Short-Term Analysis to Support Mental Health and Substance Use Disorder Parity Implementation. The Interim Final Rules (IFR)


On February 2, 2010 the Departments of Labor, Treasury and Health and Human Services published Interim Final Rules (IFR) in the Federal Register.2 The IFR and the accompanying guidance were meant to help consumers, self-insured employers, insurers, health plans and managed behavioral health organizations (MBHOs) (among other stakeholders) understand the provisions of the MHPAEA and to guide the implementation.

Non-Quantitative Treatment Limitations

The IFR forbid self-insured employers and health plans from employing more restrictive “quantitative treatment limitations” (such as visit limitations for treatment of mental and substance use disorders) and also required that the use of “non-quantitative limitations” (including differential formulary design, standards for admitting providers to the network, or differential medical necessity criteria) be no more stringent in limiting the scope or duration of benefits for behavioral health treatment relative to medical treatment.

Non-quantitative treatment limitations (NQTLs) refer to the broad array of health care management policies and practices designed to contain costs of health care, including medical necessity definitions and criteria (claims not covered unless care is deemed medically necessary); utilization management (UM) practices (preauthorization, concurrent review, retrospective review to determine medical necessity), formulary design in the pharmacy benefit (tiers of medications with differing co-pays/maximum days filled), and provider network management (credentialing and inclusion/exclusion of providers from networks; establishing fees for in-network providers; setting usual, customary, and reasonable fees for out-of-network providers).

The IFR specifically requires that the “processes, strategies, evidentiary standards and other factors used to apply NQTLs to MH/SUD benefits in a classification have to be comparable to and applied no more stringently than the processes, strategies, evidentiary standards and other factors used to apply to medical-surgical benefits in the same classification.” The regulations also acknowledge that there may be different clinical standards used in making these determinations -- including evidence-based practice guidelines. The regulations do not necessarily require equivalence in results when applying parity requirements to NQTLs, only comparable processes, strategies, and standards in determining application of NQTSs.

After publication of the IFR questions remain regarding application of the NQTL provisions and also how the MHPAEA applies to scope of services.

Scope of Services

In behavioral health -- like other areas of medical care -- there is a continuum of services that lie between inpatient and outpatient care that have been shown to effectively treat some MH/SUDs, and in some cases do so more cost-effectively than inpatient care. Examples of such intermediate forms of behavioral health care include non-hospital residential services, partial hospitalization services, and intensive outpatient services including case management and some forms of psychosocial rehabilitation. The “scope of services” issue concerns the extent to which the MHPAEA requires a full rangeof MH/SUD services (i.e., a continuum of care). The IFR did not specify requirements regarding application of parity to these intermediate services.

Given the unanswered questions in the IFR with regard to NQTLs and scope of services, the Office of the Assistant Secretary for Planning and Evaluation (ASPE) sought a contractor to perform short-term studies in order to better understand the likely impact of regulation.

ASPE asked RAND to design and conduct studies to address the following policy questions:

  1. What should be the criteria for parity in NQTLs?

  2. What is the impact of applying parity to the scope of services covered by health plans and insurers, focusing on various levels of coverage of intermediate services?

The purpose of this Project Memorandum is to summarize the findings from these two studies.

2. 26 CFR Part 54 (Treasury-IRS); 29 CFR Part 2590 (Labor-EBSA) and 45 CFR Part 146 (HHS-CMS).

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