Mental health parity: Are you ready for an audit?

As the saying goes, what you measure gets managed. And really, that’s all employers and their benefits partners need to know about the new DOL’s new mental health parity enforcement.

It sounds simple, except for one small thing: very few stakeholders have been doing any benchmarking of their mental health benefits whatsoever over the 25-plus years of the Mental Health Parity Act’s existence. Or if they have, they’ve been doing it wrong.

In a recent session at the BenefitsPRO Broker Expo in Austin, Jennifer Berman and Jessica Waltman of MZQ Consulting dove into the increased enforcement of the Mental Health Parity and Addiction Equity Act as a result of the Consolidated Appropriations Act, including what exactly plan sponsors need to be doing and why it’s been so difficult to get it done.

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The original Mental Health Parity Act was passed way back in 1996, with the follow-up MHPAEA in 2008. In the interceding 12 years, a lot of progress was made but more was needed, and that’s the position we’re in today.

“For the past 10 years, at the federal regulatory level, they kept saying, ‘Everyone’s doing it wrong,’” Waltman says. But with the passage of the CAA, which included thousands of pages of health care-specific language, the Department of Labor was empowered to finally say, “Hey, you’ve been doing mental health parity wrong. We’re tired of it, and we’re going to make you do it right.”

Parity, equality and NQTLS

The key focus of the DOL’s ramped-up enforcement efforts is looking at Non-Quantitative Treatment Limitations (NQTLs). These, says Waltman, are “all the parts of the plan that aren’t purely numeric. There are things you make people do to get their coverage or get paid for their coverage.”

Separate from premiums and cost-sharing, it’s things like prior authorizations for care, reimbursement rates for providers –- ”all of these things that don’t directly relate to numbers,” Waltman says. “They’re kind of squishy, and they’re just there, we didn’t always give them a ton of thought.”

Berman describes the “buckets” that these NQTLs fall into, including in-network and out-of-network rates for in-patient care, outpatient care, emergency services and prescription drugs. Each bucket itself includes anywhere from 20 to 30 metrics.

“This takes months and months,” Berman says. “It’s not an easy process. Once you’ve found the plan document, then you really need to dig into all of these underlying policies, procedures and standards.”

For all of these criteria, a plan will have to show the justification for the decision. The end goal is to demonstrate that the criteria used in designing the plan’s mental health coverage has been done thoughtfully and in such a way that it’s no more stringent than the plan design for medical and surgical care.

But that’s just the half of it–after establishing what the plan SAYS it does, sponsors must also show what the plan ACTUALLY does.“You have to test what’s in writing, and what you’re actually doing on a day-to-day basis,” Waltman says. “You can write down whatever you want, and then on the operational level, we’ll find out it was taking 20 years to preauthorize mental benefits. Almost every time, the plan is far worse in writing than it is operationally.”

Uncooperative players

Even plan sponsors who have seen the writing on the wall and want to be ready when the DOL comes knocking at their door will face an uphill battle. It’s an onerous list of data that needs to be tracked down, often from less-than-cooperative vendor partners.

“Whoever’s doing the utilization management, whoever is doing the network, whoever is managing the claims,” says Waltman. ”Sometimes you have multiple entities doing utilization management. We have to reach out to all of these people. We have to figure out what they are doing, what guidelines they’re following.

“Even enteties that you might think might have set up something… no,” she adds. “None of them have it. Getting operational data is very tricky. They also don’t want to give up this information because you get into sensitive things like reimbursement rates.”

The DOL suspects, for example, that low reimbursement rates are part of the reason that so many mental health providers remain out of network–but they need evidence to back it up. Unfortunately for plan sponsors, a lot of health insurers are not overly willing to share the “secret sauce,” as Bergman put it, of how their reimbursement rates are set.

“The good news is we’re starting to break through,” says Waltman. “We’re pretty persistent, we’re starting to get their tricks and learn the code words. Also, we need it because it’s starting to be enforced.”

The DOL is going easy on the first round of audited companies from 2021 (all 156 of whom were found in non-compliance), but Bergman warned that this issue is one that the government is backing up with significant funding. “I have never seen anything like I have in the past year in the mental health parity space,” she says.

And even if it’s not the DOL who comes knocking, well, it’s only a matter of time before ERISA catches up with you. “We’ll see more claims every day under mental health parity,” Berman predicts. “If you have somebody today ask to see that comparative analysis… ERISA litigation is its own interesting thing. What are your plan participants going to do to you, and the plaintiffs bar?“