Does Your Health Plan Violate The New Mental Health Parity Rules?

New regulations are giving employers their first glimpse of the mental health and substance abuse benefit changes that may be needed by 2011 to ensure that their health plans do not violate the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (“New Mental Health Parity Act”).

Published in the February 2 Federal Register and jointly issued by the IRS, the Department of Labor and the Department of Health and Human Services, the interim final regulations will require employers to consider issues such as:

• Separate deductibles for mental health/substance abuse and standard medical/surgical benefits.
• Medical management standards, prescription drug formulary design and other “nonquantitative” treatment limitations that plans set for mental health and substance abuse benefits.
• Operational differences between how mental health and substance abuse benefits are administered and how medical benefits are administered.
• How the general parity rule applies to a multi-tiered prescription drug program.
• Specialist co-pays that could apply to nearly all mental health or substance use claims, but only a fraction of medical claims.

Though these regulations withdraw prior rules that date to 1997, they do not answer all employer questions about the New Mental Health Parity Act – such as with respect to the exemption from the requirements for plans that experience certain cost increases from compliance.

Note: This article was published in the January/February 2010 issue of The Employment Law Authority.