The federal government’s proposed rules implementing the 2008 mental health parity law would have unclear and in some cases unintended consequences, according to comments submitted to the government by the Society for Human Resource Management (SHRM).
In a letter sent to the U.S. Department of Labor’s Employee Benefits Security Administration, SHRM noted that SHRM and its members support the goals of the Mental Health Parity and Addiction Equity Act (MHPAEA). However, the letter said, the Labor Department and two other agencies involved with the mental health law should “recognize the practical implications of implementation, the unintended consequences of some of the provisions, and the cost and administrative burden of some of the requirements.”
The letter noted that SHRM members “will be the individuals who implement the rules beginning July 1, 2010,” and asks the government to “adopt at least a one-plan-year period of good faith compliance to give employers and their vendors a full annual cycle to implement these sweeping, unanticipated, and at times, unclear regulations.”
In some cases, according to the SHRM comments, the proposed regulations, published in the Federal Register on Feb. 2, 2010, appear to exceed the intent of Congress when it approved the law. In many instances, the letter noted, the proposed regulations run into a problem faced by many HR professionals today: the incredible complexity of the U.S. health care system, in particular the way in which health insurance is administered.
“These comments are intended to assist the departments [of Labor, Treasury, and Health and Human Services] in revising regulations that promote the MHPAEA goal of parity for mental health and substance use disorder (MHSA) benefits,” says the letter, which was submitted on May 3, 2010. At the same time, the letter continues, SHRM requests “that the departments take into account the real world difficulties and expense of applying the rules to multiple plan designs to meet an ambitious effective date.”
Since the rules were proposed, Congress passed a major health care reform law, further complicating HR’s efforts to comply with various coverage mandates, the SHRM comments noted.
One area of difficulty, SHRM pointed out, involves the principle in the mental health parity law that financial requirements and treatment limits for mental health services should be equivalent to those for other health conditions offered by health plans that offer mental health coverage. There are six classifications for medical costs: in- and out-of-network inpatient costs; in- and out-of-network outpatient expenses; emergency services; and pharmacy costs. There is significant potential for errors when mapping costs relating to mental health services for purposes of complying with the new rules, SHRM noted. The Society’s comments suggest applying “a comparability approach” to determining whether costs are equivalent, and SHRM asks that the agencies “limit penalties to no more than the cost of the error” to insured individuals.
SHRM pointed out problems in the rules regarding non-qualitative treatment limits, which include things such as prescription drug formulary designs that are typically beyond the control of HR professionals and not detailed in the proposed regulations or the MHPAEA. Including non-qualitative treatment limits in the rules “exceeds the scope of regulatory authority” of the parity law. That law “is designed to assure parity of medical and MHSA benefits,” the comments said. “If Congress had intended for MHPAEA to regulate medical carrier operations and decision-making, they would have said so.” SHRM asked that the non-qualitative treatment limits “be removed as requirements under the rules.”
In addition, SHRM’s comments said that the proposed rules “create a false dichotomy” in their approach to determining which conditions are mental health-related conditions and subject to the law. Many such conditions, such as depression, “have biological causes or correlates and associated treatments.” The rules indicate that “it is only the nature of the condition that determines whether a benefit is subject to MHPAEA, when on a practical level, it is a combination of the nature of the condition, the type of provider, the setting in which treatment occurs, and the symptom treated that determines whether a treatment is MHSA or medical,” the comments stated.
The complexity of applying the coverage rules for conditions and treatments will make it “extremely difficult for claims payers to administer correctly and will likely add delays to claims administration,” the SHRM letter said in urging that the rules be more narrowly focused.
SHRM questioned applying the mental health parity law to smoking cessation programs. “Many smoking cessation programs are not part of a group health plan,” the comments said. “Instead, they consist of telephonic coaching or web-based, educational programs offered to help participants curb smoking habits in absence of a MHSA condition. … This application appears to be an over-reaching interpretation of MHPAEA.”
Steve Bates is manager of online editorial content for SHRM. He can be reached at email@example.com.
Mental Health Parity: Is Your Plan Ready? SHRM Online Legal Issues, October 2009
Employee Assistance Programs Target Mental Health Parity Costs, SHRM Online Benefits Discipline, August 2009
Mental Health Parity: Benefit Design Challenges, SHRM Online Benefits Discipline, May 2009
New Mental Health Parity Law Raises Cost Concerns, SHRM Online Legal Issues, October 2008