By: HUB’s EB Compliance Team

In a recently-released report, the Departments of Labor and Health and Human Services (the “Departments”) shared findings from closed investigations under the Mental Health Parity and Addiction Equity Act (“MHPAEA”) conducted between October 1, 2023, and September 30, 2024—the federal government's most recently completed fiscal year. These findings provide insight into the scope of MHPAEA enforcement and highlight key issues that are currently a priority for the Departments.

Scope

The report notes that “[i]t is not uncommon for complex MHPAEA investigations to take multiple years to complete,” especially where large service providers are involved, since they are, “complex, resource-intensive and often involve specialized interdisciplinary teams and consultations with experts.” 

Between the two Departments, 56 plans were reviewed for MHPAEA compliance with 33 total violations found. All the non-compliant plans were either self-funded or involved plans that offered fully-insured and self-funded options under the same plan. The breakdown was a nearly evenly split between violations of financial limits/quantitative treatment limitations (e.g., copays, coinsurance, deductibles, etc.) and nonquantitative treatment limitations (e.g., prior authorization, benefit exclusions).

 Specifically, the report notes that the violations related to:

  • 10 financial limits;
  • Five (5) quantitative treatment limitations (“QTLs”);
  • 17 nonquantitative treatment limitations (“NQTLs”); and
  • One (1) final determination of noncompliance with the NQTL comparative analysis requirements in a closed investigation (see more here on the comparative analysis requirements).

Notably, the report also highlights a couple of important facts. First, Department of Labor (“DOL”) investigations can be triggered by calls made to the DOL, including in one example by a mental health provider. Second, if an investigation reveals an issue, the Departments typically ask the carrier or third-party administrator to correct any issue across its entire book. This extends the results of any investigation well beyond the initially investigated plan.

Types of Issues

In short, the Departments noted the following violations that were corrected (divided into QTL and NQTL violations):

QTL Violations

  • Visit limits on other autism spectrum disorders (ASD)- related services.
  • Applying 30% coinsurance for outpatient mental health and substance use disorder services, but failed to apply the same requirement to substantially all medical or surgical benefits.
  • Impermissibly higher copays for mental health and substance use disorder office visits, when compared to medical/surgical office visits.
  • Failure to conduct an analysis of the predominant copay that applied to substantially all medical/surgical benefits (a requirement for the QTLs).
  • Imposing a higher specialist copy on all mental health and substance use disorder outpatient services when the lower, regular office visit copay should have applied.

NQTL Violations

  • Excluding applied behavior analysis (ABA) therapy, which is used to treat ASD.
  • A blanket precertification requirement to all mental health and substance use disorder services, with no similar requirement for medical/surgical services.
  • Requiring that drugs to treat mental health conditions must be prescribed by a psychiatrist or neurologist or else be subject to 50% coinsurance, with no similar requirement for drugs used to treat medical/surgical conditions.
  • Imposing a 6-month limit on ABA prior authorizations (thus requiring a new authorization every 6 months) when there was no such limitation for medical/surgical benefits.
  • Excluding methadone treatment for opioid use disorder when there was no comparable exclusion for a medical/surgical medication treatment.
  • Imposing factors that were not comparable for determining whether to cover a drug to treat mental health and substance use disorders versus those to treat medical/surgical conditions and applying those factors more stringently to the mental health/substance use disorder treatments.

Takeaways

While not an exclusive or comprehensive list of all possible violations, the list provides some guidance on the types of issues the Departments view as violations (particularly on the NQTL side). Employers should review their plan designs for any potential MHPAEA violations based on the above enforcement data and work with their providers to rectify any noncompliant design elements.

If you have any questions, please contact your HUB Advisor. View more compliance articles in our Compliance Directory.

NOTICE OF DISCLAIMER
Neither Hub International Limited nor any of its affiliated companies is a law or accounting firm, and therefore they cannot provide legal or tax advice. The information herein is provided for general information only, and is not intended to constitute legal or tax advice as to an organization’s or individual's specific circumstances. It is based on Hub International's understanding of the law as it exists on the date of this publication. Subsequent developments may result in this information becoming outdated or incorrect and Hub International does not have an obligation to update this information. You should consult an attorney, accountant, or other legal or tax professional regarding the application of the general information provided here to your organization’s specific situation in light of your or your organization’s particular needs.