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Introduction: The Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) is a federal law that may apply to two different types of coverage: 1) Large group self-funded group health plans (CMS has jurisdiction over self-funded public sector (non-federal governmental) plans, while the Department of Labor (866-444-3272) has jurisdiction over private sector self-funded group health plans.); 2) Large group fully insured group health plans. Contact your state's insurance department to find out about whether additional protections apply to your coverage if you are in a fully insured group health plan or have individual market (non-employment based) health coverage. Medicare and Medicaid are not issuers of health insurance. They are public health plans through which individuals obtain health coverage. Medicaid Managed Care plans, however, are subject to the MHPAEA requirements. Contact your specific Medicare or Medicaid contractor to discuss your level of benefits. Employment-related group health plans that provide benefits through insurance are known as fully insured group health plans. Employment-related group health plans that pay for coverage directly, without purchasing health insurance from an issuer, are called self-funded group health plans. Contact your plan administrator to find out if your group coverage is fully insured or self-funded. MHPAEA may prevent your large group health plan from imposing financial requirements and treatment limitations on mental health and substance use disorder (MH/SUD) benefits that are more restrictive than financial requirements and treatment limitations on medical/surgical benefits. MHPAEA also may prevent your large group health plan from placing annual or lifetime dollar limits on MH/SUD benefits that are lower - less favorable - than annual or lifetime dollar limits for medical/surgical benefits offered under the plan. MHPAEA does NOT apply to small group health plans or health insurance coverage in the individual (non-employment based) market, but you should check to see if your state law requires mental health parity in such other cases. (Visit www.ncsl.org, on the right hand side of the page enter "mental health parity" then select "State Laws Mandating or Regulating Mental Health Benefits" in order to view State specific information.) MHPAEA applies to most group health plans with more than 50 workers. According to Federal standards, MHPAEA does NOT apply to group health plans sponsored by employers with fewer than 51 workers. Summary of MHPAEA Protections: The Mental Health Parity Act of 1996 (MHPA) states that a group health plan may not impose annual or lifetime dollar limits on mental health benefits that are less favorable than any such limits imposed on medical surgical benefits. MHPAEA preserves the MHPA protections, and adds significant new protections. Although the law requires "parity", or equivalence, with regard to annual and lifetime dollar limits, financial requirements and treatment limitations, MHPAEA does NOT require large group health plans and their health insurance issuers to include MH/SUD benefits in their benefits package. The law's requirements apply only to large group health plans and their health insurance issuers that already include MH/SUD benefits in their benefit packages. Key changes made by MHPAEA, which is generally effective for plan years beginning after October 3, 2009, include the following: • If a group health plan includes medical/surgical benefits and mental health benefits, the financial requirements (e.g., deductibles and co-payments) and treatment limitations (e.g., number of visits or days of coverage) that apply to mental health benefits must be no more restrictive than the predominant financial requirements or treatment limitations that apply to substantially all medical/surgical benefits; • If a group health plan includes medical/surgical benefits and substance use disorder benefits, the financial requirements and treatment limitations that apply to substance use disorder benefits must be no more restrictive than the predominant financial requirements or treatment limitations that apply to substantially all medical/surgical benefits; • MH/SUD benefits may not be subject to any separate cost sharing requirements or treatment limitations that only apply to such benefits; • If a group health plan includes medical/surgical benefits and mental health benefits, and the plan provides for out of network medical/surgical benefits, it must provide for out of network mental health benefits; • If a group health plan includes medical/surgical benefits and substance use disorder benefits, and the plan provides for out of network medical/surgical benefits, it must provide for out of network substance use disorder benefits; • Standards for medical necessity determinations and reasons for any denial of benefits relating to MH/SUD, must be disclosed upon request; • The MHPA parity requirements under existing law (regarding annual and lifetime dollar limits) continue and are extended to substance use disorder benefits. Exceptions: There are three exceptions to the MHPAEA requirements: • MHPAEA requirements do not apply to small employers who have between 2 and 50 employees; • Large group health plan sponsors that meet the requirements stated in the MHPAEA download below (Section 512(a)(2) Cost Exemption) and demonstrate that compliance with MHPAEA increases their claims by at least two percent in the first year (one percent in subsequent years) may request exemption from the MHPAEA based on their cost exemption. Subsequently, the plan sponsors may notify the plan beneficiaries that MHPAEA does not apply to their coverage; and • A nonfederal governmental employer that provides self-funded group health plan coverage to its employees (coverage that is not provided through an insurer) may elect to exempt its plan (opt-out) from the requirements of MHPAEA by following the Procedures & Requirements posted on the Self-Funded Nonfederal Governmental Plans webpage (see Related Links Inside CMS), then issuing a notice of opt-out to enrollees at the time of enrollment and on an annual basis. Thereafter, the employer must also file the opt-out notification with CMS. For additional information, you may e-mail us at phig@cms.hhs.gov.
Page Last Modified: 01/27/2010 1:48:21 PM
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