Mental health parity rule is favorable for psychology

by Government Relations Staff

February 28, 2010 — On February 2, the U.S. Departments of Health and Human Services, Labor and Treasury released an interim final rule implementing the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act (the “MHPAEA”). Based on an extensive analysis (see link at end of this article) by the APA Practice Organization (APAPO), the details of the interim final rule are very favorable for practicing psychologists and consumers of psychological services.

The MHPAEA requires that for all group health plans of 50 or more employees that provide both medical/surgical and mental health/substance use disorder benefits, such plans must ensure that the financial requirements and treatment limitations applied to mental/substance use disorder benefits are no more restrictive than those imposed on medical/surgical benefits. This requirement applies to all aspects of the benefits coverage — including lifetime and annual dollar limits, deductibles, copayments, coinsurance, out-of-pocket maximums and day or visit limits.

As reflected in the final interim rule, federal regulators intend to implement the MHPAEA as APAPO urged them to do during the rulemaking process. The regulators adopted our suggestion that parity be applied in a straightforward way and in a manner most favorable to the plan enrollee. This means that requirements and limitations on mental health and substance use benefits cannot be applied in a more restrictive manner than those for medical and surgical benefits.

Further, APAPO had urged that the rule prohibit separate deductibles and out-of-pocket maximums for mental health and substance use benefits, since such separate limits — even if they were equal — would violate the spirit of the law.  The interim rule prohibits separate deductibles and out-of-pocket maximums for mental health and substance use disorder benefits.

APAPO also encouraged the federal regulators to look beyond typical financial requirements and treatment limitations and apply the MHPAEA so it prohibits any type of requirement or limitation that would violate the spirit of the law.  For example, we flagged for the regulators episodic limits or plan differentials around reasonable or customary charges. The interim regulations require parity for these aspects of plan coverage.

Among other favorable aspects of the interim rule, mental health providers may not be classified as “specialists” for purposes of copayments. A common health plan design imposes lower copayments for treatment by primary care providers and higher copayments for treatment by specialists. Some health plans classify mental health providers as specialists. However, the interim final rule precludes separate classification of specialists versus primary care providers for purposes of imposing a higher copayment requirement.

The new rule will even require parity in benefit management. For instance, a plan generally must apply a benefit management standard to a mental health/substance use disorder service that is comparable to and applied no more stringently than that applied to a medical/surgical service.

We anticipate that regulators will finalize the rule once a 90-day comment period ends in early May. The final rule becomes effective for health plan years beginning on or after July 1, 2010. Accordingly, most health plans will have to meet the requirements of the new regulation for plan years beginning next January. 

As regulators prepare for final rulemaking, we continue to work to ensure that any last-minute changes to the interim final rule remain true to the spirit of the law.

According to APAPO Assistant Executive Director, Government Relations, Marilyn Richmond, J.D., the interim final rule is a “very positive start and a testament to the hard work and determination of psychologists across the country.”  Richmond noted that for several years grassroots psychologists lobbied their legislators at home and in Washington, DC, mobilized broad-based support and made contributions to psychology’s national political action committee, AAP/PLAN.

“These efforts, coupled with those of our government relations team at APAPO, have made possible this big step forward toward ending insurance discrimination against those who need mental health and substance use services,” said Richmond.

Members of APA who pay the Practice Assessment to the APA Practice Organization have access to our detailed analysis of the interim final rule to implement the MHPAEA.