusion of coverage for nutrition counseling for eating disorders results in the plan failing to provide meaningful benefits for the treatment of eating disorders in the outpatient, in-network classification, as determined in comparison to the benefits provided for medical/surgical conditions in the classification. (3) * * * (i) * * * (A) Substantially all . For purposes of this paragraph (c)(3), a type of financial requirement or quantitative treatment limitation is considered to apply to substantially all medical/surgical benefits in a classification of benefits if |
917 | i) * * * (A) Substantially all . For purposes of this paragraph (c)(3), a type of financial requirement or quantitative treatment limitation is considered to apply to substantially all medical/surgical benefits in a classification of benefits if it applies to at least two-thirds of all medical/surgical benefits in that classification. (For purposes of this paragraph (c)(3)(i)(A), benefits expressed as subject to a zero level of a type of financial requirement are treated as benefits not subject to that type of financial requirement, and benefits expressed as subject to a quantitative treatment limitation that is unlimited are treated as benefits not subject to that type of quantitative treatment limitation.) If a type of financial requirement or quantitative treatment limitation does not apply to at least two-thirds of all medical/surgical benefits in a classification, then that type cannot be applied to mental health or substance use disorder benefits in that classification. * * * * * (C) Portion based on plan payments . For purposes of this paragraph (c)(3), the determination of the portion of medical/surgical benefits in a classification of benefits subject to a financial requirement or quantitative treatment limitation (or subject to any level of a financial requirement or quantitative treatment limitation) is 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 (or for the portion of the plan year after a change in plan benefits that affects the applicability of the financial requirement or quantitative treatment limitation). (D) Clarifications for certain threshold requirements . For any deductible, the dollar amount of plan payments includes all plan payments with respect to claims that would be subject to the deductible if it had not been satisfied. For any out-of-pocket maximum, the dollar amount of plan payments includes all plan payments associated with out-of-pocket payments that are taken into account towards the out-of-pocket maximum as well as all plan payments associated with out-of-pocket payments that would have been made towards the out-of-pocket maximum if it had not been satisfied. Similar rules apply for any other thresholds at which the rate of plan payment changes. (See also PHS Act section 2707 and Affordable Care Act section 1302(c), which establish annual limitations on out-of-pocket maximums for all non-grandfathered health plans.) * * * * * (iii) Special rules . Unless specifically permitted under this paragraph (c)(3)(iii), sub-classifications are not permitted when applying the rules of paragraph (c)(3) of this section. (A) Multi-tiered prescription drug benefits . If a plan applies different levels of financial requirements to different tiers of prescription drug benefits based on reasonable factors determined in accordance with the rules in paragraph (c)(4) of this section (relating to requirements for nonquantitative treatment limitations) and without regard to whether a drug is generally prescribed with respect to medical/surgical benefits or with respect to mental health or substance use disorder benefits, the plan satisfies the parity requirements of this paragraph (c) with respect to prescription drug benefits. Reasonable factors include cost, efficacy, generic versus brand name, and mail order versus pharmacy pick-up. (B) Multiple network tiers . If a plan provides benefits through multiple tiers of in-network providers (such as an in-network tier of preferred providers with more generous cost-sharing to participants than a separate in-network tier of participating providers), the plan may divide its benefits furnished on an in-network basis into sub-classifications that reflect network tiers, if the tiering is based on reasonable factors determined in accordance with the rules in paragraph (c)(4) of this section (such as quality, performance, and market standards) and without regard to whether a provider provides services with respect to medical/surgical benefits or mental health or substance use disorder benefits. After the sub-classifications are established, the plan may not impose any financial requirement or treatment limitation on mental health or substance use disorder benefits in any sub-classification that is more restrictive than the predominant financial requirement or treatment limitation that applies to substantially all medical/surgical benefits in the sub-classification using the methodology set forth in paragraph (c)(3)(i) of this section. * * * * * (iv) Examples . The rules of paragraphs (c)(3)(i) through (iii) of |
918 | in the sub-classification using the methodology set forth in paragraph (c)(3)(i) of this section. * * * * * (iv) Examples . The rules of paragraphs (c)(3)(i) through (iii) of this section are illustrated by the following examples. In each example, the group health plan is subject to the requirements of this section and provides both medical/surgical benefits and mental health and substance use disorder benefits. (A) Example 1 —( 1 ) Facts . ( i ) For inpatient, out-of-network medical/surgical benefits, a group health plan imposes five levels of coinsurance. Using a reasonable method, the plan projects its payments for the upcoming year as follows: Table 1 to Paragraph (c)(3)(iv)(A)( 1 )( i ) Coinsurance rate 0 % 10% 15% 20% 30% Total Projected payments $200x $100x $450x $100x $150x $1,000x Percent of total plan costs 20% 10% 45% 10% 15% Percent subject to coinsurance level N/A 12.5% (100x/800x) 56.25% (450x/800x) 12.5% (100x/800x) 18.75% (150x/800x) ( ii ) The plan projects plan costs of $800x to be subject to coinsurance ($100x + $450x + $100x + $150x = $800x). Thus, 80 percent ($800x/$1,000x) of the benefits are projected to be subject to coinsurance, and 56.25 percent of the benefits subject to coinsurance are projected to be subject to the 15 percent coinsurance level. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(A) ( Example 1 ), the two-thirds threshold of the substantially all standard is met for coinsurance because 80 percent of all inpatient, out-of-network medical/surgical benefits are subject to coinsurance. Moreover, the 15 percent coinsurance is the predominant level because it is applicable to more than one-half of inpatient, out-of-network medical/surgical benefits subject to the coinsurance requirement. The plan may not impose any level of coinsurance with respect to inpatient, out-of-network mental health or substance use disorder benefits that is more restrictive than the 15 percent level of coinsurance. (B) Example 2 —( 1 ) Facts . ( i ) For outpatient, in-network medical/surgical benefits, a plan imposes five different copayment levels. Using a reasonable method, the plan projects payments for the upcoming year as follows: Table 2 to Paragraph (c)(3)(iv)(B)( 1 )( i ) Copayment amount $0 $10 $15 $20 $50 Total Projected payments $200x $200x $200x $300x $100x $1,000x Percent of total plan costs 20% 20% 20% 30% 10% Percent subject to copayments N/A 25% (200x/800x) 25% (200x/800x) 37.5% (300x/800x) 12.5% (100x/800x) ( ii ) The plan projects plan costs of $800x to be subject to copayments ($200x + $200x +$300x + $100x = $800x). Thus, 80 percent ($800x/$1,000x) of the benefits are projected to be subject to a copayment. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(B) ( Example 2 ), the two-thirds threshold of the substantially all standard is met for copayments because 80 percent of all outpatient, in-network medical/surgical benefits are subject to a copayment. Moreover, there is no single level that applies to more than one-half of medical/surgical benefits in the classification subject to a copayment (for the $10 copayment, 25%; for the $15 copayment, 25%; for the $20 copayment, 37.5%; and for the $50 copayment, 12.5%). The plan can combine any levels of copayment, including the highest levels, to determine the predominant level |
919 | ment, 25%; for the $20 copayment, 37.5%; and for the $50 copayment, 12.5%). The plan can combine any levels of copayment, including the highest levels, to determine the predominant level that can be applied to mental health or substance use disorder benefits. If the plan combines the highest levels of copayment, the combined projected payments for the two highest copayment levels, the $50 copayment and the $20 copayment, are not more than one-half of the outpatient, in-network medical/surgical benefits subject to a copayment because they are exactly one-half ($300x + $100x = $400x; $400x/$800x = 50%). The combined projected payments for the three highest copayment levels – the $50 copayment, the $20 copayment, and the $15 copayment – are more than one-half of the outpatient, in-network medical/surgical benefits subject to the copayments ($100x + $300x + $200x = $600x; $600x/$800x = 75%). Thus, the plan may not impose any copayment on outpatient, in-network mental health or substance use disorder benefits that is more restrictive than the least restrictive copayment in the combination, the $15 copayment. (C) Example 3 —( 1 ) Facts . A plan imposes a $250 deductible on all medical/surgical benefits for self-only coverage and a $500 deductible on all medical/surgical benefits for family coverage. The plan has no network of providers. For all medical/surgical benefits, the plan imposes a coinsurance requirement. The plan imposes no other financial requirements or treatment limitations. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(C) ( Example 3 ), because the plan has no network of providers, all benefits are provided out-of-network. Because self-only and family coverage are subject to different deductibles, whether the deductible applies to substantially all medical/surgical benefits is determined separately for self-only medical/surgical benefits and family medical/surgical benefits. Because the coinsurance is applied without regard to coverage units, the predominant coinsurance that applies to substantially all medical/surgical benefits is determined without regard to coverage units. (D) Example 4 —( 1 ) Facts . A plan applies the following financial requirements for prescription drug benefits. The requirements are applied without regard to whether a drug is generally prescribed with respect to medical/surgical benefits or with respect to mental health or substance use disorder benefits. Moreover, the process for certifying a particular drug as “generic”, “preferred brand name”, “non-preferred brand name”, or “specialty” complies with the rules of paragraph (c)(4) of this section (relating to requirements for nonquantitative treatment limitations). Table 3 to Paragraph (c)(3)(iv)(D)( 1 ) Tier 1 Tier 2 Tier 3 Tier 4 Tier description Generic drugs Preferred brand name drugs Non-preferred brand name drugs (which may have Tier 1 or Tier 2 alternatives) Specialty drugs Percent paid by plan 90% 80% 60% 50% ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(D) ( Example 4 ), the financial requirements that apply to prescription drug benefits are applied without regard to whether a drug is generally prescribed with respect to medical/surgical benefits or with respect to mental health or substance use disorder benefits; the process for certifying drugs in different tiers complies with paragraph (c)(4) of this section; and the bases for establishing different levels or types of financial requirements are reasonable. The financial requirements applied to prescription drug benefits do not violate the parity requirements of this paragraph (c)(3). (E) Example 5 —( 1 ) Facts . A plan has two-tiers of network of providers: a preferred provider tier and a participating provider tier. Providers are placed in either the preferred tier or participating tier based on reasonable factors determined in accordance with the rules in paragraph (c)(4) of this section, such as accreditation, quality and performance measures (including customer feedback), and relative reimbursement rates. Furthermore, provider tier placement is determined without regard to whether a provider specializes in the treatment |
920 | with the rules in paragraph (c)(4) of this section, such as accreditation, quality and performance measures (including customer feedback), and relative reimbursement rates. Furthermore, provider tier placement is determined without regard to whether a provider specializes in the treatment of mental health conditions or substance use disorders, or medical/surgical conditions. The plan divides the in-network classifications into two sub-classifications (in-network/preferred and in-network/participating). The plan does not impose any financial requirement or treatment limitation on mental health or substance use disorder benefits in either of these sub-classifications that is more restrictive than the predominant financial requirement or treatment limitation that applies to substantially all medical/surgical benefits in each sub-classification. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(E) ( Example 5 ), the division of in-network benefits into sub-classifications that reflect the preferred and participating provider tiers does not violate the parity requirements of this paragraph (c)(3). (F) Example 6 —( 1 ) Facts . With respect to outpatient, in-network benefits, a plan imposes a $25 copayment for office visits and a 20 percent coinsurance requirement for outpatient surgery. The plan divides the outpatient, in-network classification into two sub-classifications (in-network office visits and all other outpatient, in-network items and services). The plan does not impose any financial requirement or quantitative treatment limitation on mental health or substance use disorder benefits in either of these sub-classifications that is more restrictive than the predominant financial requirement or quantitative treatment limitation that applies to substantially all medical/surgical benefits in each sub-classification. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(F) ( Example 6 ), the division of outpatient, in-network benefits into sub-classifications for office visits and all other outpatient, in-network items and services does not violate the parity requirements of this paragraph (c)(3). (G) Example 7 —( 1 ) Facts . Same facts as in paragraph (c)(3)(iv)(F)( 1 ) of this section ( Example 6 ), but for purposes of determining parity, the plan divides the outpatient, in-network classification into outpatient, in-network generalists and outpatient, in-network specialists. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(G) ( Example 7 ), the division of outpatient, in-network benefits into any sub-classifications other than office visits and all other outpatient items and services violates the requirements of paragraph (c)(3)(iii)(C) of this section. * * * * * (4) Nonquantitative treatment limitations . Subject to paragraph (c)(4)(v) of this section, a group health plan may not impose a nonquantitative treatment limitation with respect to mental health or substance use disorder benefits in a classification unless the plan’s imposition of the limitation meets the requirements of paragraphs (c)(4)(i), (ii), and (iv) of this section. If a group health plan fails to meet any of these requirements with respect to a nonquantitative treatment limitation, the limitation violates Code section 9812(a)(3)(A)(ii) and may not be imposed by the plan. (i) Requirement that nonquantitative treatment limitations be no more restrictive for mental health benefits and substance use disorder benefits . A group health plan may not apply any nonquantitative treatment limitation 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 nonquantitative treatment limitation applied to substantially all medical/surgical benefits in the same classification. (A) Restrictive . For purposes of this paragraph (c)(4)(i), a nonquantitative treatment limitation is restrictive to the extent it imposes conditions, terms, or requirements that limit access to benefits under the terms of the plan. Conditions, terms, or requirements include, but are not 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. (B) Substantially all . For purposes of this paragraph (c)(4)(i), a nonquantitative treatment limitation is considered to apply to substantially all medical/surgical benefits in a classification if it applies |
921 | or disorder under the plan. (B) Substantially all . For purposes of this paragraph (c)(4)(i), a nonquantitative treatment limitation is considered to apply to substantially all medical/surgical benefits in a classification if it applies to at least two-thirds of all medical/surgical benefits in that classification, consistent with paragraph (c)(4)(i)(D) of this section. Whether the nonquantitative treatment limitation applies to at least two-thirds of all medical/surgical benefits is determined without regard to whether the nonquantitative treatment limitation was triggered based on a particular factor or evidentiary standard. If a nonquantitative treatment limitation does not apply to at least two-thirds of all medical/surgical benefits in a classification, then that limitation cannot be applied to mental health or substance use disorder benefits in that classification. (C) Predominant . For purposes of this paragraph (c)(4)(i), the term predominant means the most common or most frequent variation of the nonquantitative treatment limitation within a classification, determined in accordance with the method outlined in paragraph (c)(4)(i)(D) of this section, to the extent the plan imposes multiple variations of a nonquantitative treatment limitation within the classification. For example, multiple variations of inpatient concurrent review include review commencing 1 day, 3 days, or 7 days after admission, depending on the reason for the stay. (D) Portion based on plan payments . For purposes of paragraphs (c)(4)(i)(B) and (C) of this section, the determination of the portion of medical/surgical benefits in a classification of benefits subject to a nonquantitative treatment limitation is 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 (or the portion of the plan year after a change in benefits that affects the applicability of the nonquantitative treatment limitation). Any reasonable method may be used to determine the dollar amount expected to be paid under a plan for medical/surgical benefits. (E) Exceptions for independent professional medical or clinical standards and standards to detect or prevent and prove fraud, waste, and abuse . Notwithstanding paragraphs (c)(4)(i)(A) through (D) of this section, a plan that applies a nonquantitative treatment limitation that impartially applies independent professional medical or clinical standards or applies standards to detect or prevent and prove fraud, waste, and abuse, as described in paragraph (c)(4)(v)(A) or (B) of this section, to mental health or substance use disorder benefits in any classification will not be considered to violate this paragraph (c)(4)(i) with respect to such nonquantitative treatment limitation. (ii) Additional requirements related to design and application of the nonquantitative treatment limitation —(A) In general . Consistent with paragraph (a)(1) of this section, a plan may not impose a nonquantitative treatment limitation with respect to mental health or substance use disorder benefits in any classification unless, under the terms of the plan as written and in operation, any processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits in the classification are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in designing and applying the limitation with respect to medical/surgical benefits in the classification. (B) Prohibition on discriminatory factors and evidentiary standards . For purposes of determining comparability and stringency under paragraph (c)(4)(ii)(A) of this section, a plan may not rely upon any factor or evidentiary standard if the information, evidence, sources, or standards on which the factor or evidentiary standard is based discriminates against mental health or substance use disorder benefits as compared to medical/surgical benefits. For purposes of this paragraph (c)(4)(ii)(B): ( 1 ) Impartially applied generally recognized independent professional medical or clinical standards described in paragraph (c)(4)(v)(A) of this section are not considered to discriminate against mental health or substance use disorder benefits. ( 2 ) Standards reasonably designed to detect or prevent and prove fraud, waste, and abuse described in paragraph (c)(4)(v)(B) of this section are not considered to discriminate |
922 | considered to discriminate against mental health or substance use disorder benefits. ( 2 ) Standards reasonably designed to detect or prevent and prove fraud, waste, and abuse described in paragraph (c)(4)(v)(B) of this section are not considered to discriminate against mental health or substance use disorder benefits. ( 3 ) 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 including, but not limited to, the source of the information, the purpose or context of the information, and the content of the information. (iii) Illustrative, non-exhaustive list of nonquantitative treatment limitations . Nonquantitative treatment limitations include – (A) Medical management standards (such as prior authorization) limiting or excluding benefits based on medical necessity or medical appropriateness, or based on whether the treatment is experimental or investigative; (B) Formulary design for prescription drugs; (C) For plans with multiple network tiers (such as preferred providers and participating providers), network tier design; (D) 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; (E) Plan 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; (F) Refusal to pay for higher-cost therapies until it can be shown that a lower-cost therapy is not effective (also known as fail-first policies or step therapy protocols); (G) Exclusions based on failure to complete a course of treatment; and (H) Restrictions based on geographic location, facility type, provider specialty, and other criteria that limit the scope or duration of benefits for services provided under the plan. (iv) Required use of outcomes data —(A) In general . When designing and applying a nonquantitative treatment limitation, a plan must collect and evaluate relevant data in a manner reasonably designed to assess the impact of the nonquantitative treatment limitation on access to mental health and substance use disorder benefits and medical/surgical benefits, and consider the impact as part of the plan’s analysis of whether the limitation, in operation, complies with paragraphs (c)(4)(i) and (ii) of this section. The Secretary, jointly with the Secretary of the Department of Labor and the Secretary of Health and Human Services, may specify in guidance the type, form, and manner of collection and evaluation for the data required under this paragraph (c)(4)(iv)(A). ( 1 ) For purposes of this paragraph (c)(4)(iv)(A), relevant data includes, but is not limited to, the number and percentage of claims denials and any other data relevant to the nonquantitative treatment limitation required by State law or private accreditation standards. ( 2 ) In addition to the relevant data set forth in paragraph (c)(4)(iv)(A)( 1 ) of this section, relevant data for nonquantitative treatment limitations related to network composition standards includes, but is not limited to, in-network and out-of-network utilization rates (including data related to provider claim submissions), network adequacy metrics (including time and distance data, and data on providers accepting new patients), and provider reimbursement rates (including as compared to billed charges). (B) Material differences . Subject to paragraph (c)(4)(iv)(C) of this section, to the extent the relevant data evaluated pursuant to paragraph (c)(4)(iv)(A) of this section show material differences in access to mental health and substance use disorder benefits as compared to medical/surgical benefits, the differences will be considered a strong indicator that the plan violates paragraph (c)(4)(i) or (ii) of this section. In such instances, the plan: ( 1 ) Must take reasonable action to address the material differences in access as necessary to ensure compliance, in operation, with paragraphs (c)(4)(i) and (ii) of this section; and ( 2 ) Must document the action that has been or is |
923 | Must take reasonable action to address the material differences in access as necessary to ensure compliance, in operation, with paragraphs (c)(4)(i) and (ii) of this section; and ( 2 ) Must document the action that has been or is being taken by the plan to mitigate any material differences in access to mental health and substance use disorder benefits as compared to medical/surgical benefits, as required by § 54.9812-2(c)(5)(iv). (C) Special rule for nonquantitative treatment limitations related to network composition . Notwithstanding paragraph (c)(4)(iv)(B) of this section, when designing and applying one or more nonquantitative treatment limitation(s) related to network composition standards, a plan fails to meet the requirements of paragraphs (c)(4)(i) and (ii) of this section, in operation, if the relevant data show material differences in access to in-network mental health and substance use disorder benefits as compared to in-network medical/surgical benefits in a classification. (D) Exception for independent professional medical or clinical standards . A plan designing and applying a nonquantitative treatment limitation with respect to mental health or substance use disorder benefits in any classification that impartially applies independent professional medical or clinical standards, as described in paragraph (c)(4)(v)(A) of this section, is not required to comply with the requirements of this paragraph (c)(4)(iv) with respect to that classification. (v) Independent professional medical or clinical standards and standards to detect or prevent and prove fraud, waste, and abuse . (A) To qualify for the exceptions in paragraphs (c)(4)(i)(E), (c)(4)(ii)(B), and (c)(4)(iv)(D) of this section for independent professional medical or clinical standards, a nonquantitative treatment limitation must impartially apply generally recognized independent professional medical or clinical standards (consistent with generally accepted standards of care) to medical/surgical benefits and mental health or substance use disorder benefits, and may not deviate from those standards in any way, such as by imposing additional or different requirements. (B) To qualify for the exceptions in paragraphs (c)(4)(i)(E) and (c)(4)(ii)(B) of this section to detect or prevent and prove fraud, waste, and abuse, a nonquantitative treatment limitation must be reasonably designed to detect or prevent and prove fraud, waste, and abuse, based on indicia of fraud, waste, and abuse that have been reliably established through objective and unbiased data, and also be narrowly designed to minimize the negative impact on access to appropriate mental health and substance use disorder benefits. (vi) Prohibition on separate nonquantitative treatment limitations applicable only to mental health or substance use disorder benefits . Consistent with paragraph (c)(2)(i) of this section, a group health plan may not apply any nonquantitative treatment limitation that is applicable only with respect to mental health or substance use disorder benefits and does not apply with respect to any medical/surgical benefits in the same benefit classification. (vii) Effect of final determination of noncompliance under § 54.9812-2 . If a group health plan receives a final determination from the Secretary that the plan is not in compliance with the requirements of § 54.9812-2 with respect to a nonquantitative treatment limitation, the nonquantitative treatment limitation violates this paragraph (c)(4) and the Secretary may direct the plan not to impose the nonquantitative treatment limitation, unless and until the plan demonstrates to the Secretary compliance with the requirements of this section or takes appropriate action to remedy the violation. (viii) Examples . The rules of this paragraph (c)(4) are illustrated by the following examples. In each example, the group health plan is subject to the requirements of this section and provides both medical/surgical benefits and mental health and substance use disorder benefits. Additionally, in examples that conclude that the plan violates one provision of this paragraph (c)(4), such examples do not necessarily imply compliance with other provisions of this paragraph (c)(4), as these examples do not analyze compliance with all other provisions of this paragraph (c)(4). (A) Example 1 (More restrictive prior authorization requirement in operation) —( 1 ) Facts . A plan requires prior authorization from the plan’s utilization reviewer that a treatment is medically necessary for all |
924 | provisions of this paragraph (c)(4). (A) Example 1 (More restrictive prior authorization requirement in operation) —( 1 ) Facts . A plan requires prior authorization from the plan’s utilization reviewer that a treatment is medically necessary for all inpatient, in-network medical/surgical benefits and for all inpatient, in-network mental health and substance use disorder benefits. While inpatient, in-network benefits for medical/surgical conditions are approved for periods of 1, 3, and 7 days, after which a treatment plan must be submitted by the patient’s attending provider and approved by the plan, the approvals for 7 days are most common under this plan. For inpatient, in-network mental health and substance use disorder benefits, routine approval is most commonly given only for one day, after which a treatment plan must be submitted by the patient’s attending provider and approved by the plan. The difference in the duration of approvals is not the result of independent professional medical or clinical standards or standards to detect or prevent and prove fraud, waste, and abuse, but rather reflects the application of a heightened standard to the provision of the mental health and substance use disorder benefits in the relevant classification. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(A) ( Example 1 ), the plan violates the rules of paragraph (c)(4)(i) of this section. Under the terms of the plan, prior authorization applies to at least two-thirds of all medical/surgical benefits in the relevant classification (inpatient, in-network), since it applies to all benefits in the relevant classification. Further, the most common or frequent variation of the nonquantitative treatment limitation applied to medical/surgical benefits in the relevant classification (the predominant nonquantitative treatment limitation) is the routine approval of inpatient, in-network benefits for 7 days before the patient’s attending provider must submit a treatment plan. However, the plan routinely approves inpatient, in-network benefits for mental health and substance use disorder conditions for only 1 day before the patient’s attending provider must submit a treatment plan (and, in doing so, does not impartially apply independent professional medical or clinical standards or apply standards to detect or prevent and prove fraud, waste, and abuse that qualify for the exceptions in paragraph (c)(4)(i)(E) of this section). In operation, therefore, the prior authorization requirement imposed on inpatient, in-network mental health and substance use disorder benefits is more restrictive than the predominant prior authorization requirement applicable to substantially all medical/surgical benefits in the inpatient, in-network classification because the practice of approving only 1 day of inpatient benefits limits access to the full range of treatment options available for a condition or disorder under the plan as compared to the routine 7-day approval that is given for inpatient, in-network medical/surgical benefits. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (B) Example 2 (More restrictive peer-to-peer concurrent review requirements in operation) —( 1 ) Facts . A plan follows a written process for the concurrent review of all medical/surgical benefits and mental health and substance use disorder benefits within the inpatient, in-network classification. Under the process, a first-level review is conducted in every instance in which concurrent review applies and an authorization request is approved by the first-level reviewer only if the clinical information submitted by the facility meets the plan’s criteria for a continued stay. If the first-level reviewer is unable to approve the authorization request because the clinical information submitted by the facility does not meet the plan’s criteria for a continued stay, it is sent to a second-level reviewer who will either approve or deny the request. While the written process only requires review by the second-level reviewer to either deny or approve the request, in operation, second-level reviewers for mental health and substance use disorder benefits conduct a peer-to-peer review with a provider (acting as the authorized representative of a participant or beneficiary) before coverage of the treatment is approved. The peer-to-peer review requirement is not the result of independent professional medical or clinical standards or standards to detect or prevent and prove fraud, waste, and abuse |
925 | the authorized representative of a participant or beneficiary) before coverage of the treatment is approved. The peer-to-peer review requirement is not the result of independent professional medical or clinical standards or standards to detect or prevent and prove fraud, waste, and abuse. The plan does not impose a peer-to-peer review, as written or in operation, as part of the second-level review for medical/surgical benefits. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(B) ( Example 2 ), the plan violates the rules of paragraph (c)(4)(i) of this section. The concurrent review nonquantitative treatment limitation applies to at least two-thirds of all medical/surgical benefits within the inpatient, in-network classification because the plan follows the concurrent review process for all medical/surgical benefits. The most common or frequent variation of this nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) applicable to substantially all medical/surgical benefits is that peer-to-peer review is not imposed as part of second-level review. The plan does not impartially apply independent professional medical or clinical standards or apply standards to detect or prevent and prove fraud, waste, and abuse that qualify for the exceptions in paragraph (c)(4)(i)(E) of this section. As written, the plan’s concurrent review requirements are the same for medical/surgical benefits and mental health and substance use disorder benefits. However, in operation, by compelling an additional action (peer-to-peer review as part of second-level review) to access only mental health or substance use disorder benefits, the plan applies the limitation to mental health and substance use disorder benefits in a manner that is more restrictive than the predominant nonquantitative treatment limitation applied to substantially all medical/surgical benefits in the inpatient, in-network classification. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (C) Example 3 (More restrictive peer-to-peer review medical necessity standard in operation; deviation from independent professional medical and clinical standards) —( 1 ) Facts . A plan generally requires that all treatment be medically necessary in the inpatient, out-of-network classification. For both medical/surgical benefits and mental health and substance use disorder benefits, the written medical necessity standards are based on independent professional medical or clinical standards that do not require peer-to-peer review. In operation, the plan covers out-of-network benefits for medical/surgical or mental health inpatient treatment outside of a hospital if the physician documents medical appropriateness, but for out-of-network benefits for substance use disorder inpatient treatment outside of a hospital, the plan requires a physician to also complete peer-to-peer review. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(C) ( Example 3 ), the plan violates the rules of paragraph (c)(4)(i) of this section. The medical necessity nonquantitative treatment limitation applies to at least two-thirds of all medical/surgical benefits in the inpatient, out-of-network classification. The most common or frequent variation of the nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) applicable to substantially all medical/surgical benefits is the requirement that a physician document medical appropriateness without peer-to-peer review. The plan purports to impartially apply independent professional medical or clinical standards that would otherwise qualify for the exception in paragraph (c)(4)(i)(E) of this section, but deviates from those standards by imposing the additional requirement to complete peer-to-peer review for inpatient, out-of-network benefits for substance use disorder outside of a hospital. Therefore, the exception in paragraph (c)(4)(i)(E) of this section does not apply. As written, the plan provisions apply the nonquantitative treatment limitation to mental health and substance use disorder benefits in the inpatient, out-of-network classification in the same manner as for medical/surgical benefits. However, in operation, the nonquantitative treatment limitation imposed with respect to out-of-network substance use disorder benefits for treatment outside of a hospital is more restrictive than the predominant nonquantitative treatment limitation applied to |
926 | for medical/surgical benefits. However, in operation, the nonquantitative treatment limitation imposed with respect to out-of-network substance use disorder benefits for treatment outside of a hospital is more restrictive than the predominant nonquantitative treatment limitation applied to substantially all medical/surgical benefits in the classification because it limits access to the full range of treatment options available for a condition or disorder under the plan or coverage as compared to medical/surgical benefits in the same classification. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (D) Example 4 (Not comparable and more stringent methods for determining reimbursement rates in operation) —( 1 ) Facts. A plan’s base reimbursement rates for outpatient, in-network providers are determined based on a variety of factors, including the providers’ required training, licensure, and expertise. For purposes of this example, the plan’s nonquantitative treatment limitations for determining reimbursement rates for mental health and substance use disorder benefits are not more restrictive than the predominant nonquantitative treatment limitation applied to substantially all medical/surgical benefits in the classification under paragraph (c)(4)(i) of this section. As written, for mental health, substance use disorder, and medical/surgical benefits, all reimbursement rates for physicians and non-physician practitioners for the same Current Procedural Terminology (CPT) code vary based on a combination of factors, such as the nature of the service, provider type, number of providers qualified to provide the service in a given geographic area, and market need (demand). As a result, reimbursement rates for mental health, substance use disorder, and medical/surgical benefits furnished by non-physician providers are generally less than for physician providers. In operation, the plan reduces the reimbursement rate for mental health and substance use disorder non-physician providers from that paid to mental health and substance use disorder physicians by the same percentage for every CPT code but does not apply the same reductions for non-physician medical/surgical providers. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(D) ( Example 4 ), the plan violates the rules of paragraph (c)(4)(ii) of this section. Because the plan reimburses non-physician providers of mental health and substance use disorder services by reducing their reimbursement rate from the rate to physician providers by the same percentage for every CPT code but does not apply the same reductions to non-physician providers of medical/surgical services, in operation, the factors used in applying the nonquantitative treatment limitation to mental health and substance use disorder benefits are not comparable to, and are applied more stringently than, the factors used in applying the limitation with respect to medical/surgical benefits. Because the facts assume that the plan’s methods for determining reimbursement rates comply with paragraph (c)(4)(i) of this section and the plan violates the rules of paragraph (c)(4)(ii) of this section, this example does not analyze compliance with paragraph (c)(4)(iv) of this section. (E) Example 5 (Exception for impartially applied generally recognized independent professional medical or clinical standards) —( 1 ) Facts . A group health plan develops a medical management requirement for all inpatient, out-of-network benefits for both medical/surgical benefits and mental health and substance use disorder benefits to ensure treatment is medically necessary. The medical management requirement impartially applies independent professional medical or clinical standards in a manner that qualifies for the exception in paragraph (c)(4)(i)(E) of this section. The plan does not rely on any other factors or evidentiary standards and the processes, strategies, evidentiary standards, and other factors used in designing and applying the medical management requirement to mental health and substance use disorder benefits are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, and other factors used in designing and applying the requirement with respect to medical/surgical benefits. Within the inpatient, out-of-network classification, the application of the medical management requirement results in a higher percentage of denials for mental health and substance use disorder claims than medical/surgical claims, because the benefits were found to be medically necessary for a lower percentage of mental |
927 | of-network classification, the application of the medical management requirement results in a higher percentage of denials for mental health and substance use disorder claims than medical/surgical claims, because the benefits were found to be medically necessary for a lower percentage of mental health and substance use disorder claims based on the impartial application of the independent professional medical or clinical standards by the nonquantitative treatment limitation. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(E) ( Example 5 ), the plan does not violate the rules of this paragraph (c)(4). The medical management nonquantitative treatment limitation imposed on mental health and substance use disorder benefits does not violate paragraph (c)(4)(i) or (iv) of this section because it impartially applies independent professional medical or clinical standards for both medical/surgical benefits and mental health and substance use disorder benefits in a manner that qualifies for the exceptions in paragraphs (c)(4)(i)(E) and (c)(4)(iv)(D) of this section, respectively. Moreover, the nonquantitative treatment limitation does not violate paragraph (c)(4)(ii) of this section because the independent professional medical or clinical standards are not considered to be a discriminatory factor or evidentiary standard under paragraph (c)(4)(ii)(B) of this section. Additionally, as written and in operation, the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits in the inpatient, out-of-network classification are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, and other factors used in applying the limitation with respect to medical/surgical benefits in the classification, regardless of the fact that the application of the nonquantitative treatment limitation resulted in higher percentages of claim denials for mental health and substance use disorder benefits as compared to medical/surgical benefits. (F) Example 6 (More restrictive prior authorization requirement; exception for impartially applied generally recognized independent professional medical or clinical standards not met) —( 1 ) Facts. The provisions of a plan state that it applies independent professional medical and clinical standards (consistent with generally accepted standards of care) for setting prior authorization requirements for both medical/surgical and mental health and substance use disorder prescription drugs. The relevant generally recognized independent professional medical standard for treatment of opioid use disorder that the plan utilizes—in this case, the American Society of Addiction Medicine national practice guidelines—does not support prior authorization every 30 days for buprenorphine/naloxone. However, in operation, the plan requires prior authorization for buprenorphine/naloxone combination at each refill (every 30 days) for treatment of opioid use disorder. ( 2 ) Conclusion. In this paragraph (c)(4)(viii)(F) ( Example 6 ), the plan violates the rules of paragraph (c)(4)(i) of this section. The plan does not qualify for the exception in paragraph (c)(4)(i)(E) of this section, because, although the provisions of the plan state that it applies independent professional medical and clinical standards, the plan deviates from the relevant standards with respect to prescription drugs to treat opioid use disorder. The prior authorization nonquantitative treatment limitation is applied to at least two-thirds of all medical/surgical benefits in the prescription drugs classification. The most common or frequent variation of this nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) applicable to substantially all medical/surgical benefits is following generally recognized independent professional medical and clinical standards (consistent with generally accepted standards of care). The prior authorization requirements imposed on substance use disorder benefits are more restrictive than the predominant nonquantitative treatment limitation applicable to substantially all medical/surgical benefits in the classification, because the plan imposes additional requirements on substance use disorder benefits that limit access to the full range of treatment options available for a condition or disorder under the plan as compared to medical/surgical benefits in the same classification. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (G) Example 7 (Impermissible nonquantitative treatment limitation imposed following a final determination of noncompliance and direction by the Secretary) —( 1 ) |
928 | compliance with paragraph (c)(4)(ii) or (iv) of this section. (G) Example 7 (Impermissible nonquantitative treatment limitation imposed following a final determination of noncompliance and direction by the Secretary) —( 1 ) Facts. Following an initial request by the Secretary for a plan’s comparative analysis of a nonquantitative treatment limitation pursuant to § 54.9812-2(d), the plan submits a comparative analysis for the nonquantitative treatment limitation. After review of the comparative analysis, the Secretary makes an initial determination that the comparative analysis fails to demonstrate that the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits in the relevant classification are comparable to, and applied no more stringently than, those used in designing and applying the limitation to medical/surgical benefits in the classification. Pursuant to § 54.9812-2(d)(3), the plan submits a corrective action plan and additional comparative analyses within 45 calendar days after the initial determination, and the Secretary then determines that the additional comparative analyses do not demonstrate compliance with the requirements of this paragraph (c)(4). The plan receives a final determination of noncompliance from the Secretary, which informs the plan that it is not in compliance with this paragraph (c)(4) and directs the plan not to impose the nonquantitative treatment limitation by a certain date, unless and until the plan demonstrates compliance to the Secretary or takes appropriate action to remedy the violation. The plan makes no changes to its plan terms by that date and continues to impose the nonquantitative treatment limitation. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(G) ( Example 7 ), the plan violates the requirements of this paragraph (c)(4) by imposing the nonquantitative treatment limitation after the Secretary directs the plan not to impose it, pursuant to paragraph (c)(4)(vii) of this section. (H) Example 8 (Provider network admission standards not more restrictive and compliant with requirements for design and application of NQTLs) —( 1 ) Facts . As part of a plan’s standards for provider admission to its network, in the outpatient, in-network classification, any provider seeking to contract with the plan must have a certain number of years of supervised clinical experience. As a result of that standard, master’s level mental health therapists are required to obtain supervised clinical experience beyond their licensure, while master’s level medical/surgical providers, psychiatrists, and Ph.D.-level psychologists do not require additional experience beyond their licensure because their licensure already requires supervised clinical experience. The plan collects and evaluates relevant data in a manner reasonably designed to assess the impact of the nonquantitative treatment limitation. This includes in-network and out-of-network utilization rates (including data related to provider claim submissions), network adequacy metrics (including time and distance data, and data on providers accepting new patients), and provider reimbursement rates (including as compared to billed charges). This data demonstrates that participants and beneficiaries seeking outpatient care are able to access outpatient, in-network mental health and substance use disorder providers at the same frequency as outpatient, in-network medical/surgical providers, that mental health and substance use disorder providers are active in the network and are accepting new patients to the same extent as medical/surgical providers, and that mental health and substance use disorder providers are within similar time and distances to plan participants and beneficiaries as are medical/surgical providers. This data also does not identify material differences in what the plan pays psychiatrists or non-physician mental health providers, compared to physicians or non-physician medical/surgical providers, respectively, both for the same reimbursement codes and as compared to Medicare rates. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(H) ( Example 8 ), the plan does not violate this paragraph (c)(4). The standards for this nonquantitative treatment limitation, namely provider admission to the plan’s network, are applied to at least two-thirds of all medical/surgical benefits in the outpatient, in-network classification, as it applies to all medical/surgical benefits in the classification. The most common or frequent variation of this nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) that applies to |
929 | urgical benefits in the outpatient, in-network classification, as it applies to all medical/surgical benefits in the classification. The most common or frequent variation of this nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) that applies to substantially all medical/surgical benefits in the classification is having a certain number of years of supervised clinical experience. The standards for provider admission to the plan’s network that are imposed with respect to mental health or substance use disorder benefits are no more restrictive, as written or in operation, than the predominant variation of the nonquantitative treatment limitation applicable to substantially all medical/surgical benefits in the classification, because the standards do not limit access to the full range of treatment options available for a condition or disorder under the plan as compared to medical/surgical benefits in the same classification. The requirement that providers have a certain number of years of supervised clinical experience that the plan relied upon to design and apply the nonquantitative treatment limitation is not considered to discriminate against mental health or substance use disorder benefits, even though this results in the requirement that master’s level mental health therapists obtain supervised clinical experience beyond their licensure, unlike master’s level medical/surgical providers. In addition, as written and in operation, the processes, strategies, evidentiary standards, or other factors used in applying the nonquantitative treatment limitation to mental health or substance use disorder benefits in the classification are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in applying the limitation with respect to medical/surgical benefits in the classification, because the plan applies the same standard to all providers in the classification. Finally, the plan collects and evaluates relevant data in a manner reasonably designed to assess the impact of the nonquantitative treatment limitation on access to mental health and substance use disorder benefits, which does not show material differences in access to in-network mental health and substance use disorder benefits as compared to in-network medical/surgical benefits in the classification. (I) Example 9 (More restrictive requirement for primary caregiver participation applied to ABA therapy) —( 1 ) Facts . A plan generally applies medical necessity criteria in adjudicating claims for coverage of all outpatient, in-network medical/surgical and mental health and substance use disorder benefits, including ABA therapy for the treatment of ASD, which is a mental health condition. The plan’s medical necessity criteria for coverage of ABA therapy requires evidence that the participant’s or beneficiary’s primary caregivers actively participate in ABA therapy, as documented by consistent attendance in parent, caregiver, or guardian training sessions. In adding this requirement, the plan deviates from independent professional medical or clinical standards, and there are no similar medical necessity criteria requiring evidence of primary caregiver participation in order to receive coverage of any medical/surgical benefits. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(I) ( Example 9 ), the plan violates paragraph (c)(4)(i) of this section. The plan applies medical necessity criteria to at least two-thirds of all outpatient, in-network medical/surgical benefits, as they apply to all medical/surgical benefits in the classification. The most common or frequent variation of this nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) that applies to substantially all medical/surgical benefits in the classification does not include the requirement to provide evidence that the participant’s or beneficiary’s primary caregivers actively participate in the treatment. The plan does not qualify for the exception in paragraph (c)(4)(i)(E) of this section in applying its restriction on coverage for ABA therapy because the plan deviates from the independent professional medical or clinical standards by imposing a different requirement. As a result, the nonquantitative treatment limitation imposed on mental health and substance use disorder benefits is more restrictive than the predominant medical necessity requirement imposed on substantially all medical/surgical benefits in the classification (which does not include the requirement to provide evidence that primary caregivers actively participate in treatment). Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (J) Example 10 (More restrictive exclusion for experimental or investigative treatment applied to ABA therapy) —( 1 |
930 | of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (J) Example 10 (More restrictive exclusion for experimental or investigative treatment applied to ABA therapy) —( 1 ) Facts. A plan, as written, generally excludes coverage for all treatments that are experimental or investigative for both medical/surgical benefits and mental health and substance use disorder benefits in the outpatient, in-network classification. As a result, the plan generally excludes experimental treatment of medical conditions and surgical procedures, mental health conditions, and substance use disorders when no professionally recognized treatment guidelines define clinically appropriate standards of care for the condition or disorder and fewer than two randomized controlled trials are available to support the treatment’s use with respect to the given condition or disorder. The plan provides benefits for the treatment of ASD, which is a mental health condition, but, in operation, the plan excludes coverage for ABA therapy to treat children with ASD, deeming it experimental. More than one professionally recognized treatment guideline defines clinically appropriate standards of care for ASD and more than two randomized controlled trials are available to support the use of ABA therapy to treat certain children with ASD. ( 2 ) Conclusion. In this paragraph (c)(4)(viii)(J) ( Example 10 ), the plan violates the rules of paragraph (c)(4)(i) of this section. The coverage exclusion for experimental or investigative treatment applies to at least two-thirds of all medical/surgical benefits, as it applies to all medical/surgical benefits in the outpatient, in-network classification. The most common or frequent variation of this nonquantitative treatment limitation in the classification (the predominant nonquantitative treatment limitation) applicable to substantially all medical/surgical benefits is the exclusion under the plan for coverage of experimental treatment of medical/surgical conditions when no professionally recognized treatment guidelines define clinically appropriate standards of care for the condition or disorder and fewer than two randomized controlled trials are available to support the treatment’s use with respect to the given condition or procedure. In operation, the exclusion for experimental or investigative treatment imposed on ABA therapy is more restrictive than the predominant variation of the nonquantitative treatment limitation for experimental or investigative treatment imposed on substantially all medical/surgical benefits in the classification because the exclusion limits access to the full range of treatment options available for a condition or disorder under the plan as compared to medical/surgical benefits in the same classification. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (K) Example 11 (Separate EAP exhaustion treatment limitation applicable only to mental health benefits) —( 1 ) Facts . An employer maintains both a major medical plan and an employee assistance program (EAP). The EAP provides, among other benefits, a limited number of mental health or substance use disorder counseling sessions, which, together with other benefits provided by the EAP, are not significant benefits in the nature of medical care. Participants are eligible for mental health or substance use disorder benefits under the major medical plan only after exhausting the counseling sessions provided by the EAP. No similar exhaustion requirement applies with respect to medical/surgical benefits provided under the major medical plan. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(K) ( Example 11 ), limiting eligibility for mental health and substance use disorder benefits under the major medical plan until EAP benefits are exhausted is a nonquantitative treatment limitation subject to the parity requirements of this paragraph (c). Because the limitation does not apply to medical/surgical benefits, it is a separate nonquantitative treatment limitation applicable only to mental health and substance use disorder benefits that violates paragraph (c)(4)(vi) of this section. Additionally, this EAP would not qualify as excepted benefits under §54.9831-1(c)(3)(vi)(B)( 1 ) because participants in the major medical plan are required to use and exhaust benefits under the EAP (making the EAP a gatekeeper) before an individual is eligible for benefits under the plan. (L) Example 12 (Separate residential exclusion treatment limitation applicable only to mental health benefits) —( 1 ) Facts . A plan generally covers inpatient, in-network and inpatient out-of-network treatment in any setting, |
931 | plan. (L) Example 12 (Separate residential exclusion treatment limitation applicable only to mental health benefits) —( 1 ) Facts . A plan generally covers inpatient, in-network and inpatient out-of-network treatment in any setting, including skilled nursing facilities and rehabilitation hospitals, provided other medical necessity standards are satisfied. The plan also has an exclusion for residential treatment, which the plan defines as an inpatient benefit, for mental health and substance use disorder benefits. This exclusion was not generated through any broader nonquantitative treatment limitation (such as medical necessity or other clinical guideline). ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(L) ( Example 12 ), the plan violates the rules of paragraph (c)(4)(vi) of this section. Because the plan does not apply a comparable exclusion to inpatient benefits for medical/surgical conditions, the exclusion of residential treatment is a separate nonquantitative treatment limitation applicable only to mental health and substance use disorder benefits in the inpatient, in-network and inpatient, out-of-network classifications that does not apply with respect to any medical/surgical benefits in the same benefit classification. (M) Example 13 (Standards for provider admission to a network) —( 1 ) Facts . A plan applies nonquantitative treatment limitations related to network composition in the outpatient in-network and inpatient, in-network classifications. The plan’s networks are constructed by separate service providers for medical/surgical benefits and mental health and substance use disorder benefits. For purposes of this example, these facts assume that these nonquantitative treatment limitations related to network composition for mental health and substance use disorder benefits are not more restrictive than the predominant nonquantitative treatment limitations applied to substantially all medical/surgical benefits in the classifications under paragraph (c)(4)(i) of this section. The facts also assume that, as written and in operation, the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitations related to network access to mental health or substance use disorder benefits in the outpatient in-network and inpatient in-network classifications are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitations with respect to medical/surgical benefits in the classifications, as required under paragraph (c)(4)(ii) of this section. The plan collects and evaluates all relevant data in a manner reasonably designed to assess the impact of the nonquantitative treatment limitations related to network composition on access to mental health and substance use disorder benefits as compared with access to medical/surgical benefits and considers the impact as part of the plan’s analysis of whether the standards, in operation, comply with paragraphs (c)(4)(i) and (ii) of this section. The plan determined that the data did not reveal any material differences in access. That data included metrics relating to the time and distance from plan participants and beneficiaries to network providers in rural and urban regions; the number of network providers accepting new patients; the proportions of mental health and substance use disorder and medical/surgical providers and facilities that provide services in rural and urban regions who are in the plan’s network; provider reimbursement rates; in-network and out-of-network utilization rates (including data related to the dollar value and number of provider claims submissions); and survey data from participants on the extent to which they forgo or pay out-of-pocket for treatment because of challenges finding in-network providers. The efforts the plan made when designing and applying its nonquantitative treatment limitations related to network composition, which ultimately led to its outcomes data not revealing any material differences in access to benefits for mental health or substance use disorders as compared with medical/surgical benefits, included making sure that the plan’s service providers are making special efforts to enroll available providers, including by authorizing greater compensation or other inducements to the extent necessary, and expanding telehealth arrangements as appropriate to manage regional shortages. The plan also notifies participants in clear and prominent language on its website, employee brochures, and the summary plan description of a toll-free number available to help participants find in-network providers. In addition, when plan participants submit bills for out-of-network items and services, the plan directs their service providers to |
932 | employee brochures, and the summary plan description of a toll-free number available to help participants find in-network providers. In addition, when plan participants submit bills for out-of-network items and services, the plan directs their service providers to reach out to the treating providers and facilities to see if they will enroll in the network. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(M) ( Example 13 ), the plan does not violate this paragraph (c)(4). As stated in the Facts section, the plan’s nonquantitative treatment limitations related to network composition comply with the rules of paragraphs (c)(4)(i) and (ii) of this section. The plan collects and evaluates relevant data, as required under paragraph (c)(4)(iv)(A) of this section, and the data does not reveal any material differences in access to mental health and substance use disorder benefits as compared to medical/surgical benefits, as a result of the actions the plan took (as set forth in the facts) when initially designing its nonquantitative treatment limitations related to network composition. Because the plan takes comparable actions to ensure that their mental health and substance use disorder provider network is as accessible as their medical/surgical provider network and exercises careful oversight over both their service providers and the comparative robustness of the networks with an eye to ensuring that network composition results in access to in-network benefits for mental health and substance use disorder services that is as generous as for medical/surgical services, plan participants and beneficiaries can access covered mental health and substance use disorder services and benefits as readily as medical/surgical benefits. This is reflected in the plan’s carefully designed metrics and assessment of network composition. * * * * * (d) * * * (3) Provisions of other law . Compliance with the disclosure requirements in paragraphs (d)(1) and (2) of this section is not determinative of compliance with any other provision of applicable Federal or State law. In particular, in addition to those disclosure requirements, provisions of other applicable law require disclosure of information relevant to medical/surgical, mental health, and substance use disorder benefits. For example, ERISA section 104 and 29 CFR 2520.104b-1 provide that, for plans subject to ERISA, instruments under which the plan is established or operated must generally be furnished to plan participants within 30 days of request. Instruments under which the plan is established or operated include documents with information on medical necessity criteria for both medical/surgical benefits and mental health and substance use disorder benefits; the processes, strategies, evidentiary standards, and other factors used to apply a nonquantitative treatment limitation with respect to medical/surgical benefits and mental health or substance use disorder benefits under the plan; and the comparative analyses and other applicable information required by § 54.9812-2. In addition, 29 CFR 2560.503-1 and § 54.9815-2719T set forth rules regarding claims and appeals, including the right of claimants (or their authorized representative) upon appeal of an adverse benefit determination (or a final internal adverse benefit determination) to be provided upon request and free of charge, reasonable access to and copies of all documents, records, and other information relevant to the claimant’s claim for benefits. This includes documents with information on medical necessity criteria for both medical/surgical benefits and mental health and substance use disorder benefits, as well as the processes, strategies, evidentiary standards, and other factors used to apply a nonquantitative treatment limitation with respect to medical/surgical benefits and mental health or substance use disorder benefits under the plan and the comparative analyses and other applicable information required by § 54.9812-2. (e) * * * (4) Coordination with EHB requirements . Nothing in paragraph (f) or (g) of this section or § 54.9812-2(g) changes the requirements of 45 CFR 147.150 and 156.115, providing that a health insurance issuer offering non-grandfathered health insurance coverage in the individual or small group market providing mental health and substance use disorder services, including behavioral health treatment services, as part of essential health benefits required under 45 CFR 156.110(a)(5) and 156.115(a), must comply with the requirements under section 2726 of the Public Health Service Act and its implementing regulations to satisfy the |
933 | treatment services, as part of essential health benefits required under 45 CFR 156.110(a)(5) and 156.115(a), must comply with the requirements under section 2726 of the Public Health Service Act and its implementing regulations to satisfy the requirement to provide coverage for mental health and substance use disorder services, including behavioral health treatment, as part of essential health benefits. * * * * * (i) * * * (1) In general . Except as provided in paragraph (i)(2) of this section, this section applies to group health plans on the first day of the first plan year beginning on or after January 1, 2025. Until the applicability date in the preceding sentence, plans are required to continue to comply with 26 CFR 54.9812-1, revised as of April 1, 2023. * * * * * (j) Severability . If any provision of this section is held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, or stayed pending further agency action, the provision shall be construed so as to continue to give the maximum effect to the provision permitted by law, unless such holding shall be one of invalidity or unenforceability, in which event the provision shall be severable from this section and shall not affect the remainder thereof or the application of the provision to persons not similarly situated or to dissimilar circumstances. 3. Add § 54.9812-2 to read as follows: § 54.9812-2 Nonquantitative treatment limitation comparative analysis requirements. (a) Meaning of terms . Unless otherwise stated in this section, the terms of this section have the meanings indicated in § 54.9812-1(a)(2). (b) In general . In the case of a group health plan that provides both medical/surgical benefits and mental health or substance use disorder benefits and that imposes any nonquantitative treatment limitation on mental health or substance use disorder benefits, the plan must perform and document a comparative analysis of the design and application of each nonquantitative treatment limitation applicable to mental health or substance use disorder benefits. Each comparative analysis must comply with the content requirements of paragraph (c) of this section and be made available to the Secretary, upon request, in the manner required by paragraphs (d) and (e) of this section. (c) Comparative analysis content requirements . With respect to each nonquantitative treatment limitation applicable to mental health or substance use disorder benefits under a group health plan, the comparative analysis performed by the plan must include, at minimum, the elements specified in this paragraph (c). In addition to the comparative analysis for each nonquantitative treatment limitation, each plan must prepare and make available to the Secretary, upon request, a written list of all nonquantitative treatment limitations imposed under the plan and a general description of any information considered or relied upon by the plan in preparing the comparative analysis for each nonquantitative treatment limitation. (1) Description of the nonquantitative treatment limitation . The comparative analysis must include, with respect to the nonquantitative treatment limitation that is the subject of the comparative analysis: (i) Identification of the nonquantitative treatment limitation, including the specific terms of the plan or other relevant terms regarding the nonquantitative treatment limitation, the policies or guidelines (internal or external) in which the nonquantitative treatment limitation appears or is described, and the applicable sections of any other relevant documents, such as provider contracts, that describe the nonquantitative treatment limitation; (ii) Identification of all mental health or substance use disorder benefits and medical/surgical benefits to which the nonquantitative treatment limitation applies, including a list of which benefits are considered mental health or substance use disorder benefits and which benefits are considered medical/surgical benefits; (iii) A description of which benefits are included in each classification set forth in § 54.9812-1(c)(2)(ii)(A); and (iv) Identification of the predominant nonquantitative treatment limitation applicable to substantially all medical/surgical benefits in each classification, including an explanation of how the plan determined which variation is the predominant nonquantitative treatment limitation as compared to other variations, as well as how the plan identified the variations of the nonquantitative treatment limitation. (2) Identification and definition of the factors used to design or apply the nonquantitative treatment limitation . The comparative analysis must include, with respect to every factor |
934 | , as well as how the plan identified the variations of the nonquantitative treatment limitation. (2) Identification and definition of the factors used to design or apply the nonquantitative treatment limitation . The comparative analysis must include, with respect to every factor considered or relied upon to design the nonquantitative treatment limitation or apply the nonquantitative treatment limitation to mental health or substance use disorder benefits and medical/surgical benefits: (i) Identification of all of the factors considered, as well as the evidentiary standards considered or relied upon to design or apply each factor and the sources from which each evidentiary standard was derived, in determining which mental health or substance use disorder benefits and which medical/surgical benefits are subject to the nonquantitative treatment limitation; and (ii) A definition of each factor, including: (A) A detailed description of the factor; and (B) A description of each evidentiary standard (and the source of each evidentiary standard) identified under paragraph (c)(2)(i) of this section. (3) Description of how factors are used in the design and application of the nonquantitative treatment limitation . The comparative analysis must include a description of how each factor identified and defined pursuant to paragraph (c)(2) of this section is used in the design or application of the nonquantitative treatment limitation to mental health and substance use disorder benefits and medical/surgical benefits in a classification, including: (i) A detailed explanation of how each factor identified and defined in paragraph (c)(2) of this section is used to determine which mental health or substance use disorder benefits and which medical/surgical benefits are subject to the nonquantitative treatment limitation; (ii) An explanation of the evidentiary standards or other information or sources (if any) considered or relied upon in designing or applying the factors or relied upon in designing and applying the nonquantitative treatment limitation, including in the determination of whether and how mental health or substance use disorder benefits or medical/surgical benefits are subject to the nonquantitative treatment limitation; (iii) If the application of the factor depends on specific decisions made in the administration of benefits, the nature of the decisions, the timing of the decisions, and the professional designation and qualifications of each decision maker; (iv) If more than one factor is identified and defined in paragraph (c)(2) of this section, an explanation of: (A) How all of the factors relate to each other; (B) The order in which all the factors are applied, including when they are applied; (C) Whether and how any factors are given more weight than others; and (D) The reasons for the ordering or weighting of the factors; and (v) Any deviation(s) or variation(s) from a factor, its applicability, or its definition (including the evidentiary standards used to define the factor and the information or sources from which each evidentiary standard was derived), such as how the factor is used differently to apply the nonquantitative treatment limitation to mental health or substance use disorder benefits as compared to medical/surgical benefits, and a description of how the plan establishes such deviation(s) or variation(s). (4) Demonstration of comparability and stringency as written . The comparative analysis must evaluate whether, in any classification, under the terms of the plan as written, any processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation with respect to medical/surgical benefits. The comparative analysis must include, with respect to the nonquantitative treatment limitation and the factors used in designing and applying the nonquantitative treatment limitation: (i) Documentation of each factor identified and defined in paragraph (c)(2) of this section that was applied to determine whether the nonquantitative treatment limitation applies to mental health or substance use disorder benefits and medical/surgical benefits in a classification, including, as relevant: (A) Quantitative data, calculations, or other analyses showing whether, in each classification in which the nonquantitative treatment limitation applies, mental health or substance use disorder benefits and medical/surgical benefits met or did not meet any applicable threshold identified in the relevant evident |
935 | itative data, calculations, or other analyses showing whether, in each classification in which the nonquantitative treatment limitation applies, mental health or substance use disorder benefits and medical/surgical benefits met or did not meet any applicable threshold identified in the relevant evidentiary standard, and the evaluation of relevant data as required under § 54.9812-1(c)(4)(iv)(A), to determine that the nonquantitative treatment limitation would or would not apply; and (B) Records maintained by the plan documenting the consideration and application of all factors and evidentiary standards, as well as the results of their application; (ii) In each classification in which the nonquantitative treatment limitation applies to mental health or substance use disorder benefits, a comparison of how the nonquantitative treatment limitation, as written, is applied to mental health or substance use disorder benefits and to medical/surgical benefits, including the specific provisions of any forms, checklists, procedure manuals, or other documentation used in designing and applying the nonquantitative treatment limitation or that address the application of the nonquantitative treatment limitation; (iii) Documentation demonstrating how the factors are comparably applied, as written, to mental health or substance use disorder benefits and medical/surgical benefits in each classification, to determine which benefits are subject to the nonquantitative treatment limitation; and (iv) An explanation of the reason(s) for any deviation(s) or variation(s) in the application of a factor used to apply the nonquantitative treatment limitation, or the application of the nonquantitative treatment limitation, to mental health or substance use disorder benefits as compared to medical/surgical benefits, and how the plan establishes such deviation(s) or variation(s), including: (A) In the definition of the factors, the evidentiary standards used to define the factors, and the sources from which the evidentiary standards were derived; (B) In the design of the factors or evidentiary standards; or (C) In the application or design of the nonquantitative treatment limitation. (5) Demonstration of comparability and stringency in operation . The comparative analysis must evaluate whether, in any classification, under the terms of the plan in operation, the processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in designing and applying the limitation with respect to medical/surgical benefits. The comparative analysis must include, with respect to the nonquantitative treatment limitation and the factors used in designing and applying the nonquantitative treatment limitation: (i) A comprehensive explanation of how the plan ensures that, in operation, the processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits in a classification are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation with respect to medical/surgical benefits, including: (A) An explanation of any methodology and underlying data used to demonstrate the application of the nonquantitative treatment limitation, in operation; and (B) The sample period, inputs used in any calculations, definitions of terms used, and any criteria used to select the mental health or substance use disorder benefits and medical/surgical benefits to which the nonquantitative treatment limitation is applicable; (ii) Identification of the relevant data collected and evaluated as required under § 54.9812-1(c)(4)(iv)(A); (iii) An evaluation of the outcomes that resulted from the application of the nonquantitative treatment limitation to mental health or substance use disorder benefits and medical/surgical benefits, including the relevant data as required under § 54.9812-1(c)(4)(iv)(A); (iv) A detailed explanation of material differences in outcomes evaluated pursuant to paragraph (c)(5)(iii) of this section that are not attributable to differences in the comparability or relative stringency of the nonquantitative treatment limitation as applied to mental health or substance use disorder benefits and medical/surgical benefits and the bases for concluding that material differences in outcomes are not attributable to differences in the comparability or relative stringency of |
936 | relative stringency of the nonquantitative treatment limitation as applied to mental health or substance use disorder benefits and medical/surgical benefits and the bases for concluding that material differences in outcomes are not attributable to differences in the comparability or relative stringency of the nonquantitative treatment limitation; and (v) A discussion of any measures that have been or are being implemented by the plan to mitigate any material differences in access to mental health or substance use disorder benefits as compared to medical/surgical benefits, including the actions the plan is taking under § 54.9812-1(c)(4)(iv)(B)( 1 ) to address material differences to ensure compliance with § 54.9812-1(c)(4)(i) and (ii). (6) Findings and conclusions . The comparative analysis must address the findings and conclusions as to the comparability of the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits and medical/surgical benefits within each classification, and the relative stringency of their application, both as written and in operation, and include: (i) Any findings or conclusions indicating that the plan is not (or might not be) in compliance with the requirements of § 54.9812-1(c)(4), including any actions the plan has taken or intends to take to address any potential areas of concern or noncompliance; (ii) A reasoned and detailed discussion of the findings and conclusions described in paragraph (c)(6)(i) of this section; (iii) Citations to any additional specific information not otherwise included in the comparative analysis that supports the findings and conclusions described in paragraph (c)(6)(i) of this section; (iv) The date of the analysis and the title and credentials of all relevant persons who participated in the performance and documentation of the comparative analysis; and (v) If the comparative analysis relies upon an evaluation by a reviewer or consultant considered by the plan to be an expert, an assessment of each expert’s qualifications and the extent to which the plan ultimately relied upon each expert’s evaluation in performing and documenting the comparative analysis of the design and application of each nonquantitative treatment limitation applicable to both mental health or substance use disorder benefits and medical/surgical benefits. (d) Requirements related to submission of comparative analyses to the Secretary upon request —(1) Initial request by the Secretary for comparative analysis . A group health plan must make the comparative analysis required by paragraph (b) of this section available and submit it to the Secretary within 10 business days of receipt of a request from the Secretary (or an additional period of time specified by the Secretary). (2) Additional information required after a comparative analysis is deemed to be insufficient . In instances in which the Secretary determines that the plan has not submitted sufficient information under paragraph (d)(1) of this section for the Secretary to review the comparative analysis required in paragraph (b) of this section, the Secretary will specify to the plan the additional information the plan must submit to the Secretary to be responsive to the request under paragraph (d)(1) of this section. Any such information must be provided to the Secretary by the plan within 10 business days after the Secretary specifies the additional information to be submitted (or an additional period of time specified by the Secretary). (3) Initial determination of noncompliance, required action, and corrective action plan . In instances in which the Secretary reviewed the comparative analysis submitted under paragraph (d)(1) of this section and any additional information submitted under paragraph (d)(2) of this section, and made an initial determination that the plan is not in compliance with the requirements of § 54.9812-1(c)(4) or this section, the plan must respond to the Secretary and specify the actions the plan will take to bring the plan into compliance, and provide to the Secretary additional comparative analyses meeting the requirements of paragraph (b) of this section that demonstrate compliance with § 54.9812-1(c)(4) and this section, not later than 45 calendar days after the Secretary’s initial determination that the plan is not in compliance. (4) Requirement to notify participants and beneficiaries of final determination of noncompliance —(i) In general . If the Secretary makes a final determination of noncompliance, the plan must notify all participants and beneficiaries enrolled in the plan that the plan |
937 | . (4) Requirement to notify participants and beneficiaries of final determination of noncompliance —(i) In general . If the Secretary makes a final determination of noncompliance, the plan must notify all participants and beneficiaries enrolled in the plan that the plan has been determined to not be in compliance with the requirements of § 54.9812-1(c)(4) or this section with respect to such plan. Such notice must be provided within 7 calendar days of receipt of the final determination of noncompliance, and the plan must provide a copy of the notice to the Secretary, and any service provider involved in the claims process. (ii) Content of notice . The notice to participants and beneficiaries required in paragraph (d)(4)(i) of this section shall be written in a manner calculated to be understood by the average plan participant and must include, in plain language, the following information in a standalone notice: (A) The following statement prominently displayed on the first page, in no less than 14-point font: “Attention! Department of the Treasury has determined that [insert the name of group health plan] is not in compliance with the Mental Health Parity and Addiction Equity Act.”; (B) A summary of changes the plan has made as part of its corrective action plan specified to the Secretary following the initial determination of noncompliance, including an explanation of any opportunity for a participant or beneficiary to have a claim for benefits reprocessed; (C) A summary of the Secretary’s final determination that the plan is not in compliance with § 54.9812-1(c)(4) or this section, including any provisions or practices identified as being in violation of MHPAEA, additional corrective actions identified by the Secretary in the final determination notice, and information on how participants and beneficiaries can obtain from the plan a copy of the final determination of noncompliance; (D) Any additional actions the plan is taking to come into compliance with § 54.9812-1(c)(4) or this section, when the plan will take such actions, and a clear and accurate statement explaining whether the Secretary has indicated that those actions, if completed, will result in compliance; and (E) Contact information for questions and complaints, and a statement explaining how participants and beneficiaries can obtain more information about the notice, including: ( 1 ) The plan’s phone number and an email or web portal address; and ( 2 ) The Employee Benefits Security Administration’s phone number and email or web portal address. (iii) Manner of notice . The plan must make the notice required under paragraph (d)(4)(i) of this section available in paper form, or electronically (such as by email or an Internet posting) if: (A) The format is readily accessible; (B) The notice is provided in paper form free of charge upon request; and (C) In a case in which the electronic form is an internet posting, the plan timely notifies the participant or beneficiary in paper form (such as a postcard) or email, that the documents are available on the internet, provides the internet address, includes the statement required in paragraph (d)(4)(ii)(A) of this section, and notifies the participant or beneficiary that the documents are available in paper form upon request. (e) Requests for a copy of a comparative analysis . In addition to making a comparative analysis available upon request to the Secretary, a plan must make available a copy of the comparative analysis required by paragraph (b) of this section when requested by: (1) Any applicable State authority; and (2) A participant or beneficiary (or a provider or other person acting as a participant’s or beneficiary’s authorized representative) who has received an adverse benefit determination related to mental health or substance use disorder benefits. (f) Rule of construction . Nothing in this section or § 54.9812-1 shall be construed to prevent the Secretary from acting within the scope of existing authorities to address violations of § 54.9812-1 or this section. (g) Applicability. The provisions of this section apply to group health plans described in § 54.9812-1(e), to the extent the plan is not exempt under § 54.9812-1(f) or (g), for plan years beginning on or after January 1, 2025. (h) Severability . If any |
938 | 9812-1(e), to the extent the plan is not exempt under § 54.9812-1(f) or (g), for plan years beginning on or after January 1, 2025. (h) Severability . If any provision of this section is held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, or stayed pending further agency action, the provision shall be construed so as to continue to give the maximum effect to the provision permitted by law, unless such holding shall be one of invalidity or unenforceability, in which event the provision shall be severable from this section and shall not affect the remainder thereof or the application of the provision to persons not similarly situated or to dissimilar circumstances. DEPARTMENT OF LABOR Employee Benefits Security Administration 29 CFR Chapter XXV For the reasons set forth in the preamble, the Department of Labor proposes to amend 29 CFR part 2590 as set forth below: PART 2590—RULES AND REGULATIONS FOR GROUP HEALTH PLANS 4. The authority citation for part 2590 continues to read as follows: Authority: 29 U.S.C. 1027, 1059, 1135, 1161-1168, 1169, 1181-1183, 1181 note, 1185, 1185a-n, 1191, 1191a, 1191b, and 1191c; sec. 101(g), Pub. L.104-191, 110 Stat. 1936; sec. 401(b), Pub. L. 105-200, 112 Stat. 645 (42 U.S.C. 651 note); sec. 512(d), Pub. L. 110-343, 122 Stat. 3881; sec. 1001, 1201, and 1562(e), Pub. L. 111-148, 124 Stat. 119, as amended by Pub. L. 111-152, 124 Stat. 1029; Division M, Pub. L. 113-235, 128 Stat. 2130; Pub. L. 116-260 134 Stat. 1182; Secretary of Labor’s Order 1-2011, 77 FR 1088 (Jan. 9, 2012). 5. Amend § 2590.712 by: a. Redesignating paragraph (a) as paragraph (a)(2) and adding paragraphs (a) heading and (a)(1); b. In newly redesignated paragraph (a)(2): i. Revising the introductory text; ii. Adding the definitions of “DSM,” “Evidentiary standards,” “Factors,” and “ICD” in alphabetical order; iii. Revising the definitions of “Medical/surgical benefits” and “Mental health benefits”; iv. Adding the definitions of “Processes” and “Strategies” in alphabetical order; and v. Revising the definitions of “Substance use disorder benefits” and “Treatment limitations”; c. Revising paragraphs (c)(1)(ii), (c)(2)(i), and (c)(2)(ii)(A) introductory text; d. In paragraph (c)(2)(ii)(C), designating Examples 1 through 4 as paragraphs (c)(2)(ii)(C)( 1 ) through ( 4 ) and revising newly designated paragraphs (c)(2)(ii)(C)( 1 ) through ( 4 ); e. Adding paragraphs (c)(2)(ii)(C)( 5 ) and ( 6 ); f. Revising paragraphs (c)(3)(i)(A), (C), and (D); g. In paragraph (c)(3)(iii), adding introductory text; h. Revising paragraphs (c)(3)(iii)(A) and (B), (c)(3)(iv), (c)(4), (d)(3), (e)(4), and (i)(1); and i. Adding paragraph (j). The revisions and additions read as follows: § 2590.712 Parity in mental health and substance use disorder benefits (a) Purpose and meaning of terms —(1) Purpose . This section and § 2590.712-1 set forth rules to ensure parity in aggregate lifetime and annual dollar limits, financial requirements |
939 | Parity in mental health and substance use disorder benefits (a) Purpose and meaning of terms —(1) Purpose . This section and § 2590.712-1 set forth rules to ensure parity in aggregate lifetime and annual dollar limits, financial requirements, and quantitative and nonquantitative treatment limitations between mental health and substance use disorder benefits and medical/surgical benefits, as required under ERISA section 712. A fundamental purpose of ERISA section 712, this section, and § 2590.712-1 is to ensure that participants and beneficiaries in a group health plan (or health insurance coverage offered by an issuer in connection with a group health plan) that offers mental health or substance use disorder benefits are not subject to more restrictive lifetime or annual dollar limits, financial requirements, or treatment limitations with respect to those benefits than the predominant dollar limits, financial requirements, or treatment limitations that are applied to substantially all medical/surgical benefits covered by the plan or coverage, as further provided in this section and § 2590.712-1. Accordingly, in complying with the provisions of ERISA section 712, this section, and § 2590.712-1, 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 and substance use disorder benefits under the plan or coverage than they impose on access to generally comparable medical/surgical benefits. The provisions of ERISA section 712, this section, and § 2590.712-1 should be interpreted in a manner that is consistent with the purpose described in this paragraph (a)(1). (2) Meaning of terms . For purposes of this section and § 2590.712-1, except where the context clearly indicates otherwise, the following terms have the meanings indicated: * * * * * DSM means the American Psychiatric Association’s Diagnostic and Statistical Manual of Mental Disorders. For the purpose of this definition, the most current version of the DSM is the version that is applicable no earlier than on the date that is 1 year before the first day of the applicable plan year. Evidentiary standards are any evidence, sources, or standards that a group health plan (or health insurance issuer offering coverage in connection with such a plan) considered or relied upon in designing or applying a factor with respect to a nonquantitative treatment limitation, including specific benchmarks or thresholds. 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; 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. Factors are all information, including processes and strategies (but not evidentiary standards), that a group health plan (or health insurance issuer offering coverage in connection with such a plan) considered or relied upon to design a nonquantitative treatment limitation, or to determine whether or how the nonquantitative treatment limitation applies to benefits under the plan or coverage. Examples of factors include, but are not limited to: provider discretion in determining a 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. * * * * * ICD means the World Health Organization’s International Classification of Diseases adopted by the Department of Health and Human Services through 45 CFR 162.1002. For the purpose of this definition, the most current version of the ICD is the version that is applicable no earlier than on the date that is 1 year before the first day of the applicable plan year. Medical/surgical benefits means benefits with respect to items or services for medical conditions or surgical procedures, as defined under the terms of the group health plan (or health |
940 | on the date that is 1 year before the first day of the applicable plan year. Medical/surgical benefits means benefits with respect to items or services for medical conditions or surgical procedures, as defined under the terms of the group health plan (or health insurance coverage offered by an issuer in connection with such a plan) and in accordance with applicable Federal and State law, but does not include mental health benefits or substance use disorder benefits. Notwithstanding the preceding sentence, any condition or procedure defined by the plan or coverage as being or as 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). To the extent 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 in accordance with applicable Federal and State law. Mental health benefits means benefits with respect to items or services for mental health conditions, as defined under the terms of the group health plan (or health insurance coverage offered by an issuer in connection with such a plan) and in accordance with applicable Federal and State law, but does not include medical/surgical benefits or substance use disorder benefits. Notwithstanding the preceding sentence, any condition defined by the plan or coverage as being or as not being a mental health condition must be defined consistent with generally recognized independent standards of current medical practice. For the purpose of this definition, to be consistent with generally recognized independent standards of current medical practice, the 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 DSM. To the extent generally recognized independent standards of current medical practice do not address whether a condition is a mental health condition, plans and issuers may define the condition in accordance with applicable Federal and State law. Processes are actions, steps, or procedures that a group health plan (or health insurance issuer offering coverage in connection with such a plan) uses to apply a nonquantitative treatment limitation, 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. Processes include but are not limited to: procedures to submit information to authorize coverage for an item or service prior to receiving the benefit or while treatment is ongoing (including requirements for peer or expert clinical review of that information); provider referral requirements; and the development and approval of a treatment plan. Processes also 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 nonquantitative treatment limitations, such as how a panel of staff members applies the nonquantitative treatment limitation (including the qualifications of staff involved, number of staff members allocated, and time allocated), consultations with panels of experts in applying the nonquantitative treatment limitation, and reviewer discretion in adhering to criteria hierarchy when applying a nonquantitative treatment limitation. Strategies are practices, methods, or internal metrics that a plan (or health insurance issuer offering coverage in connection with such a plan) considers, reviews, or uses to design a nonquantitative treatment limitation. Examples of strategies include but are not limited to: the development of the clinical rationale used in approving or denying benefits; deviation from generally accepted standards of care; the selection of information 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. Strategies also include 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 nonquantitative treatment limitations, including the plan’s decisions related to the 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 nonquantitative treatment limitation; and the composition of the panels used to design a nonquantitative treatment limitation. Substance use disorder benefits means benefits |
941 | members allocated, and time allocated; breadth of sources and evidence considered; consultations with panels of experts in designing the nonquantitative treatment limitation; and the composition of the panels used to design a nonquantitative treatment limitation. Substance use disorder benefits means benefits with respect to items or services for substance use disorders, as defined under the terms of the group health plan (or health insurance coverage offered by an issuer in connection with such a plan) and in accordance with applicable Federal and State law, but does not include medical/surgical benefits or mental health benefits. Notwithstanding the preceding sentence, any disorder defined by the plan or coverage as being or as not being a substance use disorder must be defined consistent with generally recognized independent standards of current medical practice. For the purpose of this definition, to be consistent with generally recognized independent standards of current medical practice, the definition 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. To the extent generally recognized independent standards of current medical practice do not address whether a disorder is a substance use disorder, plans and issuers may define the disorder in accordance with applicable Federal and State law. Treatment limitations include limits on benefits based on the frequency of treatment, number of visits, days of coverage, days in a waiting period, or other similar limits on the scope or duration of treatment. Treatment limitations include both quantitative treatment limitations, which are expressed numerically (such as 50 outpatient visits per year), and nonquantitative treatment limitations, which otherwise limit the scope or duration of benefits for treatment under a plan or coverage. (See paragraph (c)(4)(iii) of this section for an illustrative, non-exhaustive list of nonquantitative treatment limitations.) A complete exclusion of all benefits for a particular condition or disorder, however, is not a treatment limitation for purposes of this definition. * * * * * (c) * * * (1) * * * (ii) Type of financial requirement or treatment limitation . When reference is made in this paragraph (c) to a type of financial requirement or treatment limitation, the reference to type means its nature. Different types of financial requirements include deductibles, copayments, coinsurance, and out-of-pocket maximums. Different types of quantitative treatment limitations include annual, episode, and lifetime day and visit limits. See paragraph (c)(4)(iii) of this section for an illustrative, non-exhaustive list of nonquantitative treatment limitations. * * * * * (2) * * * (i) General rule . A group health plan (or health insurance coverage offered by an issuer in connection with a group health plan) that provides both medical/surgical benefits and mental health or substance use disorder benefits may not apply any financial requirement or treatment limitation to mental health or substance use disorder benefits in any classification that is more restrictive than the predominant financial requirement or treatment limitation of that type applied to substantially all medical/surgical benefits in the same classification. Whether a financial requirement or treatment limitation is a predominant financial requirement or treatment limitation that applies to substantially all medical/surgical benefits in a classification is determined separately for each type of financial requirement or treatment limitation. A plan or issuer may not impose any financial requirement or treatment limitation that is applicable only with respect to mental health or substance use disorder benefits and not to any medical/surgical benefits in the same benefit classification. The application of the rules of this paragraph (c)(2) to financial requirements and quantitative treatment limitations is addressed in paragraph (c)(3) of this section; the application of the rules of this paragraph (c)(2) to nonquantitative treatment limitations is addressed in paragraph (c)(4) of this section. (ii) * * * (A) In general . If a plan (or health insurance coverage) provides any benefits for a mental health condition or substance use disorder in any classification of benefits described in this paragraph (c)(2)(ii), benefits for that mental health condition or substance use disorder must be provided in every classification in which medical/surgical benefits are provided. For purposes of this paragraph |
942 | substance use disorder in any classification of benefits described in this paragraph (c)(2)(ii), benefits for that mental health condition or substance use disorder must be provided in every classification in which medical/surgical benefits are provided. For purposes of this paragraph (c)(2)(ii), a plan (or health insurance coverage) providing any benefits for a mental health condition or substance use disorder in any classification of benefits does not provide benefits for the mental health condition or substance use disorder in every classification in which medical/surgical benefits are provided unless the plan (or health insurance coverage) provides meaningful benefits for treatment for that condition or disorder in each such classification, as determined in comparison to the benefits provided for medical/surgical conditions in the classification. In determining the classification in which a particular benefit belongs, a plan (or health insurance issuer) must apply the same standards to medical/surgical benefits and to mental health or substance use disorder benefits. To the extent that a plan (or health insurance coverage) provides benefits in a classification and imposes any separate financial requirement or treatment limitation (or separate level of a financial requirement or treatment limitation) for benefits in the classification, the rules of this paragraph (c) apply separately with respect to that classification for all financial requirements or treatment limitations (illustrated in examples in paragraph (c)(2)(ii)(C) of this section). The following classifications of benefits are the only classifications used in applying the rules of this paragraph (c), in addition to the permissible sub-classifications described in paragraph (c)(3)(iii) of this section: * * * * * (C) * * * ( 1 ) Example 1 —( i ) Facts . A group health plan offers inpatient and outpatient benefits and does not contract with a network of providers. The plan imposes a $500 deductible on all benefits. For inpatient medical/surgical benefits, the plan imposes a coinsurance requirement. For outpatient medical/surgical benefits, the plan imposes copayments. The plan imposes no other financial requirements or treatment limitations. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 1 ) ( Example 1 ), because the plan has no network of providers, all benefits provided are out-of-network. Because inpatient, out-of-network medical/surgical benefits are subject to separate financial requirements from outpatient, out-of-network medical/surgical benefits, the rules of this paragraph (c) apply separately with respect to any financial requirements and treatment limitations, including the deductible, in each classification. ( 2 ) Example 2 —( i ) Facts . A plan imposes a $500 deductible on all benefits. The plan has no network of providers. The plan generally imposes a 20 percent coinsurance requirement with respect to all benefits, without distinguishing among inpatient, outpatient, emergency care, or prescription drug benefits. The plan imposes no other financial requirements or treatment limitations. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 2 ) ( Example 2 ), because the plan does not impose separate financial requirements (or treatment limitations) based on classification, the rules of this paragraph (c) apply with respect to the deductible and the coinsurance across all benefits. ( 3 ) Example 3 —( i ) Facts . Same facts as in paragraph (c)(2)(ii)(C)( 2 )( i ) of this section ( Example 2 ), except the plan exempts emergency care benefits from the 20 percent coinsurance requirement. The plan imposes no other financial requirements or treatment limitations. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 3 ) ( Example 3 ), because the plan imposes separate financial requirements based on classifications, the rules of this paragraph (c) apply with respect to the deductible and the coinsurance separately for benefits in the emergency care classification and all other benefits. ( 4 ) Example 4 —( i ) Facts . Same facts as in paragraph (c)(2)(ii)(C)( 2 )( i ) of this section ( Example 2 ), except the plan also imposes a preauthorization requirement for all inpatient treatment in order for benefits to be paid. No such requirement applies to outpatient treatment. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 4 ) ( Example 4 ), because the plan has no network of providers, all benefits provided are out-of-network. Because the plan |
943 | applies to outpatient treatment. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 4 ) ( Example 4 ), because the plan has no network of providers, all benefits provided are out-of-network. Because the plan imposes a separate treatment limitation based on classifications, the rules of this paragraph (c) apply with respect to the deductible and coinsurance separately for inpatient, out-of-network benefits and all other benefits. ( 5 ) Example 5 —( i ) Facts . A plan generally covers treatment for autism spectrum disorder (ASD), a mental health condition, and covers outpatient, out-of-network developmental evaluations for ASD but excludes all other benefits for outpatient treatment for ASD, including applied behavioral analysis (ABA) therapy, when provided on an out-of-network basis. The plan generally covers the full range of outpatient treatments and treatment settings for medical conditions and surgical procedures when provided on an out-of-network basis. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 5 ) ( Example 5 ), the plan violates the rules of this paragraph (c)(2)(ii). Because the plan only covers one type of benefit for ASD in the outpatient, out-of-network classification and excludes all other benefits for ASD in the classification, but generally covers the full range of medical/surgical benefits in the classification, it fails to provide meaningful benefits for treatment of ASD in the classification. ( 6 ) Example 6 —( i ) Facts . A plan generally covers diagnosis and treatment for eating disorders, a mental health condition, but specifically excludes coverage for nutrition counseling to treat eating disorders, including in the outpatient, in-network classification. Nutrition counseling is one of the primary treatments for eating disorders. The plan generally provides benefits for the primary treatments for medical/surgical conditions in the outpatient, in-network classification. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 6 ) ( Example 6 ), the plan violates the rules of this paragraph (c)(2)(ii). The exclusion of coverage for nutrition counseling for eating disorders results in the plan failing to provide meaningful benefits for the treatment of eating disorders in the outpatient, in-network classification, as determined in comparison to the benefits provided for medical/surgical conditions in the classification. (3) * * * (i) * * * (A) Substantially all . For purposes of this paragraph (c)(3), a type of financial requirement or quantitative treatment limitation is considered to apply to substantially all medical/surgical benefits in a classification of benefits if it applies to at least two-thirds of all medical/surgical benefits in that classification. (For purposes of this paragraph (c)(3)(i)(A), benefits expressed as subject to a zero level of a type of financial requirement are treated as benefits not subject to that type of financial requirement, and benefits expressed as subject to a quantitative treatment limitation that is unlimited are treated as benefits not subject to that type of quantitative treatment limitation.) If a type of financial requirement or quantitative treatment limitation does not apply to at least two-thirds of all medical/surgical benefits in a classification, then that type cannot be applied to mental health or substance use disorder benefits in that classification. * * * * * (C) Portion based on plan payments . For purposes of this paragraph (c)(3), the determination of the portion of medical/surgical benefits in a classification of benefits subject to a financial requirement or quantitative treatment limitation (or subject to any level of a financial requirement or quantitative treatment limitation) is 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 (or for the portion of the plan year after a change in plan benefits that affects the applicability of the financial requirement or quantitative treatment limitation). (D) Clarifications for certain threshold requirements . For any deductible, the dollar amount of plan payments includes all plan payments with respect to claims that would be subject to the deductible if it had not been satisfied. For any out-of-pocket maximum, the dollar amount of plan payments includes all plan payments associated with out-of-pocket payments that are taken into account towards the out-of-pocket maximum as well as all plan payments associated with out-of-pocket payments that would have been made towards the out-of-pocket maximum if it |
944 | associated with out-of-pocket payments that are taken into account towards the out-of-pocket maximum as well as all plan payments associated with out-of-pocket payments that would have been made towards the out-of-pocket maximum if it had not been satisfied. Similar rules apply for any other thresholds at which the rate of plan payment changes. (See also PHS Act section 2707 and Affordable Care Act section 1302(c), which establish annual limitations on out-of-pocket maximums for all non-grandfathered health plans.) * * * * * (iii) Special rules . Unless specifically permitted under this paragraph (c)(3)(iii), sub-classifications are not permitted when applying the rules of paragraph (c)(3) of this section. (A) Multi-tiered prescription drug benefits . If a plan (or health insurance coverage) applies different levels of financial requirements to different tiers of prescription drug benefits based on reasonable factors determined in accordance with the rules in paragraph (c)(4) of this section (relating to requirements for nonquantitative treatment limitations) and without regard to whether a drug is generally prescribed with respect to medical/surgical benefits or with respect to mental health or substance use disorder benefits, the plan (or health insurance coverage) satisfies the parity requirements of this paragraph (c) with respect to prescription drug benefits. Reasonable factors include cost, efficacy, generic versus brand name, and mail order versus pharmacy pick-up. (B) Multiple network tiers . If a plan (or health insurance coverage) provides benefits through multiple tiers of in-network providers (such as an in-network tier of preferred providers with more generous cost-sharing to participants than a separate in-network tier of participating providers), the plan may divide its benefits furnished on an in-network basis into sub-classifications that reflect network tiers, if the tiering is based on reasonable factors determined in accordance with the rules in paragraph (c)(4) of this section (such as quality, performance, and market standards) and without regard to whether a provider provides services with respect to medical/surgical benefits or mental health or substance use disorder benefits. After the sub-classifications are established, the plan or issuer may not impose any financial requirement or treatment limitation on mental health or substance use disorder benefits in any sub-classification that is more restrictive than the predominant financial requirement or treatment limitation that applies to substantially all medical/surgical benefits in the sub-classification using the methodology set forth in paragraph (c)(3)(i) of this section. * * * * * (iv) Examples . The rules of paragraphs (c)(3)(i) through (iii) of this section are illustrated by the following examples. In each example, the group health plan is subject to the requirements of this section and provides both medical/surgical benefits and mental health and substance use disorder benefits. (A) Example 1 —( 1 ) Facts . ( i ) For inpatient, out-of-network medical/surgical benefits, a group health plan imposes five levels of coinsurance. Using a reasonable method, the plan projects its payments for the upcoming year as follows: Table 1 to Paragraph (c)(3)(iv)(A)( 1 )( i ) Coinsurance rate 0 % 10% 15% 20% 30% Total Projected payments $200x $100x $450x $100x $150x $1,000x Percent of total plan costs 20% 10% 45% 10% 15% Percent subject to coinsurance level N/A 12.5% (100x/800x) 56.25% (450x/800x) 12.5% (100x/800x) 18.75% (150x/800x) ( ii ) The plan projects plan costs of $800x to be subject to coinsurance ($100x + $450x + $100x + $150x = $800x). Thus, 80 percent ($800x/$1,000x) of the benefits are projected to be subject to coinsurance, and 56.25 percent of the benefits subject to coinsurance are projected to be subject to the 15 percent coinsurance level. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(A) ( Example 1 ), the two-thirds threshold of the substantially all standard is met for coinsurance because 80 percent of |
945 | be subject to the 15 percent coinsurance level. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(A) ( Example 1 ), the two-thirds threshold of the substantially all standard is met for coinsurance because 80 percent of all inpatient, out-of-network medical/surgical benefits are subject to coinsurance. Moreover, the 15 percent coinsurance is the predominant level because it is applicable to more than one-half of inpatient, out-of-network medical/surgical benefits subject to the coinsurance requirement. The plan may not impose any level of coinsurance with respect to inpatient, out-of-network mental health or substance use disorder benefits that is more restrictive than the 15 percent level of coinsurance. (B) Example 2 —( 1 ) Facts . ( i ) For outpatient, in-network medical/surgical benefits, a plan imposes five different copayment levels. Using a reasonable method, the plan projects payments for the upcoming year as follows: Table 2 to Paragraph (c)(3)(iv)(B)( 1 )( i ) Copayment amount $0 $10 $15 $20 $50 Total Projected payments $200x $200x $200x $300x $100x $1,000x Percent of total plan costs 20% 20% 20% 30% 10% Percent subject to copayments N/A 25% (200x/800x) 25% (200x/800x) 37.5% (300x/800x) 12.5% (100x/800x) ( ii ) The plan projects plan costs of $800x to be subject to copayments ($200x + $200x +$300x + $100x = $800x). Thus, 80 percent ($800x/$1,000x) of the benefits are projected to be subject to a copayment. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(B) ( Example 2 ), the two-thirds threshold of the substantially all standard is met for copayments because 80 percent of all outpatient, in-network medical/surgical benefits are subject to a copayment. Moreover, there is no single level that applies to more than one-half of medical/surgical benefits in the classification subject to a copayment (for the $10 copayment, 25%; for the $15 copayment, 25%; for the $20 copayment, 37.5%; and for the $50 copayment, 12.5%). The plan can combine any levels of copayment, including the highest levels, to determine the predominant level that can be applied to mental health or substance use disorder benefits. If the plan combines the highest levels of copayment, the combined projected payments for the two highest copayment levels, the $50 copayment and the $20 copayment, are not more than one-half of the outpatient, in-network medical/surgical benefits subject to a copayment because they are exactly one-half ($300x + $100x = $400x; $400x/$800x = 50%). The combined projected payments for the three highest copayment levels – the $50 copayment, the $20 copayment, and the $15 copayment – are more than one-half of the outpatient, in-network medical/surgical benefits subject to the copayments ($100x + $300x + $200x = $600x; $600x/$800x = 75%). Thus, the plan may not impose any copayment on outpatient, in-network mental health or substance use disorder benefits that is more restrictive than the least restrictive copayment in the combination, the $15 copayment. (C) Example 3 —( 1 ) Facts . A plan imposes a $250 deductible on all medical/surgical benefits for self-only coverage and a $500 deductible on all medical/surgical benefits for family coverage. The plan has no network of providers. For all medical/surgical benefits, the plan imposes a coinsurance requirement. The plan imposes no other financial requirements or treatment limitations. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(C) ( Example 3 ), because the plan has no network of providers, all benefits are provided out |
946 | coinsurance requirement. The plan imposes no other financial requirements or treatment limitations. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(C) ( Example 3 ), because the plan has no network of providers, all benefits are provided out-of-network. Because self-only and family coverage are subject to different deductibles, whether the deductible applies to substantially all medical/surgical benefits is determined separately for self-only medical/surgical benefits and family medical/surgical benefits. Because the coinsurance is applied without regard to coverage units, the predominant coinsurance that applies to substantially all medical/surgical benefits is determined without regard to coverage units. (D) Example 4 —( 1 ) Facts . A plan applies the following financial requirements for prescription drug benefits. The requirements are applied without regard to whether a drug is generally prescribed with respect to medical/surgical benefits or with respect to mental health or substance use disorder benefits. Moreover, the process for certifying a particular drug as “generic”, “preferred brand name”, “non-preferred brand name”, or “specialty” complies with the rules of paragraph (c)(4) of this section (relating to requirements for nonquantitative treatment limitations). Table 3 to Paragraph (c)(3)(iv)(D)( 1 ) Tier 1 Tier 2 Tier 3 Tier 4 Tier description Generic drugs Preferred brand name drugs Non-preferred brand name drugs (which may have Tier 1 or Tier 2 alternatives) Specialty drugs Percent paid by plan 90% 80% 60% 50% ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(D) ( Example 4 ), the financial requirements that apply to prescription drug benefits are applied without regard to whether a drug is generally prescribed with respect to medical/surgical benefits or with respect to mental health or substance use disorder benefits; the process for certifying drugs in different tiers complies with paragraph (c)(4) of this section; and the bases for establishing different levels or types of financial requirements are reasonable. The financial requirements applied to prescription drug benefits do not violate the parity requirements of this paragraph (c)(3). (E) Example 5 —( 1 ) Facts . A plan has two-tiers of network of providers: a preferred provider tier and a participating provider tier. Providers are placed in either the preferred tier or participating tier based on reasonable factors determined in accordance with the rules in paragraph (c)(4) of this section, such as accreditation, quality and performance measures (including customer feedback), and relative reimbursement rates. Furthermore, provider tier placement is determined without regard to whether a provider specializes in the treatment of mental health conditions or substance use disorders, or medical/surgical conditions. The plan divides the in-network classifications into two sub-classifications (in-network/preferred and in-network/participating). The plan does not impose any financial requirement or treatment limitation on mental health or substance use disorder benefits in either of these sub-classifications that is more restrictive than the predominant financial requirement or treatment limitation that applies to substantially all medical/surgical benefits in each sub-classification. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(E) ( Example 5 ), the division of in-network benefits into sub-classifications that reflect the preferred and participating provider tiers does not violate the parity requirements of this paragraph (c)(3). (F) Example 6 —( 1 ) Facts . With respect to outpatient, in-network benefits, a plan imposes a $25 copayment for office visits and a 20 percent coinsurance requirement for outpatient surgery. The plan divides the outpatient, in-network classification into two sub-classifications (in-network office visits and all other outpatient, in-network items and services).The plan or issuer does not impose any financial requirement or quantitative treatment limitation on mental health or substance use disorder benefits in either of these sub-classifications that is more restrictive than the predominant financial requirement or quantitative treatment limitation that applies to substantially all medical/surgical benefits in each sub-classification. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(F) ( Example 6 ), the division of outpatient, in-network benefits into sub-classifications for office visits and all other outpatient, in-network items and services does not violate the parity requirements of |
947 | this paragraph (c)(3)(iv)(F) ( Example 6 ), the division of outpatient, in-network benefits into sub-classifications for office visits and all other outpatient, in-network items and services does not violate the parity requirements of this paragraph (c)(3). (G) Example 7 —( 1 ) Facts . Same facts as in paragraph (c)(3)(iv)(F)( 1 ) of this section ( Example 6 ), but for purposes of determining parity, the plan divides the outpatient, in-network classification into outpatient, in-network generalists and outpatient, in-network specialists. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(G) ( Example 7 ), the division of outpatient, in-network benefits into any sub-classifications other than office visits and all other outpatient items and services violates the requirements of paragraph (c)(3)(iii)(C) of this section. * * * * * (4) Nonquantitative treatment limitations . Subject to paragraph (c)(4)(v) of this section, a group health plan (or health insurance coverage offered by an issuer in connection with a group health plan) may not impose a nonquantitative treatment limitation with respect to mental health or substance use disorder benefits in a classification unless the plan’s or coverage’s imposition of the limitation meets the requirements of paragraphs (c)(4)(i), (ii), and (iv) of this section. If a group health plan (or health insurance coverage offered by an issuer in connection with a group health plan) fails to meet any of these requirements with respect to a nonquantitative treatment limitation, the limitation violates section 712(a)(3)(A)(ii) of ERISA and may not be imposed by the plan (or health insurance coverage). (i) Requirement that nonquantitative treatment limitations be no more restrictive for mental health benefits and substance use disorder benefits . A group health plan (or health insurance issuer offering coverage in connection with a group health plan) may not apply any nonquantitative treatment limitation 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 nonquantitative treatment limitation applied to substantially all medical/surgical benefits in the same classification. (A) Restrictive . For purposes of this paragraph (c)(4)(i), a nonquantitative treatment limitation is restrictive to the extent it imposes conditions, terms, or requirements that limit access to benefits under the terms of the plan or coverage. Conditions, terms, or requirements include, but are not 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 or coverage. (B) Substantially all . For purposes of this paragraph (c)(4)(i), a nonquantitative treatment limitation is considered to apply to substantially all medical/surgical benefits in a classification if it applies to at least two-thirds of all medical/surgical benefits in that classification, consistent with paragraph (c)(4)(i)(D) of this section. Whether the nonquantitative treatment limitation applies to at least two-thirds of all medical/surgical benefits is determined without regard to whether the nonquantitative treatment limitation was triggered based on a particular factor or evidentiary standard. If a nonquantitative treatment limitation does not apply to at least two-thirds of all medical/surgical benefits in a classification, then that limitation cannot be applied to mental health or substance use disorder benefits in that classification. (C) Predominant . For purposes of this paragraph (c)(4)(i), the term predominant means the most common or most frequent variation of the nonquantitative treatment limitation within a classification, determined in accordance with the method outlined in paragraph (c)(4)(i)(D) of this section, to the extent the plan or issuer imposes multiple variations of a nonquantitative treatment limitation within the classification. For example, multiple variations of inpatient concurrent review include review commencing 1 day, 3 days, or 7 days after admission, depending on the reason for the stay. (D) Portion based on plan payments . For purposes of paragraphs (c)(4)(i)(B) and (C) of this section, the determination of the portion of medical/surgical benefits in |
948 | on the reason for the stay. (D) Portion based on plan payments . For purposes of paragraphs (c)(4)(i)(B) and (C) of this section, the determination of the portion of medical/surgical benefits in a classification of benefits subject to a nonquantitative treatment limitation is 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 nonquantitative treatment limitation). Any reasonable method may be used to determine the dollar amount expected to be paid under a plan or coverage for medical/surgical benefits. (E) Exceptions for independent professional medical or clinical standards and standards to detect or prevent and prove fraud, waste, and abuse . Notwithstanding paragraphs (c)(4)(i)(A) through (D) of this section, a plan or issuer that applies a nonquantitative treatment limitation that impartially applies independent professional medical or clinical standards or applies standards to detect or prevent and prove fraud, waste, and abuse, as described in paragraph (c)(4)(v)(A) or (B) of this section, to mental health or substance use disorder benefits in any classification will not be considered to violate this paragraph (c)(4)(i) with respect to such nonquantitative treatment limitation. (ii) Additional requirements related to design and application of the nonquantitative treatment limitation —(A) In general . Consistent with paragraph (a)(1) of this section, a plan or issuer may not impose a nonquantitative treatment limitation 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 the nonquantitative treatment limitation to mental health or substance use disorder benefits in the classification are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in designing and applying the limitation with respect to medical/surgical benefits in the classification. (B) Prohibition on discriminatory factors and evidentiary standards . For purposes of determining comparability and stringency under paragraph (c)(4)(ii)(A) of this section, a plan or issuer may not rely upon any factor or evidentiary standard if the information, evidence, sources, or standards on which the factor or evidentiary standard is based discriminates against mental health or substance use disorder benefits as compared to medical/surgical benefits. For purposes of this paragraph (c)(4)(ii)(B): ( 1 ) Impartially applied generally recognized independent professional medical or clinical standards described in paragraph (c)(4)(v)(A) of this section are not considered to discriminate against mental health or substance use disorder benefits. ( 2 ) Standards reasonably designed to detect or prevent and prove fraud, waste, and abuse described in paragraph (c)(4)(v)(B) of this section are not considered to discriminate against mental health or substance use disorder benefits. ( 3 ) 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 including, but not limited to, the source of the information, the purpose or context of the information, and the content of the information. (iii) Illustrative, non-exhaustive list of nonquantitative treatment limitations . Nonquantitative treatment limitations include – (A) Medical management standards (such as prior authorization) limiting or excluding benefits based on medical necessity or medical appropriateness, or based on whether the treatment is experimental or investigative; (B) Formulary design for prescription drugs; (C) For plans with multiple network tiers (such as preferred providers and participating providers), network tier design; (D) 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; (E) Plan or issuer methods for determining out-of-network |
949 | 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; (E) Plan or issuer 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; (F) Refusal to pay for higher-cost therapies until it can be shown that a lower-cost therapy is not effective (also known as fail-first policies or step therapy protocols); (G) Exclusions based on failure to complete a course of treatment; and (H) Restrictions based on geographic location, facility type, provider specialty, and other criteria that limit the scope or duration of benefits for services provided under the plan or coverage. (iv) Required use of outcomes data —(A) In general . When designing and applying a nonquantitative treatment limitation, a plan or issuer must collect and evaluate relevant data in a manner reasonably designed to assess the impact of the nonquantitative treatment limitation 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 limitation, in operation, complies with paragraphs (c)(4)(i) and (ii) of this section. The Secretary, jointly with the Secretary of the Treasury and the Secretary of Health and Human Services, may specify in guidance the type, form, and manner of collection and evaluation for the data required under this paragraph (c)(4)(iv)(A). ( 1 ) For purposes of this paragraph (c)(4)(iv)(A), relevant data includes, but is not limited to, the number and percentage of claims denials and any other data relevant to the nonquantitative treatment limitation required by State law or private accreditation standards. ( 2 ) In addition to the relevant data set forth in paragraph (c)(4)(iv)(A)( 1 ) of this section, relevant data for nonquantitative treatment limitations related to network composition standards includes, but is not limited to, in-network and out-of-network utilization rates (including data related to provider claim submissions), network adequacy metrics (including time and distance data, and data on providers accepting new patients), and provider reimbursement rates (including as compared to billed charges). (B) Material differences . Subject to paragraph (c)(4)(iv)(C) of this section, to the extent the relevant data evaluated pursuant to paragraph (c)(4)(iv)(A) of this section show material differences in access to mental health and substance use disorder benefits as compared to medical/surgical benefits, the differences will be considered a strong indicator that the plan or issuer violates paragraph (c)(4)(i) or (ii) of this section. In such instances, the plan or issuer: ( 1 ) Must take reasonable action to address the material differences in access as necessary to ensure compliance, in operation, with paragraphs (c)(4)(i) and (ii) of this section; and ( 2 ) Must document the action that has been or is being taken by the plan or issuer to mitigate any material differences in access to mental health and substance use disorder benefits as compared to medical/surgical benefits, as required by § 2590.712-1(c)(5)(iv). (C) Special rule for nonquantitative treatment limitations related to network composition . Notwithstanding paragraph (c)(4)(iv)(B) of this section, when designing and applying one or more nonquantitative treatment limitation(s) related to network composition standards, a plan or issuer fails to meet the requirements of paragraphs (c)(4)(i) and (ii) of this section, in operation, if the relevant data show material differences in access to in-network mental health and substance use disorder benefits as compared to in-network medical/surgical benefits in a classification. (D) Exception for independent professional medical or clinical standards . A plan or issuer designing and applying a nonquantitative treatment limitation with respect to mental health or substance use disorder benefits in any classification that impartially applies independent professional medical or clinical standards, as described in paragraph (c)(4)(v)(A) of this section, is not required to comply with the requirements of this paragraph (c)(4)(iv) with respect to |
950 | classification that impartially applies independent professional medical or clinical standards, as described in paragraph (c)(4)(v)(A) of this section, is not required to comply with the requirements of this paragraph (c)(4)(iv) with respect to that classification. (v) Independent professional medical or clinical standards and standards to detect or prevent and prove fraud, waste, and abuse . (A) To qualify for the exceptions in paragraphs (c)(4)(i)(E), (c)(4)(ii)(B), and (c)(4)(iv)(D) of this section for independent professional medical or clinical standards, a nonquantitative treatment limitation must impartially apply generally recognized independent professional medical or clinical standards (consistent with generally accepted standards of care) to medical/surgical benefits and mental health or substance use disorder benefits, and may not deviate from those standards in any way, such as by imposing additional or different requirements. (B) To qualify for the exceptions in paragraphs (c)(4)(i)(E) and (c)(4)(ii)(B) of this section to detect or prevent and prove fraud, waste, and abuse, a nonquantitative treatment limitation must be reasonably designed to detect or prevent and prove fraud, waste, and abuse, based on indicia of fraud, waste, and abuse that have been reliably established through objective and unbiased data, and also be narrowly designed to minimize the negative impact on access to appropriate mental health and substance use disorder benefits. (vi) Prohibition on separate nonquantitative treatment limitations applicable only to mental health or substance use disorder benefits . Consistent with paragraph (c)(2)(i) of this section, a group health plan (or health insurance coverage offered by an issuer in connection with such a plan) may not apply any nonquantitative treatment limitation that is applicable only with respect to mental health or substance use disorder benefits and does not apply with respect to any medical/surgical benefits in the same benefit classification. (vii) Effect of final determination of noncompliance under § 2590.712-1 . If a group health plan (or health insurance issuer offering group health insurance coverage in connection with such a plan) receives a final determination from the Secretary that the plan or issuer is not in compliance with the requirements of § 2590.712-1 with respect to a nonquantitative treatment limitation, the nonquantitative treatment limitation violates this paragraph (c)(4) and the Secretary may direct the plan or issuer not to impose the nonquantitative treatment limitation, unless and until the plan or issuer demonstrates to the Secretary compliance with the requirements of this section or takes appropriate action to remedy the violation. (viii) Examples . The rules of this paragraph (c)(4) are illustrated by the following examples. In each example, the group health plan is subject to the requirements of this section and provides both medical/surgical benefits and mental health and substance use disorder benefits. Additionally, in examples that conclude that the plan or issuer violates one provision of this paragraph (c)(4), such examples do not necessarily imply compliance with other provisions of this paragraph (c)(4), as these examples do not analyze compliance with all other provisions of this paragraph (c)(4). (A) Example 1 (More restrictive prior authorization requirement in operation) —( 1 ) Facts . A plan requires prior authorization from the plan’s utilization reviewer that a treatment is medically necessary for all inpatient, in-network medical/surgical benefits and for all inpatient, in-network mental health and substance use disorder benefits. While inpatient, in-network benefits for medical/surgical conditions are approved for periods of 1, 3, and 7 days, after which a treatment plan must be submitted by the patient’s attending provider and approved by the plan, the approvals for 7 days are most common under this plan. For inpatient, in-network mental health and substance use disorder benefits, routine approval is most commonly given only for one day, after which a treatment plan must be submitted by the patient’s attending provider and approved by the plan. The difference in the duration of approvals is not the result of independent professional medical or clinical standards or standards to detect or prevent and prove fraud, waste, and abuse, but rather reflects the application of a heightened standard to the provision of the mental health and substance use disorder benefits in the relevant classification. ( 2 ) Conclusion . In this paragraph |
951 | standards or standards to detect or prevent and prove fraud, waste, and abuse, but rather reflects the application of a heightened standard to the provision of the mental health and substance use disorder benefits in the relevant classification. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(A) ( Example 1 ), the plan violates the rules of paragraph (c)(4)(i) of this section. Under the terms of the plan, prior authorization applies to at least two-thirds of all medical/surgical benefits in the relevant classification (inpatient, in-network), since it applies to all benefits in the relevant classification. Further, the most common or frequent variation of the nonquantitative treatment limitation applied to medical/surgical benefits in the relevant classification (the predominant nonquantitative treatment limitation) is the routine approval of inpatient, in-network benefits for 7 days before the patient’s attending provider must submit a treatment plan. However, the plan routinely approves inpatient, in-network benefits for mental health and substance use disorder conditions for only 1 day before the patient’s attending provider must submit a treatment plan (and, in doing so, does not impartially apply independent professional medical or clinical standards or apply standards to detect or prevent and prove fraud, waste, and abuse that qualify for the exceptions in paragraph (c)(4)(i)(E) of this section). In operation, therefore, the prior authorization requirement imposed on inpatient, in-network mental health and substance use disorder benefits is more restrictive than the predominant prior authorization requirement applicable to substantially all medical/surgical benefits in the inpatient, in-network classification because the practice of approving only 1 day of inpatient benefits limits access to the full range of treatment options available for a condition or disorder under the plan or coverage as compared to the routine 7-day approval that is given for inpatient, in-network medical/surgical benefits. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (B) Example 2 (More restrictive peer-to-peer concurrent review requirements in operation) —( 1 ) Facts . A plan follows a written process for the concurrent review of all medical/surgical benefits and mental health and substance use disorder benefits within the inpatient, in-network classification. Under the process, a first-level review is conducted in every instance in which concurrent review applies and an authorization request is approved by the first-level reviewer only if the clinical information submitted by the facility meets the plan’s criteria for a continued stay. If the first-level reviewer is unable to approve the authorization request because the clinical information submitted by the facility does not meet the plan’s criteria for a continued stay, it is sent to a second-level reviewer who will either approve or deny the request. While the written process only requires review by the second-level reviewer to either deny or approve the request, in operation, second-level reviewers for mental health and substance use disorder benefits conduct a peer-to-peer review with a provider (acting as the authorized representative of a participant or beneficiary) before coverage of the treatment is approved. The peer-to-peer review requirement is not the result of independent professional medical or clinical standards or standards to detect or prevent and prove fraud, waste, and abuse. The plan does not impose a peer-to-peer review, as written or in operation, as part of the second-level review for medical/surgical benefits. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(B) ( Example 2 ), the plan violates the rules of paragraph (c)(4)(i) of this section. The concurrent review nonquantitative treatment limitation applies to at least two-thirds of all medical/surgical benefits within the inpatient, in-network classification because the plan follows the concurrent review process for all medical/surgical benefits. The most common or frequent variation of this nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) applicable to substantially all medical/surgical benefits is that peer-to-peer review is not imposed as part of second-level review. The plan does not impartially apply independent professional medical or clinical standards or apply standards to detect or prevent and prove fraud, waste, and abuse that qualify |
952 | benefits is that peer-to-peer review is not imposed as part of second-level review. The plan does not impartially apply independent professional medical or clinical standards or apply standards to detect or prevent and prove fraud, waste, and abuse that qualify for the exceptions in paragraph (c)(4)(i)(E) of this section. As written, the plan’s concurrent review requirements are the same for medical/surgical benefits and mental health and substance use disorder benefits. However, in operation, by compelling an additional action (peer-to-peer review as part of second-level review) to access only mental health or substance use disorder benefits, the plan applies the limitation to mental health and substance use disorder benefits in a manner that is more restrictive than the predominant nonquantitative treatment limitation applied to substantially all medical/surgical benefits in the inpatient, in-network classification. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (C) Example 3 (More restrictive peer-to-peer review medical necessity standard in operation; deviation from independent professional medical and clinical standards) —( 1 ) Facts . A plan generally requires that all treatment be medically necessary in the inpatient, out-of-network classification. For both medical/surgical benefits and mental health and substance use disorder benefits, the written medical necessity standards are based on independent professional medical or clinical standards that do not require peer-to-peer review. In operation, the plan covers out-of-network benefits for medical/surgical or mental health inpatient treatment outside of a hospital if the physician documents medical appropriateness, but for out-of-network benefits for substance use disorder inpatient treatment outside of a hospital, the plan requires a physician to also complete peer-to-peer review. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(C) ( Example 3 ), the plan violates the rules of paragraph (c)(4)(i) of this section. The medical necessity nonquantitative treatment limitation applies to at least two-thirds of all medical/surgical benefits in the inpatient, out-of-network classification. The most common or frequent variation of the nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) applicable to substantially all medical/surgical benefits is the requirement that a physician document medical appropriateness without peer-to-peer review. The plan purports to impartially apply independent professional medical or clinical standards that would otherwise qualify for the exception in paragraph (c)(4)(i)(E) of this section, but deviates from those standards by imposing the additional requirement to complete peer-to-peer review for inpatient, out-of-network benefits for substance use disorder outside of a hospital. Therefore, the exception in paragraph (c)(4)(i)(E) of this section does not apply. As written, the plan provisions apply the nonquantitative treatment limitation to mental health and substance use disorder benefits in the inpatient, out-of-network classification in the same manner as for medical/surgical benefits. However, in operation, the nonquantitative treatment limitation imposed with respect to out-of-network substance use disorder benefits for treatment outside of a hospital is more restrictive than the predominant nonquantitative treatment limitation applied to substantially all medical/surgical benefits in the classification because it limits access to the full range of treatment options available for a condition or disorder under the plan or coverage as compared to medical/surgical benefits in the same classification. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (D) Example 4 (Not comparable and more stringent methods for determining reimbursement rates in operation )—( 1 ) Facts. A plan’s base reimbursement rates for outpatient, in-network providers are determined based on a variety of factors, including the providers’ required training, licensure, and expertise. For purposes of this example, the plan’s nonquantitative treatment limitations for determining reimbursement rates for mental health and substance use disorder benefits are not more restrictive than the predominant nonquantitative treatment limitation applied to substantially all medical/surgical benefits in the classification |
953 | of this example, the plan’s nonquantitative treatment limitations for determining reimbursement rates for mental health and substance use disorder benefits are not more restrictive than the predominant nonquantitative treatment limitation applied to substantially all medical/surgical benefits in the classification under paragraph (c)(4)(i) of this section. As written, for mental health, substance use disorder, and medical/surgical benefits, all reimbursement rates for physicians and non-physician practitioners for the same Current Procedural Terminology (CPT) code vary based on a combination of factors, such as the nature of the service, provider type, number of providers qualified to provide the service in a given geographic area, and market need (demand). As a result, reimbursement rates for mental health, substance use disorder, and medical/surgical benefits furnished by non-physician providers are generally less than for physician providers. In operation, the plan reduces the reimbursement rate for mental health and substance use disorder non-physician providers from that paid to mental health and substance use disorder physicians by the same percentage for every CPT code but does not apply the same reductions for non-physician medical/surgical providers. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(D) ( Example 4 ), the plan violates the rules of paragraph (c)(4)(ii) of this section. Because the plan reimburses non-physician providers of mental health and substance use disorder services by reducing their reimbursement rate from the rate to physician providers by the same percentage for every CPT code but does not apply the same reductions to non-physician providers of medical/surgical services, in operation, the factors used in applying the nonquantitative treatment limitation to mental health and substance use disorder benefits are not comparable to, and are applied more stringently than, the factors used in applying the limitation with respect to medical/surgical benefits. Because the facts assume that the plan’s methods for determining reimbursement rates comply with paragraph (c)(4)(i) of this section and the plan violates the rules of paragraph (c)(4)(ii) of this section, this example does not analyze compliance with paragraph (c)(4)(iv) of this section. (E) Example 5 (Exception for impartially applied generally recognized independent professional medical or clinical standards) —( 1 ) Facts . A group health plan develops a medical management requirement for all inpatient, out-of-network benefits for both medical/surgical benefits and mental health and substance use disorder benefits to ensure treatment is medically necessary. The medical management requirement impartially applies independent professional medical or clinical standards in a manner that qualifies for the exception in paragraph (c)(4)(i)(E) of this section. The plan does not rely on any other factors or evidentiary standards and the processes, strategies, evidentiary standards, and other factors used in designing and applying the medical management requirement to mental health and substance use disorder benefits are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, and other factors used in designing and applying the requirement with respect to medical/surgical benefits. Within the inpatient, out-of-network classification, the application of the medical management requirement results in a higher percentage of denials for mental health and substance use disorder claims than medical/surgical claims, because the benefits were found to be medically necessary for a lower percentage of mental health and substance use disorder claims based on the impartial application of the independent professional medical or clinical standards by the nonquantitative treatment limitation. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(E) ( Example 5 ), the plan does not violate the rules of this paragraph (c)(4). The medical management nonquantitative treatment limitation imposed on mental health and substance use disorder benefits does not violate paragraph (c)(4)(i) or (iv) of this section because it impartially applies independent professional medical or clinical standards for both medical/surgical benefits and mental health and substance use disorder benefits in a manner that qualifies for the exceptions in paragraphs (c)(4)(i)(E) and (c)(4)(iv)(D) of this section, respectively. Moreover, the nonquantitative treatment limitation does not violate paragraph (c)(4)(ii) of this section because the independent professional medical or clinical standards are not considered to be a discriminatory factor or evidentiary standard |
954 | D) of this section, respectively. Moreover, the nonquantitative treatment limitation does not violate paragraph (c)(4)(ii) of this section because the independent professional medical or clinical standards are not considered to be a discriminatory factor or evidentiary standard under paragraph (c)(4)(ii)(B) of this section. Additionally, as written and in operation, the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits in the inpatient, out-of-network classification are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, and other factors used in applying the limitation with respect to medical/surgical benefits in the classification, regardless of the fact that the application of the nonquantitative treatment limitation resulted in higher percentages of claim denials for mental health and substance use disorder benefits as compared to medical/surgical benefits. (F) Example 6 (More restrictive prior authorization requirement; exception for impartially applied generally recognized independent professional medical or clinical standards not met) —( 1 ) Facts. The provisions of a plan state that it applies independent professional medical and clinical standards (consistent with generally accepted standards of care) for setting prior authorization requirements for both medical/surgical and mental health and substance use disorder prescription drugs. The relevant generally recognized independent professional medical standard for treatment of opioid use disorder that the plan utilizes—in this case, the American Society of Addiction Medicine national practice guidelines—does not support prior authorization every 30 days for buprenorphine/naloxone. However, in operation, the plan requires prior authorization for buprenorphine/naloxone combination at each refill (every 30 days) for treatment of opioid use disorder. ( 2 ) Conclusion. In this paragraph (c)(4)(viii)(F) ( Example 6 ), the plan violates the rules of paragraph (c)(4)(i) of this section. The plan does not qualify for the exception in paragraph (c)(4)(i)(E) of this section, because, although the provisions of the plan state that it applies independent professional medical and clinical standards, the plan deviates from the relevant standards with respect to prescription drugs to treat opioid use disorder. The prior authorization nonquantitative treatment limitation is applied to at least two-thirds of all medical/surgical benefits in the prescription drugs classification. The most common or frequent variation of this nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) applicable to substantially all medical/surgical benefits is following generally recognized independent professional medical and clinical standards (consistent with generally accepted standards of care). The prior authorization requirements imposed on substance use disorder benefits are more restrictive than the predominant nonquantitative treatment limitation applicable to substantially all medical/surgical benefits in the classification, because the plan imposes additional requirements on substance use disorder benefits that limit access to the full range of treatment options available for a condition or disorder under the plan or coverage as compared to medical/surgical benefits in the same classification. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (G) Example 7 (Impermissible nonquantitative treatment limitation imposed following a final determination of noncompliance and direction by the Secretary) —( 1 ) Facts. Following an initial request by the Secretary for a plan’s comparative analysis of a nonquantitative treatment limitation pursuant to § 2590.712-1(d), the plan submits a comparative analysis for the nonquantitative treatment limitation. After review of the comparative analysis, the Secretary makes an initial determination that the comparative analysis fails to demonstrate that the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits in the relevant classification are comparable to, and applied no more stringently than, those used in designing and applying the limitation to medical/surgical benefits in the classification. Pursuant to § 2590.712-1(d)(3), the plan submits a corrective action plan and additional comparative analyses within 45 calendar days after the initial determination, and the Secretary then determines that the additional comparative analyses do not demonstrate compliance with the requirements of this paragraph (c)(4). The |
955 | )(3), the plan submits a corrective action plan and additional comparative analyses within 45 calendar days after the initial determination, and the Secretary then determines that the additional comparative analyses do not demonstrate compliance with the requirements of this paragraph (c)(4). The plan receives a final determination of noncompliance from the Secretary, which informs the plan that it is not in compliance with this paragraph (c)(4) and directs the plan not to impose the nonquantitative treatment limitation by a certain date, unless and until the plan demonstrates compliance to the Secretary or takes appropriate action to remedy the violation. The plan makes no changes to its plan terms by that date and continues to impose the nonquantitative treatment limitation. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(G) ( Example 7 ), the plan violates the requirements of this paragraph (c)(4) by imposing the nonquantitative treatment limitation after the Secretary directs the plan not to impose it, pursuant to paragraph (c)(4)(vii) of this section. (H) Example 8 (Provider network admission standards not more restrictive and compliant with requirements for design and application of NQTLs) —( 1 ) Facts . As part of a plan’s standards for provider admission to its network, in the outpatient, in-network classification, any provider seeking to contract with the plan must have a certain number of years of supervised clinical experience. As a result of that standard, master’s level mental health therapists are required to obtain supervised clinical experience beyond their licensure, while master’s level medical/surgical providers, psychiatrists, and Ph.D.-level psychologists do not require additional experience beyond their licensure because their licensure already requires supervised clinical experience. The plan collects and evaluates relevant data in a manner reasonably designed to assess the impact of the nonquantitative treatment limitation. This includes in-network and out-of-network utilization rates (including data related to provider claim submissions), network adequacy metrics (including time and distance data, and data on providers accepting new patients), and provider reimbursement rates (including as compared to billed charges). This data demonstrates that participants and beneficiaries seeking outpatient care are able to access outpatient, in-network mental health and substance use disorder providers at the same frequency as outpatient, in-network medical/surgical providers, that mental health and substance use disorder providers are active in the network and are accepting new patients to the same extent as medical/surgical providers, and that mental health and substance use disorder providers are within similar time and distances to plan participants and beneficiaries as are medical/surgical providers. This data also does not identify material differences in what the plan or issuer pays psychiatrists or non-physician mental health providers, compared to physicians or non-physician medical/surgical providers, respectively, both for the same reimbursement codes and as compared to Medicare rates. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(H) ( Example 8 ), the plan does not violate this paragraph (c)(4). The standards for this nonquantitative treatment limitation, namely provider admission to the plan’s network, are applied to at least two-thirds of all medical/surgical benefits in the outpatient, in-network classification, as it applies to all medical/surgical benefits in the classification. The most common or frequent variation of this nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) that applies to substantially all medical/surgical benefits in the classification is having a certain number of years of supervised clinical experience. The standards for provider admission to the plan’s network that are imposed with respect to mental health or substance use disorder benefits are no more restrictive, as written or in operation, than the predominant variation of the nonquantitative treatment limitation applicable to substantially all medical/surgical benefits in the classification, because the standards do not limit access to the full range of treatment options available for a condition or disorder under the plan or coverage as compared to medical/surgical benefits in the same classification. The requirement that providers have a certain number of years of supervised clinical experience that the plan relied upon to design and apply the nonquantitative treatment limitation is not considered to discriminate against mental health or substance use disorder benefits, even though this results in the requirement that master’s level mental health therapists obtain supervised clinical experience beyond their licensure, unlike master’s level medical/surgical |
956 | limitation is not considered to discriminate against mental health or substance use disorder benefits, even though this results in the requirement that master’s level mental health therapists obtain supervised clinical experience beyond their licensure, unlike master’s level medical/surgical providers. In addition, as written and in operation, the processes, strategies, evidentiary standards, or other factors used in applying the nonquantitative treatment limitation to mental health or substance use disorder benefits in the classification are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in applying the limitation with respect to medical/surgical benefits in the classification, because the plan applies the same standard to all providers in the classification. Finally, the plan or issuer collects and evaluates relevant data in a manner reasonably designed to assess the impact of the nonquantitative treatment limitation on access to mental health and substance use disorder benefits, which does not show material differences in access to in-network mental health and substance use disorder benefits as compared to in-network medical/surgical benefits in the classification. (I) Example 9 (More restrictive requirement for primary caregiver participation applied to ABA therapy) —( 1 ) Facts . A plan generally applies medical necessity criteria in adjudicating claims for coverage of all outpatient, in-network medical/surgical and mental health and substance use disorder benefits, including ABA therapy for the treatment of ASD, which is a mental health condition. The plan’s medical necessity criteria for coverage of ABA therapy requires evidence that the participant’s or beneficiary’s primary caregivers actively participate in ABA therapy, as documented by consistent attendance in parent, caregiver, or guardian training sessions. In adding this requirement, the plan deviates from independent professional medical or clinical standards, and there are no similar medical necessity criteria requiring evidence of primary caregiver participation in order to receive coverage of any medical/surgical benefits. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(I) ( Example 9 ), the plan violates paragraph (c)(4)(i) of this section. The plan applies medical necessity criteria to at least two-thirds of all outpatient, in-network medical/surgical benefits, as they apply to all medical/surgical benefits in the classification. The most common or frequent variation of this nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) that applies to substantially all medical/surgical benefits in the classification does not include the requirement to provide evidence that the participant’s or beneficiary’s primary caregivers actively participate in the treatment. The plan does not qualify for the exception in paragraph (c)(4)(i)(E) of this section in applying its restriction on coverage for ABA therapy because the plan deviates from the independent professional medical or clinical standards by imposing a different requirement. As a result, the nonquantitative treatment limitation imposed on mental health and substance use disorder benefits is more restrictive than the predominant medical necessity requirement imposed on substantially all medical/surgical benefits in the classification (which does not include the requirement to provide evidence that primary caregivers actively participate in treatment). Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (J) Example 10 (More restrictive exclusion for experimental or investigative treatment applied to ABA therapy) —( 1 ) Facts. A plan, as written, generally excludes coverage for all treatments that are experimental or investigative for both medical/surgical benefits and mental health and substance use disorder benefits in the outpatient, in-network classification. As a result, the plan generally excludes experimental treatment of medical conditions and surgical procedures, mental health conditions, and substance use disorders when no professionally recognized treatment guidelines define clinically appropriate standards of care for the condition or disorder and fewer than two randomized controlled trials are available to support the treatment’s use with respect to the given condition or disorder. The plan provides benefits for the treatment of ASD, which is a mental health condition, but, in operation, the plan excludes coverage for ABA therapy to treat children with ASD, deeming it experimental. More than one professionally recognized treatment guideline defines clinically appropriate standards of care for ASD and more than two randomized controlled trials are available to support the use of ABA therapy to treat certain children with ASD. ( 2 |
957 | children with ASD, deeming it experimental. More than one professionally recognized treatment guideline defines clinically appropriate standards of care for ASD and more than two randomized controlled trials are available to support the use of ABA therapy to treat certain children with ASD. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(J) ( Example 10 ), the plan violates the rules of paragraph (c)(4)(i) of this section. The coverage exclusion for experimental or investigative treatment applies to at least two-thirds of all medical/surgical benefits, as it applies to all medical/surgical benefits in the outpatient, in-network classification. The most common or frequent variation of this nonquantitative treatment limitation in the classification (the predominant nonquantitative treatment limitation) applicable to substantially all medical/surgical benefits is the exclusion under the plan for coverage of experimental treatment of medical/surgical conditions when no professionally recognized treatment guidelines define clinically appropriate standards of care for the condition or disorder and fewer than two randomized controlled trials are available to support the treatment’s use with respect to the given condition or procedure. In operation, the exclusion for experimental or investigative treatment imposed on ABA therapy is more restrictive than the predominant variation of the nonquantitative treatment limitation for experimental or investigative treatment imposed on substantially all medical/surgical benefits in the classification because the exclusion limits access to the full range of treatment options available for a condition or disorder under the plan or coverage as compared to medical/surgical benefits in the same classification. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (K) Example 11 (Separate EAP exhaustion treatment limitation applicable only to mental health benefits) —( 1 ) Facts . An employer maintains both a major medical plan and an employee assistance program (EAP). The EAP provides, among other benefits, a limited number of mental health or substance use disorder counseling sessions, which, together with other benefits provided by the EAP, are not significant benefits in the nature of medical care. Participants are eligible for mental health or substance use disorder benefits under the major medical plan only after exhausting the counseling sessions provided by the EAP. No similar exhaustion requirement applies with respect to medical/surgical benefits provided under the major medical plan. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(K) ( Example 11 ), limiting eligibility for mental health and substance use disorder benefits under the major medical plan until EAP benefits are exhausted is a nonquantitative treatment limitation subject to the parity requirements of this paragraph (c). Because the limitation does not apply to medical/surgical benefits, it is a separate nonquantitative treatment limitation applicable only to mental health and substance use disorder benefits that violates paragraph (c)(4)(vi) of this section. Additionally, this EAP would not qualify as excepted benefits under § 2590.732(c)(3)(vi)(B)( 1 ) because participants in the major medical plan are required to use and exhaust benefits under the EAP (making the EAP a gatekeeper) before an individual is eligible for benefits under the plan. (L) Example 12 (Separate residential exclusion treatment limitation applicable only to mental health benefits) —( 1 ) Facts . A plan generally covers inpatient, in-network and inpatient out-of-network treatment in any setting, including skilled nursing facilities and rehabilitation hospitals, provided other medical necessity standards are satisfied. The plan also has an exclusion for residential treatment, which the plan defines as an inpatient benefit, for mental health and substance use disorder benefits. This exclusion was not generated through any broader nonquantitative treatment limitation (such as medical necessity or other clinical guideline). ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(L) ( Example 12 ), the plan violates the rules of paragraph (c)(4)(vi) of this section. Because the plan does not apply a comparable exclusion to inpatient benefits for medical/surgical conditions, the exclusion of residential treatment is a separate nonquantitative treatment limitation applicable only to mental health and substance use disorder benefits in the inpatient, in-network and inpatient, out-of-network classifications that does not apply with respect to any medical/surgical benefits in the same benefit classification. (M) Example |
958 | to mental health and substance use disorder benefits in the inpatient, in-network and inpatient, out-of-network classifications that does not apply with respect to any medical/surgical benefits in the same benefit classification. (M) Example 13 (Standards for provider admission to a network) —( 1 ) Facts . A plan applies nonquantitative treatment limitations related to network composition in the outpatient in-network and inpatient, in-network classifications. The plan’s networks are constructed by separate service providers for medical/surgical benefits and mental health and substance use disorder benefits. For purposes of this example, these facts assume that these nonquantitative treatment limitations related to network composition for mental health and substance use disorder benefits are not more restrictive than the predominant nonquantitative treatment limitations applied to substantially all medical/surgical benefits in the classifications under paragraph (c)(4)(i) of this section. The facts also assume that, as written and in operation, the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitations related to network access to mental health or substance use disorder benefits in the outpatient in-network and inpatient in-network classifications are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitations with respect to medical/surgical benefits in the classifications, as required under paragraph (c)(4)(ii) of this section. The plan collects and evaluates all relevant data in a manner reasonably designed to assess the impact of the nonquantitative treatment limitations related to network composition on access to mental health and substance use disorder benefits as compared with access to medical/surgical benefits and considers the impact as part of the plan’s or issuer’s analysis of whether the standards, in operation, comply with paragraphs (c)(4)(i) and (ii) of this section. The plan determined that the data did not reveal any material differences in access. That data included metrics relating to the time and distance from plan participants and beneficiaries to network providers in rural and urban regions; the number of network providers accepting new patients; the proportions of mental health and substance use disorder and medical/surgical providers and facilities that provide services in rural and urban regions who are in the plan’s network; provider reimbursement rates; in-network and out-of-network utilization rates (including data related to the dollar value and number of provider claims submissions); and survey data from participants on the extent to which they forgo or pay out-of-pocket for treatment because of challenges finding in-network providers. The efforts the plan made when designing and applying its nonquantitative treatment limitations related to network composition, which ultimately led to its outcomes data not revealing any material differences in access to benefits for mental health or substance use disorders as compared with medical/surgical benefits, included making sure that the plan’s service providers are making special efforts to enroll available providers, including by authorizing greater compensation or other inducements to the extent necessary, and expanding telehealth arrangements as appropriate to manage regional shortages. The plan also notifies participants in clear and prominent language on its website, employee brochures, and the summary plan description of a toll-free number available to help participants find in-network providers. In addition, when plan participants submit bills for out-of-network items and services, the plan directs their service providers to reach out to the treating providers and facilities to see if they will enroll in the network. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(M) ( Example 13 ), the plan does not violate this paragraph (c)(4). As stated in the Facts section, the plan’s nonquantitative treatment limitations related to network composition comply with the rules of paragraphs (c)(4)(i) and (ii) of this section. The plan collects and evaluates relevant data, as required under paragraph (c)(4)(iv)(A) of this section, and the data does not reveal any material differences in access to mental health and substance use disorder benefits as compared to medical/surgical benefits, as a result of the actions the plan took (as set forth in the facts) when initially designing its nonquantitative treatment limitations related to network composition. Because the plan takes comparable actions to ensure that their |
959 | as compared to medical/surgical benefits, as a result of the actions the plan took (as set forth in the facts) when initially designing its nonquantitative treatment limitations related to network composition. Because the plan takes comparable actions to ensure that their mental health and substance use disorder provider network is as accessible as their medical/surgical provider network and exercises careful oversight over both their service providers and the comparative robustness of the networks with an eye to ensuring that network composition results in access to in-network benefits for mental health and substance use disorder services that is as generous as for medical/surgical services, plan participants and beneficiaries can access covered mental health and substance use disorder services and benefits as readily as medical/surgical benefits. This is reflected in the plan’s carefully designed metrics and assessment of network composition. * * * * * (d) * * * (3) Provisions of other law . Compliance with the disclosure requirements in paragraphs (d)(1) and (2) of this section is not determinative of compliance with any other provision of applicable Federal or State law. In particular, in addition to those disclosure requirements, provisions of other applicable law require disclosure of information relevant to medical/surgical, mental health, and substance use disorder benefits. For example, ERISA section 104 and § 2520.104b-1 of this chapter provide that, for plans subject to ERISA, instruments under which the plan is established or operated must generally be furnished to plan participants within 30 days of request. Instruments under which the plan is established or operated include documents with information on medical necessity criteria for both medical/surgical benefits and mental health and substance use disorder benefits; the processes, strategies, evidentiary standards, and other factors used to apply a nonquantitative treatment limitation with respect to medical/surgical benefits and mental health or substance use disorder benefits under the plan; and the comparative analyses and other applicable information required by § 2590.712-1. In addition, § 2560.503-1 of this chapter and § 2590.715-2719 set forth rules regarding claims and appeals, including the right of claimants (or their authorized representative) upon appeal of an adverse benefit determination (or a final internal adverse benefit determination) to be provided upon request and free of charge, reasonable access to and copies of all documents, records, and other information relevant to the claimant’s claim for benefits. This includes documents with information on medical necessity criteria for both medical/surgical benefits and mental health and substance use disorder benefits, as well as the processes, strategies, evidentiary standards, and other factors used to apply a nonquantitative treatment limitation with respect to medical/surgical benefits and mental health or substance use disorder benefits under the plan and the comparative analyses and other applicable information required by § 2590.712-1. (e) * * * (4) Coordination with EHB requirements . Nothing in paragraph (f) or (g) of this section or § 2590.712-1(g) changes the requirements of 45 CFR 147.150 and 156.115, providing that a health insurance issuer offering non-grandfathered health insurance coverage in the individual or small group market providing mental health and substance use disorder services, including behavioral health treatment services, as part of essential health benefits required under 45 CFR 156.110(a)(5) and 156.115(a), must comply with the requirements under section 2726 of the Public Health Service Act and its implementing regulations to satisfy the requirement to provide coverage for mental health and substance use disorder services, including behavioral health treatment, as part of essential health benefits. * * * * * (i) * * * (1) In general . Except as provided in paragraph (i)(2) of this section, this section applies to group health plans and health insurance issuers offering group health insurance coverage on the first day of the first plan year beginning on or after January 1, 2025. Until the applicability date in the preceding sentence, plans and issuers are required to continue to comply with 29 CFR 2590.712, revised as of July 1, 2022. * * * * * (j) Severability . If any provision of this section is held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, or stayed pending further agency action, the provision shall be construed so as to continue to |
960 | ) Severability . If any provision of this section is held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, or stayed pending further agency action, the provision shall be construed so as to continue to give the maximum effect to the provision permitted by law, unless such holding shall be one of invalidity or unenforceability, in which event the provision shall be severable from this section and shall not affect the remainder thereof or the application of the provision to persons not similarly situated or to dissimilar circumstances. 6. Add § 2590.712-1 to read as follows: § 2590.712-1 Nonquantitative treatment limitation comparative analysis requirements. (a) Meaning of terms . Unless otherwise stated in this section, the terms of this section have the meanings indicated in § 2590.712(a)(2). (b) In general . In the case of a group health plan (or health insurance issuer offering group health insurance coverage in connection with a group health plan) that provides both medical/surgical benefits and mental health or substance use disorder benefits and that imposes any nonquantitative treatment limitation on mental health or substance use disorder benefits, the plan or issuer must perform and document a comparative analysis of the design and application of each nonquantitative treatment limitation applicable to mental health or substance use disorder benefits. Each comparative analysis must comply with the content requirements of paragraph (c) of this section and be made available to the Secretary, upon request, in the manner required by paragraphs (d) and (e) of this section. (c) Comparative analysis content requirements . With respect to each nonquantitative treatment limitation applicable to mental health or substance use disorder benefits under a group health plan (or health insurance coverage offered in connection with a group health plan), the comparative analysis performed by the plan or issuer must include, at minimum, the elements specified in this paragraph (c). In addition to the comparative analysis for each nonquantitative treatment limitation, each plan or issuer must prepare and make available to the Secretary, upon request, a written list of all nonquantitative treatment limitations imposed under the plan or coverage and a general description of any information considered or relied upon by the plan or issuer in preparing the comparative analysis for each nonquantitative treatment limitation. This list and general description must be provided to the named fiduciaries of the plan who are required to review the findings or conclusions of each comparative analysis, as required under paragraph (c)(6)(vi) of this section. (1) Description of the nonquantitative treatment limitation . The comparative analysis must include, with respect to the nonquantitative treatment limitation that is the subject of the comparative analysis: (i) Identification of the nonquantitative treatment limitation, including the specific terms of the plan or coverage or other relevant terms regarding the nonquantitative treatment limitation, the policies or guidelines (internal or external) in which the nonquantitative treatment limitation appears or is described, and the applicable sections of any other relevant documents, such as provider contracts, that describe the nonquantitative treatment limitation; (ii) Identification of all mental health or substance use disorder benefits and medical/surgical benefits to which the nonquantitative treatment limitation applies, including a list of which benefits are considered mental health or substance use disorder benefits and which benefits are considered medical/surgical benefits; (iii) A description of which benefits are included in each classification set forth in § 2590.712(c)(2)(ii)(A); and (iv) Identification of the predominant nonquantitative treatment limitation applicable to substantially all medical/surgical benefits in each classification, including an explanation of how the plan or issuer determined which variation is the predominant nonquantitative treatment limitation as compared to other variations, as well as how the plan identified the variations of the nonquantitative treatment limitation. (2) Identification and definition of the factors used to design or apply the nonquantitative treatment limitation . The comparative analysis must include, with respect to every factor considered or relied upon to design the nonquantitative treatment limitation or apply the nonquantitative treatment limitation to mental health or substance use disorder benefits and medical/surgical benefits: (i) Identification of all of the factors considered, as well as the evidentiary standards considered or relied upon to design or apply each factor and the sources from which each evidentiary standard was derived, in determining which mental health or substance use disorder benefits and which |
961 | ) Identification of all of the factors considered, as well as the evidentiary standards considered or relied upon to design or apply each factor and the sources from which each evidentiary standard was derived, in determining which mental health or substance use disorder benefits and which medical/surgical benefits are subject to the nonquantitative treatment limitation; and (ii) A definition of each factor, including: (A) A detailed description of the factor; and (B) A description of each evidentiary standard (and the source of each evidentiary standard) identified under paragraph (c)(2)(i) of this section. (3) Description of how factors are used in the design and application of the nonquantitative treatment limitation . The comparative analysis must include a description of how each factor identified and defined pursuant to paragraph (c)(2) of this section is used in the design or application of the nonquantitative treatment limitation to mental health and substance use disorder benefits and medical/surgical benefits in a classification, including: (i) A detailed explanation of how each factor identified and defined in paragraph (c)(2) of this section is used to determine which mental health or substance use disorder benefits and which medical/surgical benefits are subject to the nonquantitative treatment limitation; (ii) An explanation of the evidentiary standards or other information or sources (if any) considered or relied upon in designing or applying the factors or relied upon in designing and applying the nonquantitative treatment limitation, including in the determination of whether and how mental health or substance use disorder benefits or medical/surgical benefits are subject to the nonquantitative treatment limitation; (iii) If the application of the factor depends on specific decisions made in the administration of benefits, the nature of the decisions, the timing of the decisions, and the professional designation and qualifications of each decision maker; (iv) If more than one factor is identified and defined in paragraph (c)(2) of this section, an explanation of: (A) How all of the factors relate to each other; (B) The order in which all the factors are applied, including when they are applied; (C) Whether and how any factors are given more weight than others; and (D) The reasons for the ordering or weighting of the factors; and (v) Any deviation(s) or variation(s) from a factor, its applicability, or its definition (including the evidentiary standards used to define the factor and the information or sources from which each evidentiary standard was derived), such as how the factor is used differently to apply the nonquantitative treatment limitation to mental health or substance use disorder benefits as compared to medical/surgical benefits, and a description of how the plan or issuer establishes such deviation(s) or variation(s). (4) Demonstration of comparability and stringency as written . The comparative analysis must evaluate whether, in any classification, under the terms of the plan (or health insurance coverage) as written, any processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation with respect to medical/surgical benefits. The comparative analysis must include, with respect to the nonquantitative treatment limitation and the factors used in designing and applying the nonquantitative treatment limitation: (i) Documentation of each factor identified and defined in paragraph (c)(2) of this section that was applied to determine whether the nonquantitative treatment limitation applies to mental health or substance use disorder benefits and medical/surgical benefits in a classification, including, as relevant: (A) Quantitative data, calculations, or other analyses showing whether, in each classification in which the nonquantitative treatment limitation applies, mental health or substance use disorder benefits and medical/surgical benefits met or did not meet any applicable threshold identified in the relevant evidentiary standard, and the evaluation of relevant data as required under § 2590.712(c)(4)(iv)(A), to determine that the nonquantitative treatment limitation would or would not apply; and (B) Records maintained by the plan or issuer documenting the consideration and application of all factors and evidentiary standards, as well as the results of their application; (ii) In each |
962 | the nonquantitative treatment limitation would or would not apply; and (B) Records maintained by the plan or issuer documenting the consideration and application of all factors and evidentiary standards, as well as the results of their application; (ii) In each classification in which the nonquantitative treatment limitation applies to mental health or substance use disorder benefits, a comparison of how the nonquantitative treatment limitation, as written, is applied to mental health or substance use disorder benefits and to medical/surgical benefits, including the specific provisions of any forms, checklists, procedure manuals, or other documentation used in designing and applying the nonquantitative treatment limitation or that address the application of the nonquantitative treatment limitation; (iii) Documentation demonstrating how the factors are comparably applied, as written, to mental health or substance use disorder benefits and medical/surgical benefits in each classification, to determine which benefits are subject to the nonquantitative treatment limitation; and (iv) An explanation of the reason(s) for any deviation(s) or variation(s) in the application of a factor used to apply the nonquantitative treatment limitation, or the application of the nonquantitative treatment limitation, to mental health or substance use disorder benefits as compared to medical/surgical benefits, and how the plan or issuer establishes such deviation(s) or variation(s), including: (A) In the definition of the factors, the evidentiary standards used to define the factors, and the sources from which the evidentiary standards were derived; (B) In the design of the factors or evidentiary standards; or (C) In the application or design of the nonquantitative treatment limitation. (5) Demonstration of comparability and stringency in operation . The comparative analysis must evaluate whether, in any classification, under the terms of the plan (or health insurance coverage) in operation, the processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in designing and applying the limitation with respect to medical/surgical benefits. The comparative analysis must include, with respect to the nonquantitative treatment limitation and the factors used in designing and applying the nonquantitative treatment limitation: (i) A comprehensive explanation of how the plan or issuer ensures that, in operation, the processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits in a classification are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation with respect to medical/surgical benefits, including: (A) An explanation of any methodology and underlying data used to demonstrate the application of the nonquantitative treatment limitation, in operation; and (B) The sample period, inputs used in any calculations, definitions of terms used, and any criteria used to select the mental health or substance use disorder benefits and medical/surgical benefits to which the nonquantitative treatment limitation is applicable; (ii) Identification of the relevant data collected and evaluated as required under § 2590.712(c)(4)(iv)(A); (iii) An evaluation of the outcomes that resulted from the application of the nonquantitative treatment limitation to mental health or substance use disorder benefits and medical/surgical benefits, including the relevant data as required under § 2590.712(c)(4)(iv)(A); (iv) A detailed explanation of material differences in outcomes evaluated pursuant to paragraph (c)(5)(iii) of this section that are not attributable to differences in the comparability or relative stringency of the nonquantitative treatment limitation as applied to mental health or substance use disorder benefits and medical/surgical benefits and the bases for concluding that material differences in outcomes are not attributable to differences in the comparability or relative stringency of the nonquantitative treatment limitation; and (v) A discussion of any measures that have been or are being implemented by the plan or issuer to mitigate any material differences in access to mental health or substance use disorder benefits as compared to medical/surgical benefits, including the actions the plan or issuer is taking under § 2590.712(c)(4)(iv |
963 | by the plan or issuer to mitigate any material differences in access to mental health or substance use disorder benefits as compared to medical/surgical benefits, including the actions the plan or issuer is taking under § 2590.712(c)(4)(iv)(B)( 1 ) to address material differences to ensure compliance with § 2590.712(c)(4)(i) and (ii). (6) Findings and conclusions . The comparative analysis must address the findings and conclusions as to the comparability of the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits and medical/surgical benefits within each classification, and the relative stringency of their application, both as written and in operation, and include: (i) Any findings or conclusions indicating that the plan or coverage is not (or might not be) in compliance with the requirements of § 2590.712(c)(4), including any actions the plan or issuer has taken or intends to take to address any potential areas of concern or noncompliance; (ii) A reasoned and detailed discussion of the findings and conclusions described in paragraph (c)(6)(i) of this section; (iii) Citations to any additional specific information not otherwise included in the comparative analysis that supports the findings and conclusions described in paragraph (c)(6)(i) of this section; (iv) The date of the analysis and the title and credentials of all relevant persons who participated in the performance and documentation of the comparative analysis; (v) If the comparative analysis relies upon an evaluation by a reviewer or consultant considered by the plan or issuer to be an expert, an assessment of each expert’s qualifications and the extent to which the plan or issuer ultimately relied upon each expert’s evaluation in performing and documenting the comparative analysis of the design and application of each nonquantitative treatment limitation applicable to both mental health or substance use disorder benefits and medical/surgical benefits; and (vi) A certification by one or more named fiduciaries who have reviewed the comparative analysis stating whether they found the comparative analysis to be in compliance with the content requirements of paragraph (c) of this section. (d) Requirements related to submission of comparative analyses to the Secretary upon request —(1) Initial request by the Secretary for comparative analysis . A group health plan or health insurance issuer offering group health insurance coverage must make the comparative analysis required by paragraph (b) of this section available and submit it to the Secretary within 10 business days of receipt of a request from the Secretary (or an additional period of time specified by the Secretary). (2) Additional information required after a comparative analysis is deemed to be insufficient . In instances in which the Secretary determines that the plan or issuer has not submitted sufficient information under paragraph (d)(1) of this section for the Secretary to review the comparative analysis required in paragraph (b) of this section, the Secretary will specify to the plan or issuer the additional information the plan or issuer must submit to the Secretary to be responsive to the request under paragraph (d)(1) of this section. Any such information must be provided to the Secretary by the plan or issuer within 10 business days after the Secretary specifies the additional information to be submitted (or an additional period of time specified by the Secretary). (3) Initial determination of noncompliance, required action, and corrective action plan . In instances in which the Secretary reviewed the comparative analysis submitted under paragraph (d)(1) of this section and any additional information submitted under paragraph (d)(2) of this section, and made an initial determination that the plan or issuer is not in compliance with the requirements of § 2590.712(c)(4) or this section, the plan or issuer must respond to the Secretary and specify the actions the plan or issuer will take to bring the plan or coverage into compliance, and provide to the Secretary additional comparative analyses meeting the requirements of paragraph (b) of this section that demonstrate compliance with § 2590.712(c)(4) and this section, not later than 45 calendar days after the Secretary’s initial determination that the plan or issuer is not in compliance. (4) Requirement to notify participants and beneficiaries of final determination of noncompliance —(i) In general . If the Secretary makes a final determination of noncompliance, the plan or issuer must notify all participants and beneficiaries enrolled in the plan or coverage |
964 | (4) Requirement to notify participants and beneficiaries of final determination of noncompliance —(i) In general . If the Secretary makes a final determination of noncompliance, the plan or issuer must notify all participants and beneficiaries enrolled in the plan or coverage that the plan or issuer has been determined to not be in compliance with the requirements of § 2590.712(c)(4) or this section with respect to such plan or coverage. Such notice must be provided within 7 calendar days of receipt of the final determination of noncompliance, and the plan or issuer must provide a copy of the notice to the Secretary, and any service provider involved in the claims process, and any fiduciary responsible for deciding benefit claims within the same time frame. (ii) Content of notice . The notice to participants and beneficiaries required in paragraph (d)(4)(i) of this section shall be written in a manner calculated to be understood by the average plan participant and must include, in plain language, the following information in a standalone notice: (A) The following statement prominently displayed on the first page, in no less than 14-point font: “Attention! The Department of Labor has determined that [insert the name of group health plan or health insurance issuer] is not in compliance with the Mental Health Parity and Addiction Equity Act.”; (B) A summary of changes the plan or issuer has made as part of its corrective action plan specified to the Secretary following the initial determination of noncompliance, including an explanation of any opportunity for a participant or beneficiary to have a claim for benefits reprocessed; (C) A summary of the Secretary’s final determination that the plan or issuer is not in compliance with § 2590.712(c)(4) or this section, including any provisions or practices identified as being in violation of MHPAEA, additional corrective actions identified by the Secretary in the final determination notice, and information on how participants and beneficiaries can obtain from the plan or issuer a copy of the final determination of noncompliance; (D) Any additional actions the plan or issuer is taking to come into compliance with § 2590.712(c)(4) or this section, when the plan or issuer will take such actions, and a clear and accurate statement explaining whether the Secretary has indicated that those actions, if completed, will result in compliance; and (E) Contact information for questions and complaints, and a statement explaining how participants and beneficiaries can obtain more information about the notice, including: ( 1 ) The plan’s or issuer’s phone number and an email or web portal address; and ( 2 ) The Employee Benefits Security Administration’s phone number and email or web portal address. (iii) Manner of notice . The plan or issuer must make the notice required under paragraph (d)(4)(i) of this section available in paper form, or electronically (such as by email or an Internet posting) if: (A) The format is readily accessible; (B) The notice is provided in paper form free of charge upon request; and (C) In a case in which the electronic form is an internet posting, the plan or issuer timely notifies the participant or beneficiary in paper form (such as a postcard) or email, that the documents are available on the internet, provides the internet address, includes the statement required in paragraph (d)(4)(ii)(A) of this section, and notifies the participant or beneficiary that the documents are available in paper form upon request. (e) Requests for a copy of a comparative analysis . In addition to making a comparative analysis available upon request to the Secretary, a plan or issuer must make available a copy of the comparative analysis required by paragraph (b) of this section when requested by: (1) Any applicable State authority; (2) A participant or beneficiary (or a provider or other person acting as a participant’s or beneficiary’s authorized representative) who has received an adverse benefit determination related to mental health or substance use disorder benefits; and (3) Participants and beneficiaries, who may request the comparative analysis at any time under ERISA section 104. (f) Rule of construction . Nothing in this section or § 2590.712 shall be construed to prevent the Secretary from acting within the scope of existing authorities to address violations of § 2590.712 or this section. (g) Applicability. The provisions of |
965 | of construction . Nothing in this section or § 2590.712 shall be construed to prevent the Secretary from acting within the scope of existing authorities to address violations of § 2590.712 or this section. (g) Applicability. The provisions of this section apply to group health plans and health insurance issuers offering group health insurance coverage described in § 2590.712(e), to the extent the plan or issuer is not exempt under § 2590.712(f) or (g), for plan years beginning on or after January 1, 2025. (h) Severability . If any provision of this section is held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, or stayed pending further agency action, the provision shall be construed so as to continue to give the maximum effect to the provision permitted by law, unless such holding shall be one of invalidity or unenforceability, in which event the provision shall be severable from this section and shall not affect the remainder thereof or the application of the provision to persons not similarly situated or to dissimilar circumstances. DEPARTMENT OF HEALTH AND HUMAN SERVICES For the reasons set forth in the preamble, the Department of Health and Human Services proposes to amend 45 CFR parts 146 and 147 as set forth below: PART 146—REQUIREMENTS FOR THE GROUP HEALTH INSURANCE MARKET 7. The authority citation for part 146 continues to read as follows: Authority: 42 U.S.C. 300gg–1 through 300gg–5, 300gg–11 through 300gg–23, 300gg–91, and 300gg–92. 8. Amend § 146.136 is amended by: a. Redesignating paragraph (a) as paragraph (a)(2) and adding paragraphs (a) heading and (a)(1); b. In newly redesignated paragraph (a)(2): i. Revising the introductory text; ii. Adding the definitions of “DSM,” “Evidentiary standards,” “Factors,” and “ICD” in alphabetical order; iii. Revising the definitions of “Medical/surgical benefits” and “Mental health benefits”; iv. Adding the definitions of “Processes” and “Strategies” in alphabetical order; and v. Revising the definitions of “Substance use disorder benefits” and “Treatment limitations”; c. Revising paragraphs (c)(1)(ii), (c)(2)(i), and (c)(2)(ii)(A) introductory text; d. In paragraph (c)(2)(ii)(C), designating Examples 1 through 4 as paragraphs (c)(2)(ii)(C)( 1 ) through ( 4 ) and revising newly designated paragraphs (c)(2)(ii)(C)( 1 ) through ( 4 ); e. Adding paragraphs (c)(2)(ii)(C)( 5 ) and ( 6 ); f. Revising paragraphs (c)(3)(i)(A), (C), and (D); g. In paragraph (c)(3)(iii), adding introductory text; h. Revising paragraphs (c)(3)(iii)(A) and (B), (c)(3)(iv), (c)(4), (d)(3), (e)(4), and (i)(1); and i. Adding paragraph (j). The revisions and additions read as follows: § 146.136 Parity in mental health and substance use disorder benefits. (a) Purpose and meaning of terms – (1) Purpose . This section and § 146.137 set forth rules to ensure parity in aggregate lifetime and annual dollar limits, financial requirements, and quantitative and nonquantitative treatment limitations between mental health and substance use disorder benefits and medical/surgical benefits, as required under PHS Act section 2726. A fundamental purpose of PHS Act section 2726, this section, and § 146.137 is to ensure that participants and beneficiaries in a group health plan (or health insurance coverage offered by an issuer in connection with a group health plan) that offers mental health or substance use disorder benefits are not subject to more restrictive lifetime or annual dollar limits, financial requirements, or treatment limitations with respect to those benefits than the predominant dollar limits, financial requirements, or |
966 | in connection with a group health plan) that offers mental health or substance use disorder benefits are not subject to more restrictive lifetime or annual dollar limits, financial requirements, or treatment limitations with respect to those benefits than the predominant dollar limits, financial requirements, or treatment limitations that are applied to substantially all medical/surgical benefits covered by the plan or coverage, as further provided in this section and § 146.137. Accordingly, in complying with the provisions of PHS Act section 2726, this section, and § 146.137, 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 and substance use disorder benefits under the plan or coverage than they impose on access to generally comparable medical/surgical benefits. The provisions of PHS section 2726, this section, and § 146.137 should be interpreted in a manner that is consistent with the purpose described in this paragraph (a)(1). (2) Meaning of terms . For purposes of this section and § 146.137, except where the context clearly indicates otherwise, the following terms have the meanings indicated: * * * * * DSM means the American Psychiatric Association’s Diagnostic and Statistical Manual of Mental Disorders. For the purpose of this definition, the most current version of the DSM is the version that is applicable no earlier than on the date that is 1 year before the first day of the applicable plan year. Evidentiary standards are any evidence, sources, or standards that a group health plan (or health insurance issuer offering coverage in connection with such a plan) considered or relied upon in designing or applying a factor with respect to a nonquantitative treatment limitation, including specific benchmarks or thresholds. 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; 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. Factors are all information, including processes and strategies (but not evidentiary standards), that a group health plan (or health insurance issuer offering coverage in connection with such a plan) considered or relied upon to design a nonquantitative treatment limitation, or to determine whether or how the nonquantitative treatment limitation applies to benefits under the plan or coverage. Examples of factors include, but are not limited to: provider discretion in determining a 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. * * * * * ICD means the World Health Organization’s International Classification of Diseases adopted by the Department of Health and Human Services through § 162.1002 of this subtitle. For the purpose of this definition, the most current version of the ICD is the version that is applicable no earlier than on the date that is 1 year before the first day of the applicable plan year. Medical/surgical benefits means benefits with respect to items or services for medical conditions or surgical procedures, as defined under the terms of the group health plan (or health insurance coverage offered by an issuer in connection with such a plan) and in accordance with applicable Federal and State law, but does not include mental health benefits or substance use disorder benefits. Notwithstanding the preceding sentence, any condition or procedure defined by the plan or coverage as being or as 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). To the extent 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 in accordance with applicable Federal and State law |
967 | of the ICD). To the extent 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 in accordance with applicable Federal and State law. Mental health benefits means benefits with respect to items or services for mental health conditions, as defined under the terms of the group health plan (or health insurance coverage offered by an issuer in connection with such a plan) and in accordance with applicable Federal and State law, but does not include medical/surgical benefits or substance use disorder benefits. Notwithstanding the preceding sentence, any condition defined by the plan or coverage as being or as not being a mental health condition must be defined consistent with generally recognized independent standards of current medical practice. For the purpose of this definition, to be consistent with generally recognized independent standards of current medical practice, the 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 DSM. To the extent generally recognized independent standards of current medical practice do not address whether a condition is a mental health condition, plans and issuers may define the condition in accordance with applicable Federal and State law. Processes are actions, steps, or procedures that a group health plan (or health insurance issuer offering coverage in connection with such a plan) uses to apply a nonquantitative treatment limitation, 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. Processes include but are not limited to: procedures to submit information to authorize coverage for an item or service prior to receiving the benefit or while treatment is ongoing (including requirements for peer or expert clinical review of that information); provider referral requirements; and the development and approval of a treatment plan. Processes also 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 nonquantitative treatment limitations, such as how a panel of staff members applies the nonquantitative treatment limitation (including the qualifications of staff involved, number of staff members allocated, and time allocated), consultations with panels of experts in applying the nonquantitative treatment limitation, and reviewer discretion in adhering to criteria hierarchy when applying a nonquantitative treatment limitation. Strategies are practices, methods, or internal metrics that a plan (or health insurance issuer offering coverage in connection with such a plan) considers, reviews, or uses to design a nonquantitative treatment limitation. Examples of strategies include but are not limited to: the development of the clinical rationale used in approving or denying benefits; deviation from generally accepted standards of care; the selection of information 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. Strategies also include 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 nonquantitative treatment limitations, including the plan’s decisions related to the 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 nonquantitative treatment limitation; and the composition of the panels used to design a nonquantitative treatment limitation. Substance use disorder benefits means benefits with respect to items or services for substance use disorders, as defined under the terms of the group health plan (or health insurance coverage offered by an issuer in connection with such a plan) and in accordance with applicable Federal and State law, but does not include medical/surgical benefits or mental health benefits. Notwithstanding the preceding sentence, any disorder defined by the plan or coverage as being or as not being a substance use disorder must be defined consistent with generally recognized independent standards of current medical practice. For the purpose of this definition, to be consistent with generally recognized independent standards of current medical practice, the definition must include all disorders covered under the plan or coverage that fall under any |
968 | must be defined consistent with generally recognized independent standards of current medical practice. For the purpose of this definition, to be consistent with generally recognized independent standards of current medical practice, the definition 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. To the extent generally recognized independent standards of current medical practice do not address whether a disorder is a substance use disorder, plans and issuers may define the disorder in accordance with applicable Federal and State law. Treatment limitations include limits on benefits based on the frequency of treatment, number of visits, days of coverage, days in a waiting period, or other similar limits on the scope or duration of treatment. Treatment limitations include both quantitative treatment limitations, which are expressed numerically (such as 50 outpatient visits per year), and nonquantitative treatment limitations, which otherwise limit the scope or duration of benefits for treatment under a plan or coverage. (See paragraph (c)(4)(iii) of this section for an illustrative, non-exhaustive list of nonquantitative treatment limitations.) A complete exclusion of all benefits for a particular condition or disorder, however, is not a treatment limitation for purposes of this definition. * * * * * (c) * * * (1) * * * (ii) Type of financial requirement or treatment limitation . When reference is made in this paragraph (c) to a type of financial requirement or treatment limitation, the reference to type means its nature. Different types of financial requirements include deductibles, copayments, coinsurance, and out-of-pocket maximums. Different types of quantitative treatment limitations include annual, episode, and lifetime day and visit limits. See paragraph (c)(4)(iii) of this section for an illustrative, non-exhaustive list of nonquantitative treatment limitations. * * * * * (2) * * * (i) General rule . A group health plan (or health insurance coverage offered by an issuer in connection with a group health plan) that provides both medical/surgical benefits and mental health or substance use disorder benefits may not apply any financial requirement or treatment limitation to mental health or substance use disorder benefits in any classification that is more restrictive than the predominant financial requirement or treatment limitation of that type applied to substantially all medical/surgical benefits in the same classification. Whether a financial requirement or treatment limitation is a predominant financial requirement or treatment limitation that applies to substantially all medical/surgical benefits in a classification is determined separately for each type of financial requirement or treatment limitation. A plan or issuer may not impose any financial requirement or treatment limitation that is applicable only with respect to mental health or substance use disorder benefits and not to any medical/surgical benefits in the same benefit classification. The application of the rules of this paragraph (c)(2) to financial requirements and quantitative treatment limitations is addressed in paragraph (c)(3) of this section; the application of the rules of this paragraph (c)(2) to nonquantitative treatment limitations is addressed in paragraph (c)(4) of this section. (ii) * * * (A) In general . If a plan (or health insurance coverage) provides any benefits for a mental health condition or substance use disorder in any classification of benefits described in this paragraph (c)(2)(ii), benefits for that mental health condition or substance use disorder must be provided in every classification in which medical/surgical benefits are provided. For purposes of this paragraph (c)(2)(ii), a plan (or health insurance coverage) providing any benefits for a mental health condition or substance use disorder in any classification of benefits does not provide benefits for the mental health condition or substance use disorder in every classification in which medical/surgical benefits are provided unless the plan (or health insurance coverage) provides meaningful benefits for treatment for that condition or disorder in each such classification, as determined in comparison to the benefits provided for medical/surgical conditions in the classification. In determining the classification in which a particular benefit belongs, a plan (or health insurance issuer) must apply the same standards to medical/surgical benefits and to mental health or |
969 | comparison to the benefits provided for medical/surgical conditions in the classification. In determining the classification in which a particular benefit belongs, a plan (or health insurance issuer) must apply the same standards to medical/surgical benefits and to mental health or substance use disorder benefits. To the extent that a plan (or health insurance coverage) provides benefits in a classification and imposes any separate financial requirement or treatment limitation (or separate level of a financial requirement or treatment limitation) for benefits in the classification, the rules of this paragraph (c) apply separately with respect to that classification for all financial requirements or treatment limitations (illustrated in examples in paragraph (c)(2)(ii)(C) of this section). The following classifications of benefits are the only classifications used in applying the rules of this paragraph (c), in addition to the permissible sub-classifications described in paragraph (c)(3)(iii) of this section: * * * * * (C) * * * ( 1 ) Example 1 —( i ) Facts . A group health plan offers inpatient and outpatient benefits and does not contract with a network of providers. The plan imposes a $500 deductible on all benefits. For inpatient medical/surgical benefits, the plan imposes a coinsurance requirement. For outpatient medical/surgical benefits, the plan imposes copayments. The plan imposes no other financial requirements or treatment limitations. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 1 ) ( Example 1 ), because the plan has no network of providers, all benefits provided are out-of-network. Because inpatient, out-of-network medical/surgical benefits are subject to separate financial requirements from outpatient, out-of-network medical/surgical benefits, the rules of this paragraph (c) apply separately with respect to any financial requirements and treatment limitations, including the deductible, in each classification. ( 2 ) Example 2 —( i ) Facts . A plan imposes a $500 deductible on all benefits. The plan has no network of providers. The plan generally imposes a 20 percent coinsurance requirement with respect to all benefits, without distinguishing among inpatient, outpatient, emergency care, or prescription drug benefits. The plan imposes no other financial requirements or treatment limitations. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 2 ) ( Example 2 ), because the plan does not impose separate financial requirements (or treatment limitations) based on classification, the rules of this paragraph (c) apply with respect to the deductible and the coinsurance across all benefits. ( 3 ) Example 3 —( i ) Facts . Same facts as in paragraph (c)(2)(ii)(C)( 2 )( i ) of this section ( Example 2 ), except the plan exempts emergency care benefits from the 20 percent coinsurance requirement. The plan imposes no other financial requirements or treatment limitations. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 3 ) ( Example 3 ), because the plan imposes separate financial requirements based on classifications, the rules of this paragraph (c) apply with respect to the deductible and the coinsurance separately for benefits in the emergency care classification and all other benefits. ( 4 ) Example 4 —( i ) Facts . Same facts as in paragraph (c)(2)(ii)(C)( 2 )( i ) of this section ( Example 2 ), except the plan also imposes a preauthorization requirement for all inpatient treatment in order for benefits to be paid. No such requirement applies to outpatient treatment. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 4 ) ( Example 4 ), because the plan has no network of providers, all benefits provided are out-of-network. Because the plan imposes a separate treatment limitation based on classifications, the rules of this paragraph (c) apply with respect to the deductible and coinsurance separately for inpatient, out-of-network benefits and all other benefits. ( 5 ) Example 5 —( i ) Facts . A plan generally covers treatment for autism spectrum disorder (ASD), a mental health condition, and covers outpatient, out-of-network developmental evaluations for ASD but excludes all other benefits for outpatient treatment for ASD, including applied behavioral analysis (ABA) therapy, when provided on an out-of-network basis. The plan generally covers the full range of outpatient treatments and treatment settings for medical conditions and |
970 | ASD but excludes all other benefits for outpatient treatment for ASD, including applied behavioral analysis (ABA) therapy, when provided on an out-of-network basis. The plan generally covers the full range of outpatient treatments and treatment settings for medical conditions and surgical procedures when provided on an out-of-network basis. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 5 ) ( Example 5 ), the plan violates the rules of this paragraph (c)(2)(ii). Because the plan only covers one type of benefit for ASD in the outpatient, out-of-network classification and excludes all other benefits for ASD in the classification, but generally covers the full range of medical/surgical benefits in the classification, it fails to provide meaningful benefits for treatment of ASD in the classification. ( 6 ) Example 6 —( i ) Facts . A plan generally covers diagnosis and treatment for eating disorders, a mental health condition, but specifically excludes coverage for nutrition counseling to treat eating disorders, including in the outpatient, in-network classification. Nutrition counseling is one of the primary treatments for eating disorders. The plan generally provides benefits for the primary treatments for medical/surgical conditions in the outpatient, in-network classification. ( ii ) Conclusion . In this paragraph (c)(2)(ii)(C)( 6 ) ( Example 6 ), the plan violates the rules of this paragraph (c)(2)(ii). The exclusion of coverage for nutrition counseling for eating disorders results in the plan failing to provide meaningful benefits for the treatment of eating disorders in the outpatient, in-network classification, as determined in comparison to the benefits provided for medical/surgical conditions in the classification. (3) * * * (i) * * * (A) Substantially all . For purposes of this paragraph (c)(3), a type of financial requirement or quantitative treatment limitation is considered to apply to substantially all medical/surgical benefits in a classification of benefits if it applies to at least two-thirds of all medical/surgical benefits in that classification. (For purposes of this paragraph (c)(3)(i)(A), benefits expressed as subject to a zero level of a type of financial requirement are treated as benefits not subject to that type of financial requirement, and benefits expressed as subject to a quantitative treatment limitation that is unlimited are treated as benefits not subject to that type of quantitative treatment limitation.) If a type of financial requirement or quantitative treatment limitation does not apply to at least two-thirds of all medical/surgical benefits in a classification, then that type cannot be applied to mental health or substance use disorder benefits in that classification. * * * * * (C) Portion based on plan payments . For purposes of this paragraph (c)(3), the determination of the portion of medical/surgical benefits in a classification of benefits subject to a financial requirement or quantitative treatment limitation (or subject to any level of a financial requirement or quantitative treatment limitation) is 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 (or for the portion of the plan year after a change in plan benefits that affects the applicability of the financial requirement or quantitative treatment limitation). (D) Clarifications for certain threshold requirements . For any deductible, the dollar amount of plan payments includes all plan payments with respect to claims that would be subject to the deductible if it had not been satisfied. For any out-of-pocket maximum, the dollar amount of plan payments includes all plan payments associated with out-of-pocket payments that are taken into account towards the out-of-pocket maximum as well as all plan payments associated with out-of-pocket payments that would have been made towards the out-of-pocket maximum if it had not been satisfied. Similar rules apply for any other thresholds at which the rate of plan payment changes. (See also PHS Act section 2707 and Affordable Care Act section 1302(c), which establish annual limitations on out-of-pocket maximums for all non-grandfathered health plans.) * * * * * (iii) Special rules . Unless specifically permitted under this paragraph (c)(3)(iii), sub-classifications are not permitted when applying the rules of paragraph (c)(3) of this section. (A) Multi-tiered prescription drug benefits . If a plan (or health insurance coverage) applies different levels of financial requirements |
971 | iii), sub-classifications are not permitted when applying the rules of paragraph (c)(3) of this section. (A) Multi-tiered prescription drug benefits . If a plan (or health insurance coverage) applies different levels of financial requirements to different tiers of prescription drug benefits based on reasonable factors determined in accordance with the rules in paragraph (c)(4) of this section (relating to requirements for nonquantitative treatment limitations) and without regard to whether a drug is generally prescribed with respect to medical/surgical benefits or with respect to mental health or substance use disorder benefits, the plan (or health insurance coverage) satisfies the parity requirements of this paragraph (c) with respect to prescription drug benefits. Reasonable factors include cost, efficacy, generic versus brand name, and mail order versus pharmacy pick-up. (B) Multiple network tiers . If a plan (or health insurance coverage) provides benefits through multiple tiers of in-network providers (such as an in-network tier of preferred providers with more generous cost-sharing to participants than a separate in-network tier of participating providers), the plan may divide its benefits furnished on an in-network basis into sub-classifications that reflect network tiers, if the tiering is based on reasonable factors determined in accordance with the rules in paragraph (c)(4) of this section (such as quality, performance, and market standards) and without regard to whether a provider provides services with respect to medical/surgical benefits or mental health or substance use disorder benefits. After the sub-classifications are established, the plan or issuer may not impose any financial requirement or treatment limitation on mental health or substance use disorder benefits in any sub-classification that is more restrictive than the predominant financial requirement or treatment limitation that applies to substantially all medical/surgical benefits in the sub-classification using the methodology set forth in paragraph (c)(3)(i) of this section. * * * * * (iv) Examples . The rules of paragraphs (c)(3)(i) through (iii) of this section are illustrated by the following examples. In each example, the group health plan is subject to the requirements of this section and provides both medical/surgical benefits and mental health and substance use disorder benefits. (A) Example 1 —( 1 ) Facts . ( i ) For inpatient, out-of-network medical/surgical benefits, a group health plan imposes five levels of coinsurance. Using a reasonable method, the plan projects its payments for the upcoming year as follows: Table 1 to Paragraph (c)(3)(iv)(A)( 1 )( i ) Coinsurance rate 0 % 10% 15% 20% 30% Total Projected payments $200x $100x $450x $100x $150x $1,000x Percent of total plan costs 20% 10% 45% 10% 15% Percent subject to coinsurance level N/A 12.5% (100x/800x) 56.25% (450x/800x) 12.5% (100x/800x) 18.75% (150x/800x) ( ii ) The plan projects plan costs of $800x to be subject to coinsurance ($100x + $450x + $100x + $150x = $800x). Thus, 80 percent ($800x/$1,000x) of the benefits are projected to be subject to coinsurance, and 56.25 percent of the benefits subject to coinsurance are projected to be subject to the 15 percent coinsurance level. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(A) ( Example 1 ), the two-thirds threshold of the substantially all standard is met for coinsurance because 80 percent of all inpatient, out-of-network medical/surgical benefits are subject to coinsurance. Moreover, the 15 percent coinsurance is the predominant level because it is applicable to more than one-half of inpatient, out-of-network medical/surgical benefits subject to the coinsurance requirement. The plan may not impose any level of coinsurance with respect to inpatient, out-of-network mental health or substance use disorder benefits that is more restrictive than the 15 percent level of coinsurance. (B) Example 2 —( 1 ) Facts . ( i ) For outpatient, in-network medical/surgical benefits, a plan imposes five different |
972 | health or substance use disorder benefits that is more restrictive than the 15 percent level of coinsurance. (B) Example 2 —( 1 ) Facts . ( i ) For outpatient, in-network medical/surgical benefits, a plan imposes five different copayment levels. Using a reasonable method, the plan projects payments for the upcoming year as follows: Table 2 to Paragraph (c)(3)(iv)(B)( 1 )( i ) Copayment amount $0 $10 $15 $20 $50 Total Projected payments $200x $200x $200x $300x $100x $1,000x Percent of total plan costs 20% 20% 20% 30% 10% Percent subject to copayments N/A 25% (200x/800x) 25% (200x/800x) 37.5% (300x/800x) 12.5% (100x/800x) ( ii ) The plan projects plan costs of $800x to be subject to copayments ($200x + $200x +$300x + $100x = $800x). Thus, 80 percent ($800x/$1,000x) of the benefits are projected to be subject to a copayment. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(B) ( Example 2 ), the two-thirds threshold of the substantially all standard is met for copayments because 80 percent of all outpatient, in-network medical/surgical benefits are subject to a copayment. Moreover, there is no single level that applies to more than one-half of medical/surgical benefits in the classification subject to a copayment (for the $10 copayment, 25%; for the $15 copayment, 25%; for the $20 copayment, 37.5%; and for the $50 copayment, 12.5%). The plan can combine any levels of copayment, including the highest levels, to determine the predominant level that can be applied to mental health or substance use disorder benefits. If the plan combines the highest levels of copayment, the combined projected payments for the two highest copayment levels, the $50 copayment and the $20 copayment, are not more than one-half of the outpatient, in-network medical/surgical benefits subject to a copayment because they are exactly one-half ($300x + $100x = $400x; $400x/$800x = 50%). The combined projected payments for the three highest copayment levels – the $50 copayment, the $20 copayment, and the $15 copayment – are more than one-half of the outpatient, in-network medical/surgical benefits subject to the copayments ($100x + $300x + $200x = $600x; $600x/$800x = 75%). Thus, the plan may not impose any copayment on outpatient, in-network mental health or substance use disorder benefits that is more restrictive than the least restrictive copayment in the combination, the $15 copayment. (C) Example 3 —( 1 ) Facts . A plan imposes a $250 deductible on all medical/surgical benefits for self-only coverage and a $500 deductible on all medical/surgical benefits for family coverage. The plan has no network of providers. For all medical/surgical benefits, the plan imposes a coinsurance requirement. The plan imposes no other financial requirements or treatment limitations. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(C) ( Example 3 ), because the plan has no network of providers, all benefits are provided out-of-network. Because self-only and family coverage are subject to different deductibles, whether the deductible applies to substantially all medical/surgical benefits is determined separately for self-only medical/surgical benefits and family medical/surgical benefits. Because the coinsurance is applied without regard to coverage units, the predominant coinsurance that applies to substantially all medical/surgical benefits is determined without regard to coverage units. (D) Example 4 —( 1 ) Facts . A plan applies the following financial requirements for prescription drug benefits. The requirements are applied without regard to whether a drug is generally prescribed with respect to medical/surgical benefits or with respect to mental |
973 | . (D) Example 4 —( 1 ) Facts . A plan applies the following financial requirements for prescription drug benefits. The requirements are applied without regard to whether a drug is generally prescribed with respect to medical/surgical benefits or with respect to mental health or substance use disorder benefits. Moreover, the process for certifying a particular drug as “generic”, “preferred brand name”, “non-preferred brand name”, or “specialty” complies with the rules of paragraph (c)(4) of this section (relating to requirements for nonquantitative treatment limitations). Table 3 to Paragraph (c)(3)(iv)(D)( 1 ) Tier 1 Tier 2 Tier 3 Tier 4 Tier description Generic drugs Preferred brand name drugs Non-preferred brand name drugs (which may have Tier 1 or Tier 2 alternatives) Specialty drugs Percent paid by plan 90% 80% 60% 50% ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(D) ( Example 4 ), the financial requirements that apply to prescription drug benefits are applied without regard to whether a drug is generally prescribed with respect to medical/surgical benefits or with respect to mental health or substance use disorder benefits; the process for certifying drugs in different tiers complies with paragraph (c)(4) of this section; and the bases for establishing different levels or types of financial requirements are reasonable. The financial requirements applied to prescription drug benefits do not violate the parity requirements of this paragraph (c)(3). (E) Example 5 —( 1 ) Facts . A plan has two-tiers of network of providers: a preferred provider tier and a participating provider tier. Providers are placed in either the preferred tier or participating tier based on reasonable factors determined in accordance with the rules in paragraph (c)(4) of this section, such as accreditation, quality and performance measures (including customer feedback), and relative reimbursement rates. Furthermore, provider tier placement is determined without regard to whether a provider specializes in the treatment of mental health conditions or substance use disorders, or medical/surgical conditions. The plan divides the in-network classifications into two sub-classifications (in-network/preferred and in-network/participating). The plan does not impose any financial requirement or treatment limitation on mental health or substance use disorder benefits in either of these sub-classifications that is more restrictive than the predominant financial requirement or treatment limitation that applies to substantially all medical/surgical benefits in each sub-classification. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(E) ( Example 5 ), the division of in-network benefits into sub-classifications that reflect the preferred and participating provider tiers does not violate the parity requirements of this paragraph (c)(3). (F) Example 6 —( 1 ) Facts . With respect to outpatient, in-network benefits, a plan imposes a $25 copayment for office visits and a 20 percent coinsurance requirement for outpatient surgery. The plan divides the outpatient, in-network classification into two sub-classifications (in-network office visits and all other outpatient, in-network items and services). The plan or issuer does not impose any financial requirement or quantitative treatment limitation on mental health or substance use disorder benefits in either of these sub-classifications that is more restrictive than the predominant financial requirement or quantitative treatment limitation that applies to substantially all medical/surgical benefits in each sub-classification. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(F) ( Example 6 ), the division of outpatient, in-network benefits into sub-classifications for office visits and all other outpatient, in-network items and services does not violate the parity requirements of this paragraph (c)(3). (G) Example 7 —( 1 ) Facts . Same facts as in paragraph (c)(3)(iv)(F)( 1 ) of this section ( Example 6 ), but for purposes of determining parity, the plan divides the outpatient, in-network classification into outpatient, in-network generalists and outpatient, in-network specialists. ( 2 ) Conclusion . In this paragraph (c)(3)(iv)(G) ( Example 7 ), the division of outpatient, in-network benefits into any sub-classifications other than office visits and all other outpatient items and services violates the requirements of paragraph (c)(3)(iii)(C |
974 | )(3)(iv)(G) ( Example 7 ), the division of outpatient, in-network benefits into any sub-classifications other than office visits and all other outpatient items and services violates the requirements of paragraph (c)(3)(iii)(C) of this section. * * * * * (4) Nonquantitative treatment limitations. Subject to paragraph (c)(4)(v) of this section, a group health plan (or health insurance coverage offered by an issuer in connection with a group health plan) may not impose a nonquantitative treatment limitation with respect to mental health or substance use disorder benefits in a classification unless the plan’s or coverage’s imposition of the limitation meets the requirements of paragraphs (c)(4)(i), (ii), and (iv) of this section. If a group health plan (or health insurance coverage offered by an issuer in connection with a group health plan) fails to meet any of these requirements with respect to a nonquantitative treatment limitation, the limitation violates section 2726(a)(3)(A)(ii) of the PHS Act and may not be imposed by the plan (or health insurance coverage). (i) Requirement that nonquantitative treatment limitations be no more restrictive for mental health benefits and substance use disorder benefits . A group health plan (or health insurance issuer offering coverage in connection with a group health plan) may not apply any nonquantitative treatment limitation 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 nonquantitative treatment limitation applied to substantially all medical/surgical benefits in the same classification. (A) Restrictive . For purposes of this paragraph (c)(4)(i), a nonquantitative treatment limitation is restrictive to the extent it imposes conditions, terms, or requirements that limit access to benefits under the terms of the plan or coverage. Conditions, terms, or requirements include, but are not 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 or coverage. (B) Substantially all . For purposes of this paragraph (c)(4)(i), a nonquantitative treatment limitation is considered to apply to substantially all medical/surgical benefits in a classification if it applies to at least two-thirds of all medical/surgical benefits in that classification, consistent with paragraph (c)(4)(i)(D) of this section. Whether the nonquantitative treatment limitation applies to at least two-thirds of all medical/surgical benefits is determined without regard to whether the nonquantitative treatment limitation was triggered based on a particular factor or evidentiary standard. If a nonquantitative treatment limitation does not apply to at least two-thirds of all medical/surgical benefits in a classification, then that limitation cannot be applied to mental health or substance use disorder benefits in that classification. (C) Predominant . For purposes of this paragraph (c)(4)(i), the term predominant means the most common or most frequent variation of the nonquantitative treatment limitation within a classification, determined in accordance with the method outlined in paragraph (c)(4)(i)(D) of this section, to the extent the plan or issuer imposes multiple variations of a nonquantitative treatment limitation within the classification. For example, multiple variations of inpatient concurrent review include review commencing 1 day, 3 days, or 7 days after admission, depending on the reason for the stay. (D) Portion based on plan payments . For purposes of paragraphs (c)(4)(i)(B) and (C) of this section, the determination of the portion of medical/surgical benefits in a classification of benefits subject to a nonquantitative treatment limitation is 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 nonquantitative treatment limitation). Any reasonable method may be used to determine the dollar amount expected to be paid under a plan or coverage for medical/surgical benefits. (E) Exceptions for independent professional medical or clinical standards and standards to detect or prevent and prove fraud, waste, and abuse . Notwithstanding paragraphs (c)(4)(i |
975 | to be paid under a plan or coverage for medical/surgical benefits. (E) Exceptions for independent professional medical or clinical standards and standards to detect or prevent and prove fraud, waste, and abuse . Notwithstanding paragraphs (c)(4)(i)(A) through (D) of this section, a plan or issuer that applies a nonquantitative treatment limitation that impartially applies independent professional medical or clinical standards or applies standards to detect or prevent and prove fraud, waste, and abuse, as described in paragraph (c)(4)(v)(A) or (B) of this section, to mental health or substance use disorder benefits in any classification will not be considered to violate this paragraph (c)(4)(i) with respect to such nonquantitative treatment limitation. (ii) Additional requirements related to design and application of the nonquantitative treatment limitation —(A) In general . Consistent with paragraph (a)(1) of this section, a plan or issuer may not impose a nonquantitative treatment limitation 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 the nonquantitative treatment limitation to mental health or substance use disorder benefits in the classification are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in designing and applying the limitation with respect to medical/surgical benefits in the classification. (B) Prohibition on discriminatory factors and evidentiary standards . For purposes of determining comparability and stringency under paragraph (c)(4)(ii)(A) of this section, a plan or issuer may not rely upon any factor or evidentiary standard if the information, evidence, sources, or standards on which the factor or evidentiary standard is based discriminates against mental health or substance use disorder benefits as compared to medical/surgical benefits. For purposes of this paragraph (c)(4)(ii)(B): ( 1 ) Impartially applied generally recognized independent professional medical or clinical standards described in paragraph (c)(4)(v)(A) of this section are not considered to discriminate against mental health or substance use disorder benefits. ( 2 ) Standards reasonably designed to detect or prevent and prove fraud, waste, and abuse described in paragraph (c)(4)(v)(B) of this section are not considered to discriminate against mental health or substance use disorder benefits. ( 3 ) 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 including, but not limited to, the source of the information, the purpose or context of the information, and the content of the information. (iii) Illustrative, non-exhaustive list of nonquantitative treatment limitations . Nonquantitative treatment limitations include – (A) Medical management standards (such as prior authorization) limiting or excluding benefits based on medical necessity or medical appropriateness, or based on whether the treatment is experimental or investigative; (B) Formulary design for prescription drugs; (C) For plans with multiple network tiers (such as preferred providers and participating providers), network tier design; (D) 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; (E) Plan or issuer 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; (F) Refusal to pay for higher-cost therapies until it can be shown that a lower-cost therapy is not effective (also known as fail-first policies or step therapy protocols); (G) Exclusions based on failure to complete a course of treatment; and (H) Restrictions based on geographic location, facility type, provider specialty, and other criteria that limit the scope or duration of benefits for services provided under the plan or coverage. (iv) Required use of outcomes data —(A) |
976 | ; and (H) Restrictions based on geographic location, facility type, provider specialty, and other criteria that limit the scope or duration of benefits for services provided under the plan or coverage. (iv) Required use of outcomes data —(A) In general . When designing and applying a nonquantitative treatment limitation, a plan or issuer must collect and evaluate relevant data in a manner reasonably designed to assess the impact of the nonquantitative treatment limitation 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 limitation, in operation, complies with paragraphs (c)(4)(i) and (ii) of this section. The Secretary, jointly with the Secretary of the Treasury and the Secretary of Labor, may specify in guidance the type, form, and manner of collection and evaluation for the data required under this paragraph (c)(4)(iv)(A). ( 1 ) For purposes of this paragraph (c)(4)(iv)(A), relevant data includes, but is not limited to, the number and percentage of claims denials and any other data relevant to the nonquantitative treatment limitation required by State law or private accreditation standards. ( 2 ) In addition to the relevant data set forth in paragraph (c)(4)(iv)(A)( 1 ) of this section, relevant data for nonquantitative treatment limitations related to network composition standards includes, but is not limited to, in-network and out-of-network utilization rates (including data related to provider claim submissions), network adequacy metrics (including time and distance data, and data on providers accepting new patients), and provider reimbursement rates (including as compared to billed charges). (B) Material differences . Subject to paragraph (c)(4)(iv)(C) of this section, to the extent the relevant data evaluated pursuant to paragraph (c)(4)(iv)(A) of this section show material differences in access to mental health and substance use disorder benefits as compared to medical/surgical benefits, the differences will be considered a strong indicator that the plan or issuer violates paragraph (c)(4)(i) or (ii) of this section. In such instances, the plan or issuer: ( 1 ) Must take reasonable action to address the material differences in access as necessary to ensure compliance, in operation, with paragraphs (c)(4)(i) and (ii) of this section; and ( 2 ) Must document the action that has been or is being taken by the plan or issuer to mitigate any material differences in access to mental health and substance use disorder benefits as compared to medical/surgical benefits, as required by § 146.137(c)(5)(iv). (C) Special rule for nonquantitative treatment limitations related to network composition . Notwithstanding paragraph (c)(4)(iv)(B) of this section, when designing and applying one or more nonquantitative treatment limitation(s) related to network composition standards, a plan or issuer fails to meet the requirements of paragraphs (c)(4)(i) and (ii) of this section, in operation, if the relevant data show material differences in access to in-network mental health and substance use disorder benefits as compared to in-network medical/surgical benefits in a classification. (D) Exception for independent professional medical or clinical standards . A plan or issuer designing and applying a nonquantitative treatment limitation with respect to mental health or substance use disorder benefits in any classification that impartially applies independent professional medical or clinical standards, as described in paragraph (c)(4)(v)(A) of this section, is not required to comply with the requirements of this paragraph (c)(4)(iv) with respect to that classification. (v) Independent professional medical or clinical standards and standards to detect or prevent and prove fraud, waste, and abuse . (A) To qualify for the exceptions in paragraphs (c)(4)(i)(E), (c)(4)(ii)(B), and (c)(4)(iv)(D) of this section for independent professional medical or clinical standards, a nonquantitative treatment limitation must impartially apply generally recognized independent professional medical or clinical standards (consistent with generally accepted standards of care) to medical/surgical benefits and mental health or substance use disorder benefits, and may not deviate from those standards in any way, such as by imposing additional or different |
977 | independent professional medical or clinical standards (consistent with generally accepted standards of care) to medical/surgical benefits and mental health or substance use disorder benefits, and may not deviate from those standards in any way, such as by imposing additional or different requirements. (B) To qualify for the exceptions in paragraphs (c)(4)(i)(E) and (c)(4)(ii)(B) of this section to detect or prevent and prove fraud, waste, and abuse, a nonquantitative treatment limitation must be reasonably designed to detect or prevent and prove fraud, waste, and abuse, based on indicia of fraud, waste, and abuse that have been reliably established through objective and unbiased data, and also be narrowly designed to minimize the negative impact on access to appropriate mental health and substance use disorder benefits. (vi) Prohibition on separate nonquantitative treatment limitations applicable only to mental health or substance use disorder benefits . Consistent with paragraph (c)(2)(i) of this section, a group health plan (or health insurance coverage offered by an issuer in connection with such a plan) may not apply any nonquantitative treatment limitation that is applicable only with respect to mental health or substance use disorder benefits and does not apply with respect to any medical/surgical benefits in the same benefit classification. (vii) Effect of final determination of noncompliance under § 146.137 . If a group health plan (or health insurance issuer offering group health insurance coverage in connection with such a plan) receives a final determination from the Secretary that the plan or issuer is not in compliance with the requirements of § 146.137 with respect to a nonquantitative treatment limitation, the nonquantitative treatment limitation violates this paragraph (c)(4) and the Secretary may direct the plan or issuer not to impose the nonquantitative treatment limitation, unless and until the plan or issuer demonstrates to the Secretary compliance with the requirements of this section or takes appropriate action to remedy the violation. (viii) Examples . The rules of this paragraph (c)(4) are illustrated by the following examples. In each example, the group health plan is subject to the requirements of this section and provides both medical/surgical benefits and mental health and substance use disorder benefits. Additionally, in examples that conclude that the plan or issuer violates one provision of this paragraph (c)(4), such examples do not necessarily imply compliance with other provisions of this paragraph (c)(4), as these examples do not analyze compliance with all other provisions of this paragraph (c)(4). (A) Example 1 (More restrictive prior authorization requirement in operation) —( 1 ) Facts . A plan requires prior authorization from the plan’s utilization reviewer that a treatment is medically necessary for all inpatient, in-network medical/surgical benefits and for all inpatient, in-network mental health and substance use disorder benefits. While inpatient, in-network benefits for medical/surgical conditions are approved for periods of 1, 3, and 7 days, after which a treatment plan must be submitted by the patient’s attending provider and approved by the plan, the approvals for 7 days are most common under this plan. For inpatient, in-network mental health and substance use disorder benefits, routine approval is most commonly given only for one day, after which a treatment plan must be submitted by the patient’s attending provider and approved by the plan. The difference in the duration of approvals is not the result of independent professional medical or clinical standards or standards to detect or prevent and prove fraud, waste, and abuse, but rather reflects the application of a heightened standard to the provision of the mental health and substance use disorder benefits in the relevant classification. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(A) ( Example 1 ), the plan violates the rules of paragraph (c)(4)(i) of this section. Under the terms of the plan, prior authorization applies to at least two-thirds of all medical/surgical benefits in the relevant classification (inpatient, in-network), since it applies to all benefits in the relevant classification. Further, the most common or frequent variation of the nonquantitative treatment limitation applied to medical/surgical benefits in the relevant classification (the predominant nonquantitative treatment limitation) is the routine approval of inpatient, in-network benefits for 7 days before the patient’s attending provider must submit a treatment plan. However, |
978 | to medical/surgical benefits in the relevant classification (the predominant nonquantitative treatment limitation) is the routine approval of inpatient, in-network benefits for 7 days before the patient’s attending provider must submit a treatment plan. However, the plan routinely approves inpatient, in-network benefits for mental health and substance use disorder conditions for only 1 day before the patient’s attending provider must submit a treatment plan (and, in doing so, does not impartially apply independent professional medical or clinical standards or apply standards to detect or prevent and prove fraud, waste, and abuse that qualify for the exceptions in paragraph (c)(4)(i)(E) of this section). In operation, therefore, the prior authorization requirement imposed on inpatient, in-network mental health and substance use disorder benefits is more restrictive than the predominant prior authorization requirement applicable to substantially all medical/surgical benefits in the inpatient, in-network classification because the practice of approving only 1 day of inpatient benefits limits access to the full range of treatment options available for a condition or disorder under the plan or coverage as compared to the routine 7-day approval that is given for inpatient, in-network medical/surgical benefits. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (B) Example 2 (More restrictive peer-to-peer concurrent review requirements in operation) —( 1 ) Facts . A plan follows a written process for the concurrent review of all medical/surgical benefits and mental health and substance use disorder benefits within the inpatient, in-network classification. Under the process, a first-level review is conducted in every instance in which concurrent review applies and an authorization request is approved by the first-level reviewer only if the clinical information submitted by the facility meets the plan’s criteria for a continued stay. If the first-level reviewer is unable to approve the authorization request because the clinical information submitted by the facility does not meet the plan’s criteria for a continued stay, it is sent to a second-level reviewer who will either approve or deny the request. While the written process only requires review by the second-level reviewer to either deny or approve the request, in operation, second-level reviewers for mental health and substance use disorder benefits conduct a peer-to-peer review with a provider (acting as the authorized representative of a participant or beneficiary) before coverage of the treatment is approved. The peer-to-peer review requirement is not the result of independent professional medical or clinical standards or standards to detect or prevent and prove fraud, waste, and abuse. The plan does not impose a peer-to-peer review, as written or in operation, as part of the second-level review for medical/surgical benefits. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(B) ( Example 2 ), the plan violates the rules of paragraph (c)(4)(i) of this section. The concurrent review nonquantitative treatment limitation applies to at least two-thirds of all medical/surgical benefits within the inpatient, in-network classification because the plan follows the concurrent review process for all medical/surgical benefits. The most common or frequent variation of this nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) applicable to substantially all medical/surgical benefits is that peer-to-peer review is not imposed as part of second-level review. The plan does not impartially apply independent professional medical or clinical standards or apply standards to detect or prevent and prove fraud, waste, and abuse that qualify for the exceptions in paragraph (c)(4)(i)(E) of this section. As written, the plan’s concurrent review requirements are the same for medical/surgical benefits and mental health and substance use disorder benefits. However, in operation, by compelling an additional action (peer-to-peer review as part of second-level review) to access only mental health or substance use disorder benefits, the plan applies the limitation to mental health and substance use disorder benefits in a manner that is more restrictive than the predominant nonquantitative treatment limitation applied to substantially all medical/surgical benefits in the inpatient, in-network classification. Because the plan violates the rules of paragraph (c)(4)(i |
979 | disorder benefits in a manner that is more restrictive than the predominant nonquantitative treatment limitation applied to substantially all medical/surgical benefits in the inpatient, in-network classification. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (C) Example 3 (More restrictive peer-to-peer review medical necessity standard in operation; deviation from independent professional medical and clinical standards) —( 1 ) Facts . A plan generally requires that all treatment be medically necessary in the inpatient, out-of-network classification. For both medical/surgical benefits and mental health and substance use disorder benefits, the written medical necessity standards are based on independent professional medical or clinical standards that do not require peer-to-peer review. In operation, the plan covers out-of-network benefits for medical/surgical or mental health inpatient treatment outside of a hospital if the physician documents medical appropriateness, but for out-of-network benefits for substance use disorder inpatient treatment outside of a hospital, the plan requires a physician to also complete peer-to-peer review. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(C) ( Example 3 ), the plan violates the rules of paragraph (c)(4)(i) of this section. The medical necessity nonquantitative treatment limitation applies to at least two-thirds of all medical/surgical benefits in the inpatient, out-of-network classification. The most common or frequent variation of the nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) applicable to substantially all medical/surgical benefits is the requirement that a physician document medical appropriateness without peer-to-peer review. The plan purports to impartially apply independent professional medical or clinical standards that would otherwise qualify for the exception in paragraph (c)(4)(i)(E) of this section, but deviates from those standards by imposing the additional requirement to complete peer-to-peer review for inpatient, out-of-network benefits for substance use disorder outside of a hospital. Therefore, the exception in paragraph (c)(4)(i)(E) of this section does not apply. As written, the plan provisions apply the nonquantitative treatment limitation to mental health and substance use disorder benefits in the inpatient, out-of-network classification in the same manner as for medical/surgical benefits. However, in operation, the nonquantitative treatment limitation imposed with respect to out-of-network substance use disorder benefits for treatment outside of a hospital is more restrictive than the predominant nonquantitative treatment limitation applied to substantially all medical/surgical benefits in the classification because it limits access to the full range of treatment options available for a condition or disorder under the plan or coverage as compared to medical/surgical benefits in the same classification. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (D) Example 4 (Not comparable and more stringent methods for determining reimbursement rates in operation) —( 1 ) Facts. A plan’s base reimbursement rates for outpatient, in-network providers are determined based on a variety of factors, including the providers’ required training, licensure, and expertise. For purposes of this example, the plan’s nonquantitative treatment limitations for determining reimbursement rates for mental health and substance use disorder benefits are not more restrictive than the predominant nonquantitative treatment limitation applied to substantially all medical/surgical benefits in the classification under paragraph (c)(4)(i) of this section. As written, for mental health, substance use disorder, and medical/surgical benefits, all reimbursement rates for physicians and non-physician practitioners for the same Current Procedural Terminology (CPT) code vary based on a combination of factors, such as the nature of the service, provider type, number of providers qualified to provide the service in a given geographic area, and market need (demand). As a result, reimbursement rates for mental health, substance use disorder, and medical/surgical benefits furnished by non-physician providers are generally less than for physician providers. In operation, the plan reduces the reimbursement rate for mental health and substance use |
980 | As a result, reimbursement rates for mental health, substance use disorder, and medical/surgical benefits furnished by non-physician providers are generally less than for physician providers. In operation, the plan reduces the reimbursement rate for mental health and substance use disorder non-physician providers from that paid to mental health and substance use disorder physicians by the same percentage for every CPT code but does not apply the same reductions for non-physician medical/surgical providers. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(D) ( Example 4 ), the plan violates the rules of paragraph (c)(4)(ii) of this section. Because the plan reimburses non-physician providers of mental health and substance use disorder services by reducing their reimbursement rate from the rate to physician providers by the same percentage for every CPT code but does not apply the same reductions to non-physician providers of medical/surgical services, in operation, the factors used in applying the nonquantitative treatment limitation to mental health and substance use disorder benefits are not comparable to, and are applied more stringently than, the factors used in applying the limitation with respect to medical/surgical benefits. Because the facts assume that the plan’s methods for determining reimbursement rates comply with paragraph (c)(4)(i) of this section and the plan violates the rules of paragraph (c)(4)(ii) of this section, this example does not analyze compliance with paragraph (c)(4)(iv) of this section. (E) Example 5 (Exception for impartially applied generally recognized independent professional medical or clinical standards) —( 1 ) Facts . A group health plan develops a medical management requirement for all inpatient, out-of-network benefits for both medical/surgical benefits and mental health and substance use disorder benefits to ensure treatment is medically necessary. The medical management requirement impartially applies independent professional medical or clinical standards in a manner that qualifies for the exception in paragraph (c)(4)(i)(E) of this section. The plan does not rely on any other factors or evidentiary standards and the processes, strategies, evidentiary standards, and other factors used in designing and applying the medical management requirement to mental health and substance use disorder benefits are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, and other factors used in designing and applying the requirement with respect to medical/surgical benefits. Within the inpatient, out-of-network classification, the application of the medical management requirement results in a higher percentage of denials for mental health and substance use disorder claims than medical/surgical claims, because the benefits were found to be medically necessary for a lower percentage of mental health and substance use disorder claims based on the impartial application of the independent professional medical or clinical standards by the nonquantitative treatment limitation. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(E) ( Example 5 ), the plan does not violate the rules of this paragraph (c)(4). The medical management nonquantitative treatment limitation imposed on mental health and substance use disorder benefits does not violate paragraph (c)(4)(i) or (iv) of this section because it impartially applies independent professional medical or clinical standards for both medical/surgical benefits and mental health and substance use disorder benefits in a manner that qualifies for the exceptions in paragraphs (c)(4)(i)(E) and (c)(4)(iv)(D) of this section, respectively. Moreover, the nonquantitative treatment limitation does not violate paragraph (c)(4)(ii) of this section because the independent professional medical or clinical standards are not considered to be a discriminatory factor or evidentiary standard under paragraph (c)(4)(ii)(B) of this section. Additionally, as written and in operation, the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits in the inpatient, out-of-network classification are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, and other factors used in applying the limitation with respect to medical/surgical benefits in the classification, regardless of the fact that the application of the nonquantitative treatment limitation resulted in higher percentages of claim denials for mental health and substance use disorder benefits as compared to medical/surgical |
981 | limitation with respect to medical/surgical benefits in the classification, regardless of the fact that the application of the nonquantitative treatment limitation resulted in higher percentages of claim denials for mental health and substance use disorder benefits as compared to medical/surgical benefits. (F) Example 6 (More restrictive prior authorization requirement; exception for impartially applied generally recognized independent professional medical or clinical standards not met) —( 1 ) Facts. The provisions of a plan state that it applies independent professional medical and clinical standards (consistent with generally accepted standards of care) for setting prior authorization requirements for both medical/surgical and mental health and substance use disorder prescription drugs. The relevant generally recognized independent professional medical standard for treatment of opioid use disorder that the plan utilizes—in this case, the American Society of Addiction Medicine national practice guidelines—does not support prior authorization every 30 days for buprenorphine/naloxone. However, in operation, the plan requires prior authorization for buprenorphine/naloxone combination at each refill (every 30 days) for treatment of opioid use disorder. ( 2 ) Conclusion. In this paragraph (c)(4)(viii)(F) ( Example 6 ), the plan violates the rules of paragraph (c)(4)(i) of this section. The plan does not qualify for the exception in paragraph (c)(4)(i)(E) of this section, because, although the provisions of the plan state that it applies independent professional medical and clinical standards, the plan deviates from the relevant standards with respect to prescription drugs to treat opioid use disorder. The prior authorization nonquantitative treatment limitation is applied to at least two-thirds of all medical/surgical benefits in the prescription drugs classification. The most common or frequent variation of this nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) applicable to substantially all medical/surgical benefits is following generally recognized independent professional medical and clinical standards (consistent with generally accepted standards of care). The prior authorization requirements imposed on substance use disorder benefits are more restrictive than the predominant nonquantitative treatment limitation applicable to substantially all medical/surgical benefits in the classification, because the plan imposes additional requirements on substance use disorder benefits that limit access to the full range of treatment options available for a condition or disorder under the plan or coverage as compared to medical/surgical benefits in the same classification. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (G) Example 7 (Impermissible nonquantitative treatment limitation imposed following a final determination of noncompliance and direction by the Secretary) —( 1 ) Facts. Following an initial request by the Secretary for a plan’s comparative analysis of a nonquantitative treatment limitation pursuant to § 146.137(d), the plan submits a comparative analysis for the nonquantitative treatment limitation. After review of the comparative analysis, the Secretary makes an initial determination that the comparative analysis fails to demonstrate that the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits in the relevant classification are comparable to, and applied no more stringently than, those used in designing and applying the limitation to medical/surgical benefits in the classification. Pursuant to § 146.137(d)(3), the plan submits a corrective action plan and additional comparative analyses within 45 calendar days after the initial determination, and the Secretary then determines that the additional comparative analyses do not demonstrate compliance with the requirements of this paragraph (c)(4). The plan receives a final determination of noncompliance from the Secretary, which informs the plan that it is not in compliance with this paragraph (c)(4) and directs the plan not to impose the nonquantitative treatment limitation by a certain date, unless and until the plan demonstrates compliance to the Secretary or takes appropriate action to remedy the violation. The plan makes no changes to its plan terms by that date and continues to impose the nonquantitative treatment limitation. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(G) ( Example 7 ), the plan violates the requirements of this paragraph (c)(4) by imposing the nonquantitative treatment limitation after the Secretary directs the plan not to impose it, pursuant to paragraph (c)( |
982 | )(4)(viii)(G) ( Example 7 ), the plan violates the requirements of this paragraph (c)(4) by imposing the nonquantitative treatment limitation after the Secretary directs the plan not to impose it, pursuant to paragraph (c)(4)(vii) of this section. (H) Example 8 (Provider network admission standards not more restrictive and compliant with requirements for design and application of NQTLs) —( 1 ) Facts . As part of a plan’s standards for provider admission to its network, in the outpatient, in-network classification, any provider seeking to contract with the plan must have a certain number of years of supervised clinical experience. As a result of that standard, master’s level mental health therapists are required to obtain supervised clinical experience beyond their licensure, while master’s level medical/surgical providers, psychiatrists, and Ph.D.-level psychologists do not require additional experience beyond their licensure because their licensure already requires supervised clinical experience. The plan collects and evaluates relevant data in a manner reasonably designed to assess the impact of the nonquantitative treatment limitation. This includes in-network and out-of-network utilization rates (including data related to provider claim submissions), network adequacy metrics (including time and distance data, and data on providers accepting new patients), and provider reimbursement rates (including as compared to billed charges). This data demonstrates that participants and beneficiaries seeking outpatient care are able to access outpatient, in-network mental health and substance use disorder providers at the same frequency as outpatient, in-network medical/surgical providers, that mental health and substance use disorder providers are active in the network and are accepting new patients to the same extent as medical/surgical providers, and that mental health and substance use disorder providers are within similar time and distances to plan participants and beneficiaries as are medical/surgical providers. This data also does not identify material differences in what the plan or issuer pays psychiatrists or non-physician mental health providers, compared to physicians or non-physician medical/surgical providers, respectively, both for the same reimbursement codes and as compared to Medicare rates. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(H) ( Example 8 ), the plan does not violate this paragraph (c)(4). The standards for this nonquantitative treatment limitation, namely provider admission to the plan’s network, are applied to at least two-thirds of all medical/surgical benefits in the outpatient, in-network classification, as it applies to all medical/surgical benefits in the classification. The most common or frequent variation of this nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) that applies to substantially all medical/surgical benefits in the classification is having a certain number of years of supervised clinical experience. The standards for provider admission to the plan’s network that are imposed with respect to mental health or substance use disorder benefits are no more restrictive, as written or in operation, than the predominant variation of the nonquantitative treatment limitation applicable to substantially all medical/surgical benefits in the classification, because the standards do not limit access to the full range of treatment options available for a condition or disorder under the plan or coverage as compared to medical/surgical benefits in the same classification. The requirement that providers have a certain number of years of supervised clinical experience that the plan relied upon to design and apply the nonquantitative treatment limitation is not considered to discriminate against mental health or substance use disorder benefits, even though this results in the requirement that master’s level mental health therapists obtain supervised clinical experience beyond their licensure, unlike master’s level medical/surgical providers. In addition, as written and in operation, the processes, strategies, evidentiary standards, or other factors used in applying the nonquantitative treatment limitation to mental health or substance use disorder benefits in the classification are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in applying the limitation with respect to medical/surgical benefits in the classification, because the plan applies the same standard to all providers in the classification. Finally, the plan or issuer collects and evaluates relevant data in a manner reasonably designed to assess the impact of the nonquantitative treatment limitation on access to mental health and substance use disorder benefits, which does not show material differences in access to in-network mental |
983 | , the plan or issuer collects and evaluates relevant data in a manner reasonably designed to assess the impact of the nonquantitative treatment limitation on access to mental health and substance use disorder benefits, which does not show material differences in access to in-network mental health and substance use disorder benefits as compared to in-network medical/surgical benefits in the classification. (I) Example 9 (More restrictive requirement for primary caregiver participation applied to ABA therapy) —( 1 ) Facts . A plan generally applies medical necessity criteria in adjudicating claims for coverage of all outpatient, in-network medical/surgical and mental health and substance use disorder benefits, including ABA therapy for the treatment of ASD, which is a mental health condition. The plan’s medical necessity criteria for coverage of ABA therapy requires evidence that the participant’s or beneficiary’s primary caregivers actively participate in ABA therapy, as documented by consistent attendance in parent, caregiver, or guardian training sessions. In adding this requirement, the plan deviates from independent professional medical or clinical standards, and there are no similar medical necessity criteria requiring evidence of primary caregiver participation in order to receive coverage of any medical/surgical benefits. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(I) ( Example 9 ), the plan violates paragraph (c)(4)(i) of this section. The plan applies medical necessity criteria to at least two-thirds of all outpatient, in-network medical/surgical benefits, as they apply to all medical/surgical benefits in the classification. The most common or frequent variation of this nonquantitative treatment limitation (the predominant nonquantitative treatment limitation) that applies to substantially all medical/surgical benefits in the classification does not include the requirement to provide evidence that the participant’s or beneficiary’s primary caregivers actively participate in the treatment. The plan does not qualify for the exception in paragraph (c)(4)(i)(E) of this section in applying its restriction on coverage for ABA therapy because the plan deviates from the independent professional medical or clinical standards by imposing a different requirement. As a result, the nonquantitative treatment limitation imposed on mental health and substance use disorder benefits is more restrictive than the predominant medical necessity requirement imposed on substantially all medical/surgical benefits in the classification (which does not include the requirement to provide evidence that primary caregivers actively participate in treatment). Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (J) Example 10 (More restrictive exclusion for experimental or investigative treatment applied to ABA therapy) —( 1 ) Facts. A plan, as written, generally excludes coverage for all treatments that are experimental or investigative for both medical/surgical benefits and mental health and substance use disorder benefits in the outpatient, in-network classification. As a result, the plan generally excludes experimental treatment of medical conditions and surgical procedures, mental health conditions, and substance use disorders when no professionally recognized treatment guidelines define clinically appropriate standards of care for the condition or disorder and fewer than two randomized controlled trials are available to support the treatment’s use with respect to the given condition or disorder. The plan provides benefits for the treatment of ASD, which is a mental health condition, but, in operation, the plan excludes coverage for ABA therapy to treat children with ASD, deeming it experimental. More than one professionally recognized treatment guideline defines clinically appropriate standards of care for ASD and more than two randomized controlled trials are available to support the use of ABA therapy to treat certain children with ASD. ( 2 ) Conclusion. In this paragraph (c)(4)(viii)(J) ( Example 10 ), the plan violates the rules of paragraph (c)(4)(i) of this section. The coverage exclusion for experimental or investigative treatment applies to at least two-thirds of all medical/surgical benefits, as it applies to all medical/surgical benefits in the outpatient, in-network classification. The most common or frequent variation of this nonquantitative treatment limitation in the classification (the predominant nonquantitative treatment limitation) applicable to substantially all medical/surgical benefits is the exclusion under the plan for coverage of experimental treatment of medical/surgical conditions when no professionally recognized treatment guidelines define clinically appropriate standards of care for the condition or disorder and fewer |
984 | quantitative treatment limitation) applicable to substantially all medical/surgical benefits is the exclusion under the plan for coverage of experimental treatment of medical/surgical conditions when no professionally recognized treatment guidelines define clinically appropriate standards of care for the condition or disorder and fewer than two randomized controlled trials are available to support the treatment’s use with respect to the given condition or procedure. In operation, the exclusion for experimental or investigative treatment imposed on ABA therapy is more restrictive than the predominant variation of the nonquantitative treatment limitation for experimental or investigative treatment imposed on substantially all medical/surgical benefits in the classification because the exclusion limits access to the full range of treatment options available for a condition or disorder under the plan or coverage as compared to medical/surgical benefits in the same classification. Because the plan violates the rules of paragraph (c)(4)(i) of this section, this example does not analyze compliance with paragraph (c)(4)(ii) or (iv) of this section. (K) Example 11 (Separate EAP exhaustion treatment limitation applicable only to mental health benefits) —( 1 ) Facts . An employer maintains both a major medical plan and an employee assistance program (EAP). The EAP provides, among other benefits, a limited number of mental health or substance use disorder counseling sessions, which, together with other benefits provided by the EAP, are not significant benefits in the nature of medical care. Participants are eligible for mental health or substance use disorder benefits under the major medical plan only after exhausting the counseling sessions provided by the EAP. No similar exhaustion requirement applies with respect to medical/surgical benefits provided under the major medical plan. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(K) ( Example 11 ), limiting eligibility for mental health and substance use disorder benefits under the major medical plan until EAP benefits are exhausted is a nonquantitative treatment limitation subject to the parity requirements of this paragraph (c). Because the limitation does not apply to medical/surgical benefits, it is a separate nonquantitative treatment limitation applicable only to mental health and substance use disorder benefits that violates paragraph (c)(4)(vi) of this section. Additionally, this EAP would not qualify as excepted benefits under §146.145(b)(3)(vi)(B)( 1 ) because participants in the major medical plan are required to use and exhaust benefits under the EAP (making the EAP a gatekeeper) before an individual is eligible for benefits under the plan. (L) Example 12 (Separate residential exclusion treatment limitation applicable only to mental health benefits) —( 1 ) Facts . A plan generally covers inpatient, in-network and inpatient out-of-network treatment in any setting, including skilled nursing facilities and rehabilitation hospitals, provided other medical necessity standards are satisfied. The plan also has an exclusion for residential treatment, which the plan defines as an inpatient benefit, for mental health and substance use disorder benefits. This exclusion was not generated through any broader nonquantitative treatment limitation (such as medical necessity or other clinical guideline). ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(L) ( Example 12 ), the plan violates the rules of paragraph (c)(4)(vi) of this section. Because the plan does not apply a comparable exclusion to inpatient benefits for medical/surgical conditions, the exclusion of residential treatment is a separate nonquantitative treatment limitation applicable only to mental health and substance use disorder benefits in the inpatient, in-network and inpatient, out-of-network classifications that does not apply with respect to any medical/surgical benefits in the same benefit classification. (M) Example 13 (Standards for provider admission to a network) —( 1 ) Facts . A plan applies nonquantitative treatment limitations related to network composition in the outpatient in-network and inpatient, in-network classifications. The plan’s networks are constructed by separate service providers for medical/surgical benefits and mental health and substance use disorder benefits. For purposes of this example, these facts assume that these nonquantitative treatment limitations related to network composition for mental health and substance use disorder benefits are not more restrictive than the predominant nonquantitative treatment limitations applied to substantially all medical/surgical benefits in the classifications under paragraph (c)(4)(i) of this section. The facts also assume that, as written and in operation, the processes |
985 | more restrictive than the predominant nonquantitative treatment limitations applied to substantially all medical/surgical benefits in the classifications under paragraph (c)(4)(i) of this section. The facts also assume that, as written and in operation, the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitations related to network access to mental health or substance use disorder benefits in the outpatient in-network and inpatient in-network classifications are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitations with respect to medical/surgical benefits in the classifications, as required under paragraph (c)(4)(ii) of this section. The plan collects and evaluates all relevant data in a manner reasonably designed to assess the impact of the nonquantitative treatment limitations related to network composition on access to mental health and substance use disorder benefits as compared with access to medical/surgical benefits and considers the impact as part of the plan’s or issuer’s analysis of whether the standards, in operation, comply with paragraphs (c)(4)(i) and (ii) of this section. The plan determined that the data did not reveal any material differences in access. That data included metrics relating to the time and distance from plan participants and beneficiaries to network providers in rural and urban regions; the number of network providers accepting new patients; the proportions of mental health and substance use disorder and medical/surgical providers and facilities that provide services in rural and urban regions who are in the plan’s network; provider reimbursement rates; in-network and out-of-network utilization rates (including data related to the dollar value and number of provider claims submissions); and survey data from participants on the extent to which they forgo or pay out-of-pocket for treatment because of challenges finding in-network providers. The efforts the plan made when designing and applying its nonquantitative treatment limitations related to network composition, which ultimately led to its outcomes data not revealing any material differences in access to benefits for mental health or substance use disorders as compared with medical/surgical benefits, included making sure that the plan’s service providers are making special efforts to enroll available providers, including by authorizing greater compensation or other inducements to the extent necessary, and expanding telehealth arrangements as appropriate to manage regional shortages. The plan also notifies participants in clear and prominent language on its website, employee brochures, and the summary plan description of a toll-free number available to help participants find in-network providers. In addition, when plan participants submit bills for out-of-network items and services, the plan directs their service providers to reach out to the treating providers and facilities to see if they will enroll in the network. ( 2 ) Conclusion . In this paragraph (c)(4)(viii)(M) ( Example 13 ), the plan does not violate this paragraph (c)(4). As stated in the Facts section, the plan’s nonquantitative treatment limitations related to network composition comply with the rules of paragraphs (c)(4)(i) and (ii) of this section. The plan collects and evaluates relevant data, as required under paragraph (c)(4)(iv)(A) of this section, and the data does not reveal any material differences in access to mental health and substance use disorder benefits as compared to medical/surgical benefits, as a result of the actions the plan took (as set forth in the facts) when initially designing its nonquantitative treatment limitations related to network composition. Because the plan takes comparable actions to ensure that their mental health and substance use disorder provider network is as accessible as their medical/surgical provider network and exercises careful oversight over both their service providers and the comparative robustness of the networks with an eye to ensuring that network composition results in access to in-network benefits for mental health and substance use disorder services that is as generous as for medical/surgical services, plan participants and beneficiaries can access covered mental health and substance use disorder services and benefits as readily as medical/surgical benefits. This is reflected in the plan’s carefully designed metrics and assessment of network composition. * * * * * (d) * * * (3) Provisions of other law . Compliance with the disclosure requirements in paragraphs (d)(1) and (2) of |
986 | plan’s carefully designed metrics and assessment of network composition. * * * * * (d) * * * (3) Provisions of other law . Compliance with the disclosure requirements in paragraphs (d)(1) and (2) of this section is not determinative of compliance with any other provision of applicable Federal or State law. In particular, in addition to those disclosure requirements, provisions of other applicable law require disclosure of information relevant to medical/surgical, mental health, and substance use disorder benefits. For example, § 147.136 of this subchapter sets forth rules regarding claims and appeals, including the right of claimants (or their authorized representative) upon appeal of an adverse benefit determination (or a final internal adverse benefit determination) to be provided upon request and free of charge, reasonable access to and copies of all documents, records, and other information relevant to the claimant’s claim for benefits. This includes documents with information on medical necessity criteria for both medical/surgical benefits and mental health and substance use disorder benefits, as well as the processes, strategies, evidentiary standards, and other factors used to apply a nonquantitative treatment limitation with respect to medical/surgical benefits and mental health or substance use disorder benefits under the plan and the comparative analyses and other applicable information required by § 146.137. (e) * * * (4) Coordination with EHB requirements . Nothing in paragraph (f) or (g) of this section or § 146.137(g) changes the requirements of §§ 147.150 and 156.115 of this subchapter, providing that a health insurance issuer offering non-grandfathered health insurance coverage in the individual or small group market providing mental health and substance use disorder services, including behavioral health treatment services, as part of essential health benefits required under §§ 156.110(a)(5) and 156.115(a) of this subchapter, must comply with the requirements under section 2726 of the PHS Act and its implementing regulations in this subchapter to satisfy the requirement to provide coverage for mental health and substance use disorder services, including behavioral health treatment, as part of essential health benefits. * * * * * (i) * * * (1) In general . Except as provided in paragraph (i)(2) of this section, this section applies to group health plans and health insurance issuers offering group health insurance coverage on the first day of the first plan year beginning on or after January 1, 2025. Until the applicability date in the preceding sentence, plans and issuers are required to continue to comply with 45 CFR 146.136, revised as of October 1, 2021. * * * * * (j) Severability . If any provision of this section is held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, or stayed pending further agency action, the provision shall be construed so as to continue to give the maximum effect to the provision permitted by law, unless such holding shall be one of invalidity or unenforceability, in which event the provision shall be severable from this section and shall not affect the remainder thereof or the application of the provision to persons not similarly situated or to dissimilar circumstances. 9. Add § 146.137 to read as follows: § 146.137 Nonquantitative treatment limitation comparative analysis requirements. (a) Meaning of terms . Unless otherwise stated in this section, the terms of this section have the meanings indicated in § 146.136(a)(2). (b) In general . In the case of a group health plan (or health insurance issuer offering group health insurance coverage in connection with a group health plan) that provides both medical/surgical benefits and mental health or substance use disorder benefits and that imposes any nonquantitative treatment limitation on mental health or substance use disorder benefits, the plan or issuer must perform and document a comparative analysis of the design and application of each nonquantitative treatment limitation applicable to mental health or substance use disorder benefits. Each comparative analysis must comply with the content requirements of paragraph (c) of this section and be made available to the Secretary, upon request, in the manner required by paragraphs (d) and (e) of this section. (c) Comparative analysis content requirements . With respect to each nonquantitative treatment limitation applicable to mental health or substance use disorder benefits under a group health plan (or health insurance coverage offered in connection |
987 | d) and (e) of this section. (c) Comparative analysis content requirements . With respect to each nonquantitative treatment limitation applicable to mental health or substance use disorder benefits under a group health plan (or health insurance coverage offered in connection with a group health plan), the comparative analysis performed by the plan or issuer must include, at minimum, the elements specified in this paragraph (c). In addition to the comparative analysis for each nonquantitative treatment limitation, each plan or issuer must prepare and make available to the Secretary, upon request, a written list of all nonquantitative treatment limitations imposed under the plan or coverage and a general description of any information considered or relied upon by the plan or issuer in preparing the comparative analysis for each nonquantitative treatment limitation. (1) Description of the nonquantitative treatment limitation . The comparative analysis must include, with respect to the nonquantitative treatment limitation that is the subject of the comparative analysis: (i) Identification of the nonquantitative treatment limitation, including the specific terms of the plan or coverage or other relevant terms regarding the nonquantitative treatment limitation, the policies or guidelines (internal or external) in which the nonquantitative treatment limitation appears or is described, and the applicable sections of any other relevant documents, such as provider contracts, that describe the nonquantitative treatment limitation; (ii) Identification of all mental health or substance use disorder benefits and medical/surgical benefits to which the nonquantitative treatment limitation applies, including a list of which benefits are considered mental health or substance use disorder benefits and which benefits are considered medical/surgical benefits; (iii) A description of which benefits are included in each classification set forth in § 146.136(c)(2)(ii)(A); and (iv) Identification of the predominant nonquantitative treatment limitation applicable to substantially all medical/surgical benefits in each classification, including an explanation of how the plan or issuer determined which variation is the predominant nonquantitative treatment limitation as compared to other variations, as well as how the plan identified the variations of the nonquantitative treatment limitation. (2) Identification and definition of the factors used to design or apply the nonquantitative treatment limitation . The comparative analysis must include, with respect to every factor considered or relied upon to design the nonquantitative treatment limitation or apply the nonquantitative treatment limitation to mental health or substance use disorder benefits and medical/surgical benefits: (i) Identification of all of the factors considered, as well as the evidentiary standards considered or relied upon to design or apply each factor and the sources from which each evidentiary standard was derived, in determining which mental health or substance use disorder benefits and which medical/surgical benefits are subject to the nonquantitative treatment limitation; and (ii) A definition of each factor, including: (A) A detailed description of the factor; and (B) A description of each evidentiary standard (and the source of each evidentiary standard) identified under paragraph (c)(2)(i) of this section. (3) Description of how factors are used in the design and application of the nonquantitative treatment limitation . The comparative analysis must include a description of how each factor identified and defined pursuant to paragraph (c)(2) of this section is used in the design or application of the nonquantitative treatment limitation to mental health and substance use disorder benefits and medical/surgical benefits in a classification, including: (i) A detailed explanation of how each factor identified and defined in paragraph (c)(2) of this section is used to determine which mental health or substance use disorder benefits and which medical/surgical benefits are subject to the nonquantitative treatment limitation; (ii) An explanation of the evidentiary standards or other information or sources (if any) considered or relied upon in designing or applying the factors or relied upon in designing and applying the nonquantitative treatment limitation, including in the determination of whether and how mental health or substance use disorder benefits or medical/surgical benefits are subject to the nonquantitative treatment limitation; (iii) If the application of the factor depends on specific decisions made in the administration of benefits, the nature of the decisions, the timing of the decisions, and the professional designation and qualifications of each decision maker; (iv) If more than one factor is identified and defined in paragraph (c)(2) of this section, an explanation of: (A) How all of the factors relate |
988 | the decisions, and the professional designation and qualifications of each decision maker; (iv) If more than one factor is identified and defined in paragraph (c)(2) of this section, an explanation of: (A) How all of the factors relate to each other; (B) The order in which all the factors are applied, including when they are applied; (C) Whether and how any factors are given more weight than others; and (D) The reasons for the ordering or weighting of the factors; and (v) Any deviation(s) or variation(s) from a factor, its applicability, or its definition (including the evidentiary standards used to define the factor and the information or sources from which each evidentiary standard was derived), such as how the factor is used differently to apply the nonquantitative treatment limitation to mental health or substance use disorder benefits as compared to medical/surgical benefits, and a description of how the plan or issuer establishes such deviation(s) or variation(s). (4) Demonstration of comparability and stringency as written . The comparative analysis must evaluate whether, in any classification, under the terms of the plan (or health insurance coverage) as written, any processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation with respect to medical/surgical benefits. The comparative analysis must include, with respect to the nonquantitative treatment limitation and the factors used in designing and applying the nonquantitative treatment limitation: (i) Documentation of each factor identified and defined in paragraph (c)(2) of this section that was applied to determine whether the nonquantitative treatment limitation applies to mental health or substance use disorder benefits and medical/surgical benefits in a classification, including, as relevant: (A) Quantitative data, calculations, or other analyses showing whether, in each classification in which the nonquantitative treatment limitation applies, mental health or substance use disorder benefits and medical/surgical benefits met or did not meet any applicable threshold identified in the relevant evidentiary standard, and the evaluation of relevant data as required under § 146.136(c)(4)(iv)(A), to determine that the nonquantitative treatment limitation would or would not apply; and (B) Records maintained by the plan or issuer documenting the consideration and application of all factors and evidentiary standards, as well as the results of their application; (ii) In each classification in which the nonquantitative treatment limitation applies to mental health or substance use disorder benefits, a comparison of how the nonquantitative treatment limitation, as written, is applied to mental health or substance use disorder benefits and to medical/surgical benefits, including the specific provisions of any forms, checklists, procedure manuals, or other documentation used in designing and applying the nonquantitative treatment limitation or that address the application of the nonquantitative treatment limitation; (iii) Documentation demonstrating how the factors are comparably applied, as written, to mental health or substance use disorder benefits and medical/surgical benefits in each classification, to determine which benefits are subject to the nonquantitative treatment limitation; and (iv) An explanation of the reason(s) for any deviation(s) or variation(s) in the application of a factor used to apply the nonquantitative treatment limitation, or the application of the nonquantitative treatment limitation, to mental health or substance use disorder benefits as compared to medical/surgical benefits, and how the plan or issuer establishes such deviation(s) or variation(s), including: (A) In the definition of the factors, the evidentiary standards used to define the factors, and the sources from which the evidentiary standards were derived; (B) In the design of the factors or evidentiary standards; or (C) In the application or design of the nonquantitative treatment limitation. (5) Demonstration of comparability and stringency in operation . The comparative analysis must evaluate whether, in any classification, under the terms of the plan (or health insurance coverage) in operation, the processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder |
989 | , in any classification, under the terms of the plan (or health insurance coverage) in operation, the processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in designing and applying the limitation with respect to medical/surgical benefits. The comparative analysis must include, with respect to the nonquantitative treatment limitation and the factors used in designing and applying the nonquantitative treatment limitation: (i) A comprehensive explanation of how the plan or issuer ensures that, in operation, the processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits in a classification are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in designing and applying the nonquantitative treatment limitation with respect to medical/surgical benefits, including: (A) An explanation of any methodology and underlying data used to demonstrate the application of the nonquantitative treatment limitation, in operation; and (B) The sample period, inputs used in any calculations, definitions of terms used, and any criteria used to select the mental health or substance use disorder benefits and medical/surgical benefits to which the nonquantitative treatment limitation is applicable; (ii) Identification of the relevant data collected and evaluated as required under § 146.136(c)(4)(iv)(A); (iii) An evaluation of the outcomes that resulted from the application of the nonquantitative treatment limitation to mental health or substance use disorder benefits and medical/surgical benefits, including the relevant data as required under § 146.136(c)(4)(iv)(A); (iv) A detailed explanation of material differences in outcomes evaluated pursuant to paragraph (c)(5)(iii) of this section that are not attributable to differences in the comparability or relative stringency of the nonquantitative treatment limitation as applied to mental health or substance use disorder benefits and medical/surgical benefits and the bases for concluding that material differences in outcomes are not attributable to differences in the comparability or relative stringency of the nonquantitative treatment limitation; and (v) A discussion of any measures that have been or are being implemented by the plan or issuer to mitigate any material differences in access to mental health or substance use disorder benefits as compared to medical/surgical benefits, including the actions the plan or issuer is taking under § 146.136(c)(4)(iv)(B)( 1 ) to address material differences to ensure compliance with § 146.136(c)(4)(i) and (ii). (6) Findings and conclusions . The comparative analysis must address the findings and conclusions as to the comparability of the processes, strategies, evidentiary standards, and other factors used in designing and applying the nonquantitative treatment limitation to mental health or substance use disorder benefits and medical/surgical benefits within each classification, and the relative stringency of their application, both as written and in operation, and include: (i) Any findings or conclusions indicating that the plan or coverage is not (or might not be) in compliance with the requirements of § 146.136(c)(4), including any actions the plan or issuer has taken or intends to take to address any potential areas of concern or noncompliance; (ii) A reasoned and detailed discussion of the findings and conclusions described in paragraph (c)(6)(i) of this section; (iii) Citations to any additional specific information not otherwise included in the comparative analysis that supports the findings and conclusions described in paragraph (c)(6)(i) of this section; (iv) The date of the analysis and the title and credentials of all relevant persons who participated in the performance and documentation of the comparative analysis; and (v) If the comparative analysis relies upon an evaluation by a reviewer or consultant considered by the plan or issuer to be an expert, an assessment of each expert’s qualifications and the extent to which the plan or issuer ultimately relied upon each expert’s evaluation in performing and documenting the comparative analysis of the design and application of each nonquantitative treatment limitation applicable to both mental health or substance use disorder benefits and medical/surgical benefits. (d) Requirements related to submission |
990 | upon each expert’s evaluation in performing and documenting the comparative analysis of the design and application of each nonquantitative treatment limitation applicable to both mental health or substance use disorder benefits and medical/surgical benefits. (d) Requirements related to submission of comparative analyses to the Secretary upon request —(1) Initial request by the Secretary for comparative analysis . A group health plan or health insurance issuer offering group health insurance coverage must make the comparative analysis required by paragraph (b) of this section available and submit it to the Secretary within 10 business days of receipt of a request from the Secretary (or an additional period of time specified by the Secretary). (2) Additional information required after a comparative analysis is deemed to be insufficient . In instances in which the Secretary determines that the plan or issuer has not submitted sufficient information under paragraph (d)(1) of this section for the Secretary to review the comparative analysis required in paragraph (b) of this section, the Secretary will specify to the plan or issuer the additional information the plan or issuer must submit to the Secretary to be responsive to the request under paragraph (d)(1) of this section. Any such information must be provided to the Secretary by the plan or issuer within 10 business days after the Secretary specifies the additional information to be submitted (or an additional period of time specified by the Secretary). (3) Initial determination of noncompliance, required action, and corrective action plan . In instances in which the Secretary reviewed the comparative analysis submitted under paragraph (d)(1) of this section and any additional information submitted under paragraph (d)(2) of this section, and made an initial determination that the plan or issuer is not in compliance with the requirements of § 146.136(c)(4) or this section, the plan or issuer must respond to the Secretary and specify the actions the plan or issuer will take to bring the plan or coverage into compliance, and provide to the Secretary additional comparative analyses meeting the requirements of paragraph (b) of this section that demonstrate compliance with § 146.136(c)(4) and this section, not later than 45 calendar days after the Secretary’s initial determination that the plan or issuer is not in compliance. (4) Requirement to notify participants and beneficiaries of final determination of noncompliance —(i) In general . If the Secretary makes a final determination of noncompliance, the plan or issuer must notify all participants and beneficiaries enrolled in the plan or coverage that the plan or issuer has been determined to not be in compliance with the requirements of § 146.136(c)(4) or this section with respect to such plan or coverage. Such notice must be provided within 7 calendar days of receipt of the final determination of noncompliance, and the plan or issuer must provide a copy of the notice to the Secretary, and any service provider involved in the claims process. (ii) Content of notice . The notice to participants and beneficiaries required in paragraph (d)(4)(i) of this section shall be written in a manner calculated to be understood by the average plan participant and must include, in plain language, the following information in a standalone notice: (A) The following statement prominently displayed on the first page, in no less than 14-point font: “Attention! The Department of Health and Human Services has determined that [insert the name of group health plan or health insurance issuer] is not in compliance with the Mental Health Parity and Addiction Equity Act.”; (B) A summary of changes the plan or issuer has made as part of its corrective action plan specified to the Secretary following the initial determination of noncompliance, including an explanation of any opportunity for a participant or beneficiary to have a claim for benefits reprocessed; (C) A summary of the Secretary’s final determination that the plan or issuer is not in compliance with § 146.136(c)(4) or this section, including any provisions or practices identified as being in violation of MHPAEA, additional corrective actions identified by the Secretary in the final determination notice, and information on how participants and beneficiaries can obtain from the plan or issuer a copy of the final determination of noncompliance; (D) Any additional actions the plan or issuer is taking to come into compliance with § 146.136(c)(4) or this section, when the plan or issuer will take such actions, and a clear and accurate statement explaining whether the Secretary has indicated that those actions, if completed, will result |
991 | taking to come into compliance with § 146.136(c)(4) or this section, when the plan or issuer will take such actions, and a clear and accurate statement explaining whether the Secretary has indicated that those actions, if completed, will result in compliance; and (E) Contact information for questions and complaints, and a statement explaining how participants and beneficiaries can obtain more information about the notice, including: ( 1 ) The plan’s or issuer’s phone number and an email or web portal address; and ( 2 ) The Center for Medicare and Medicaid Services’ phone number and email or web portal address. (iii) Manner of notice . The plan or issuer must make the notice required under paragraph (d)(4)(i) of this section available in paper form, or electronically (such as by email or an Internet posting) if: (A) The format is readily accessible; (B) The notice is provided in paper form free of charge upon request; and (C) In a case in which the electronic form is an internet posting, the plan or issuer timely notifies the participant or beneficiary in paper form (such as a postcard) or email, that the documents are available on the internet, provides the internet address, includes the statement required in paragraph (d)(4)(ii)(A) of this section, and notifies the participant or beneficiary that the documents are available in paper form upon request. (e) Requests for a copy of a comparative analysis . In addition to making a comparative analysis available upon request to the Secretary, a plan or issuer must make available a copy of the comparative analysis required by paragraph (b) of this section when requested by: (1) Any applicable State authority; and (2) A participant or beneficiary (or a provider or other person acting as a participant’s or beneficiary’s authorized representative) who has received an adverse benefit determination related to mental health or substance use disorder benefits. (f) Rule of construction . Nothing in this section or § 146.136 shall be construed to prevent the Secretary from acting within the scope of existing authorities to address violations of § 146.136 or this section. (g) Applicability. The provisions of this section apply to group health plans and health insurance issuers offering group health insurance coverage described in § 146.136(e), to the extent the plan or issuer is not exempt under § 146.136(f) or (g), for plan years beginning on or after January 1, 2025. (h) Severability . If any provision of this section is held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, or stayed pending further agency action, the provision shall be construed so as to continue to give the maximum effect to the provision permitted by law, unless such holding shall be one of invalidity or unenforceability, in which event the provision shall be severable from this section and shall not affect the remainder thereof or the application of the provision to persons not similarly situated or to dissimilar circumstances. 9. Amend § 146.180 by: a. Revising paragraph (a)(2); b. Redesignating paragraphs (a)(3) through (7) as paragraphs (a)(4) through (8); c. Adding new paragraph (a)(3); d. Revising newly redesignated paragraphs (a)(5) and (a)(7)(i) and paragraph (f)(1); and e. Adding paragraph (f)(4)(iii). The revisions and additions read as follows: §146.180 Treatment of non-Federal governmental plans. (a) * * * (2) General rule . For plans years beginning on or after September 23, 2010, a sponsor of a non-Federal governmental plan may elect to exempt its plan, to the extent the plan is not provided through health insurance coverage (that is self-funded), from one or more of the requirements described in paragraphs (a)(1)(iv) through (vii) of this section, except as provided in paragraphs (a)(3) and (f)(1) of this section with respect to the requirements described in paragraph (a)(1)(v) of this section. (3) Sunset of election option related to parity in mental health and substance use disorder benefits. A sponsor of a non-Federal governmental plan may not newly elect to exempt its |
992 | requirements described in paragraph (a)(1)(v) of this section. (3) Sunset of election option related to parity in mental health and substance use disorder benefits. A sponsor of a non-Federal governmental plan may not newly elect to exempt its plan(s) from the requirements described in paragraph (a)(1)(v) of this section on or after December 29, 2022. * * * * * (5) Examples – (i) Example 1. A non-Federal governmental employer has elected to exempt its self-funded group health plan from all of the requirements described in paragraph (a)(1) of this section. The plan year commences September 1 of each year. The plan is not subject to the provisions of paragraph (a)(2) of this section until the plan year that commences on September 1, 2011. Accordingly, for that plan year and any subsequent plan years, the plan sponsor may elect to exempt its plan only from the requirements described in paragraphs (a)(1)(iv) through (vii) of this section, subject to paragraphs (a)(3) and (f)(1) of this section with respect to the requirements described in paragraph (a)(1)(v) of this section. (ii) Example 2. A non-Federal governmental employer has elected to exempt its collectively bargained self-funded plan from all of the requirements described in paragraph (a)(1) of this section. The collective bargaining agreement applies to 5 plan years, October 1, 2009 through September 30, 2014. For the plan year that begins on October 1, 2014, the plan sponsor is no longer permitted to elect to exempt its plan from the requirements described in paragraphs (a)(1) (i) through (iii) of this section. Accordingly, for that plan year and any subsequent plan years, the plan sponsor may elect to exempt its plan only from the requirements described in paragraphs (a)(1)(iv) through (vii) of this section, subject to paragraphs (a)(3) and (f)(1) of this section with respect to the requirements described in paragraph (a)(1)(v) of this section. * * * * * (7) * * * (i) Subject to paragraph (a)(7)(ii) of this section, the purchase of stop-loss or excess risk coverage by a self-funded non-Federal governmental plan does not prevent an election under this section. * * * * * (f) * * * (1) Election renewal . A plan sponsor may renew an election under this section through subsequent elections. Notwithstanding the previous sentence and except as provided in paragraph (f)(4)(iii) of this section, an election with respect to the requirements described in paragraph (a)(1)(v) of this section expiring on or after June 27, 2023, may not be renewed. The timeliness standards described in paragraph (c) of this section apply to election renewals under paragraph (f) of this section. * * * * * (4) * * * (iii) In the case of a plan that is subject to multiple collective bargaining agreements of varying lengths and that has an election with respect to the requirements described in paragraph (a)(1)(v) of this section in effect as of December 29, 2022, that expires on or after June 27, 2023, the plan may extend such election until the date on which the term of the last such agreement expires. * * * * * PART 147—HEALTH INSURANCE REFORM REQUIREMENTS FOR THE GROUP AND INDIVIDUAL HEALTH INSURANCE MARKETS 10. The authority citation for part 147 continues to read as follows: Authority: 42 U.S.C. 300gg through 300gg–63, 300gg–91, 300gg–92, and 300gg–111 through 300gg–139, as amended, and section 3203, Pub. L. 116–136, 134 Stat. 281. 11. Revise § 147.160 to read as follows: § 147.160 Parity in mental health and substance use disorder benefits . (a) In general. The provisions of §§ 146.136 and 146.137 of this subchapter apply to individual health insurance coverage offered by a health insurance issuer in the same manner and to the same extent as such provisions apply to health insurance coverage offered by a health insurance issuer in connection with a group |
993 | .136 and 146.137 of this subchapter apply to individual health insurance coverage offered by a health insurance issuer in the same manner and to the same extent as such provisions apply to health insurance coverage offered by a health insurance issuer in connection with a group health plan in the large group market. (b) Applicability date. The provisions of this section apply for policy years beginning on or after January 1, 2026. Until the applicability date in the preceding sentence, issuers are required to continue to comply with 45 CFR 147.160, revised as of October 1, 2021. This section applies to non-grandfathered and grandfathered health plans as defined in § 147.140. (Filed by the Office of the Federal Register July 31, 2023, 8:45 a.m., and published in the issue of the Federal Register for August 3, 2023, 88 FR 51552) 1 Department of Health and Human Services (2023). SAMHSA Announces National Survey on Drug Use and Health (NSDUH) Results Detailing Mental Illness and Substance Use Levels in 2021. Retrieved from https://www.hhs.gov/about/news/2023/01/04/samhsa-announces-national-survey-drug-use-health-results-detailing-mental-illness-substance-use-levels-2021.html. 2 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, August 2020–February 2021. MMWR Morb Mortal Wkly Rep 2021;70:490–494. DOI: http://dx.doi.org/10.15585/mmwr.mm7013e2. 3 Id . 4 Hedegaard, H., Miniño, A. M., Wagner, M. (2020). Drug Overdose Deaths in the United States, 1999-2019. NCHS Data Brief No. 304 (December 2020) https://www.cdc.gov/nchs/data/databriefs/db394-H.pdf; Centers for Disease Control and Prevention, National Center for Health Statistics. Vital Statistics Rapid Release: Provisional Drug Overdose Death Counts. Available at https://www.cdc.gov/nchs/nvss/vsrr/drug-overdose-data.htm . Accessed on July 14, 2023. 5 Hedegaard H, Spencer MR. Urban–rural differences in drug overdose death rates, 1999–2019. NCHS Data Brief, no 403. Hyattsville, MD: National Center for Health Statistics. 2021. DOI: https://dx.doi.org/10.15620/cdc:102891. 6 Spencer MR, Garnett MF, Miniño AM. Urban–rural differences in drug overdose death rates, 2020. NCHS Data Brief, no 440. Hyattsville, MD: National Center for Health Statistics. 2022. DOI: https://dx.doi.org/10.15620/cdc:118601. 7 National Vital Statistics System. Provisional Drug Overdose Death Counts. https://www.cdc.gov/nchs/pressroom/nchs_press_releases/2022/202205.htm. 8 Friedman, Joseph R, and Helena Hansen (2022). Research Letter: Evaluation of Increases in Drug Overdose Mortality Rates in the US by Race and Ethnicity Before and During the COVID-19 Pandemic. JAMA Psychiatry. https://jamanetwork.com/journals/jamapsychiatry/fullarticle/2789697?utm_campaign=articlePDF&utm_medium=articlePDFlink&utm_source=articlePDF&utm_content=jamapsychiatry.2022.0004. 9 Id. 10 Mental Health America (2022). Youth Ranking 2022. https://mhanational.org/issues/2022/mental-health-america-youth-data. 11 Sheridan D, Grusing S, Marshall R. (2022) |
994 | Health America (2022). Youth Ranking 2022. https://mhanational.org/issues/2022/mental-health-america-youth-data. 11 Sheridan D, Grusing S, Marshall R. (2022) Changes in Suicidal Ingestion Among Preadolescent Children from 2000 to 2020. JAMA Pediatrics. https://jamanetwork.com/journals/jamapediatrics/article-abstract/2789948; see also CDC, Youth Risk Behavior Survey, available at https://www.cdc.gov/healthyyouth/data/yrbs/pdf/YRBS_Data-Summary-Trends_Report2023_508.pdf . 12 Bridge JA, Horowitz LM, Fontanella CA, et al. (2018). Age-Related Racial Disparity in Suicide Rates Among US Youths From 2001 Through 2015. JAMA Pediatrics. https://jamanetwork.com/journals/jamapediatrics/fullarticle/2680952 . 13 The Trevor Project (2022). 2022 National Survey on LGBTQ Youth Mental Health. https://www.thetrevorproject.org/survey-2022/. 14 The Trevor Project (2022). The Mental Health and Well-Being of Multiracial LGBTQ Youth. https://www.thetrevorproject.org/research-briefs/the-mental-health-and-well-being-of-multiracial-lgbtq-youth-aug-2022/. 15 Radhakrishnan L, Leeb R, Bitsko R, Carey K, Gates A, Holland K, Hartnett K, Kite-Powell A, DeVies J, Smith A, van Santen K, Crossen S, Sheppard M, Wotiz S, Lane R, Njai R, Johnson A, Winn A, Kirking H, Rodgers L, Thomas C, Soetebier K, Adjemian J, Anderson K. (2022) Pediatric Emergency Department Visits Associated with Mental Health Conditions Before and During the COVID-19 Pandemic — United States, January 2019–January 2022. MMWR Morb Mortal Wkly Rep 2022; 71(8);319-324. https://www.cdc.gov/mmwr/volumes/71/wr/mm7108e2.htm. 16 Id. 17 Stuart B. Murray, Aaron J. Blashill, and Jerel P. Calzo (2022). Prevalence of Disordered Eating and Associations With Sex, Pubertal Maturation, and Weight in Children in the US, available at https://jamanetwork.com/journals/jamapediatrics/article-abstract/2794847. 18 Centers for Disease Control and Prevention, National Center for HIV, Viral Hepatitis, STD, and TB Prevention, U.S. Teen Girls Experiencing Increased Sadness and Violence (Feb. 13, 2023), available at https://www.cdc.gov/nchhstp/newsroom/2023/increased-sadness-and-violence-press-release.html. 19 Van Boekel, L. C., Brouwers, E. P., van Weeghel, J., & Garretsen, H. F. (2013). Stigma among health professionals towards patients with substance use disorders and its consequences for healthcare delivery: systematic review. Drug and Alcohol Dependence, 131(1-2), 23–35. DOI: 10.1016/j.drugalcdep.2013.02.018, available at https://pubmed.ncbi.nlm.nih.gov/23490450/. 20 Cf. Jack Turbin. Ghost networks of psychiatrists make money for insurance companies but hinder patients’ access to care. Stat News, June 17, 2019, https://www.statnews.com/2019/06/17/ghost-networks-psychiatrists-hinder-patient-care/ 21 National Alliance on Mental Illness (2021). Mood Disorder Survey Report. https://nami.org/NAMI/media/NAMI-Media/Research/NAMI-Mood-Disorder-Survey-White-Paper.pdf. 22 Esther Aden |
995 | ness (2021). Mood Disorder Survey Report. https://nami.org/NAMI/media/NAMI-Media/Research/NAMI-Mood-Disorder-Survey-White-Paper.pdf. 22 Esther Adeniran, Megan Quinn, Richard Wallace, Rachel R. Walden, Titilola Labisi, Afolakemi Olaniyan, Billy Brooks, Robert Pack (2023). A scoping review of barriers and facilitators to the integration of substance use treatment services into US mainstream health care, Drug and Alcohol Dependence Reports; Volume 7, 100152 https://www.sciencedirect.com/science/article/pii/S2772724623000227. 23 Center for Behavioral Health Statistics and Quality (2022), Results from the 2021 National Survey on Drug Use and Health: Detailed Tables, Substance Abuse and Mental Health Services Administration, available at https://www.samhsa.gov/data/report/2021-nsduh-detailed-tables. For this purpose, “any treatment” includes having participated in a mutual aid group, such as Alcoholics Anonymous, Narcotics Anonymous, or SMART Recovery, and receiving services in a hospital through primary care. 24 Id. 25 Health Resources and Services Administration, Designated Health Professional Shortage Areas Statistics (data updated through June 30, 2023), available at https://data.hrsa.gov/Default/GenerateHPSAQuarterlyReport (last accessed July 18, 2023). 26 Borders, TF. Major Depression, Treatment Receipt, and Treatment Sources among Non-Metropolitan and Metropolitan Adults. Lexington, KY: Rural and Underserved Health Research Center; 2020. Available at https://www.ruralhealthresearch.org/publications/1348. 27 See, generally , Commonwealth Fund, Behavioral Health Care in the United States: How It Works and Where It Falls Short, available at https://www.commonwealthfund.org/publications/explainer/2022/sep/behavioral-health-care-us-how-it-works-where-it-falls-short. 28 See National Alliance on Mental Illness, Mental Health By the Numbers, available at https://www.nami.org/mhstats (showing 8.4 million people in the U.S. provide care to an adult with a mental or emotional health issue); KFF, KFF/CNN Mental Health In America Survey, available at https://www.kff.org/other/report/kff-cnn-mental-health-in-america-survey/ (showing half of adults say they have had a severe mental health crisis in their family); California Health Care Foundation, In Their Own Words: How Fragmented Care Harms People with Both Mental Illness and Substance Use Disorder, available at https://www.chcf.org/publication/fragmented-care-harms-people-mental-illness-substance-use-disorder/. 29 See Busch, Susan H. and Kelly Kyanko, Assessment of Perception of Mental Health vs. Medical Health Plan Networks Among US Adults with Private Insurance, available at https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8536951/. 30 See Kelly A. Kyanko, Leslie A. Curry, and Susan H. Busch, Out-of-Network Providers Use More Likely in Mental Health than General Health Care Among Privately Insured, available at https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4707657/. 31 Melek, S., Davenport, S., Gray, T. J. (2019). Addiction and mental health vs. physical health: Widening disparities in network use and provider reimbursement (p. 6). Milliman. https://assets.milliman.com/ektron/Addiction_and_mental_health_vs_physical_health_Widening_disparities_in_network_use_and_provider_reimbursement.pdf. 32 Id. 33 Id. at pp. 6-7. 34 See Busch, Susan H. and Kelly Kyanko, Assessment of Perception of Mental Health |
996 | _network_use_and_provider_reimbursement.pdf. 32 Id. 33 Id. at pp. 6-7. 34 See Busch, Susan H. and Kelly Kyanko, Assessment of Perception of Mental Health vs. Medical Health Plan Networks Among US Adults with Private Insurance, available at https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8536951/. 35 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, available at https://www.congress.gov/congressional-report/110th-congress/house-report/374 . (“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.”) 36 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). 37 2022 MHPAEA Report to Congress, p. 4, available at 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 and https://www.cms.gov/files/document/2022-mhpaea-report-congress.pdf ; 2023 MHPAEA Comparative Analysis Report to Congress, July 2023 (2023 MHPAEA Report to Congress), available at www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2023-mhpaea-comparative-analysis.pdf and https://www.cms.gov/cciio/resources/forms-reports-and-other-resources#mental-health-parity. 38 As discussed in more detail later in this preamble, NQTLs are generally non-numerical requirements that limit the scope or duration of benefits, such as prior authorization requirements, step therapy, and standards for provider admission to participate in a network, including methodologies for determining reimbursement rates. 39 PHS Act section 2723(b). 40 PHS Act section 2723(a). 41 CMS currently enforces MHPAEA with respect to issuers in Texas and Wyoming. In addition, CMS has collaborative enforcement agreements with Alabama, Florida, Louisiana, Montana, and Wisconsin. These States with collaborative enforcement agreements with CMS perform State regulatory and oversight functions with respect to some or all of the applicable provisions of title XXVII of the PHS Act, including MHPAEA. However, if the State finds a potential violation and is unable to obtain compliance by an issuer, the State will refer the matter to CMS for possible enforcement action. 42 78 FR 68240 (Nov. 13, 2013). 43 See, e.g. , FAQs About Affordable Care Act Implementation Part V and Mental Health Parity Implementation (Dec. 22, 2010), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-v.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-5 ; FAQs About Affordable Care Act Implementation (Part VII) and Mental Health Parity Implementation ( |
997 | ERROR: type should be string, got " https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-5 ; FAQs About Affordable Care Act Implementation (Part VII) and Mental Health Parity Implementation (Nov. 17, 2011), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-vii.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-7 ; Understanding Implementation of the Mental Health Parity and Addiction Equity Act of 2008 (May 9, 2012), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/understanding-implementation-of-mhpaea.pdf; FAQs for Employees about the Mental Health Parity and Addiction Equity Act (May 18, 2012), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/mhpaea-2.pdf; FAQs About Affordable Care Act Implementation (Part XVII) and Mental Health Parity Implementation (Nov. 8, 2013), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-xvii.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-17 ; FAQs About Affordable Care Act Implementation (Part XVIII) and Mental Health Parity Implementation (Jan. 9, 2014), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-xviii.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-18 ; FAQs About Affordable Care Act Implementation (Part XXIX) and Mental Health Parity Implementation (Oct. 23, 2015), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-xxix.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-29 (FAQs Part XXIX); FAQs About Affordable Care Act Implementation Part 31, Mental Health Parity Implementation, and Women’s Health and Cancer Rights Act Implementation (Apr. 20, 2016), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-31.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-31 ; FAQs About Affordable Care Act Implementation Part 34 and Mental Health and Substance Use Disorder Parity Implementation (Oct. 27, 2016), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-34.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-34 (FAQs Part 34); FAQs About Mental Health and Substance Use Disorder Parity Implementation and the 21st Century Cures Act Part 38 (June 16, 2017), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-" |
998 | Part 38 (June 16, 2017), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-38.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-38 (FAQs Part 38); Proposed FAQs About Mental Health and Substance Use Disorder Parity Implementation and the 21st Century Cures Act Part 39, available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-39-proposed.pdf (Proposed FAQs Part 39); Final FAQs About Mental Health and Substance Use Disorder Parity Implementation and the 21st Century Cures Act Part 39 (Sept. 5, 2019), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-39-final.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-final-set-39 (FAQs Part 39); FAQs About Families First Coronavirus Response Act and Coronavirus Aid, Relief, and Economic Security Act Implementation Part 43 (June 23, 2020), available at https://www.dol.gov/sites/dolgov/files/ebsa/about-ebsa/our-activities/resource-center/faqs/aca-part-43.pdf and https://www.hhs.gov/guidance/document/faqs-about-families-first-coronavirus-response-act-and-coronavirus-aid-relief-and-0 (FAQs part 43) ; FAQs About Mental Health and Substance Use Disorder Parity Implementation and the Consolidated Appropriations Act, 2021 Part 45 (Apr. 2, 2021), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-45.pdf and https://www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/Downloads/MHPAEA-FAQs-Part-45.pdf (FAQs Part 45); and Mental Health Parity and Addiction Equity Act (MHPAEA) FAQs, available at https://www.dol.gov/agencies/ebsa/about-ebsa/our-activities/resource-center/faqs/mhpaea-1#. 44 See, e.g. , The Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) Fact Sheet (Jan. 2010), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/fact-sheets/mhpaea.pdf; MHPAEA Enforcement Fact Sheet (Jan. 2016), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/fact-sheets/mhpaea-enforcement.pdf; FY 2016 MHPAEA Enforcement Fact Sheet, available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/fact-sheets/mhpaea-enforcement-2016.pdf; FY 2017 MHPAEA Enforcement Fact Sheet, available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/fact-sheets/mhpaea-enforcement-2017.pdf; FY 2018 MHPAEA Enforcement Fact Sheet, available at https://www.dol.gov/sites/dolgov/files |
999 | our-activities/resource-center/fact-sheets/mhpaea-enforcement-2017.pdf; FY 2018 MHPAEA Enforcement Fact Sheet, available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/fact-sheets/mhpaea-enforcement-2018.pdf; FY 2019 MHPAEA Enforcement Fact Sheet, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/mhpaea-enforcement-2019.pdf and https://www.cms.gov/CCIIO/Resources/Forms-Reports-and-Other-Resources/Downloads/mhpaea-enforcement-2019.pdf; FY 2020 MHPAEA Enforcement Fact Sheet, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/mhpaea-enforcement-2020.pdf and https://www.cms.gov/CCIIO/Resources/Forms-Reports-and-Other-Resources/Downloads/mhpaea-enforcement-2020.pdf; FY 2021 MHPAEA Enforcement Fact Sheet, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/mhpaea-enforcement-2021.pdf ; and FY 2022 MHPAEA Enforcement Fact Sheet, available at www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/mhpaea-enforcement-2022.pdf. 45 See Self-Compliance Tool for Part 7 of ERISA: Health Care-Related Provisions, available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/publications/compliance-assistance-guide-appendix-a.pdf; 2018 Self-Compliance Tool for the Mental Health Parity and Addiction Equity Act (MHPAEA), available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/self-compliance-tool-2018.pdf; and 2020 Self-Compliance Tool for the Mental Health Parity and Addiction Equity Act (MHPAEA), available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/self-compliance-tool.pdf. 46 See Form to Request Documentation from an Employer-Sponsored Health Plan or a Group or Individual Market Insurer Concerning Treatment Limitations, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/mhpaea-disclosure-template.pdf. 47 See, e.g. , DOL 2012 Report to Congress: Compliance With the Mental Health Parity and Addiction Equity Act of 2008 (Jan. 1, 2012), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/publications/mhpaea-report-to-congress-2012.pdf; DOL 2014 Report to Congress: Compliance of Group Health Plans (and Health Insurance Coverage Offered in Connection with Such Plans With the Requirements of the Mental Health Parity and Addiction Equity Act of 2008 (Sept. 2014), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/publications/mhpaea-report-to-congress-2014.pdf; DOL 2016 Report to Congress: Improving Health Coverage for Mental Health and Substance Use Disorder Patients Including Compliance with the Federal Mental Health and Substance Use Disorder Parity Prov |
1,000 | ations/mhpaea-report-to-congress-2014.pdf; DOL 2016 Report to Congress: Improving Health Coverage for Mental Health and Substance Use Disorder Patients Including Compliance with the Federal Mental Health and Substance Use Disorder Parity Provisions (Jan. 2016), available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/improving-health-coverage-for-mental-health-and-substance-use-disorder-patients.pdf; HHS Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) Enforcement Report (Dec. 12, 2017), available at https://www.cms.gov/CCIIO/Resources/Forms-Reports-and-Other-Resources/Downloads/HHS-2008-MHPAEA-Enforcement-Period.pdf; DOL 2018 Report to Congress: Pathway to Full Parity, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/dol-report-to-congress-2018-pathway-to-full-parity.pdf; 21st Century Cures Act: Section 13002 Action Plan for Enhanced Enforcement of Mental Health and Substance Use Disorder Coverage, available at https://www.hhs.gov/sites/default/files/parity-action-plan-b.pdf; HHS Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) Enforcement Report for the 2018 Federal Fiscal Year, available at https://www.cms.gov/CCIIO/Resources/Forms-Reports-and-Other-Resources/Downloads/FY2018-MHPAEA-Enforcement-Report.pdf; DOL 2020 Report to Congress: Parity Partnerships: Working Together, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/dol-report-to-congress-parity-partnerships-working-together.pdf; 2022 Report to Congress: Realizing Parity, Reducing Stigma, and Raising Awareness, available at 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 and https://www.cms.gov/files/document/2022-mhpaea-report-congress.pdf ; MHPAEA Comparative Analysis Report to Congress, July 2023, available at www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2023-mhpaea-comparative-analysis.pdf and https://www.cms.gov/cciio/resources/forms-reports-and-other-resources#mental-health-parity. 48 See Consumer Guide to Disclosure Rights: Making the Most of Your Mental Health and Substance Use Disorder Benefits, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/disclosure-guide-making-the-most-of-your-mental-health-and-substance-use-disorder-benefits.pdf; Know Your Rights: Parity for Mental Health and Substance Use Disorder Benefits, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/know-your-rights-parity-for-mental-health-and-substance-use-disorder-benefits.pdf; Parity of Mental Health and Substance Use Benefits with Other Benefits: Using Your Employer-Sponsored Health Plan to Cover Services, available at https://www.dol.gov/ |
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