CMS recently published a final rule that aims to strengthen access to mental health and substance use disorder services, collectively called behavioral health services, for Medicaid beneficiaries. The rule applies provisions of the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA), which mandated group health plans and health insurance issuers to provide equal coverage for both medical and behavioral health services to Medicaid beneficiaries who receive services through Medicaid managed care organizations, Medicaid alternative benefit plans, or the Children’s Health Insurance Program (CHIP). The intent is to create consistency between the commercial and Medicaid markets.
Nearly 23 million Medicaid beneficiaries and 880,000 CHIP beneficiaries will benefit from the new rule, according to CMS. The final rule also requires health plans to disclose information on behavioral health benefits upon request, including determinations of medical necessity, as well as the reason for any denial of reimbursement or payment for mental health or substance use disorder services. States will have up to 18 months to comply with the new rule.
The final rule was released on March 30 in conjunction with President Obama’s announcement of a new task force designed to ensure people with mental health and substance use disorders receive adequate coverage for treatment. Despite passage of the MHPAEA and the extension of behavioral health parity to health insurance plans in the individual and small group markets through the Affordable Care Act of 2010, the healthcare system continues to fall short in coverage of mental health and substance use disorder services.
A 2015 report issued by the National Alliance for Mental Health addresses the numerous barriers people living with behavioral health disorders face as they seek treatment, including discrimination by health insurance issuers. According to the report, insurers are denying authorization for mental health care at roughly twice the rate they are for other types of medical care.
Several New York Attorney General settlement agreements with health insurers for violations of behavioral health parity laws demonstrate this practice. Most recently, Beacon Health Options of New York was hit with a $900,000 penalty for widespread noncompliance with parity laws. The insurer was found to have denied claims twice as often for mental health services and four times as often for addiction recovery services compared with physical health services. Beacon Health Options was also required to overhaul its behavioral health claims review process as part of its settlement with the AG’s office.
The actions of the New York AG are not the national norm, however. Only a few states, including New York and California, are enforcing insurers to comply with behavioral health parity laws. Lack of guidance from the federal government with regards to enforcement is partly to blame for the continued disparity of mental health and substance abuse treatment.
Obama’s interagency task force, which aims to promote enforcement of the federal parity law, will work to identify and encourage best practices for state and federal agencies. The task force will deliver a report to the President by October 31, 2016, detailing its findings and recommendations. Combined with the final rule issued by CMS in March, the parity task force could provide states with the additional guidance needed to implement and enforce behavioral health parity. Whether enforcement of parity laws will increase access to services for those struggling with mental health and substance use disorders will be another story.
Nicole Witowski is a research associate at DRG and a behavioral health expert. Follow her on Twitter at @NicoleWitDRG.