Five States Pass Laws to Improve Compliance With MH Parity Laws
The new laws will help enforce federal and state mental health parity requirements. The hope is that many more states will follow their lead.
APA and its district branches were instrumental in pushing through mental health parity reporting bills in five states—Colorado, Delaware, Illinois, New York, and Tennessee—in their latest legislative sessions to hold insurance companies accountable for ensuring mental health benefits are comparable to those for medical and surgical care.
Five States Pass Parity Reporting Laws
Mental health parity reporting laws were passed in five states this past legislative session. Although the specific provisions in the laws vary, they will help enforce existing mental health parity laws by requiring health plans to improve their reporting practices on the subject.
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Colorado HB 18-1357 was signed into law May 24. It requires the commissioner of insurance to report on compliance with mental health parity laws, establishes an office of the ombudsman to assist state residents in accessing behavioral health care, and appropriates $94,000 to implement the bill.
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Delaware SB 230 sets annual reporting requirements for insurance carriers on their coverage for serious mental illness and drug and alcohol dependence, including for recipients of public assistance. At press time, it was awaiting signature by Gov. John Carney (D), who is expected to sign it.
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Illinois SB 1707 requires health plans to submit parity compliance analyses to the Illinois Department of Insurance and the Illinois Department of Healthcare and Family Services, which will be made available on a public website. It requires the departments to perform market-conduct examinations and parity compliance audits and report on their enforcement activities annually to the General Assembly. It also requires expanded access to substance use disorder treatment and closes a loophole in Illinois law that allowed school district health plans to discriminate against mental health and substance use disorders. As of press time, the bill was still awaiting signature by Gov. Bruce Rauner (R), who is expected to sign it.
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New York A3694A requires insurers and health plans to submit certain data to its Department of Financial Services (DFS) so it can evaluate their compliance with federal and state mental health and substance use parity laws. Network adequacy, cost sharing, rates of appeals, and reimbursement rates for both in-network and out-of-network mental health providers are among a list of items to be evaluated. DFS will use the data to prepare an annual mental health parity report for consumers.
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Tennessee Public Chapter 1012 requires its Department of Commerce and Insurance to implement and enforce mental health and substance use parity and prohibits any nonqualitative treatment limitations that apply to mental health or alcohol/substance use benefits that do not apply to medical and surgical benefits. It requires individual health policies to follow the same parity rules as group health policies. It also requires “drug and alcohol dependency treatment” be covered under parity rules and prohibits insurers from using any additional criteria for benefit determination for such benefits, aside from evidence-based clinical guidelines. The bill takes effect January 1, 2019.
In New York, Barry Perlman, M.D., longtime chair of the Legislation Committee of the New York State Psychiatric Association (NYSPA), worked closely with lobbyists and other mental health advocates for several years championing New York’s parity reporting bill that passed there. “This is clearly one of the most consequential pieces of legislation undertaken by NYSPA, and one that will advance the goal of fully implementing the spirit and intent of the federal and New York’s parity law that we all fought so hard to enact 12 years ago,” Perlman said.
The new laws vary by state (see box), but all require insurers to demonstrate how their care management practices for mental health and substance use treatment are no more restrictive than those for medical care.
“We are hoping that these are the first of many states to pass comprehensive parity reporting bills, because without this level of transparency and accountability on the part of insurers, we will never achieve full implementation of mental health parity laws,” said Tim Clement, APA’s Northeast regional field director of state government affairs.
It has been 10 years since the Mental Health Parity and Addiction Equity Act of 2008 required health insurers to provide the same level of benefits for mental health/substance use treatment as for medical or surgical care. That law has been largely successful in equalizing more straightforward “quantitative” mental health benefits for patients, such as number of covered visits per year and copay amounts.
But parity in how insurers design their more complicated managed care practices has not followed suit. Part of the problem is the complexity of overseeing parity for what are known as nonquantitative treatment limits (NQTLSs), such as prescription drug formulary design, prior authorization rules, network adequacy, provider reimbursement rates, or step therapies, Clement said.
“Unfortunately, the end result is that some people are denied coverage of mental health and addiction care when continued treatment is needed, and they subsequently suffer or even die from overdoses or suicides,” Clement said.
For example, insurers continue to apply far more stringent network admission standards for mental health professionals, with more documentation required and fewer providers admitted, Clement said. Reimbursement for mental health professionals is lower too: an examination of claims data from preferred provider organizations for 42 million patients revealed that behavioral care services were paid 21 percent less than claims for primary care, a Milliman study found in December 2017.
New York’s bill had faced vigorous opposition from managed care and behavioral health care organizations but was finally pushed through the Senate on the last day of the session, explained NYSPA’s Perlman. As director of psychiatry at a large hospital for 35 years, Perlman said he witnessed the continued and disparate hurdles faced by individuals with mental health and substance use disorders when trying to obtain coverage for their care. “We were continuously in conflict with managed care companies,” he added. Much of the responsibility for enforcement of parity laws has come down to the states.
Prior to the passage of the Illinois bill, the Illinois Department of Insurance was tracking compliance with existing parity laws mainly by tallying how many complaints it received from the public, said Meryl Sosa, executive director of the Illinois Psychiatric Society (IPS). “But most people don’t know anything about parity and don’t know enough to file a complaint. We’re very happy about getting this bill passed.”
The results of a statewide survey by the Kennedy Forum of Illinois mental health and substance use professionals, including IPS members, helped to sway the assembly, Sosa said. The survey revealed that clinicians have had problems getting a variety of behavioral health services covered by both Medicaid managed care organizations and commercial insurers. For example, more than half of providers surveyed reported that commercial health plans denied coverage for acute behavioral health services for their patients sometimes (41 percent), often (9 percent), or always (5 percent), because they were deemed “not medically necessary.”
Anna Weaver-Hayes, executive director of the Colorado Psychiatric Society, said it strongly supported the passage of House Bill 18-1357. “It is often difficult to access care and even more so during a mental health/SUD crisis. This bill benefits the people of Colorado, our mental health and substance use disorder treatment providers, and the state.”
APA has written a compliance guide for state regulators to use when evaluating parity compliance. It also has worked on model legislation other states can adopt. ■
For help with passing parity legislation in your state, contact Tim Clement at [email protected].
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Psychiatrics News
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Published online: 9 August 2018
Published in print: August 4, 2018 – August 17, 2018
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