Updated Tool Helps With Health Plan Compliance

On October 23^rd, 2020, the U.S. Department of Labor’s (DOL’s) Employee Benefits Security Administration (EBSA) announced a new employer resource. The resource is an updated tool to help employers comply with the Mental Health Parity and Addiction Equity Act (MHPAEA). In addition to the MHPAEA, the tool also addresses compliance with the Employee Retirement Income Security Act of 1974 (ERISA).

Information on the Self-Compliance Tool

Known as the MHPAEA Self-Compliance Tool, the resource helps plan administrators determine information about their group plan or insurance issuer. Specifically, the tool helps employers check if their plan or insurance complies with provisions of both the MHPAEA and ERISA. The information would also be important to group health plans, plan sponsors, health insurance issuers, and other parties. U.S. Secretary of Labor Eugene Scalia praised the updates. He stated: “The [MHPAEA] ensures parity in benefits for … Americans facing mental health … and substance use disorders. The self-compliance tool we’re updating today will help these Americans obtain the treatment they need … “ The EBSA last updated the MHPAEA Self-Compliance Tool in 2018. Since then, the agency proposed new updates with the Departments of Health and Human Services (HHS) and the Treasury. After issuing a request for stakeholder comments, the EBSA issued the final Self-Compliance Tool with modifications. Acting Assistant Secretary for the EBSA Jeanne Klinefelter Wilson also had positive comments for the new development. “We improved our self-compliance tool based on valuable feedback received in the public comment process. The [EBSA provides] compliance assistance to [affected parties] to help them meet their responsibilities under the law.” The release comes months after the EBSA updated model notices under the Consolidated Omnibus Budget Reconciliation Act of 1986 (COBRA).

Background of the MHPAEA

In general, the MHPAEA has rules that group health plans or health insurance issuers must follow. Specifically, on such organizations that impose financial requirements and treatment limitations on mental health and substance use benefits. Those entities must ensure that the limitations are comparable to and applied no more stringently than medical and surgical benefits. Financial requirements include cost-sharing requirements (co-pays). Treatment limitations include quantitative and non-quantitative limits on the scope or duration of treatment (visit limits or prior authorization). In 2016, under the 21st Century Cures Act, Congress directed the DOL, HHS, and the Treasury to improve MHPAEA compliance. The compliance would come in the form of new or updated program guidance, which needs updating every two years.

Employer Takeaways

Any employer that offers group health plans should examine their benefit offerings using the updated tool. Accordingly, if mental health and substance use benefits are not comparable to medical benefits, employers could be noncompliant with specific rules. This could lead to fines and penalties under both the MHPAEA and ERISA.