What to Know About the Mental Health Parity and Addiction Equity Act (MHPAEA)

How the MHPAEA changes how employee benefits are allocated.

Recently, the Department of Labor, the Department of Human Services, and the Treasury Department have come together to promote compliance with the Mental Health Parity and Addiction Equity Act (MHPAEA).  This Act requires that mental health and substance abuse disorder (MH/SUD) benefits be treated equally to medical and surgical benefits.  MHPAEA’s requirements apply to group health plans and health insurance providers that offer coverage for MH/SUD benefits in addition to the typical medical and surgical benefits.

  • MHPAEA Parity Requirements

Under this new Act, the financial requirements and treatment limitations applicable to MH/SUD benefits cannot be more restrictive than those applied to medical and surgical benefits.  The Act also sets requirements on non-quantitative treatment limitations (NQTLs) that plans may place on MH/SUD benefits.  NQTLs are limitations on the scope or duration of benefits for treatment and include things like medical management standards, formulary designs for prescription drugs, and so on.

  • MHPAEA Enforcement

The Department of Labor will oversee MHPAEA’s requirements for private-sector employment-based health plans through its Employee Benefits Security Administration (EBSA).  The EBSA will enforce requirements through compliance reviews.  If violations are discovered, then the EBSA will require the health plan provider to make the necessary changes to any noncompliant plan provisions.  Additionally, the provider will have to go back and pay any improperly denied benefit claims.

This is what you need to know about the Mental Health Parity and Addiction Equity Act (MHPAEA).  Want to learn more about the legislation affecting employee benefits?  Then contact the experts at CIA Insurance and Risk Management for the answers you need today.

Post written by Janelle Morck, Vice President | Employee Benefits Risk Management (ERM)

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