Medicaid and Children’s Health Insurance Programs; Mental Health Parity and Addiction Equity Act of 2008; the Application of Mental Health Parity…

Medicaid and Children's Health Insurance Programs; Mental Health Parity and Addiction Equity Act of 2008; the Application of Mental Health Parity Requirements to Coverage Offered by Medicaid Managed Care Organizations, the Children's Health Insurance Program (CHIP), and Alternative Benefit Plans

SUMMARY: This final rule will address the application of certain requirements set forth in the Public Health Service Act, as amended by the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008, to coverage offered by Medicaid managed care organizations, Medicaid Alternative Benefit Plans, and Children's Health Insurance Programs.

DATES: These regulations are effective on May 31, 2016.

FOR FURTHER INFORMATION CONTACT: FOR FURTHER INFORMATION CONTACT:

John O'Brien, (410) 786-5529, Alternative Benefit Plan.

Debra Dombrowski, (312) 353-1403, Managed Care.

Amy Lutzky, (410) 786-0721.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Executive Summary

II. Background

A. Introduction

B. Legislative Overview

III. Provisions of the Final Rule

A. Definitions

B. Parity Requirements for Aggregate, Lifetime and Annual Limits

C. Parity Requirements for Financial Requirements and Treatment Limitations

D. Cumulative Financial Requirements

E. Compliance With Other Cost-sharing Rules

F. Nonquantitative Treatment Limitations (NQTLs)

G. Parity for Mental Health and Substance Use Disorder Benefits in CHIP Programs Covering EPSDT

H. Availability of Information

I. Application to EHBs and Other ABP Benefits

J. ABP State Plan Requirements

K. Application of Parity Requirements to the Medicaid State Plan

L. Scope and Applicability of the Final Rule

M. Scope of Services

N. Increased Cost Exemption

O. Enforcement, Managed Care Rate Setting and Contract Review and Approval

P. Applicability and Compliance

Q. Utilization Control

R. Institutions for Mental Diseases

S. Medicare-Medicaid Dual Eligible Beneficiaries

IV. Summary of Changes

V. Collection of Information Requirements

VI. Regulatory Impact Analysis

A. Statement of Need

B. Overall Impact

C. Anticipated Effects

D. Alternatives Considered

E. Accounting Statement and Table

F. Regulatory Flexibility Act

G. Unfunded Mandates Reform Act

H. Federalism

I. Conclusion

Regulations Text

Acronyms, Abbreviations, and Short Forms

Because of the many terms to which we refer by acronym, abbreviation, or short form in this final rule, we are listing the acronyms, abbreviation, and short forms used and their corresponding terms in alphabetical order below:

2008 Extenders Act Tax Extenders and Alternative Minimum Tax Relief Act of 2008 (Division C)

The Act Social Security Act

The Affordable Care Act Patient Protection and Affordable Care Act (Pub. L. 111-148, enacted on March 23, 2010), as amended by the Health Care and Education Reconciliation Act of 2010 (Pub. L. 111-152)

The Departments Departments of the Treasury, Labor, and Health and Human Services

ABP Alternative Benefit Plan

BBA Balanced Budget Act of 1997

CHIP Children's Health Insurance Program

CHIPRA Children's Health Insurance Program Reauthorization Act of 2009

CMS Centers for Medicare and Medicaid Services

The Code Internal Revenue Code of 1986

DOL Department of Labor

DSM Diagnostic and Statistical Manual of Mental Disorders (current edition)

EHB Essential Health Benefit

EPSDT Early and Periodic Screening, Diagnostic and Treatment

ERISA Employee Retirement Income Security Act of 1974

FFP Federal Financial Participation

FFS Fee for Service

HHS Department of Health and Human Services

ICD International Classification of Diseases

MCE Managed Care Entity

MCO Managed Care Organization

MH Mental Health

MH/SUD Mental Health or Substance Use Disorder

MHPA Mental Health Parity Act of 1996

MHPAEA Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008

NQTL Nonquantitative Treatment Limitation

PAHP Prepaid Ambulatory Health Plan

PHS Act Public Health Service Act

PIHP Prepaid Inpatient Health Plan

SHO State Health Official

SUD Substance Use Disorder

Treasury Department of the Treasury

I. Executive Summary

This final rule addresses the application to Medicaid and the Children's Health Insurance Program (CHIP) of certain mental health parity requirements added to the Public Health Service Act (PHS Act) by the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) (Pub. L. 110-343, enacted on October 3, 2008). Specifically, this final rule addresses the application of MHPAEA parity requirements to: (1) Medicaid managed care organizations (MCOs) as described in section 1903(m) of the Social Security Act (the Act); (2) Medicaid benchmark and benchmark-equivalent plans (referred to in this rule as Medicaid Alternative Benefit Plans (ABPs)) as described in section 1937 of the Act; and (3) Children's Health Insurance Program (CHIP) under title XXI of the Act.

Under section 1932(b)(8) of the Act, Medicaid MCOs are required to comply with the requirements of subpart 2 of part A of title XXVII of the PHS Act, to the same extent that those requirements apply to a health insurance issuer that offers group health insurance. Subpart 2 includes mental health parity requirements added by MHPAEA that are now found at section 2726 of the PHS Act (as renumbered; formerly section 2705 of the PHS Act).

Under section 1937(b)(6) of the Act, Medicaid ABPs that are not offered by an MCO and that provide both medical and surgical benefits and mental health or substance use disorder (MH/SUD) benefits are required to ensure that financial requirements and treatment limitations for such benefits comply with the mental health parity requirements of the PHS Act (renumbered section 2726(a) of the PHS Act), in the same manner as such requirements apply to a group health plan. The section 1937 provision applies only to ABPs that are not offered by MCOs; ABPs offered by MCOs are already required to comply with these requirements under section 1932(b)(8) of the Act.

Section 2103(c)(6) of the Act requires that state CHIP plans that provide both medical and surgical benefits and MH/SUD benefits shall ensure that financial requirements and treatment limitations for such benefits comply with mental health parity requirements of the PHS Act (referencing renumbered section 2726(a) of the PHS Act) to the same extent as such requirements apply to a group health plan. In addition, section 2103(f)(2) of the Act requires that CHIP benchmark or benchmark equivalent plans comply with all of the requirements of subpart 2 of part A of the title XXVII of the PHS Act, which includes the mental health parity requirements of the PHS Act, insofar as such requirements apply to health insurance issuers that offer group health insurance coverage.

These final rules incorporate these requirements into our regulations.

II. Background

A. Legislative History

On September 26, 1996, the Congress enacted the Mental Health Parity Act of 1996 (Pub. L. 104-204) (MHPA), which required parity in aggregate lifetime and annual dollar limits for mental health benefits and medical/surgical benefits. Those mental health parity provisions were codified in section 712 of ERISA, section 2726 of the PHS Act (renumbered under section 1001 of the Affordable Care Act), and section 9812 of the Code, and applied to employment-related group health plans and health insurance coverage offered in connection with a group health plan. The Balanced Budget Act of 1997 (Pub. L. 105-33, enacted on August 5, 1997) (BBA) added sections 1932(b)(8) and 2103(f)(2) of the Act to generally apply certain aspects of MHPA, including the provisions of section 2726 of the PHS Act, to Medicaid MCOs and CHIP benefits.

MHPAEA was enacted as sections 511 and 512 of the Tax Extenders and Alternative Minimum Tax Relief Act of 2008 (Division C of Pub. L. 110-343) (the 2008 Extenders Act). MHPAEA amended the Employee Retirement Income Security Act of 1974 (ERISA), the PHS Act, and the Internal Revenue Code of 1986 (the Code). The changes made by MHPAEA consist of new standards, including parity for coverage of substance use disorder benefits, as well as amendments to the existing mental health parity provisions enacted in MHPA.

In 2009, section 502 of the Children's Health Insurance Program Reauthorization Act of 2009 (Pub. L. 111-3) (CHIPRA) amended section 2103(c) of the Act by adding paragraph (6), which requires that CHIP plans that provide both medical and surgical benefits and MH/SUD benefits comply with the provisions of section 2705(a) of the PHS Act, as amended by MHPAEA, in the same manner as a group health plan.

--This is a summary of a Federal Register article originally published on the page number listed below--

Final rule.

CFR Part: "42 CFR Parts 438, 440, 456, and 457"

RIN Number: "RIN 0938-AS24"

Citation: "81 FR 18390"

Document Number: "CMS-2333-F"

Federal Register Page Number: "18390"

"Rules and Regulations"