These synopses are intended only as aids to the reader in

HIGHLIGHTS

OF THIS ISSUE

These synopses are intended only as aids to the reader in

identifying the subject matter covered. They may not be

relied upon as authoritative interpretations.

EXCISE TAX

REG-120727-21, page 671.

This document proposes amendments to regulations implementing the Paul Wellstone and Pete Domenici Mental

Health Parity and Addiction Equity Act of 2008 (MHPAEA)

and proposes new regulations for the nonquantitative treatment limitation (NQTL) comparative analyses required under

MHPAEA, as amended by the Consolidated Appropriations

Act, 2021 (CAA, 2021). The regulations are issued jointly

with the Department of Health and Human Services, and the

Department of Labor.

Finding Lists begin on page ii.





Bulletin No. 2023–36

September 5, 2023

The IRS Mission

Provide America’s taxpayers top-quality service by helping

them understand and meet their tax responsibilities and

enforce the law with integrity and fairness to all.

Introduction

The Internal Revenue Bulletin is the authoritative instrument

of the Commissioner of Internal Revenue for announcing official rulings and procedures of the Internal Revenue Service

and for publishing Treasury Decisions, Executive Orders, Tax

Conventions, legislation, court decisions, and other items of

general interest. It is published weekly.

It is the policy of the Service to publish in the Bulletin all substantive rulings necessary to promote a uniform application

of the tax laws, including all rulings that supersede, revoke,

modify, or amend any of those previously published in the

Bulletin. All published rulings apply retroactively unless otherwise indicated. Procedures relating solely to matters of internal management are not published; however, statements of

internal practices and procedures that affect the rights and

duties of taxpayers are published.

Revenue rulings represent the conclusions of the Service

on the application of the law to the pivotal facts stated in

the revenue ruling. In those based on positions taken in rulings to taxpayers or technical advice to Service field offices,

identifying details and information of a confidential nature are

deleted to prevent unwarranted invasions of privacy and to

comply with statutory requirements.

Rulings and procedures reported in the Bulletin do not have the

force and effect of Treasury Department Regulations, but they

may be used as precedents. Unpublished rulings will not be

relied on, used, or cited as precedents by Service personnel in

the disposition of other cases. In applying published rulings and

procedures, the effect of subsequent legislation, regulations,

court decisions, rulings, and procedures must be considered,

and Service personnel and others concerned are cautioned

against reaching the same conclusions in other cases unless

the facts and circumstances are substantially the same.

The Bulletin is divided into four parts as follows:

Part I.—1986 Code.

This part includes rulings and decisions based on provisions

of the Internal Revenue Code of 1986.

Part II.—Treaties and Tax Legislation.

This part is divided into two subparts as follows: Subpart A,

Tax Conventions and Other Related Items, and Subpart B,

Legislation and Related Committee Reports.

Part III.—Administrative, Procedural, and Miscellaneous.

To the extent practicable, pertinent cross references to these

subjects are contained in the other Parts and Subparts. Also

included in this part are Bank Secrecy Act Administrative

Rulings. Bank Secrecy Act Administrative Rulings are issued

by the Department of the Treasury’s Office of the Assistant

Secretary (Enforcement).

Part IV.—Items of General Interest.

This part includes notices of proposed rulemakings, disbarment and suspension lists, and announcements.

The last Bulletin for each month includes a cumulative index

for the matters published during the preceding months. These

monthly indexes are cumulated on a semiannual basis, and are

published in the last Bulletin of each semiannual period.

The contents of this publication are not copyrighted and may be reprinted freely. A citation of the Internal Revenue Bulletin as the source would be appropriate.

September 5, 2023 

Bulletin No. 2023–36

Part IV

Notice of Proposed

Rulemaking

Requirements Related to

the Mental Health Parity

and Addiction Equity Act

REG-120727-21

AGENCY: Internal Revenue Service,

Department of the Treasury; Employee

Benefits

Security

Administration,

Department of Labor; Centers for Medicare

& Medicaid Services, Department of

Health and Human Services.

ACTION: Proposed rules.

SUMMARY: This document proposes

amendments to regulations implementing the Paul Wellstone and Pete Domenici

Mental Health Parity and Addiction

Equity Act of 2008 (MHPAEA) and

proposes new regulations implementing

the nonquantitative treatment limitation

(NQTL) comparative analyses requirements under MHPAEA, as amended by

the Consolidated Appropriations Act,

2021 (CAA, 2021). Specifically, these

proposed rules would amend the existing NQTL standard to prevent plans

and issuers from using NQTLs to place

greater limits on access to mental health

and substance use disorder benefits as

compared to medical/surgical benefits.

As part of these changes, these proposed

rules would require plans and issuers

to collect and evaluate relevant data in

a manner reasonably designed to assess

the impact of NQTLs on access to mental health and substance use disorder

benefits and medical/surgical benefits,

and would set forth a special rule with

regard to network composition. These

proposed rules would also amend existing examples and add new examples on

the application of the rules for NQTLs

to clarify and illustrate the protections

of MHPAEA. Additionally, these proposed rules would set forth the content

requirements for NQTL comparative

analyses and specify how plans and

Bulletin No. 2023–36

issuers must make these comparative

analyses available to the Department of

the Treasury (Treasury), the Department

of Labor (DOL), and the Department

of Health and Human Services (HHS)

(collectively, the Departments), as well

as to an applicable State authority, and

participants, beneficiaries, and enrollees.

The Departments also solicit comments

on whether there are ways to improve

the coverage of mental health and substance use disorder benefits through

other provisions of Federal law. Finally,

HHS proposes regulatory amendments

to implement the sunset provision for

self-funded, non-Federal governmental plan elections to opt out of compliance with MHPAEA, as adopted in the

Consolidated Appropriations Act, 2023

(CAA, 2023).

DATES: To be assured consideration,

comments must be received at one of the

addresses provided below, no later than

October 2, 2023.

ADDRESSES: Written comments may be

submitted to the address specified below.

Any comment that is submitted will be

shared with Treasury, Internal Revenue

Service (IRS), and HHS. Please do not

submit duplicates.

Comments will be made available

to the public. Warning: Do not include

any personally identifiable information

(such as name, address, or other contact information) or confidential business information that you do not want

publicly disclosed. All comments are

posted on the internet exactly as received

and can be retrieved by most internet

search engines. No deletions, modifications, or redactions will be made to the

comments received, as they are public

records. Comments may be submitted

anonymously.

In commenting, please refer to file

code 1210-AC11. Because of staff and

resource limitations, the Departments cannot accept comments by facsimile (FAX)

transmission.

Comments must be submitted in one

of the following two ways (please choose

only one of the ways listed):

671

1. Electronically. You may submit

electronic comments on this regulation to

https://www.regulations.gov. Follow the

“Submit a comment” instructions.

2. By mail. You may mail written comments to the following address

ONLY: Office of Health Plan Standards

and Compliance Assistance, Employee

Benefits Security Administration, Room

N-5653, U.S. Department of Labor, 200

Constitution Avenue, NW., Washington,

DC 20210, Attention: 1210-AC11.

Please allow sufficient time for mailed

comments to be received before the close

of the comment period.

Inspection of Public Comments: All

comments received before the close of the

comment period are available for viewing

by the public, including any personally

identifiable or confidential business information that is included in a comment. The

comments are posted on the following

website as soon as possible after they have

been received: https://www.regulations.

gov. Follow the search instructions on that

website to view public comments.

FOR FURTHER INFORMATION

CONTACT: Shira McKinlay, Internal

Revenue Service, Department of the

Treasury, at 202-317-5500; Beth Baum or

David Sydlik, Employee Benefits Security

Administration, Department of Labor, at

202-693-8335; David Mlawsky, Centers

for Medicare & Medicaid Services,

Department of Health and Human

Services, at 410-786-6851.

Customer Service Information:

Individuals interested in obtaining

information from DOL concerning private

employment-based health coverage laws

may call the Employee Benefits Security

Administration (EBSA) Toll-Free Hotline

at 1-866-444-EBSA (3272) or visit the

DOL’s website (www.dol.gov/agencies/

ebsa).

In addition, information from HHS on

private health insurance coverage and coverage provided by self-funded, non-Federal governmental group health plans can

be found on the Centers for Medicare

& Medicaid Services (CMS) website

(www.cms.gov/cciio), and information on

health care reform can be found at www.

Healthcare.gov or https://www.hhs.gov/

September 5, 2023

healthcare/index.html. In addition, information about mental and behavioral health

and addiction is available at https://www.

samhsa.gov/mental-health and https://

www.samhsa.gov/find-support.

SUPPLEMENTARY INFORMATION:

I. Background

A. Introduction

Mental health is essential to personal

and societal wellbeing. America is experiencing a mental health and substance

use disorder crisis1 that worsened during

the COVID-19 pandemic.2 This crisis

impacts both children and adults across

various demographics nationwide and disproportionately affects marginalized and

underserved communities. Recent data

from the Centers for Disease Control and

Prevention (CDC) indicate that, between

August 2020 and February 2021, the

percentage of adults exhibiting symptoms of an anxiety or depressive disorder

increased significantly, from 36.4 percent

to 41.5 percent.3

Similarly, the overdose and substance

use disorder epidemic has worsened

in recent years. Overdose death numbers have risen substantially since 2015,

reaching a then-historic high of 70,630

deaths nationally in 2019 and growing

to a reported value of 107,421 overdose

deaths in the 12-month period ending

in July 2022.4 Additionally, from 1999

through 2019, the rate of drug overdose

deaths increased from 4.0 per 100,000 to

19.6 in rural counties,5 and in 2020, the

age-adjusted rate of drug overdose deaths

increased to 26.2 per 100,000 in rural

counties.6 The number of people who died

from drug overdoses in 2021 increased

by approximately 36,000 over the prior

2 years.7 During the first year of the

COVID-19 pandemic, the overdose death

rates were highest for American Indians

and Alaska Natives and Black or African

Americans, exceeding the overdose death

rate for White people by about 30 and 16

percent, respectively.8 While Hispanic and

Latino people saw the lowest overdose

death rates, those rates still increased in

2020.9

As noted above, both children and

adolescents are also impacted by this

mental health and substance use disorder crisis. Prior to the COVID-19 public health emergency (PHE), millions of

children ages 12 to 17 reported experiencing at least one major depressive episode

or severe major depression.10 Suicidal

behavior among children has increased

sharply; known suicide attempts by

ingestion alone in children ages 10 to 12

increased by about 450 percent from 2010

to 2020.11 Suicide rates among Black or

African American children below age 13

increased rapidly from 2001 to 2015, and

those children are nearly twice as likely to

die by suicide than White children of the

same age.12 Additionally, one survey, conducted from September 20 to December

31, 2021, notes that 45 percent of Lesbian,

Gay, Bisexual, Transgender, and Queer

(LGBTQ) youth respondents ages 13 to 24

seriously considered attempting suicide in

the past year,13 including nearly half of

multiracial LGBTQ youth respondents.14

A sharp rise in eating disorders throughout the COVID-19 PHE also demonstrates

the extent of this crisis for young people.15

Emergency department visits for adolescent girls ages 12-17 with eating disorders

doubled in January 2022 as compared

to 2019,16 and children are beginning to

experience eating disorders at younger

ages.17 In addition, in 2021, nearly 3 in 5

teen girls felt persistently sad or hopeless,

Department of Health and Human Services (2023). SAMHSA Announces National Survey on Drug Use and Health (NSDUH) Results Detailing Mental Illness and Substance Use Levels

in 2021. Retrieved from https://www.hhs.gov/about/news/2023/01/04/samhsa-announces-national-survey-drug-use-health-results-detailing-mental-illness-substance-use-levels-2021.html.

2

Vahratian, A., Blumberg, S. J., Terlizzi, E. P., Schiller, J. S. (2021). Symptoms of Anxiety or Depressive Disorder and Use of Mental Health Care Among Adults During the COVID-19

Pandemic — United States, August 2020–February 2021. MMWR Morb Mortal Wkly Rep 2021;70:490–494. DOI: http://dx.doi.org/10.15585/mmwr.mm7013e2.

3

Id.

4

Hedegaard, H., Miniño, A. M., Wagner, M. (2020). Drug Overdose Deaths in the United States, 1999-2019. NCHS Data Brief No. 304 (December 2020) https://www.cdc.gov/nchs/data/databriefs/db394-H.pdf; Centers for Disease Control and Prevention, National Center for Health Statistics. Vital Statistics Rapid Release: Provisional Drug Overdose Death Counts. Available

at https://www.cdc.gov/nchs/nvss/vsrr/drug-overdose-data.htm. Accessed on July 14, 2023.

5

Hedegaard H, Spencer MR. Urban–rural differences in drug overdose death rates, 1999–2019. NCHS Data Brief, no 403. Hyattsville, MD: National Center for Health Statistics. 2021. DOI:

https://dx.doi.org/10.15620/cdc:102891.

6

Spencer MR, Garnett MF, Miniño AM. Urban–rural differences in drug overdose death rates, 2020. NCHS Data Brief, no 440. Hyattsville, MD: National Center for Health Statistics. 2022.

DOI: https://dx.doi.org/10.15620/cdc:118601.

7

National Vital Statistics System. Provisional Drug Overdose Death Counts. https://www.cdc.gov/nchs/pressroom/nchs_press_releases/2022/202205.htm.

8

Friedman, Joseph R, and Helena Hansen (2022). Research Letter: Evaluation of Increases in Drug Overdose Mortality Rates in the US by Race and Ethnicity Before and During the COVID19 Pandemic. JAMA Psychiatry. https://jamanetwork.com/journals/jamapsychiatry/fullarticle/2789697?utm_campaign=articlePDF&utm_medium=articlePDFlink&utm_source=articlePDF&utm_content=jamapsychiatry.2022.0004.

9

Id.

10

Mental Health America (2022). Youth Ranking 2022. https://mhanational.org/issues/2022/mental-health-america-youth-data.

11

Sheridan D, Grusing S, Marshall R. (2022) Changes in Suicidal Ingestion Among Preadolescent Children from 2000 to 2020. JAMA Pediatrics. https://jamanetwork.com/journals/jamapediatrics/article-abstract/2789948; see also CDC, Youth Risk Behavior Survey, available at https://www.cdc.gov/healthyyouth/data/yrbs/pdf/YRBS_Data-Summary-Trends_Report2023_508.

pdf.

12

Bridge JA, Horowitz LM, Fontanella CA, et al. (2018). Age-Related Racial Disparity in Suicide Rates Among US Youths From 2001 Through 2015. JAMA Pediatrics. https://jamanetwork.

com/journals/jamapediatrics/fullarticle/2680952.

13

The Trevor Project (2022). 2022 National Survey on LGBTQ Youth Mental Health. https://www.thetrevorproject.org/survey-2022/.

14

The

Trevor

Project

(2022).

The

Mental

Health

and

Well-Being

of

Multiracial

LGBTQ

Youth.

https://www.thetrevorproject.org/research-briefs/

the-mental-health-and-well-being-of-multiracial-lgbtq-youth-aug-2022/.

15

Radhakrishnan L, Leeb R, Bitsko R, Carey K, Gates A, Holland K, Hartnett K, Kite-Powell A, DeVies J, Smith A, van Santen K, Crossen S, Sheppard M, Wotiz S, Lane R, Njai R, Johnson

A, Winn A, Kirking H, Rodgers L, Thomas C, Soetebier K, Adjemian J, Anderson K. (2022) Pediatric Emergency Department Visits Associated with Mental Health Conditions Before

and During the COVID-19 Pandemic — United States, January 2019–January 2022. MMWR Morb Mortal Wkly Rep 2022; 71(8);319-324. https://www.cdc.gov/mmwr/volumes/71/wr/

mm7108e2.htm.

16

Id.

17

Stuart B. Murray, Aaron J. Blashill, and Jerel P. Calzo (2022). Prevalence of Disordered Eating and Associations With Sex, Pubertal Maturation, and Weight in Children in the US, available

at https://jamanetwork.com/journals/jamapediatrics/article-abstract/2794847.

1

September 5, 2023

672

Bulletin No. 2023–36

the highest level reported over the past

decade.18

Americans are too frequently discouraged from and forgo seeking mental

health and substance use disorders care

because of barriers, both inside and outside of the health care system, such as

discrimination, stigmatization,19 inability

to find an in-network provider accepting new patients,20 cost, and geography.

These barriers are particularly problematic for young adults ages 18-34, who are

less likely to believe their mental health

symptoms are well-managed than older

adults,21 and for people seeking substance use disorder treatment.22 One survey reports that less than seven percent

of people in need of substance use disorder treatment received care at a specialty

facility and less than 10 percent received

“any treatment,”23 while only about 19

percent of people with opioid use disorder in 2021 received life-saving medications.24 Sixty percent of rural Americans

live in mental health professional shortage

areas.25 Additionally, non-metropolitan

adults were more likely than metropolitan

adults (43.7% vs. 34.5%) to see a general

practitioner or family doctor, as opposed

to a mental health specialist, for depressive symptoms, and among non-metropolitan adults with depression, fewer than 20

percent received treatment from a mental

health professional.26

Moreover, against the backdrop of this

mental health and substance use disorder

crisis, when patients seek benefits under

their health plan or coverage, they often

find that coverage for treatment of mental

health conditions or substance use disorders operates in a separate—and too often

disparate—system than their health plan’s

coverage for treatment of medical/surgical

conditions.27 These disparities exacerbate

the hardships faced by people living with

mental health conditions and substance

use disorders. The disparities also can

magnify the challenges faced by the parents, children, and loved ones of people

living with mental health conditions or

substance use disorders as well as those

who care for them, who are profoundly

affected by the person’s illness and their

difficulties in getting, or inability to get,

coverage for needed care.28

Ensuring meaningful access to mental

health and substance use disorder care is

vital to addressing the Nation’s mental

health and substance use disorder crisis.

A key component of access is the availability of an adequate number of appropriate providers within a plan’s network. A

survey of adults with private health coverage found that plan participants were

more likely to perceive their mental health

provider networks as inadequate when

compared to medical provider networks.29

Furthermore, another survey noted that

most plan participants reported choosing

mental health services from out-of-network mental health providers based on

provider quality issues.30

A 2019 Milliman report found a growing disparity in the utilization of out-ofnetwork behavioral health care (which

the report uses to refer to care for mental

health conditions and substance use disorders) providers relative to out-of-network medical/surgical care providers.31

The same report found that the disparity

between how often out-of-network behavioral health inpatient facilities were used

relative to out-of-network medical/surgical inpatient facilities had increased 85

percent between 2013 and 2017 for people with commercial preferred provider

organization (PPO) health plans. Over the

same period, there were also increasing

disparities in the use of out-of-network

outpatient facilities and office visits for

mental health and substance use disorder

treatment relative to the use of out-of-network outpatient facilities and office visits for medical/surgical care.32 The report

additionally noted a growing disparity

in reimbursement rates (as a percentage

18

Centers for Disease Control and Prevention, National Center for HIV, Viral Hepatitis, STD, and TB Prevention, U.S. Teen Girls Experiencing Increased Sadness and Violence (Feb. 13,

2023), available at https://www.cdc.gov/nchhstp/newsroom/2023/increased-sadness-and-violence-press-release.html.

19

Van Boekel, L. C., Brouwers, E. P., van Weeghel, J., & Garretsen, H. F. (2013). Stigma among health professionals towards patients with substance use disorders and its consequences for

healthcare delivery: systematic review. Drug and Alcohol Dependence, 131(1-2), 23–35. DOI: 10.1016/j.drugalcdep.2013.02.018, available at https://pubmed.ncbi.nlm.nih.gov/23490450/.

20

Cf. Jack Turbin. Ghost networks of psychiatrists make money for insurance companies but hinder patients’ access to care. Stat News, June 17, 2019, https://www.statnews.com/2019/06/17/

ghost-networks-psychiatrists-hinder-patient-care/

21

National Alliance on Mental Illness (2021). Mood Disorder Survey Report. https://nami.org/NAMI/media/NAMI-Media/Research/NAMI-Mood-Disorder-Survey-White-Paper.pdf.

22

Esther Adeniran, Megan Quinn, Richard Wallace, Rachel R. Walden, Titilola Labisi, Afolakemi Olaniyan, Billy Brooks, Robert Pack (2023). A scoping review of barriers and facilitators

to the integration of substance use treatment services into US mainstream health care, Drug and Alcohol Dependence Reports; Volume 7, 100152 https://www.sciencedirect.com/science/

article/pii/S2772724623000227.

23

Center for Behavioral Health Statistics and Quality (2022), Results from the 2021 National Survey on Drug Use and Health: Detailed Tables, Substance Abuse and Mental Health Services

Administration, available at https://www.samhsa.gov/data/report/2021-nsduh-detailed-tables. For this purpose, “any treatment” includes having participated in a mutual aid group, such as

Alcoholics Anonymous, Narcotics Anonymous, or SMART Recovery, and receiving services in a hospital through primary care.

24

Id.

25

Health Resources and Services Administration, Designated Health Professional Shortage Areas Statistics (data updated through June 30, 2023), available at https://data.hrsa.gov/Default/

GenerateHPSAQuarterlyReport (last accessed July 18, 2023).

26

Borders, TF. Major Depression, Treatment Receipt, and Treatment Sources among Non-Metropolitan and Metropolitan Adults. Lexington, KY: Rural and Underserved Health Research

Center; 2020. Available at https://www.ruralhealthresearch.org/publications/1348.

27

See, generally, Commonwealth Fund, Behavioral Health Care in the United States: How It Works and Where It Falls Short, available at https://www.commonwealthfund.org/publications/

explainer/2022/sep/behavioral-health-care-us-how-it-works-where-it-falls-short.

28

See National Alliance on Mental Illness, Mental Health By the Numbers, available at https://www.nami.org/mhstats (showing 8.4 million people in the U.S. provide care to an adult with a

mental or emotional health issue); KFF, KFF/CNN Mental Health In America Survey, available at https://www.kff.org/other/report/kff-cnn-mental-health-in-america-survey/ (showing half

of adults say they have had a severe mental health crisis in their family); California Health Care Foundation, In Their Own Words: How Fragmented Care Harms People with Both Mental

Illness and Substance Use Disorder, available at https://www.chcf.org/publication/fragmented-care-harms-people-mental-illness-substance-use-disorder/.

29

See Busch, Susan H. and Kelly Kyanko, Assessment of Perception of Mental Health vs. Medical Health Plan Networks Among US Adults with Private Insurance, available at https://www.

ncbi.nlm.nih.gov/pmc/articles/PMC8536951/.

30

See Kelly A. Kyanko, Leslie A. Curry, and Susan H. Busch, Out-of-Network Providers Use More Likely in Mental Health than General Health Care Among Privately Insured, available at

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4707657/.

31

Melek, S., Davenport, S., Gray, T. J. (2019). Addiction and mental health vs. physical health: Widening disparities in network use and provider reimbursement (p. 6). Milliman. https://assets.

milliman.com/ektron/Addiction_and_mental_health_vs_physical_health_Widening_disparities_in_network_use_and_provider_reimbursement.pdf.

32

Id.

Bulletin No. 2023–36

673

September 5, 2023

of Medicare-allowed amounts) between

in-network mental health and substance

use disorder providers and medical/surgical providers. Primary care reimbursements were, on average, 23.8 percent

higher than behavioral health office visit

reimbursements relative to Medicare

allowed amounts in 2017—up from a

20.8 percent difference in 2015.33 Low

reimbursement rates for behavioral health

providers and high demand for services,

among other factors, contribute to this

difficulty finding in-network providers,34

which can stifle efforts to receive necessary care for mental health conditions or

substance use disorders.

MHPAEA’s fundamental purpose is

to ensure that individuals in group health

plans or with group or individual health

insurance coverage who seek treatment

for covered mental health conditions or

substance use disorders do not face greater

barriers to accessing benefits for such

mental health conditions or substance use

disorders than they would face when seeking coverage for the treatment of a medical condition or for a surgical procedure.35

Such barriers are particularly problematic

when they effectively result in the loss of

benefits that the plan or issuer purports to

make available and that individuals reasonably expect to be covered, and they

contravene MHPAEA’s clear mandate that

the financial requirements and treatment

limitations applicable to mental health benefits or substance use disorder benefits be

“no more restrictive” than the predominant

requirements and limitations applicable to

substantially all medical/surgical benefits.36

MHPAEA was enacted as bipartisan legislation reflecting what Congress

saw as a shared public concern: that it is

wrong to place greater burdens on people

in need of mental health and substance

use disorder treatment than people in need

of medical/surgical treatment under the

same health coverage. However, almost

15 years after MHPAEA’s enactment,

disparities persist, as people face greater

barriers when accessing benefits for mental health and substance use disorders

under their plan or coverage than they do

when accessing medical/surgical benefits.

The Departments’ experience since the

MHPAEA final regulations were issued

in 2013 (2013 final regulations) (78 FR

68240 (Nov. 13, 2013)) has shown that too

often, group health plans and health insurance issuers offering group or individual

health insurance coverage are not operating in compliance with MHPAEA, which

can have devastating consequences for

individuals with mental health conditions

and substance use disorders and their families. The Departments continue to receive

and investigate complaints that plans and

issuers fail to comply with MHPAEA, by

continuing to restrict access to benefits for

mental health conditions and substance

use disorders in ways that are more onerous and limiting than for medical or surgical care. As reflected in recent reports

to Congress on MHPAEA compliance,

the Departments found nearly all plans

or issuers audited for MHPAEA compliance could not demonstrate compliance

with the law’s obligations in response to

an initial request for NQTL comparative

analyses.37 As a result of these failures,

participants and beneficiaries routinely

encounter additional barriers to access

and are denied needed and potentially

lifesaving care for opioid use disorder,

eating disorders, autism spectrum disorder (ASD), anxiety, depression, and other

mental health conditions and substance

use disorders. The harm to these participants and beneficiaries, and to their families, friends, co-workers, and others, is

incalculable.

In the last 2 years, the Departments

have made an unprecedented commitment

to advance parity for mental health and

substance use disorder care by making it

a top enforcement priority, especially with

respect to NQTLs.38 Specifically, EBSA,

which has primary enforcement jurisdiction over MHPAEA for approximately 2.5

million private, employment-based group

health plans covering approximately 133

million individuals, is taking extraordinary steps to enforce mental health and

substance use disorder parity requirements

and ensure that it is using its full authority to help participants and beneficiaries

receive equitable coverage for mental

health and substance use disorder treatment. Similarly, CMS continues to prioritize its MHPAEA enforcement activities

with respect to non-Federal governmental

plans nationwide39 and health insurance

issuers offering group and individual

health insurance coverage in States where

CMS is the direct enforcer of MHPAEA

with respect to issuers.40, 41

In addition to using their enforcement

authority, the Departments continue

Id. at pp. 6-7.

See Busch, Susan H. and Kelly Kyanko, Assessment of Perception of Mental Health vs. Medical Health Plan Networks Among US Adults with Private Insurance, available at https://www.

ncbi.nlm.nih.gov/pmc/articles/PMC8536951/.

35

In a floor statement, Representative Patrick Kennedy (D-RI), one of the chief architects of MHPAEA, made the case for its passage on the grounds that “access to mental health services is

one of the most important and most neglected civil rights issues facing the Nation. For too long, persons living with mental disorders have suffered from discriminatory treatment at all levels

of society” 153 Cong. Rec. S1864-5 (daily ed. Feb. 12, 2007). Cf. H. Rept. 110-374, Part 3, available at https://www.congress.gov/congressional-report/110th-congress/house-report/374.

(“The purpose of H.R. 1424, the ‘Paul Wellstone Mental Health and Addiction Equity Act of 2007’ is to have fairness and equity in the coverage of mental health and substance-related disorders vis-a-vis coverage for medical and surgical disorders.”)

36

Internal Revenue Code (Code) section 9812(a)(3)(A), Employee Retirement Income Security Act of 1974 (ERISA) section 712(a)(3)(A), and Public Health Service Act (PHS Act) section

2726(a)(3)(A).

37

2022 MHPAEA Report to Congress, p. 4, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2022-realizing-parity-reducing-stigma-and-raising-awareness.pdf and https://www.cms.gov/files/document/2022-mhpaea-report-congress.pdf; 2023 MHPAEA Comparative Analysis Report to Congress, July

2023 (2023 MHPAEA Report to Congress), available at www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2023-mhpaea-comparative-analysis.pdf and https://www.cms.gov/cciio/resources/forms-reports-and-other-resources#mental-health-parity.

38

As discussed in more detail later in this preamble, NQTLs are generally non-numerical requirements that limit the scope or duration of benefits, such as prior authorization requirements,

step therapy, and standards for provider admission to participate in a network, including methodologies for determining reimbursement rates.

39

PHS Act section 2723(b).

40

PHS Act section 2723(a).

41

CMS currently enforces MHPAEA with respect to issuers in Texas and Wyoming. In addition, CMS has collaborative enforcement agreements with Alabama, Florida, Louisiana, Montana,

and Wisconsin. These States with collaborative enforcement agreements with CMS perform State regulatory and oversight functions with respect to some or all of the applicable provisions

of title XXVII of the PHS Act, including MHPAEA. However, if the State finds a potential violation and is unable to obtain compliance by an issuer, the State will refer the matter to CMS

for possible enforcement action.

33

34

September 5, 2023

674

Bulletin No. 2023–36

to work to reduce the stigma and discrimination that individuals with mental health conditions and substance use

disorders face, raise awareness so these

individuals can receive the treatment

they need and the benefits to which

they are entitled, and engage consumer advocates, members of the regulated community, State regulators, and

other interested parties to inform the

Departments’ efforts in addressing the

nation’s mental illness and substance

use disorder epidemic. These efforts

have helped to deepen the Departments’

understanding of the barriers to mental

health and substance use disorder treatment Americans face, inform DOL’s and

HHS’s MHPAEA enforcement approach,

and connect advocacy groups to government resources.

The Departments have also continued

to help plans, issuers, consumers, providers, States, and other interested parties

understand and comply with MHPAEA’s

requirements, including the NQTL

comparative

analysis

requirements.

Additionally, the Departments have

worked to help families, caregivers, and

individuals understand the law and benefit

from it, as Congress intended.

Since the promulgation of the 2013

final regulations on November 13, 2013,42

the Departments have provided extensive guidance and compliance assistance

materials to the regulated community,

State regulators, and other interested

parties to facilitate the implementation

and enforcement of MHPAEA, as discussed later in this preamble, including numerous sets of Frequently Asked

Questions (FAQs),43 fact sheets,44 compliance assistance tools,45 templates,46

78 FR 68240 (Nov. 13, 2013).

See, e.g., FAQs About Affordable Care Act Implementation Part V and Mental Health Parity Implementation (Dec. 22, 2010), available at https://www.dol.gov/sites/dolgov/files/

EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-v.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-5; FAQs About

Affordable Care Act Implementation (Part VII) and Mental Health Parity Implementation (Nov. 17, 2011), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/

our-activities/resource-center/faqs/aca-part-vii.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-7; Understanding Implementation of

the Mental Health Parity and Addiction Equity Act of 2008 (May 9, 2012), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/

faqs/understanding-implementation-of-mhpaea.pdf; FAQs for Employees about the Mental Health Parity and Addiction Equity Act (May 18, 2012), available at https://www.dol.

gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/mhpaea-2.pdf; FAQs About Affordable Care Act Implementation (Part XVII) and Mental Health Parity

Implementation (Nov. 8, 2013), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-xvii.pdf and https://www.hhs.

gov/guidance/document/affordable-care-act-implementation-faqs-set-17; FAQs About Affordable Care Act Implementation (Part XVIII) and Mental Health Parity Implementation

(Jan. 9, 2014), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-xviii.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-18; FAQs About Affordable Care Act Implementation (Part XXIX) and Mental Health Parity Implementation (Oct. 23, 2015),

available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-xxix.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-29 (FAQs Part XXIX); FAQs About Affordable Care Act Implementation Part 31, Mental Health Parity Implementation, and Women’s

Health and Cancer Rights Act Implementation (Apr. 20, 2016), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/acapart-31.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-31; FAQs About Affordable Care Act Implementation Part 34 and Mental

Health and Substance Use Disorder Parity Implementation (Oct. 27, 2016), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/

faqs/aca-part-34.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-34 (FAQs Part 34); FAQs About Mental Health and Substance Use

Disorder Parity Implementation and the 21st Century Cures Act Part 38 (June 16, 2017), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/

resource-center/faqs/aca-part-38.pdf and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-set-38 (FAQs Part 38); Proposed FAQs About Mental

Health and Substance Use Disorder Parity Implementation and the 21st Century Cures Act Part 39, available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-39-proposed.pdf (Proposed FAQs Part 39); Final FAQs About Mental Health and Substance Use Disorder Parity Implementation and the

21st Century Cures Act Part 39 (Sept. 5, 2019), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-39-final.pdf

and https://www.hhs.gov/guidance/document/affordable-care-act-implementation-faqs-final-set-39 (FAQs Part 39); FAQs About Families First Coronavirus Response Act and

Coronavirus Aid, Relief, and Economic Security Act Implementation Part 43 (June 23, 2020), available at https://www.dol.gov/sites/dolgov/files/ebsa/about-ebsa/our-activities/

resource-center/faqs/aca-part-43.pdf and https://www.hhs.gov/guidance/document/faqs-about-families-first-coronavirus-response-act-and-coronavirus-aid-relief-and-0 (FAQs

part 43); FAQs About Mental Health and Substance Use Disorder Parity Implementation and the Consolidated Appropriations Act, 2021 Part 45 (Apr. 2, 2021), available at

https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-45.pdf and https://www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/

Downloads/MHPAEA-FAQs-Part-45.pdf (FAQs Part 45); and Mental Health Parity and Addiction Equity Act (MHPAEA) FAQs, available at https://www.dol.gov/agencies/ebsa/

about-ebsa/our-activities/resource-center/faqs/mhpaea-1#.

44

See, e.g., The Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) Fact Sheet (Jan. 2010), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/fact-sheets/mhpaea.pdf; MHPAEA Enforcement Fact Sheet (Jan. 2016), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/fact-sheets/mhpaea-enforcement.pdf; FY 2016 MHPAEA Enforcement Fact Sheet, available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/

fact-sheets/mhpaea-enforcement-2016.pdf; FY 2017 MHPAEA Enforcement Fact Sheet, available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/

fact-sheets/mhpaea-enforcement-2017.pdf; FY 2018 MHPAEA Enforcement Fact Sheet, available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/fact-sheets/mhpaea-enforcement-2018.pdf; FY 2019 MHPAEA Enforcement Fact Sheet, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/mhpaea-enforcement-2019.pdf and https://www.cms.gov/CCIIO/Resources/Forms-Reports-and-Other-Resources/Downloads/mhpaea-enforcement-2019.pdf; FY 2020

MHPAEA Enforcement Fact Sheet, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/mhpaea-enforcement-2020.pdf and https://

www.cms.gov/CCIIO/Resources/Forms-Reports-and-Other-Resources/Downloads/mhpaea-enforcement-2020.pdf; FY 2021 MHPAEA Enforcement Fact Sheet, available at https://www.

dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/mhpaea-enforcement-2021.pdf; and FY 2022 MHPAEA Enforcement Fact Sheet, available at www.dol.gov/

sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/mhpaea-enforcement-2022.pdf.

45

See Self-Compliance Tool for Part 7 of ERISA: Health Care-Related Provisions, available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/publications/compliance-assistance-guide-appendix-a.pdf; 2018 Self-Compliance Tool for the Mental Health Parity and Addiction Equity Act (MHPAEA), available at https://www.dol.gov/sites/

dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/self-compliance-tool-2018.pdf; and 2020 Self-Compliance Tool for the Mental Health Parity and Addiction Equity Act

(MHPAEA), available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/self-compliance-tool.pdf.

46

See Form to Request Documentation from an Employer-Sponsored Health Plan or a Group or Individual Market Insurer Concerning Treatment Limitations, available at https://www.dol.

gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/mhpaea-disclosure-template.pdf.

42

43

Bulletin No. 2023–36

675

September 5, 2023

reports,47 and publications.48 Despite this

unprecedented outreach, plans and issuers

continue to fall short of MHPAEA’s central

mandate to ensure that participants, beneficiaries, and enrollees do not face greater

barriers and restrictions to accessing benefits for mental health conditions or substance use disorders than they face when

accessing benefits for a medical condition

or surgical procedure. This noncompliance is especially evident with respect to

the design and application of NQTLs that

apply to mental health and substance use

disorder benefits. Accordingly, Congress

amended MHPAEA in the CAA, 2021, as

described later in this preamble.

The Departments are proposing these

revised rules to reinforce MHPAEA’s fundamental objective, to ensure that limitations on mental health and substance use

disorder benefits are no more restrictive

than the limitations applicable to medical/

surgical benefits. These proposed rules

also would implement important requirements that Congress enacted in the CAA,

2021 to ensure that plans and issuers perform and document their NQTL comparative analyses and provide them to the

Departments or an applicable State authority upon request for evaluation of compliance with MHPAEA. The aim of these

proposed rules is to ensure that individuals

benefit from the full protections afforded

to them under MHPAEA, while providing

clear standards for plans and issuers on

how to comply with MHPAEA.

Specifically, the proposed regulations

would:

• Make clear that MHPAEA requires

that individuals can access their mental health and substance use disorder

benefits in parity with medical/surgical benefits.

• Provide specific examples that make

clear that plans and issuers cannot

use more restrictive prior authorization and other medical management

techniques for mental health and

substance use disorder benefits; standards related to network composition

for mental health and substance use

disorder benefits; and factors to determine out-of-network reimbursement

rates for mental health and substance

use disorder providers.

• Require plans and issuers to collect

and evaluate outcomes data and take

action to address material differences

in access to mental health and substance use disorder benefits as compared to medical/surgical benefits,

with a specific focus on ensuring

that there are not any material differences in access as a result of the

application of their network composition standards.

• Codify the requirement that plans and

issuers conduct meaningful comparative analyses to measure the impact

of NQTLs. This includes evaluating

standards related to network composition, out-of-network reimbursement

rates, and prior authorization NQTLs.

• Implement the sunset provision for

self-funded, non-Federal governmental plan elections to opt out of compliance with MHPAEA, adopted in the

CAA, 2023.

As a result of these proposals, the

Departments anticipate changes in network composition and medical management techniques that would result in more

robust mental health and substance use

disorder provider networks and fewer

and less restrictive prior authorization

requirements for individuals seeking

mental health and substance use disorder

treatment.

Under a regulatory regime in which

MHPAEA’s promise of parity is realized,

participants, beneficiaries, and enrollees

would experience financial requirements

and treatment limitations for mental health

and substance use disorder benefits that

are in parity with those applied to their

medical/surgical benefits. These proposed

See, e.g., DOL 2012 Report to Congress: Compliance With the Mental Health Parity and Addiction Equity Act of 2008 (Jan. 1, 2012), available at https://www.dol.gov/sites/dolgov/files/

EBSA/about-ebsa/our-activities/resource-center/publications/mhpaea-report-to-congress-2012.pdf; DOL 2014 Report to Congress: Compliance of Group Health Plans (and Health Insurance

Coverage Offered in Connection with Such Plans With the Requirements of the Mental Health Parity and Addiction Equity Act of 2008 (Sept. 2014), available at https://www.dol.gov/

sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/publications/mhpaea-report-to-congress-2014.pdf; DOL 2016 Report to Congress: Improving Health Coverage for Mental

Health and Substance Use Disorder Patients Including Compliance with the Federal Mental Health and Substance Use Disorder Parity Provisions (Jan. 2016), available at https://www.dol.gov/

sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/improving-health-coverage-for-mental-health-and-substance-use-disorder-patients.pdf; HHS Mental Health Parity

and Addiction Equity Act of 2008 (MHPAEA) Enforcement Report (Dec. 12, 2017), available at https://www.cms.gov/CCIIO/Resources/Forms-Reports-and-Other-Resources/Downloads/

HHS-2008-MHPAEA-Enforcement-Period.pdf; DOL 2018 Report to Congress: Pathway to Full Parity, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/

mental-health-parity/dol-report-to-congress-2018-pathway-to-full-parity.pdf; 21st Century Cures Act: Section 13002 Action Plan for Enhanced Enforcement of Mental Health and Substance

Use Disorder Coverage, available at https://www.hhs.gov/sites/default/files/parity-action-plan-b.pdf; HHS Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) Enforcement

Report for the 2018 Federal Fiscal Year, available at https://www.cms.gov/CCIIO/Resources/Forms-Reports-and-Other-Resources/Downloads/FY2018-MHPAEA-Enforcement-Report.pdf;

DOL 2020 Report to Congress: Parity Partnerships: Working Together, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/dol-report-to-congress-parity-partnerships-working-together.pdf; 2022 Report to Congress: Realizing Parity, Reducing Stigma, and Raising Awareness, available at https://www.dol.gov/sites/

dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2022-realizing-parity-reducing-stigma-and-raising-awareness.pdf and https://www.cms.gov/files/document/2022-mhpaea-report-congress.pdf; MHPAEA Comparative Analysis Report to Congress, July 2023, available at www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/

mental-health-parity/report-to-congress-2023-mhpaea-comparative-analysis.pdf and https://www.cms.gov/cciio/resources/forms-reports-and-other-resources#mental-health-parity.

48

See Consumer Guide to Disclosure Rights: Making the Most of Your Mental Health and Substance Use Disorder Benefits, available at https://www.dol.gov/sites/dolgov/files/EBSA/

laws-and-regulations/laws/mental-health-parity/disclosure-guide-making-the-most-of-your-mental-health-and-substance-use-disorder-benefits.pdf; Know Your Rights: Parity for

Mental Health and Substance Use Disorder Benefits, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/know-your-rights-parity-for-mental-health-and-substance-use-disorder-benefits.pdf; Parity of Mental Health and Substance Use Benefits with Other Benefits: Using Your Employer-Sponsored Health Plan to

Cover Services, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/parity-of-mental-health-and-substance-use-benefits-withother-benefits.pdf; Understanding Parity: A Guide to Resources for Families and Caregivers, available at https://www.dol.gov/sites/dolgov/files/ebsa/laws-and-regulations/laws/mental-health-parity/understanding-parity-a-guide-to-resources-for-families-and-caregivers.pdf; Warning Signs – Plan or Policy Non-Quantitative Treatment Limitations (NQTLs) that

Require Additional Analysis to Determine Mental Health Parity Compliance, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/

warning-signs-plan-or-policy-nqtls-that-require-additional-analysis-to-determine-mhpaea-compliance.pdf; Mental Health Parity Provisions Questions and Answers, available at https://

www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/publications/compliance-assistance-guide-mhpaea.pdf; Mental Health and Substance use Disorder

Parity: Compliance Assistance Materials Index, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/compliance-assistance-materials-index.pdf; The Essential Aspects of Parity: A Training Tool for Policymakers, available at https://store.samhsa.gov/product/essential-aspects-of-parity-training-tool-for-policymakers/pep21-05-00-001; and Approaches in Implementing the Mental Health Parity and Addiction Equity Act: Best Practices from the States, available at https://store.samhsa.gov/product/

Approaches-in-Implementing-the-Mental-Health-Parity-and-Addiction-Equity-Act-Best-Practices-from-the-States/SMA16-4983.

47

September 5, 2023

676

Bulletin No. 2023–36

rules are designed to achieve MHPAEA’s

purpose to ensure that participants, beneficiaries, and enrollees will not face greater

restrictions on access to obtaining mental

health and substance use disorder benefits

than those for medical/surgical benefits.

At the same time, the proposed rules also

aim to ensure that benefit structures that

apply limitations that reflect independent

professional medical or clinical standards or guard against indicators of fraud,

waste, and abuse (while minimizing the

negative impact on access to appropriate

benefits) would continue to be permitted,

as the Departments are of the view that

such limitations are premised on standards

that generally provide an independent and

less suspect basis for determining access

to mental health and substance use disorder treatment. These proposed rules also

aim to ensure that plans and issuers that

offer mental health and substance use disorder benefits strive to attain and maintain

mental health and substance use disorder

treatment provider networks that are as

robust as their medical/surgical provider

networks in terms of available in-network

providers and facilities–not just as shown

by a list of names in a provider directory,

but as measured by actual provider participation and as evidenced by participant

usage.

In evaluating their compliance with

these proposed rules, plans and issuers

would be required to consider whether an

NQTL is inhibiting access to treatment for

mental health conditions and substance

use disorders by examining whether the

NQTL that applies to mental health or

substance use disorder benefits is more

restrictive than the predominant NQTL

that applies to substantially all medical/

surgical benefits within a classification of

benefits set forth under the regulations.49

A plan or issuer would also be required to

consider whether the processes, strategies,

evidentiary standards, or other factors

that it uses to design or apply an NQTL

to mental health or substance use disorder

benefits in a classification are comparable

to, and applied no more stringently than,

those used in designing and applying the

NQTL to medical/surgical benefits in

the same classification. Under these proposed rules, plans and issuers would be

required to consider data relevant to an

NQTL’s impact on participants’ or beneficiaries’50 abilities to obtain mental health

and substance use disorder benefits under

the plan or coverage relative to its impact

on access to medical/surgical benefits,

and to take action to address the potential

causes of material differences in access

identified through the data as necessary

to ensure compliance. As the proposal

makes clear, ensuring that people seeking

mental health and substance use disorder treatment do not face greater barriers

to access to benefits for such treatment

is central to the fundamental purpose of

MHPAEA. These proposed rules would

ensure that NQTLs that apply to mental

health and substance use disorder benefits

are “no more restrictive,” and that processes, strategies, evidentiary standards,

and other factors are “comparable to, and

applied no more stringently,” than those

applicable to medical/surgical benefits.

These proposed rules’ focus on access to

mental health and substance use disorder

benefits and constraints on obtaining such

benefits would add needed clarity to the

statutory requirements for the regulated

community and other interested parties.

Under the current rules, plans and

issuers are generally permitted to prepare NQTL comparative analyses without

regard to the overall impact of NQTLs on

participants and beneficiaries. This has

contributed to plans and issuers looking

for ways to characterize the processes,

strategies, evidentiary standards, and

other factors associated with an NQTL as

being “comparable” and “applied no more

stringently” through careful word choice,

without regard to how, in operation, the

limitation burdens participants and beneficiaries by limiting access to, or by limiting the scope and duration of, the plan’s or

issuer’s mental health and substance use

disorder benefits relative to medical/surgical benefits. Such limitations on mental

health and substance use disorder benefits

under the plan or coverage must be analyzed in terms of the comparative burden

on access they place (that is, whether they

are more restrictive) on individuals.

These proposed rules set forth a number

of standards that are intended to reinforce

the proper application of the statutory

and regulatory requirements; promote

compliance with the NQTL comparative analysis requirements; explain how

the various components of the regulation

work together; and ensure that the purpose

of MHPAEA, to remove greater barriers

to access to mental health and substance

use disorder benefits, is fulfilled. The

Departments recognize the value of input

from interested parties and welcome feedback on all aspects of the approach set

forth in these proposed rules, as well as

alternative approaches that would enable

the Departments to more effectively

implement MHPAEA.

B. The Mental Health Parity Act, The

Mental Health Parity and Addiction

Equity Act, and the Affordable Care Act

In 1996, Congress enacted the Mental

Health Parity Act of 1996 (MHPA 1996),

which required parity in aggregate lifetime and annual dollar limits for mental

health benefits and medical/surgical benefits. These mental health parity provisions

were codified in Employee Retirement

Income Security Act of 1974 (ERISA)

The required classifications of benefits (and permissible sub-classifications) used to apply the MHPAEA regulations are addressed at 26 CFR 54.9812-1(c)(2)(ii), 29 CFR 2590.712(c)(2)

(ii), and 45 CFR 146.136(c)(2)(ii).

50

These proposed rules would apply directly to group health plans or health insurance coverage offered by an issuer in connection with a group health plan, and would apply to individual

health insurance coverage by cross-reference through 45 CFR 147.160, which currently provides that the requirements of 45 CFR 146.136 apply to health insurance coverage offered by a

health insurance issuer in the individual market in the same manner and to the same extent as to health insurance coverage offered by a health insurance issuer in connection with a group

health plan in the large group market. As noted below, HHS also proposes an amendment to 45 CFR 147.160 to also include a cross-reference to proposed 45 CFR 146.137 to similarly extend

the new proposed comparative analysis requirements to individual health insurance coverage in the same manner and to the same extent as group health insurance coverage. For simplicity,

this preamble generally refers only to the applicability on group health plans and health insurance coverage offered in connection with a group health plan and to participants and beneficiaries enrolled in such a plan or coverage, but references to participants and beneficiaries should also be considered to include enrollees in the individual market, unless otherwise specified.

49

Bulletin No. 2023–36

677

September 5, 2023

section 712, PHS Act section 2705, and

Internal Revenue Code (Code) section

9812, and applied to group health plans

and health insurance coverage offered in

connection with a group health plan.51

MHPAEA was enacted on October 3,

2008, as sections 511 and 512 of the Tax

Extenders and Alternative Minimum Tax

Relief Act of 2008 (Division C of Pub. L.

110-343, 122 Stat. 3765), to amend ERISA

section 712, PHS Act section 2705, and

Code section 9812 to add new requirements, including provisions to apply the

mental health parity requirements to substance use disorder benefits, and make

further amendments to the existing mental

health parity provisions.

MHPAEA, as enacted, generally

requires that group health plans and

health insurance issuers offering group

health insurance coverage ensure that

the financial requirements and treatment

limitations applicable to mental health

or substance use disorder benefits be no

more restrictive than those applicable to

medical/surgical benefits and that there

be no separate financial requirements and

treatment limitations applicable only with

respect to mental health or substance use

disorder benefits. Together with the existing requirements for parity in aggregate

lifetime and annual dollar limits, this is

referred to as providing mental health and

substance use disorder benefits “in parity”

with medical/surgical benefits.

The Patient Protection and Affordable

Care Act (Pub. L. 111-148, 123 Stat.

3028) was enacted on March 23, 2010,

and the Health Care and Education

Reconciliation Act of 2010 (Pub. L.

111-152, 124 Stat. 1029) was enacted

on March 30, 2010 (collectively, the

Affordable Care Act). The Affordable

Care Act reorganized, amended, and

added to the provisions of part A of title

XXVII of the PHS Act relating to group

health plans and health insurance issuers

in the group and individual markets. The

Affordable Care Act added section 715(a)

(1) to ERISA and section 9815(a)(1) to

the Code to incorporate the provisions of

part A of title XXVII of the PHS Act into

ERISA and the Code, and to make them

applicable to group health plans and

health insurance issuers providing health

insurance coverage in connection with

group health plans. The PHS Act sections

incorporated by these references are sections 2701 through 2728.

The Affordable Care Act extended

MHPAEA to apply to individual health

insurance coverage and redesignated

MHPAEA in the PHS Act as section

2726.52 Additionally, section 1311(j) of

the Affordable Care Act applies PHS Act

section 2726 to qualified health plans

(QHPs)53 in the same manner and to the

same extent as to health insurance issuers and group health plans. Furthermore,

HHS’ regulations regarding essential

health benefits (EHBs)54 require health

insurance issuers offering non-grandfathered health insurance coverage in the

individual and small group markets to

comply with MHPAEA and its implementing regulations in order to satisfy the

requirement to cover “mental health and

substance use disorder services, including

behavioral health treatment,” as part of

EHBs.55

On April 28, 2009, the Departments

published a request for information soliciting comments on issues under MHPAEA

(2009 RFI).56 Over the next few years,

the Departments considered comments

regarding MHPAEA and issued further

clarifications and guidance. On February

2, 2010, the Departments published

interim final regulations implementing

MHPAEA (interim final regulations).57

After considering the comments and other

feedback received from interested parties,

the Departments published the 2013 final

regulations.58

The 2013 final regulations established

an exhaustive list of six classifications of

benefits (not counting the exhaustive list

of permissible sub-classifications also

articulated in the 2013 final regulations):

inpatient, in-network; inpatient, out-ofnetwork; outpatient, in-network; outpatient, out-of-network; emergency care;

and prescription drugs. If a plan or health

insurance coverage provides benefits for a

mental health condition or substance use

disorder in any of these classifications of

benefits, benefits for that condition or disorder must be provided in every classification in which medical/surgical benefits

are provided. The 2013 final regulations

specify that the parity requirements apply

to financial requirements, such as deductibles, copayments, and coinsurance;

quantitative treatment limitations that are

expressed numerically, such as day or visit

limits; and NQTLs, which are generally

non-numerical requirements that limit the

scope or duration of benefits, such as prior

authorization requirements, step therapy

requirements, and standards for provider

Pub. L. 104–204, 110 Stat. 2874 (Sept. 26, 1996). The Departments published interim final rules implementing MHPA 1996 at 62 FR 66932 (Dec. 22, 1997).

The requirements of MHPAEA generally apply to both grandfathered and non-grandfathered health plans. See section 1251 of the Affordable Care Act and its implementing regulations at

26 CFR 54.9815-1251, 29 CFR 2590.715-1251, and 45 CFR 147.140. Under section 1251 of the Affordable Care Act, grandfathered health plans are exempted only from certain Affordable

Care Act requirements enacted in Subtitles A and C of Title I of the Affordable Care Act. The provisions extending MHPAEA requirements to individual health insurance coverage and

requiring that qualified health plans comply with MHPAEA are not included in these sections. However, because MHPAEA requirements apply to health insurance coverage offered in the

small group market only through the requirement to provide EHB, which does not apply to grandfathered health plans, the requirements of MHPAEA do not apply to grandfathered health

plans offered in the small group market.

53

A QHP is a health insurance plan that is certified by a health insurance exchange that it meets certain minimum standards established under the Affordable Care Act and described in subpart

C of 45 CFR part 156. See 45 CFR 155.20.

54

Section 1302 of the Affordable Care Act requires non-grandfathered health plans in the individual and small group markets to cover essential health benefits (EHB), which include items

and services in the following ten benefit categories: (1) ambulatory patient services; (2) emergency services; (3) hospitalization; (4) maternity and newborn care; (5) mental health and substance use disorder services including behavioral health treatment; (6) prescription drugs; (7) rehabilitative and habilitative services and devices; (8) laboratory services; (9) preventive and

wellness services and chronic disease management; and (10) pediatric services, including oral and vision care. See 45 CFR 156.115 for description of the benefits a health plan must provide

to provide EHB.

55

Section 1302(b)(1)(E) of the Affordable Care Act; 45 CFR 156.115(a)(3).

56

74 FR 19155 (Apr. 28, 2009).

57

75 FR 5410 (Feb. 2, 2010).

58

78 FR 68240 (Nov. 13, 2013).

51

52

September 5, 2023

678

Bulletin No. 2023–36

admission to participate in a network,

including methodologies for determining

reimbursement rates.

Under MHPAEA, financial requirements and treatment limitations imposed

on mental health or substance use disorder

benefits cannot be more restrictive than

the predominant financial requirements

and treatment limitations that apply to

substantially all medical/surgical benefits

in a classification.59 The 2013 final regulations defined the “substantially all”

numerical standard for a financial requirement or quantitative treatment limitation

as two-thirds, using the same approach as

the regulations implementing MHPA 1996

with respect to aggregate annual and lifetime limits.60 The 2013 final regulations

also quantified “predominant” to mean the

level of the financial requirement or quantitative treatment limitation that applies

to more than one-half of medical/surgical

benefits in the relevant classification subject to the financial requirement or quantitative treatment limitation. Using these

numerical standards, the Departments

established a mathematical test by which

plans and issuers could determine if a

financial requirement or quantitative treatment limitation that applies to medical/

surgical benefits in a classification may be

applied to mental health and substance use

disorder benefits in that classification, and

if so, what level of the financial requirement or quantitative treatment limitation

is the most restrictive level that could be

imposed on mental health or substance use

disorder benefits within the classification.

MHPAEA generally prohibits separate

financial requirements and treatment limitations that apply only to mental health

and substance use disorder benefits.61 The

2013 final regulations also prohibit plans

and issuers from applying separate cumulative financial requirements, such as

deductibles or out-of-pocket maximums,

or separate cumulative quantitative treatment limitations, such as annual or lifetime day or visit limits, to mental health

or substance use disorder benefits in a

classification.62

In addition, the 2013 final regulations require that a group health plan or

health insurance issuer may not impose

an NQTL with respect to mental health

and substance use disorder benefits in any

classification unless, under the terms of

the plan (or health insurance coverage) as

written and in operation, any processes,

strategies, evidentiary standards, or other

factors used in applying the NQTL to

mental health and substance use disorder

benefits in the classification are comparable to, and are applied no more stringently

than, the processes, strategies, evidentiary

standards, or other factors used in applying the limitation to medical/surgical benefits in the same classification.63 The 2013

final regulations also implemented the

statutory disclosure requirements imposed

on group health plans and health insurance issuers that are subject to MHPAEA’s

requirements.64

C. Guidance

As described earlier in this preamble,

since the promulgation of the 2013 final

regulations, the Departments have provided extensive guidance and compliance assistance materials to the regulated

community, State regulators, and other

interested parties to facilitate the implementation and enforcement of MHPAEA.

Specifically, the Departments have jointly

issued 15 sets of FAQs with 96 questions,

eight enforcement fact sheets, six compliance assistance tools and templates, seven

reports to Congress, six press releases, and

seven consumer publications. In general,

the Departments’ FAQs are designed to

provide additional guidance and clarification on how MHPAEA applies in

specific contexts and are informed by

questions raised by interested parties and

scenarios encountered in the context of

the Departments’ enforcement efforts.

For example, FAQs Part 34 addresses

how MHPAEA applies to treatment of

substance use disorders (such as treating opioid use disorder with medication)

and provides examples of impermissible

NQTLs (such as more stringent fail-first

or step-therapy requirements, including

where an individual cannot reasonably

satisfy if there are no available providers that can provide services related to

the requirement in the participant’s geographic area).65

Guidance issued by the Departments

also reflects stakeholder feedback and,

in several instances, guidance documents

were proposed before they were issued in

final form. For example, the Departments

proposed FAQs Part 39 on April 23, 2018.

The finalized FAQs Part 39 was issued

on September 5, 2019, and incorporate

insights from the regulated community

regarding compliance issues faced by

plans and issuers, as well as issues faced

by plan participants and their authorized

representatives when seeking information

about mental health and substance use disorder benefits. FAQs Part 39 also provides

guidance on how the law and regulations

apply to treatments for eating disorders,

opioid use disorder, and ASD, as well as

exclusions for experimental or investigative treatments, and standards for provider

admission to a plan’s or issuer’s network,

including the methodology for determining reimbursement rates for mental health

and substance use disorder providers.66

In addition to FAQs issued after the

promulgation of the 2013 final regulations,

Code section 9812(a)(3)(A), ERISA section 712(a)(3)(A), and PHS Act section 2726(a)(3)(A).

With respect to aggregate lifetime and annual limits under MHPA 1996, the regulations in 26 CFR 54.9812-1(b); 29 CFR 2590.712(b), and 45 CFR 146.136(b) set forth rules based on

whether a plan (or health insurance coverage) includes an aggregate lifetime or annual dollar limit that applies to less than one-third or at least two-thirds of all medical/surgical benefits.

These provisions do not address the provisions of PHS Act section 2711, as incorporated by ERISA section 715 and Code section 9815, which prohibit imposing lifetime and annual limits on

the dollar value of EHBs. As a result, plans and issuers cannot impose lifetime and annual dollar limits on mental health and substance use disorder benefits that are not EHBs, if such a limit

applies to less than one-third of all medical/surgical benefits.

61

Code section 9812(a)(3)(A), ERISA section 712(a)(3)(A), and PHS Act section 2726(a)(3)(A).

62

26 CFR 54.9812-1(c)(3)(v), 29 CFR 2590.712(c)(3)(v), 45 CFR 146.136(c)(3)(v) and 147.160.

63

26 CFR 54.9812-1(c)(4)(i), 29 CFR 2590.712(c)(4)(i), 45 CFR 146.136(c)(4)(i) and 147.160.

64

26 CFR 54.9812-1(d), 29 CFR 2590.712(d), 45 CFR 146.136(d) and 147.160.

65

See FAQs Part 34, Q4-Q9.

66

See FAQs Part 39, Q1-8.

59

60

Bulletin No. 2023–36

679

September 5, 2023

the Departments have issued, generally

every 2 years, an updated compliance program guidance document (the MHPAEA

Self-Compliance Tool), which is intended

to help plans and issuers, State regulators, and other interested parties comply

with and understand MHPAEA and the

additional related requirements under

ERISA that apply to group health plans.

The Departments most recently issued the

MHPAEA Self-Compliance Tool in 2020

(2020 MHPAEA Self-Compliance Tool).67

The 2020 MHPAEA Self-Compliance

Tool includes an illustrative, non-exhaustive list of NQTLs, a process for conducting NQTL comparative analyses, a list of

the types of documents and information

that a plan or issuer should have available to support its analyses, and illustrations of specific fact patterns to aid in

compliance.68

The 2020 MHPAEA Self-Compliance

Tool includes a stepwise process a plan

or issuer can follow to perform an analysis assessing whether its NQTLs satisfy

MHPAEA’s parity requirements.69 Under

this stepwise process, the plan or issuer

should identify all NQTLs that apply to

benefits under the plan or coverage. The

plan or issuer should also identify all

the medical/surgical benefits and mental

health and substance use disorder benefits

to which each NQTL applies. After identifying all NQTLs and the benefits to which

each NQTL applies, the 2020 MHPAEA

Self-Compliance Tool suggests the plan

or issuer identify the factors considered

in the design of each NQTL. The plan

or issuer should also identify the sources

used to define those factors. Plans and

issuers have flexibility in determining the

factors and sources of factors to apply to

NQTLs, so long as they are comparable

and applied no more stringently to mental

health and substance use disorder benefits

than to medical/surgical benefits in the

respective benefits classification. When

identifying the sources of the factors

considered in designing an NQTL, the

plan or issuer should also identify any

threshold of a factor that will implicate

the NQTL.

After identifying the plan’s NQTLs,

their application to mental health and substance use disorder benefits and to medical/surgical benefits, the factors used in

designing each NQTL, and the sources

of those factors, the plan or issuer should

determine whether the processes, strategies, and evidentiary standards used in

applying the NQTL are comparable and

no more stringently applied to mental

health and substance use disorder benefits

than to medical/surgical benefits, both as

written and in operation, in the relevant

benefit classification. For instance, if a

plan’s or issuer’s utilization review is conducted by different entities or individuals

for mental health and substance use disorder benefits and medical/surgical benefits,

the plan or issuer should have measures in

place to ensure comparable application of

utilization review policies.

The 2020 MHPAEA Self-Compliance

Tool stresses that measuring and evaluating results and quantitative outcomes can

be helpful to identify potential areas of

noncompliance. For example, comparing

a plan’s or issuer’s average reimbursement rates for both mental health and

substance use disorder providers and medical/surgical providers against an external

benchmark of reimbursement rates, such

as Medicare, may help identify whether

the underlying methodology used to determine the plan’s or issuer’s reimbursement

rates warrants additional review. The

2020 MHPAEA Self-Compliance Tool

notes that substantially disparate results

are a red flag that a plan or issuer may be

imposing an NQTL on mental health and

substance use disorder benefits in a way

that fails to satisfy the parity requirements.

Other warning signs of potential noncompliance identified in the 2020 MHPAEA

Self-Compliance Tool include generally

paying at or near Medicare reimbursement rates for mental health or substance

use disorder benefits, while paying much

more than Medicare reimbursement rates

for medical/surgical benefits, and reimbursing psychiatrists, on average, less

than medical/surgical physicians for the

same evaluation and management codes.70

The 2020 MHPAEA Self-Compliance

Tool also provides many compliance tips

on how an NQTL should be analyzed.

For example, a plan or issuer should have

information available to substantiate how

factors are used to design or apply any

specific NQTL to both medical/surgical

benefits and mental health or substance

use disorder benefits. The plan or issuer

should be clear as to whether and why

any factors were given more weight than

others and should be able to explain any

variation in the application of a guideline or evidentiary standard, including

the process and factors relied upon for

establishing the variation. To comply

with MHPAEA’s parity requirements,

plans and issuers must adopt measures

for mental health and substance use disorder providers that are at least comparable to and no more stringently applied

(with regard to limiting the scope and

duration of a participant’s, beneficiary’s,

or enrollee’s benefits under the plan or

coverage) than those applied to medical/

surgical providers. This includes taking

steps to help address provider shortages,

ensure an adequate network of mental

health and substance use disorder providers, and ensure reasonable patient

wait times to avoid noncompliance with

MHPAEA’s parity requirements. By providing a basic framework for plans and

issuers to do a stepwise analysis and providing additional warning signs and tips,

the 2020 MHPAEA Self-Compliance

Tool has provided additional guidance

for plans and issuers to comply with the

requirements of MHPAEA with respect

to NQTLs.

67

Section 13001(a) of the 21st Century Cures Act added section 2726(a)(6) of the PHS Act, which directs the Departments to provide a publicly available compliance program guidance

document that is updated every 2 years.

68

See Self-Compliance Tool for the Mental Health Parity and Addiction Equity Act (MHPAEA) (2020), available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/

mental-health-parity/self-compliance-tool.pdf. The Departments issued the proposed 2020 MHPAEA Self-Compliance Tool on June 19, 2020, and requested comments from interested parties. Engagement with interested parties through written comments and listening sessions provided vital feedback for finalizing the 2020 update to the MHPAEA Self-Compliance Tool, and

that final version includes revisions in response to that feedback.

69

Id. at section F (at pp. 21-28).

70

2020 MHPAEA Self-Compliance Tool, at p. 21, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/self-compliance-tool.pdf.

September 5, 2023

680

Bulletin No. 2023–36

D. The Consolidated Appropriations Act,

2021 and Related Guidance

The CAA, 2021 was enacted on

December 27, 2020.71 Section 203 of

Title II of Division BB of the CAA, 2021

amended MHPAEA, in part, by adding

Code section 9812(a)(8), ERISA section

712(a)(8), and PHS Act section 2726(a)

(8) to expressly require group health

plans and health insurance issuers offering group or individual health insurance

coverage that include both medical/surgical benefits and mental health or substance use disorder benefits and impose

NQTLs on mental health or substance

use disorder benefits to perform and

document their comparative analyses of

the design and application of NQTLs.72

Further, plans and issuers are required

to make their comparative analyses and

other applicable information available

to the Departments or applicable State

authorities, upon request.73 The comparative analysis requirement took effect on

February 10, 2021, 45 days after the date

of enactment of the CAA, 2021.

In order to advance compliance with

MHPAEA, the CAA, 2021 states that the

Departments shall request that a group

health plan or health insurance issuer

offering group or individual health insurance coverage submit comparative analyses, with respect to a plan or coverage,

that involve potential MHPAEA violations, in response to complaints against

a plan or coverage regarding potentially

noncompliant NQTLs, and in any other

instances that the Departments determine

appropriate.74 These comparative analyses

must include:

(1) the specific plan or coverage terms

or other relevant terms regarding the

NQTLs and a description of all mental

health and substance use disorder benefits and medical/surgical benefits to which

each such term applies in each benefit

classification;

(2) the factors used to determine how

the NQTLs will apply to mental health or

substance use disorder benefits and medical/surgical benefits;

(3) the evidentiary standards used to

develop the identified factors, when applicable, provided that each factor shall be

defined, and any other source or evidence

relied upon to design and apply the NQTLs

to mental health or substance use disorder

benefits and medical/surgical benefits;

(4) the comparative analyses demonstrating that the processes, strategies, evidentiary standards, and other factors used

to apply the NQTLs to mental health or

substance use disorder benefits, as written

and in operation, are comparable to, and

are applied no more stringently than those

used to apply the NQTLs to medical/surgical benefits in the benefits classification;

and

(5) the specific findings and conclusions reached by the plan or issuer,

including any results of the analyses

that indicate that the plan or coverage is

or is not in compliance with MHPAEA

requirements.75

The CAA, 2021 further sets forth a

process by which the Departments must

evaluate the requested NQTL comparative analyses and enforce the comparative analyses requirements. If the relevant

Department with jurisdiction over the

group health plan (or health insurance

coverage) determines that a plan or issuer

has not provided sufficient information

for the relevant Department to review the

comparative analyses, the CAA, 2021

provides that the Departments shall specify the information the plan or issuer must

submit to be responsive to the request.76 In

instances in which the Departments have

reviewed the requested comparative analyses and determined that the plan or issuer

is not in compliance with MHPAEA, the

plan or issuer must specify the actions it

will take to come into compliance and

submit additional comparative analyses

that demonstrate compliance not later than

45 days after the initial determination of

noncompliance.77 Following the 45-day

corrective action period, if the relevant

Department makes a final determination

that the plan or issuer is still not in compliance, the plan or issuer must notify all

individuals enrolled in the plan or coverage of this determination, not later than 7

days after such final determination.78

The CAA, 2021 also requires the

Departments, after review of the comparative analyses, to share information on findings of compliance and noncompliance

with the State where the plan is located or

the State where the issuer is licensed to do

business, in accordance with any information sharing agreement entered into with

the State.79 Additionally, as explained

in more detail later in this preamble, the

CAA, 2021 requires the Departments to

submit annually to Congress and make

publicly available a report summarizing

the comparative analyses requested by

the Departments. The report must state, in

part, whether each plan or issuer submitted

sufficient information to permit review;

whether and why the plan or issuer is in

compliance with MHPAEA; the specific

information each plan or issuer needed

to submit to allow for a review of their

comparative analysis; and, for each plan

or issuer the Departments determined not

to be in compliance, specifications of the

actions that must be taken to come into

compliance.80

On April 2, 2021, the Departments

issued FAQs Part 45 to provide guidance

on the amendments to MHPAEA made

by the CAA, 2021 and to promote compliance by plans and issuers. FAQs Part

45 underscores that, for a comparative

Pub. L. 116-260, 134 Stat. 1182 (Dec. 27, 2020).

Code section 9812(a)(8)(A), ERISA section 712(a)(8)(A), and PHS Act section 2726(a)(8)(A).

73

Id.

74

Code section 9812(a)(8)(B)(i), ERISA section 712(a)(8)(B)(i), and PHS Act section 2726(a)(8)(B)(i).

75

Code section 9812(a)(8)(A)(i)-(v), ERISA section 712(a)(8)(A)(i)-(v), and PHS Act section 2726(a)(8)(A)(i)-(v).

76

Code section 9812(a)(8)(B)(ii), ERISA section 712(a)(8)(B)(ii), and PHS Act section 2726(a)(8)(B)(ii).

77

Code section 9812(a)(8)(B)(iii)(I), ERISA section 712(a)(8)(B)(iii)(I), and PHS Act section 2726(a)(8)(B)(iii)(I).

78

Id.

79

Code section 9812(a)(8)(C)(iii), ERISA section 712(a)(8)(C)(iii), and PHS Act section 2726(a)(8)(C)(iii).

80

Code section 9812(a)(8)(B)(iv), ERISA section 712(a)(8)(B)(iv), and PHS Act section 2726(a)(8)(B)(iv).

71

72

Bulletin No. 2023–36

681

September 5, 2023

analysis to be treated as sufficient under

the CAA, 2021, it must contain a detailed,

written, and reasoned explanation of the

specific plan terms and practices at issue

and include the bases for the plan’s or

issuer’s conclusion that the NQTL complies with MHPAEA. As FAQs Part 45

explains, at a minimum, a sufficient

NQTL comparative analysis must include

a robust discussion of certain elements,

including a clear description of the specific NQTL; plan terms; policies at issue;

and identification of any factors, evidentiary standards, sources, strategies, and

processes considered in the design and

application of the NQTL and in determining which benefits, including both mental

health and substance use disorder benefits

and medical/surgical benefits, are subject to the NQTL. To the extent a plan or

issuer defines any of the factors, evidentiary standards, strategies, or processes in

a quantitative manner, its analysis should

include the precise definitions used and

any supporting sources. The analysis also

should explain whether the plan or issuer

imposes any variation in the application

of a guideline or standard between mental health and substance use disorder benefits and medical/surgical benefits, and

if so, should describe the processes and

factors used for establishing that variation. The plan or issuer should provide a

reasoned discussion, including citations

or any specific evidence of its findings

and conclusions, as to the comparability

of the processes, strategies, evidentiary

standards, factors, and sources identified

within each affected classification and

their relative stringency, both as written

and in operation.

FAQs Part 45 highlights that a general statement of compliance by plans

and issuers, coupled with a conclusory

reference to broadly stated processes,

strategies, evidentiary standards, or other

factors is insufficient to meet the statutory requirements for an NQTL comparative analysis. Accordingly, a comparative

analysis that consists of conclusory or

generalized statements, without specific

supporting evidence and detailed explanations, or the production of a large volume

of documents without a clear explanation

of how and why each document is relevant

to the comparative analysis, fails to satisfy

the statutory requirements.

In addition, FAQs Part 45 provides

guidance as to the types of documents that

plans and issuers should be prepared to

make available to support the analysis and

conclusions reached in their comparative

analyses. This includes records documenting NQTL processes and detailing how

the plan or issuer applies NQTLs to both

medical/surgical and mental health or substance use disorder benefits, documents

and other information relevant to the factors identified, and samples of covered

and denied mental health or substance

use disorder and medical/surgical benefits

claims. FAQs Part 45 also highlights several NQTLs that DOL anticipated focusing on in the near term.

FAQs Part 45 also notes that under the

CAA, 2021, plans and issuers must make

available their respective comparative

analyses of NQTLs and other applicable

information to the applicable State authority upon request. Additionally, plans and

issuers must make the comparative analyses and other applicable information

required by the CAA, 2021 available upon

request to participants and beneficiaries

in plans subject to ERISA and to participants, beneficiaries, and enrollees in all

non-grandfathered group health plans and

non-grandfathered group or individual

health insurance coverage upon request in

connection with an appeal of an adverse

benefit determination. If a provider or

other individual is acting as a patient’s

authorized representative, the provider

or other authorized representative may

request these documents.

E. Reports to Congress

DOL is required to send Congress a

biennial report on MHPAEA implementation,81 and the Departments are required to

send Congress an annual report on NQTL

comparative analyses reviews.82 To satisfy

these requirements, on January 25, 2022,

the Departments issued the first report

to Congress since the enactment of the

CAA, 2021 (2022 MHPAEA Report to

Congress).83 The 2022 MHPAEA Report

to Congress contains extensive descriptions of the Departments’ MHPAEA

enforcement efforts, outreach efforts, consumer and compliance assistance efforts,

and guidance to interested parties, including information related to the requirement

that plans and issuers perform and document comparative analyses with respect to

the design and application of NQTLs.

Contemporaneously with these proposed rules, the Departments are issuing the second report to Congress since

the enactment of the CAA, 2021, the

MHPAEA Comparative Analysis Report

to Congress, July 2023 (2023 MHPAEA

Report to Congress).84 The 2023 MHPAEA

Report to Congress details efforts by the

Departments to implement and enforce

the amendments to MHPAEA made by the

CAA, 2021. The 2023 MHPAEA Report

to Congress focuses on the Departments’

enforcement efforts regarding NQTLs

during the second year of CAA, 2021

implementation, looks broadly at the

18-month period since plans and issuers

were first required to make their comparative analyses and other applicable information available on request, discusses

common deficiencies in comparative

analyses submitted by plans and issuers,

ERISA section 712(f).

Section 203 of the CAA, 2021 (Pub. L. 116-260, 134 Stat. 1182 (Dec. 27, 2020)). In addition, the Departments were required to send Congress an annual report on complaints and investigations concerning compliance with the requirements of MHPAEA from 2017 until 2021. See section 13003 of the 21st Century Cures Act (Cures Act), Pub. L. 114-255, 130 Stat. 1033

(Dec. 13, 2016), as amended by the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act, Pub. L. 115-271, 132 Stat. 3894

(Oct. 24, 2018).

83

2022 MHPAEA Report to Congress, available at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2022-realizing-parity-reducing-stigma-and-raising-awareness.pdf.

84

2023 MHPAEA Report to Congress, July 2023, available at www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2023-mhpaea-comparative-analysis.pdf and https://www.cms.gov/cciio/resources/forms-reports-and-other-resources#mental-health-parity.

81

82

September 5, 2023

682

Bulletin No. 2023–36

and explores examples of results that

the Departments have achieved through

enforcement.

The 2023 MHPAEA Report to Congress

notes that nearly all of the comparative

analyses reviewed by the Departments

during the relevant time period contained

insufficient information upon initial receipt

and identifies common deficiencies in the

comparative analyses prepared by plans

and issuers. Specifically, many initial

responders seemed unprepared to submit

their comparative analyses upon request

and some plans did not complete or start

a comparative analysis until after one

was requested. Some comparative analyses lacked specific supporting evidence,

detailed explanations, or sufficient detail to

draw meaningful comparisons. For example, many plans’ comparative analyses

failed to adequately explain whether or how

factors were comparably applied to mental

health and substance use disorder benefits and to medical/surgical benefits. Also,

many plans and issuers provided supporting

documents for which the relevance and probative value was not readily apparent.

Some plans also failed to identify the

specific mental health or substance use

disorder benefits and medical/surgical

benefits or MHPAEA benefit classification

to which an NQTL applied. Additionally,

some comparative analyses failed to identify or define every relevant factor. In other

instances, plans failed to demonstrate the

application of identified factors in the

design of an NQTL, and most comparative analyses failed to evaluate the relative

stringency of how the NQTL was applied

to mental health or substance use disorder

benefits versus medical/surgical benefits.

When data was included in a comparative

analysis, the data often lacked meaning

because the plan or issuer did not provide a description of its source, how the

source was selected, or information about

underlying calculations. Many comparative analyses for standards to participate

in a network did not adequately address

apparent differences in access standards

for medical/surgical providers as opposed

to mental health and substance use disorder providers, such as different time and

distance standards or provider-to-member

ratios.

F. MHPAEA Opt Out for Self-Funded

Non-Federal Governmental Plans

Prior to the enactment of the Affordable

Care Act, PHS Act section 2721(b)(2), as

added by the Health Insurance Portability

and Accountability Act of 1996 (HIPAA),

permitted sponsors of self-funded,

non-Federal governmental plans to elect

to exempt those plans from (that is, “opt

out of”) any or all of the following requirements of title XXVII of the PHS Act:

1. Limitations on preexisting condition

exclusion periods under PHS Act section

2701 (redesignated as section 2704 by the

Affordable Care Act).

2. Requirements for special enrollment periods under PHS Act section

2701 (redesignated as section 2704 by the

Affordable Care Act).

3. Prohibitions against discriminating

against individual participants and beneficiaries based on health status (but not

including provisions added by the Genetic

Information Nondiscrimination Act of

2008) under PHS Act section 2702 (redesignated as section 2705 by the Affordable

Care Act).

4. Standards relating to benefits for

newborns and mothers under PHS Act

section 2704 (redesignated as section

2725 by the Affordable Care Act).

5. Parity in the application of certain

limits to mental health and substance use

disorder benefits (including requirements

of MHPAEA) under PHS Act section

2705 (redesignated as section 2726 by the

Affordable Care Act).

6. Required coverage for reconstructive

surgery following mastectomies under

PHS Act section 2706 (redesignated as

section 2727 by the Affordable Care Act).

7. Coverage of dependent students on

a medically necessary leave of absence

under PHS Act section 2707 (redesignated

as section 2728 by the Affordable Care

Act).

The Affordable Care Act redesignated

PHS Act section 2721 as section 2722 and

amended PHS Act section 2722(a)(2) to

allow sponsors of self-funded, non-Federal governmental plans to only opt out of

requirements categories 4-7 listed above.

In response to the Affordable Care Act

amendments, HHS issued guidance on

September 21, 2010, indicating that, for

plan years beginning on or after September

23, 2010, plan sponsors of non-collectively bargained plans could elect to be

exempt only from requirements categories

4–7 listed above and that requirements

categories 1–3 were no longer available

for exemption.85 Group health plans maintained pursuant to a collective bargaining

agreement ratified before March 23, 2010,

and that had been exempted from any of

the first three requirements categories

listed above, would not have to come into

compliance with those requirements categories until the commencement of the first

plan year following the expiration of the

last plan year governed by the collective

bargaining agreement.

On March 21, 2014, HHS published

proposed regulations in the Federal

Register that proposed to revise the provisions of 45 CFR 146.180 to reflect the

amendments made by the Affordable Care

Act, consistent with the September 21,

2010, guidance.86 On May 27, 2014, HHS

finalized those proposed regulations with

modifications related to how opt out elections must be filed.87

The CAA, 2023,88 enacted on

December 29, 2022, eliminated the election for self-funded, non-Federal governmental plans to opt out of MHPAEA.89

Specifically, PHS Act section 2722(a)(2),

Office of Consumer Information and Insurance Oversight, Amendments to the HIPAA opt-out provision (formerly section 2721(b)(2) of the Public Health Service Act) made by the

Affordable Care Act (Sept. 21, 2010), available at www.cms.gov/CCIIO/Resources/Files/Downloads/opt_out_memo.pdf.

86

79 FR 15808 (Mar. 21, 2014).

87

79 FR 30240 (May 27, 2014).

88

Pub. L. 117–328, 136 Stat. 4459.

89

Division FF, Title I, Subtitle C, Chapter 3, sec. 1321, Pub. L. 117-328, 136 Stat. 4459. As a result of the CAA, 2023 amendments to PHS Act section 2722(a)(2), self-funded, non-Federal

governmental plan sponsors may opt out of only the following three PHS Act requirement categories: Standards relating to benefits for newborns and mothers (PHS Act section 2725),

Required coverage for reconstructive surgery following mastectomies (PHS Act section 2727), and Coverage for dependent students on a medically necessary leave of absence (PHS Act

section 2728).

85

Bulletin No. 2023–36

683

September 5, 2023

as amended by the CAA, 2023, provides

that no election to opt out of compliance

with the requirements of MHPAEA may

be made on or after December 29, 2022

(the date of enactment of the CAA, 2023)

and that generally no such election with

respect to MHPAEA expiring on or after

June 27, 2023 (the date that is 180 days

after the date of enactment of the CAA,

2023), may be renewed.90 In addition,

PHS Act section 2722(a)(2), as amended

by the CAA, 2023, includes an exception

for certain collectively bargained plans.

Specifically, a self-funded, non-Federal

governmental plan that is subject to multiple collective bargaining agreements of

varying lengths and that has a MHPAEA

opt-out election in effect on December

29, 2022, that expires on or after June 27,

2023, may extend such election until the

date on which the term of the last collective bargaining agreement expires.91

HHS issued a Bulletin on June 7, 2023,

that informs self-funded, non-Federal

governmental plans and other interested

parties about the CAA, 2023 amendments

to PHS Act section 2722(a)(2), outlines

when plans that currently opt out of compliance with MHPAEA are required to

come into compliance with these requirements, and specifies the form and manner

for submission of opt-out renewal election

requests92 to operationalize the special rule

for certain collectively bargained plans.93

II. Overview of the Proposed Rules –

Departments of the Treasury, Labor,

and HHS

The Departments are proposing these

rules to further MHPAEA’s fundamental goal of ensuring that limitations on

mental health and substance use disorder

benefits provided by group health plans

or health insurance issuers offering group

or individual health insurance coverage

are no more restrictive than the predominant limitations applicable to substantially

all medical/surgical benefits, and to further implement important new statutory

requirements to ensure that plans and issuers document their NQTL comparative

analyses and other applicable information

to demonstrate whether the processes,

strategies, evidentiary standards, and

other factors used to apply an NQTL to

mental health and substance use disorder

benefits are comparable to, and applied no

more stringently than, those used to apply

the limitation with respect to medical/surgical benefits in the same benefit classification. The goal of these proposed rules

is to ensure that individuals with mental

health conditions and substance use disorders can benefit from the full protections

afforded to them under MHPAEA, while

offering clear guidance to plans and issuers on how to comply with MHPAEA’s

requirements.

These proposed rules would be codified in 26 CFR part 54, 29 CFR part

2590, and 45 CFR parts 146 and 147.

Specifically, these proposed rules would

amend certain provisions of existing

MHPAEA regulations at 26 CFR 54.98121, 29 CFR 2590.712, and 45 CFR 146.136

to incorporate new and revised definitions of key terms, as well as to specify

additional steps that plans and issuers

must take to meet their obligations under

MHPAEA. These proposed rules also

would add a new regulation at 26 CFR

54.9812-2, 29 CFR 2590.712-1, and 45

CFR 146.137 establishing minimum standards for developing NQTL comparative

analyses to assess whether an NQTL, as

written and in operation, complies with

MHPAEA’s requirements. In addition,

these proposed rules would set forth the

content elements of comparative analyses

and the timeframe for plans and issuers to

respond to a request from the Departments

to submit their comparative analyses.

Additionally, HHS proposes an amendment to 45 CFR 147.160 to specify that

proposed regulations at 45 CFR 146.137

would apply to individual health insurance coverage offered by a health insurance issuer in the same manner and to the

same extent that this proposed provision

would apply to health insurance coverage

offered by a health insurance issuer in

connection with a group health plan in the

large group market.94 Consistent with the

existing text at 45 CFR 147.160(a), HHS

also proposes to extend the same requirements and framework outlined in the proposed amendments to 45 CFR 146.136 in

these proposed rules to individual health

insurance coverage in the same manner

and to the same extent as such proposed

amendments, if finalized, would apply to

group health insurance coverage. Finally,

HHS also proposes amendments to 45

CFR 146.180 to reflect the sunset of the

election option for self-funded, non-Federal governmental plans to opt out of compliance with MHPAEA, consistent with

changes made by the CAA, 2023 to PHS

Act section 2722(a)(2).95

The Departments are soliciting public

comment on all aspects of these proposed

rules.

A. Amendments to Existing Regulations

at 26 CFR 54.9812-1, 29 CFR 2590.712,

and 45 CFR 146.136

1. Purpose Section - 26 CFR 54.98121(a)(1), 29 CFR 2590.712(a)(1), and 45

CFR 146.136(a)(1)

In general, the fundamental purpose

of MHPAEA, its existing implementing

regulations, and these proposed rules is to

ensure that participants and beneficiaries

in a group health plan or in group health

insurance coverage offered by a health

PHS Act section 2722(a)(2)(F)(i).

PHS Act section 2722(a)(2)(F)(ii).

92

See 45 CFR 146.180(b) and (f).

93

Center for Consumer Information and Insurance Oversight, Insurance Standards Bulletin Series – INFORMATION, Sunset of MHPAEA opt-out provision for self-funded, non-Federal

governmental group health plans (June 7, 2023), available at https://www.cms.gov/files/document/hipaa-opt-out-bulletin.pdf.

94

Non-grandfathered health insurance coverage offered by a health insurance issuer in connection with a group health plan in the small group market is required to comply with the requirements under PHS Act section 2726 to satisfy the requirement to provide coverage for mental health and substance use disorder services, including behavioral health treatment, as part of EHB,

and as such would also be required to comply with the comparative analysis requirements proposed under 45 CFR 146.137. See 45 CFR 156.115(a)(3).

95

Division FF, Title I, Subtitle C, Chapter 3, sec. 1321, Pub. L. 117-328, 136 Stat. 4459 (Dec. 29. 2022).

90

91

September 5, 2023

684

Bulletin No. 2023–36

insurance issuer that offers mental health

or substance use disorder benefits are not

subject to greater restrictions, such as

more restrictive lifetime or annual dollar

limits, financial requirements, or treatment limitations, when seeking those benefits than when they seek medical/surgical

benefits under the terms of the plan or

coverage. This should serve as the guiding

principle for group health plans and health

insurance issuers offering group health

insurance coverage as they work to comply with MHPAEA and its implementing

regulations. While MHPAEA generally

does not mandate coverage of mental

health or substance use disorder benefits,

these proposed rules aim to better ensure

that plans and issuers that cover such benefits implement MHPAEA in accordance

with its express terms and fundamental

purpose.

Accordingly, the Departments propose

to add a purpose section to the regulations, specifying that a fundamental purpose of MHPAEA and its implementing

regulations is to ensure that participants

and beneficiaries covered under a plan

or health insurance coverage that offers

mental health or substance use disorder

benefits are not subject to more restrictive

lifetime or annual dollar limits, financial

requirements, or treatment limitations

with respect to covered mental health

and substance use disorder benefits than

the predominant dollar limits, financial

requirements, or treatment limitations

that are applied to substantially all medical/surgical benefits covered by the plan

or coverage.96 The purpose section would

further state that in complying with the

provisions of MHPAEA and its implementing regulations, plans and issuers

must not design or apply financial requirements and treatment limitations that

impose a greater burden on access (that

is, are more restrictive) to mental health

and substance use disorder benefits under

the plan or coverage than plans and issuers

impose on access to generally comparable

medical/surgical benefits. Further, these

proposed rules provide that MHPAEA and

its implementing regulations should be

interpreted in a manner that is consistent

with this purpose. The Departments seek

comment on the proposed addition of a

purpose section to the implementing regulations and the proposed language.

2. Meaning of Terms - 26 CFR 54.98121(a)(2), 29 CFR 2590.712(a)(2), and 45

CFR 146.136(a)(2)

The Departments propose to amend

the 2013 final regulations to revise several

existing definitions, add new definitions

of key terms, and add language to specify

that, except where the context clearly indicates otherwise, the definitions in 26 CFR

54.9812-1(a)(2), 29 CFR 2590.712(a)

(2), and 45 CFR 146.136(a)(2) would

also apply to the new proposed comparative analysis requirements set forth in

proposed 26 CFR 54.9812-2, 29 CFR

2590.712-1, and 45 CFR 146.137, which

are discussed in more detail later in this

preamble.97

Under MHPAEA, the term “medical

or surgical benefits” means benefits with

respect to medical or surgical services,

as defined under the terms of the plan

or coverage.98 This statutory definition

further clarifies that the term does not

include mental health or substance use

disorder benefits.99 The terms “mental

health benefits” and “substance use disorder benefits” are defined by the statute to

mean benefits with respect to services for

mental health conditions or substance use

disorders, respectively, as defined under

the terms of the plan and in accordance

with applicable Federal and State law.100

The definitions of all three of these terms

included in the 2013 final regulations further provide that any condition defined

by the plan or coverage as being or as

not being a medical/surgical condition,

mental health condition, or substance use

disorder, respectively, must be defined to

be consistent with generally recognized

independent standards of current medical

practice (for example, the most current

version of the Diagnostic and Statistical

Manual of Mental Disorders (DSM), the

most current version of the International

Classification of Diseases (ICD), or State

guidelines).

The Departments have received questions from interested parties about what it

means for a definition of a mental health

condition or substance use disorder to be

“consistent with” generally recognized

independent standards of current medical practice, and whether, for purposes of

MHPAEA, a condition is a medical condition, a mental health condition, or a substance use disorder when State insurance

law and generally recognized independent

standards of current medical practice conflict. In response to these requests for further guidance, the Departments propose to

amend the existing regulatory definitions

of the terms “medical/surgical benefits,”

“mental health benefits,” and “substance

use disorder benefits” to address these

questions and help delineate more clearly

what is a medical/surgical benefit, a mental health benefit, or a substance use disorder benefit for purposes of complying

with MHPAEA.

Specifically, the Departments propose to amend the definition of the term

“medical/surgical benefits” to mean benefits with respect to items or services for

medical conditions or surgical procedures, as defined under the terms of the

group health plan (or health insurance

coverage offered by an issuer in connection with such a plan) and in accordance

While the Departments recognize the relevant statutory text for dollar limits does not use the term “predominant” and different rules apply, the purpose of MHPA 1996 was similar and

therefore the provisions for dollar limits should generally be read and applied in a similar manner. See, e.g., Government Accountability Office (GAO), Mental Health Parity Act, May 2000,

at p. 13, available at https://www.gao.gov/assets/hehs-00-95.pdf (“To help address the discrepancies in coverage between mental and other illnesses, the Congress passed the Mental Health

Parity Act of 1996.”).

97

To accommodate the proposed addition of the “purpose” provision in paragraph (a)(1), these proposed rules would also redesignate the definitions from paragraph (a) to paragraph (a)(2) of

26 CFR 54.9812-1, 29 CFR 2590.712, and 45 CFR 146.136.

98

Code section 9812(e)(3), ERISA section 712(e)(3), and PHS Act section 2726(e)(3).

99

Id.

100

See Code section 9812(e)(4)-(5), ERISA section 712(e)(4)-(5), and PHS Act section 2726(e)(4)-(5).

96

Bulletin No. 2023–36

685

September 5, 2023

with applicable Federal and State law, but

does not include mental health benefits

or substance use disorder benefits. These

proposed rules would also amend this

regulatory definition of “medical/surgical

benefits” to provide that, notwithstanding

the first sentence, any condition or procedure defined by the plan or coverage as

being or not being a medical condition or

surgical procedure must be defined consistent with generally recognized independent standards of current medical practice

(for example, the most current version of

the ICD). To the extent that generally recognized independent standards of current

medical practice do not address whether a

condition or procedure is a medical condition or surgical procedure, plans and

issuers may define the condition or procedure as medical/surgical benefits, as long

as such definitions are in accordance with

applicable Federal and State law.

The Departments propose to remove

the reference to State guidelines in the

definition of medical/surgical benefits.

This proposed amendment is more consistent with the statute, and importantly,

would no longer allow plans and issuers

to rely on standards that are not applicable

to the plan or coverage at issue in applying

financial requirements or treatment limitations to mental health and substance use

disorder benefits.101 Generally recognized

independent standards of current medical

practice more accurately align with how a

plan should characterize benefits for purposes of compliance with MHPAEA, and

this provision would minimize situations

where contradictions with State guidelines

create conflicts and improperly limit the

protections under MHPAEA.

The Departments propose to make similar changes to the definitions of “mental

health benefits” and “substance use disorder benefits” by amending the first sentences of these definitions, removing the

reference to State guidelines, and clarifying that, notwithstanding the terms of

a plan or coverage, any condition or disorder defined by the plan or coverage as

being or not being a mental health condition or a substance use disorder must be

defined to be consistent with generally recognized independent standards of current

medical practice. Specifically, under these

proposed rules, to be consistent with generally recognized independent standards

of current medical practice, the plan’s or

coverage’s definition of “mental health

benefits” must include all conditions covered under the plan or coverage, except

for substance use disorders, that fall under

any of the diagnostic categories listed in

the mental, behavioral, and neurodevelopmental disorders chapter (or equivalent

chapter) of the most current version of the

ICD or that are listed in the most current

version of the DSM. Similarly, the plan’s

or coverage’s definition of “substance

use disorders” must include all disorders covered under the plan or coverage

that fall under any of the diagnostic categories listed as a mental or behavioral

disorder due to psychoactive substance

use (or equivalent category) in the mental, behavioral, and neurodevelopmental

disorders chapter (or equivalent chapter)

of the most current version of the ICD or

that are listed as a Substance-Related and

Addictive Disorder (or equivalent category) in the most current version of the

DSM.102 Similar to the proposed revisions

to the definition of “medical/surgical benefits,” the proposed amended definitions

of “mental health benefits” and “substance

use disorder benefits” also provide that, to

the extent generally recognized independent standards of current medical practice do not address whether a condition

or disorder is a mental health condition

or substance use disorder, respectively,

plans and issuers may define the condition

or disorder in accordance with applicable

Federal and State law.

The ICD would be defined as the

World Health Organization’s International

Classification of Diseases adopted by

HHS through 45 CFR 162.1002 or successor regulations, and the DSM would

be defined as the American Psychiatric

Association’s Diagnostic and Statistical

Manual of Mental Disorders. Because the

proposed amendments to the definitions

of “medical/surgical benefits,” “mental

health benefits,” and “substance use disorder benefits,” refer to the most current

version of the ICD or DSM, respectively,

these proposed rules also explain how to

determine which version is the most current as of a particular date. This serves to

provide plans and issuers with clarity on

when they would be required to begin to

rely on a new version of the ICD or DSM

after it is released, and sufficient time after

the adoption of an updated version of the

ICD or DSM to ensure that the terms of

their plan or coverage are consistent with

any changes made from the previous version. The definitions would specify that,

for purposes of compliance with these

proposed rules, the most current version

of the ICD or DSM, respectively, would

be that which is applicable no earlier than

on the date that is 1 year before the first

day of the applicable plan year.

These proposed rules also would permit plans and issuers to use a more current

version of the ICD or DSM than the version in effect 1 year before the first day

of the applicable plan year. In addition,

the Departments recognize that future

versions of the ICD or DSM may include

revisions to the categories of conditions

or disorders or chapters listed in the proposed amended definitions for “mental

health benefits” and “substance use disorder benefits,” which could affect the characterization of a benefit under MHPAEA.

Therefore, the proposed amended definitions for these two terms also refer to

“equivalent categories” and “equivalent

chapters” to help plans and issuers understand how they would apply the proposed

definitions, if finalized, and how to implement such changes if they are made in the

future. The Departments request comments on this aspect of these proposed

amended definitions.

To ensure parity between mental health

and substance use disorder benefits and

101

For example, some self-insured ERISA plans have argued that they can rely on State insurance law definitions that characterize a particular condition as a medical condition, mental health

condition, or substance use disorder based on State guidelines despite the fact that State insurance law is generally not applicable to self-insured ERISA plans and such plans do not otherwise

consistently comply with State insurance law.

102

Substance use disorders that fall under any of the diagnostic categories listed in the mental and behavioral health disorders chapter of the most current version of the ICD or that are listed

in the most current version of the DSM would be excluded from the definition of the term “mental health benefits” because they would be included in the definition of the term “substance

use disorder benefits.”

September 5, 2023

686

Bulletin No. 2023–36

medical/surgical benefits, it is critical that

plans and issuers define mental health

conditions and substance use disorders in

a manner consistent with the purposes of

MHPAEA. While plans and issuers have

some discretion in defining mental health

benefits and substance use disorder benefits, this discretion must be exercised in a

manner that comports with generally recognized independent standards of current

medical practice. Moreover, the proposed

amended definitions for “medical/surgical

benefits,” “mental health benefits,” and

“substance use disorder benefits” specify

that plans and issuers may use applicable State law to inform their definitions,

but only to the extent that those laws are

consistent with and do not contradict

generally recognized independent standards of current medical practice (or to

the extent these standards do not address

whether a condition or disorder is a medical condition or surgical procedure or a

mental health condition or substance use

disorder). Under both the 2013 final regulations and these proposed rules, plans

and issuers must be prepared to provide

supporting documentation to demonstrate

that the way the plan or issuer has defined

a condition or disorder for purposes of

MHPAEA is consistent with generally recognized independent standards of current

medical practice. The Departments solicit

comments on whether any additional clarification is needed on how State law may

interact with the proposed amended definitions for these key terms.

As discussed earlier in this section of

the preamble, the Departments are proposing these amendments to the definitions

of the terms “medical/surgical benefits,”

“mental health benefits,” and “substance

use disorder benefits” in part to ensure

that the use of State laws does not prevent

the application of MHPAEA’s protections

with respect to conditions or disorders that

are recognized as mental health conditions

and substance use disorders under generally recognized independent standards of

current medical practice. The Departments

recognize that States may enact various

laws for different purposes. Therefore, the

Departments are proposing to make clear

that when a plan or issuer relies upon a

State law to inform its definitions for purposes of MHPAEA, the plan or issuer must

ensure that definitions operate to apply

MHPAEA’s protections to mental health

conditions and substance use disorders, as

they are generally defined by the medical

community. The Departments also clarify

that under the proposed framework, to the

extent a State law or generally recognized

independent standards of current medical

practice define a condition or disorder as a

mental health condition or substance use

disorder, plans and issuers must treat all

benefits for the condition or disorder as

mental health benefits or substance use

disorder benefits, respectively, for purposes of analyzing parity and compliance

with MHPAEA. The Departments solicit

comments on any potential challenges of

applying MHPAEA to all benefits for a

mental health condition or substance use

disorder where items and services can

be delivered for both medical conditions

or surgical procedures and mental health

conditions or substance use disorders, and

whether additional clarifications or modifications to the proposed definitions are

necessary.

Interested parties also have requested

that the Departments confirm whether

specific conditions are mental health conditions for purposes of MHPAEA. Under

these proposed rules, as under the existing

MHPAEA regulations and section 13007

of the Cures Act,103 the Departments confirm that eating disorders, such as anorexia

nervosa, bulimia nervosa, and binge-eating disorder, are mental health conditions

under generally recognized independent

standards of current medical practice.104

Therefore, benefits for treatment of eating disorders are mental health benefits

for purposes of MHPAEA and may not be

defined as medical/surgical benefits under

a plan or coverage.105

Similarly, in response to questions

from interested parties, these proposed

rules would make clear that, for purposes

of MHPAEA, ASD is a mental health

condition under generally recognized

independent standards of current medical practice.106 Therefore, under the proposed amended definition and framework

established in these proposed rules, if a

plan or issuer generally provides benefits

for ASD, ASD may not be defined by the

plan or issuer as a medical/surgical condition. In addition, the plan or issuer may

not impose any financial requirements or

treatment limitations in a classification on

benefits for ASD treatment that are more

restrictive than the predominant financial requirements or treatment limitations

that apply to substantially all medical/

surgical benefits in the classification. The

plan or issuer also may not impose any

financial requirements or treatment limitations, including exclusions for Applied

Behavior Analysis (ABA) therapy (one

of the primary treatments for ASD), that

are separately applicable to ASD benefits

in a classification and not to any medical/

surgical benefits in the same classification.

The Departments propose to incorporate

new examples illustrating the application of MHPAEA to eating disorders and

ASD, as discussed later in this preamble.

The Departments solicit comments on

other specific mental health conditions

or substance use disorders that may warrant additional clarification for purposes

of analyzing parity and compliance with

MHPAEA.

In addition to the proposals outlined

above to amend certain existing definitions, these proposed rules also would

add several new definitions to codify

the meaning of terms used in paragraph

(c)(4)(i) of the 2013 final regulations,

which requires the processes, strategies,

evidentiary standards, and other factors

used in applying an NQTL to mental

health or substance use disorder benefits

to be comparable to, and no more stringently applied than those used to apply

the NQTL to medical/surgical benefits

in the same classification. These terms

and the standard were incorporated into

MHPAEA’s statutory language in the

103

Section 13007 of the Cures Act states that, if a plan or an issuer offering group or individual health insurance coverage provides coverage for eating disorder benefits, including residential

treatment, such group health plan or health insurance issuer shall provide such benefits consistent with the requirements of MHPAEA.

104

See, e.g., Diagnostic and Statistical Manual of Mental Disorders (5th ed.), section II, Feeding and Eating Disorders; ICD-10, Chapter 05.

105

The Departments previously clarified that eating disorders are mental health conditions, and therefore treatment of an eating disorder is a mental health benefit, in FAQs Part 38, Q1. See

DSM (5th ed.), section II, Feeding and Eating Disorders.

106

See DSM (5th ed.), section II, Autism Spectrum Disorder.

Bulletin No. 2023–36

687

September 5, 2023

amendments made by the CAA, 2021.107

The Departments propose to add new

definitions for the terms “processes,”

“strategies,” “evidentiary standards,” and

“factors” to the list of definitions for key

terms proposed to be included in 26 CFR

54.9812-1(a)(2), 29 CFR 2590.712(a)

(2), and 45 CFR 146.136(a)(2) of these

proposed rules. These new definitions

would provide clarity to plans and issuers, as well as to State regulators and

participants and beneficiaries, and help

facilitate compliance with the provisions

of these proposed rules related to NQTLs

and the development of sufficient comparative analyses required under the

CAA, 2021 and proposed 26 CFR

54.9812-2, 29 CFR 2590.712-1, and 45

CFR 146.137. Although the Departments

have issued guidance with examples

that demonstrate how these terms apply,

interested parties have stated that it can

be difficult to determine what constitutes

relevant processes, strategies, evidentiary standards, and other factors. The

Departments solicit comments on these

proposed definitions, including any alternate definitions or additional clarifications that should be considered.

The Departments propose to add a definition of the term “evidentiary standards”

to mean any evidence, sources, or standards that a group health plan (or health

insurance issuer offering coverage in

connection with such a plan) considered

or relied upon in designing or applying a

factor with respect to an NQTL, including

specific benchmarks or thresholds. The

proposed definition further provides that

evidentiary standards may be empirical,

statistical, or clinical in nature, and include

sources acquired or originating from an

objective third party, such as recognized

medical literature, professional standards

and protocols (which may include comparative effectiveness studies and clinical

trials), published research studies, payment rates for items and services (such

as publicly available databases of the

“usual, customary, and reasonable” rates

paid for items and services), and clinical

treatment guidelines. The proposed definition provides that evidentiary standards

would also include internal plan or issuer

data, such as claims or utilization data or

criteria for assuring a sufficient mix and

number of network providers, and benchmarks or thresholds, such as measures of

excessive utilization, cost levels, time or

distance standards, or network participation percentage thresholds.

Under these proposed rules, evidentiary standards generally would not be

considered factors, but instead would be

considered or relied upon in designing or

applying a factor. Under the framework

established in the 2013 final regulations,

the terms within the phrase “processes,

strategies, evidentiary standards, and

other factors” were treated as having

overlapping meanings, and specifically,

the term “other factors” was treated as a

catch-all. The CAA, 2021 codified in the

statute the phrase “processes, strategies,

evidentiary standards, and other factors.”108 However, the CAA, 2021 added

to MHPAEA other references to factors

and evidentiary standards that indicate

the drafters meant to distinguish between

factors and evidentiary standards. For

example, Code section 9812(a)(8)(A)(iii),

ERISA section 712(a)(8)(A)(iii), and PHS

Act 2726(a)(8)(A)(iii) refer to the evidentiary standards that are used for the

factors to determine that an NQTL will

apply to benefits, and those provisions

go on to distinguish between factors and

any other sources or evidence relied upon

to design or apply an NQTL. The proposed definition of evidentiary standards

is consistent with the use of these terms

by Congress in the CAA, 2021 amendments to MHPAEA and the Departments’

goal of clarifying the meanings of these

terms to help the regulated community

comply with MHPAEA’s requirements.

The Departments request comments on

this approach, including whether there are

any circumstances under which an evidentiary standard should also be considered a

factor under these proposed rules (such

as, for example, when the plan or issuer

only relies upon a single evidentiary standard to design or apply an NQTL, and no

additional processes, strategies, or other

factors).

The Departments also propose to clarify that the definition of the term “factors”

should be read broadly, so that factors are

all information, including processes and

strategies (but generally not evidentiary

standards), that a group health plan (or

health insurance issuer offering coverage

in connection with such a plan) considered or relied upon to design an NQTL

or used to determine whether or how the

NQTL applies to benefits under the plan

or coverage. The proposed definition of

the term “factors” also would include

information (but generally not evidentiary

standards) that the plan or issuer considered but rejected, consistent with previous

guidance on MHPAEA in the context of

the documents or plan information the

Departments consider relevant to a compliance determination.109 The proposed

definition also provides examples of factors, which include, but are not limited to,

provider discretion in determining diagnosis or type or length of treatment; clinical

efficacy of any proposed treatment or service; licensing and accreditation of providers; claim types with a high percentage

of fraud; quality measures; treatment outcomes; severity or chronicity of condition; variability in the cost of an episode

of treatment; high cost growth; variability

in cost and quality; elasticity of demand;

and geographic location.

Under these proposed rules, factors

would include processes and strategies,

but the Departments note that there may

be factors that do not satisfy the proposed

definitions of “processes” or “strategies.”

By defining the term “factor” broadly, the

Departments intend to capture any information used to design or apply an NQTL

(other than evidentiary standards generally), regardless of whether a plan or

issuer believes that information could also

See, e.g., Code section 9812(a)(8)(A), ERISA section 712(a)(8)(A), and PHS Act section 2726(a)(8)(A).

Code section 9812(a)(7)(B)(ii)(II) and (8)(A)(iv), ERISA section 712(a)(7)(B)(ii)(II) and (8)(A)(iv), and PHS Act section 2726(a)(7)(B)(ii)(II) and (8)(A)(iv).

109

See FAQs Part 31, Q9, which states that a plan must provide documents and plan information to a participant or beneficiary, or their authorized representative, including the specific

underlying processes, strategies, evidentiary standards, and other factors (including, but not limited to, all evidence) considered by the plan (including factors that were relied upon and were

rejected) in determining that the NQTL will apply to a particular mental health and substance use disorder benefit or any medical/surgical benefits within the benefit classification at issue.

107

108

September 5, 2023

688

Bulletin No. 2023–36

be characterized as a process or a strategy,

as those terms are proposed to be defined

under these proposed rules.

Additionally, the Departments propose

to define “processes” and “strategies” as

types of factors, in a manner that makes

clear the differences between the two

terms as they relate to the design and

application of an NQTL. Specifically, the

Departments would define “processes” as

relating to the application of an NQTL,

while “strategies” would relate to the

design of an NQTL.

The Departments therefore propose

to define “processes” to mean actions,

steps, or procedures that a plan or issuer

uses to apply an NQTL. “Processes”

would include requirements established

by the plan or issuer for a participant or

beneficiary to access benefits, including through actions by a participant’s or

beneficiary’s authorized representative,

or a provider or facility. The proposed

definition further provides that processes

include, but are not limited to: procedures to submit information to authorize

coverage for an item or service prior to

receiving the benefit or while treatment is

ongoing (including requirements for peer

or expert clinical review of that information); provider referral requirements;

and the development and approval of a

treatment plan. The proposed definition

also provides that processes include the

specific procedures used by staff or other

representatives of a plan or issuer (or the

service provider of a plan or issuer) to

administer the application of NQTLs,

such as: how a panel of staff members

applies the NQTL (including the qualifications of staff involved, number of staff

members allocated, and time allocated);

consultations with panels of experts in

applying the NQTL; and reviewer discretion in adhering to criteria hierarchy

when applying an NQTL.

These proposed rules would define

“strategies” as practices, methods, or

internal metrics that a plan or issuer

considers, reviews, or uses to design an

NQTL. The proposed definition provides

that examples of strategies include, but

are not limited to: the development of

the clinical rationale used in approving

or denying benefits; deviation from generally accepted standards of care; the

selection of information (such as from

Bulletin No. 2023–36

medical or clinical guidelines) deemed

reasonably necessary to make a medical

necessity determination; reliance on treatment guidelines or guidelines provided by

third-party organizations; and rationales

used in selecting and adopting certain

threshold amounts, professional protocols, and fee schedules. These proposed

rules would further specify that strategies

also include the creation and composition

of the staff or other representatives of a

plan or issuer (or the service provider of

a plan or issuer) that deliberates, or otherwise makes decisions, on the design of

NQTLs, including the plan’s decisions

related to qualifications of staff involved,

number of staff members allocated, and

time allocated; breadth of sources and

evidence considered; consultations with

panels of experts in designing the NQTL;

and the composition of the panels used to

design an NQTL.

To illustrate the interaction of the definitions of these terms, a plan might rely

on various combinations of processes,

strategies, evidentiary standards, and

other factors in designing and applying a

prior authorization NQTL for in-network,

non-hospital-based, inpatient/residential

facilities for non-emergency medical/surgical or mental health or substance use

disorder treatment. For example, the strategies used by the plan to design the NQTL

could include the development of the

clinical rationales the plan used in determining when to approve or deny benefits

for the facility, and the composition of the

staff of the plan that chose what information would be deemed necessary to determine whether a participant or beneficiary

has an immediate, clinically valid need

for treatment at the facility. The processes

the plan used in applying the NQTL could

include the specific steps a participant

or beneficiary (or their authorized representative, including their provider or the

facility) would need to take to obtain prior

authorization, such as obtaining a written

treatment plan. The processes would also

include the procedures used by staff or

other representatives of the plan (or the

service provider of the plan) in determining whether a particular request for prior

authorization would be approved. These

processes and strategies would also be

considered factors, as would the licensing and accreditation requirements for

689

non-hospital-based, inpatient/residential

facilities and the severity or chronicity of

a patient’s condition when they are seeking treatment at such a facility. Finally, the

evidentiary standards used to design or

apply the factors would include, for example, the benchmarks or thresholds the plan

uses to inform the number of days of treatment at the facility that would be authorized at one time, as well as published

research studies on the efficacy of the

treatment in this particular facility setting.

Finally, the Departments propose to

amend the definition of “treatment limitation” to clarify that the illustrative list

of NQTLs to which the definition refers

is non-exhaustive, and to amend the last

sentence to state that a complete exclusion

of all benefits for a particular condition or

disorder is not a treatment limitation for

purposes of this definition. By changing

the existing reference in the definition

from a “permanent” exclusion to a “complete” exclusion, the proposed amended

definition of “treatment limitation” would

better reflect a plan’s or issuer’s ability to

amend the terms of their plan or coverage

and affirm that this part of the definition

refers to an exclusion of all benefits for a

particular condition or disorder.

While NQTLs are generally defined as

treatment limitations that are not expressed

numerically, the application of an NQTL

in a numerical way does not modify its

nonquantitative character simply because

the NQTL sometimes involves numerical standards. For example, standards to

participate in a network would be NQTLs

because such standards are treatment limitations that typically are not expressed

numerically. Nevertheless, these standards

sometimes rely on or involve numerical

standards, such as reimbursement rates.

In this case, the numerical expression of

a reimbursement rate does not modify

the nonquantitative character of the standards related to network composition.

Therefore, such standards would still be

evaluated in accordance with the rules for

NQTLs under the statute and these proposed rules.

The Departments solicit comments on

all aspects of these proposed amendments

to existing definitions, as well as the new

proposed definitions. The Departments

also request comment on what additional

clarifications or examples might be helpful

September 5, 2023

in understanding these amended and new

proposed defined terms.

3. Nonquantitative Treatment Limitations

- 26 CFR 54.9812-1(c)(4), 29 CFR

2590.712(c)(4), and 45 CFR 146.136(c)

(4)

As explained earlier in this preamble,

the Departments are proposing changes

that are designed to prevent plans and

issuers from designing and implementing NQTLs that impose greater limits on

access to mental health and substance use

disorder benefits as compared to medical/surgical benefits. These proposed

rules would add additional requirements

for plans and issuers that apply NQTLs

with respect to mental health and substance use disorder benefits, to prevent

the imposition of a greater burden on

participants and beneficiaries accessing

those benefits, while preserving the ability of plans and issuers to impose those

NQTLs to the extent they are consistent

with generally recognized independent

professional medical or clinical standards

or standards related to fraud, waste, and

abuse. Subject to those two narrow exceptions, these proposed rules provide that

plans and issuers would not be permitted

to impose an NQTL unless (1) the NQTL

is no more restrictive as applied to mental

health and substance use disorder benefits than to medical/surgical benefits (also

referred to in this preamble as the no more

restrictive requirement);110 (2) the plan or

issuer satisfies requirements related to the

design and application of the NQTL (also

referred to in this preamble as the design

and application requirements);111 and (3)

the plan or issuer collects, evaluates, and

considers the impact of relevant data on

access to mental health and substance use

disorder benefits relative to access to medical/surgical benefits; and subsequently

takes reasonable action as necessary to

address any material differences in access

shown in the data to ensure compliance

with MHPAEA (also referred to in this

preamble as the relevant data evaluation

requirements).112

The proposed rules do not require

or suggest a particular sequence to the

analysis for evaluating compliance, and

no inferences should be drawn from the

order in which each of these independent requirements appear in the proposed

regulatory text. For example, a plan or

issuer designing or applying an NQTL

with respect to mental health or substance use disorder benefits could begin

analyzing compliance with MHPAEA

by looking at the design and application requirements under these proposed

rules before fully evaluating whether the

NQTL with respect to mental health or

substance use disorder benefits complies

with the no more restrictive requirement.

Additionally, if a plan or issuer, in the

process of complying with the relevant

data evaluation requirements, identifies

material differences in access to mental

health and substance use disorder benefits

as compared to medical/surgical benefits,

those differences would be considered

a strong indicator that the plan or issuer

violated the proposed no more restrictive

requirement or the design and application

requirements.113 In such instances, if the

plan or issuer took the additional steps

required under the material differences

requirement at 26 CFR 54.9812-1(c)(4)

(iv)(B), 29 CFR 2590.712(c)(4)(iv)(B),

or 45 CFR 146.136(c)(4)(iv)(B) (and the

special rule for NQTLs related to network

composition at 26 CFR 54.9812-1(c)(4)

(iv)(C), 29 CFR 2590.712(c)(4)(iv)(C),

or 45 CFR 146.136(c)(4)(iv)(C) did not

apply), then the plan or issuer would meet

all three independent requirements.114 The

Departments solicit comments on this proposed approach.

If a plan or issuer fails to meet any of

the three requirements with respect to an

NQTL in a classification, these proposed

rules state that the NQTL would violate

MHPAEA and may not be imposed on

mental health or substance use disorder

benefits in the classification. Where a

plan or issuer fails to satisfy the requirements of one part of these proposed rules

for NQTLs, the plan or issuer must make

changes to the terms of the plan or coverage or the way the NQTL is designed

or applied to ensure compliance with

MHPAEA.

These proposed rules also would prohibit plans and issuers from relying upon

any factor or evidentiary standard if the

information, evidence, sources, or standards on which the factor or evidentiary

standard is based discriminates against

mental health or substance use disorder

benefits as compared to medical/surgical benefits.115 Additionally, the proposed

rules would require plans and issuers to

collect and evaluate relevant outcomes

data and address any material differences

in access between mental health and substance use disorder benefits and medical/

surgical benefits as necessary to ensure

compliance. This proposed provision also

would impose a special rule for NQTLs

related to network composition.116

Finally, these proposed rules would

make clear that a plan or issuer that has

received a final determination of noncompliance under the comparative analysis

review process established by the CAA,

2021, including a final determination of

noncompliance based on failure to provide a sufficient comparative analysis,

also could be in violation of the substantive requirements that apply to NQTLs

under MHPAEA, as determined by the

Departments. Upon such a determination,

Proposed 26 CFR 54.9812-1(c)(4)(i), 29 CFR 2590.712(c)(4)(i), and 45 CFR 146.136(c)(4)(i).

Proposed 26 CFR 54.9812-1(c)(4)(ii), 29 CFR 2590.712(c)(4)(ii), and 45 CFR 146.136(c)(4)(ii).

112

Proposed 26 CFR 54.9812-1(c)(4)(iv), 29 CFR 2590.712(c)(4)(iv), and 45 CFR 146.136(c)(4)(iv).

113

But see the special rule for NQTLs related to network composition at proposed 26 CFR 54.9812-1(c)(4)(iv)(C), 29 CFR 2590.712(c)(4)(iv)(C), and 45 CFR 146.136(c)(4)(iv)(C), which

states that, when designing and applying one or more NQTLs related to network composition standards, a plan fails to meet the no more restrictive requirement and the design and application

requirements, in operation, if the relevant data show material differences in access to in-network mental health and substance use disorder benefits as compared to in-network medical/surgical

benefits in a classification.

114

The plan or issuer would also be required to document any steps taken in accordance with the material differences requirement (and the special rule for NQTLs related to network composition, if applicable) as part of its comparative analyses. Even if the plan or issuer had assessed compliance prior to the steps taken in accordance with the material differences requirement

and the special rule for NQTLs related to network composition, the plan or issuer would be required to re-evaluate whether the no more restrictive requirement and the design and application

requirements are met with respect to the adjusted NQTL.

115

Proposed 26 CFR 54.9812-1(c)(4)(ii)(B), 29 CFR 2590.712(c)(4)(ii)(B), and 45 CFR 146.136(c)(4)(ii)(B).

116

Proposed 26 CFR 54.9812-1(c)(4)(iv)(C), 29 CFR 2590.712(c)(4)(iv)(C), and 45 CFR 146.136(c)(4)(iv)(C).

110

111

September 5, 2023

690

Bulletin No. 2023–36

the Departments would direct the plan or

issuer to not impose the NQTL that is the

subject of the comparative analysis, unless

and until the plan or issuer can demonstrate

compliance or take appropriate action to

remedy the violation.117 The Departments

request comments on all aspects of these

proposed amendments and additions to

the rules regarding NQTLs.

a. Requirement that NQTLs be No

More Restrictive for Mental Health

and Substance Use Disorder Benefits

- 26 CFR 54.9812-1(c)(4)(i), 29

CFR 2590.712(c)(4)(i), and 45 CFR

146.136(c)(4)(i)

These proposed rules, if finalized,

would redesignate, from what is currently 26 CFR 54.9812-1(c)(4)(i), 29 CFR

2590.712(c)(4)(i), and 45 CFR 146.136(c)

(4)(i) to 26 CFR 54.9812-1(c)(4)(ii)(A),

29 CFR 2590.712 (c)(4)(ii)(A), and 45

CFR 146.136(c)(4)(ii)(A), the general rule

for evaluating NQTLs, and add new language to these paragraphs to impose additional requirements for NQTLs. As noted

elsewhere in the preamble, these proposed

rules would provide that a plan or issuer

may not apply any NQTL to mental health

or substance use disorder benefits in any

classification that is more restrictive, as

written or in operation, than the predominant NQTL that applies to substantially

all medical/surgical benefits in the same

classification.118 While the 2013 final

regulations largely relied on an analysis

of the processes, strategies, evidentiary

standards, and other factors used in the

application of NQTLs, proposed 26 CFR

54.9812-1(c)(4)(i), 29 CFR 2590.712(c)

(4)(i), and 45 CFR 146.136(c)(4)(i) is

consistent with the fundamental purpose

of MHPAEA and more closely mirrors the

statutory language in Code section 9812(a)

(3)(A), ERISA section 712(a)(3)(A), and

PHS Act 2726(a)(3)(A), which states that

plans and issuers “…shall ensure that…

the treatment limitations applicable to…

mental health or substance use disorder

benefits are no more restrictive than the

predominant treatment limitations applied

to substantially all medical and surgical

benefits covered by the plan ([or coverage]) . . . .”

To that end, the proposed rules provide

an explanation of how the terms “restrictive,” “substantially all,” and “predominant” would apply in the context of the

no more restrictive requirement in proposed 26 CFR 54.9812-1(c)(4)(i), 29 CFR

2590.712(c)(4)(i), and 45 CFR 146.136(c)

(4)(i). To comply with these proposed

rules, if finalized, plans and issuers would

be required to follow similar steps to

those that apply when analyzing parity

with respect to financial requirements or

quantitative treatment limitations under

the 2013 final regulations. These steps

would involve determining the portion of

plan payments for medical/surgical benefits subject to an NQTL in a classification;

whether the NQTL applies to substantially

all medical/surgical benefits in the classification; the predominant variation of the

NQTL that applies to medical/surgical

benefits in the classification; and whether

the NQTL, as applied to mental health

and substance use disorder benefits in the

classification, is more restrictive than the

predominant variation of the NQTL as

applied to substantially all medical/surgical benefits.

First, in determining whether an NQTL

applies to substantially all medical/surgical benefits in a classification, plans and

issuers would be required to determine

the portion of plan payments for medical/

surgical benefits expected to be subject

to the NQTL based on the dollar amount

of all plan payments for medical/surgical

benefits in the classification expected to

be paid under the plan or coverage for the

plan year (or the portion of the plan year

after a change in benefits that affects the

applicability of the NQTL). Similar to the

longstanding rules for financial requirements and quantitative treatment limitations, these proposed rules would provide

that for NQTLs, any reasonable method

may be used to determine the dollar

amount expected to be paid under the plan

or coverage for medical/surgical benefits.

In the Departments’ view, for a method to

be reasonable with respect to large group

market and self-insured group health

plans, a plan or issuer would be required

to consider group health plan-level claims

data to perform the substantially all and

predominant analyses, and must rely on

such data if it is credible to perform the

required projections.119 Similarly, for

small group market plans, an issuer would

be required to consider “plan”-level (as

opposed to the “product”-level) claims

data to perform the substantially all analysis, using the definitions of “plan” and

“product” in 45 CFR 144.103, and would

be required to rely on such data if it is

credible to perform the required projections.120 However, if an actuary who is

subject to and meets the qualification

standards for the issuance of a statement

of actuarial opinion regarding health plans

in the United States,121 including having

the necessary education and experience to

provide the actuarial opinion, determines

that a group health plan or issuer does not

have sufficient data at the plan level for

a reasonable projection of future claims

costs for the “substantially all” analyses,

the group health plan or issuer should utilize other reasonable claims data to make

a projection to conduct actuarially-appropriate analyses. As part of using a “reasonable method” to make these projections,

plans and issuers should document the

assumptions used in choosing a data set

and making projections. Plans and issuers would not be required to perform the

parity analysis under proposed 26 CFR

Proposed 26 CFR 54.9812-1(c)(4)(vii), 29 CFR 2590.712(c)(4)(vii), and 45 CFR 146.136(c)(4)(vii).

As explained later in this preamble, the Departments are also proposing to add clarifying language to these proposed rules to make clear that any references to the term “classifications” in

MHPAEA’s implementing regulations also includes permissible sub-classifications, including with respect to NQTLs.

119

See FAQs Part 34, Q3 (interpreting the reasonable method requirement with respect to financial requirements and quantitative treatment limits).

120

45 CFR 144.103 generally defines “product” as a discrete package of health insurance coverage benefits offered using a particular product network type within a service area, and “plan” as

the pairing of the health insurance coverage benefits under the product with a particular cost-sharing structure, provider network, and service area. In this context, the term “plan” is not synonymous with the term “group health plan.” This approach would also apply to individual health insurance coverage under HHS regulations that incorporate the group market rules by reference.

121

The U.S. Qualification Standards apply to members of the six U.S.-based organizations who issue Statements of Actuarial Opinion in the United States. The organizations are the American

Academy of Actuaries, American Society of Pension Professionals and Actuaries, American Society of Enrolled Actuaries, Casualty Actuarial Society, Conference of Consulting Actuaries,

and Society of Actuaries.

117

118

Bulletin No. 2023–36

691

September 5, 2023

54.9812-1(c)(4)(i), 29 CFR 2590.712 (c)

(4)(i), and 45 CFR 146.136(c)(4)(i) each

plan year unless there is a change in plan

benefit design or utilization that would

affect an NQTL within a classification.

The Departments solicit comments on

whether there are any challenges or other

considerations with this approach regarding which level of data plans and issuers

should look to in performing this prong

of the analysis, and whether there should

be a different standard given the different

nature of NQTLs.

Second, plans and issuers would be

required to determine whether the NQTL

applies to substantially all medical/surgical benefits in the classification, based

on the plan payments for medical/surgical

benefits subject to an NQTL as a portion

of the dollar amount of all plan payments

for medical/surgical benefits in the classification expected to be paid under the

plan for the plan year. An NQTL would

be considered to apply to substantially all

medical/surgical benefits in a classification if it applies to at least two-thirds of

all medical/surgical benefits in that classification. Whether the NQTL applies to

at least two-thirds of all medical/surgical

benefits would be determined without

regard to whether the NQTL was triggered

based on a particular factor or evidentiary

standard. For example, if a plan or issuer

applies a general exclusion for all benefits

in a classification that are for experimental or investigative treatment, and defines

experimental or investigative treatment

to be treatments with less than a certain

number of peer-reviewed studies demonstrating efficacy, the exclusion would be

treated as applying to all of the benefits in

the classification – not just those that may

be subject to the general exclusion for

experimental or investigative treatment

because they lack the requisite number of

peer-reviewed studies (that is, those that

actually triggered the NQTL based on the

evidentiary standard). These proposed

rules further provide that if an NQTL does

not apply to at least two-thirds of all medical/surgical benefits in a classification,

then that NQTL would not be permitted to

be applied to mental health or substance

use disorder benefits in that classification.

122

The Departments request comment

on whether any additional clarification

is needed for plans and issuers to determine whether an NQTL applies to substantially all medical/surgical benefits in a

classification. The Departments acknowledge that there are significant differences

between financial requirements or quantitative treatment limitations and NQTLs

and therefore also request comments on

whether plans and issuers maintain systems capable of making such determinations and the potential administrative

burdens that would be associated with

such determinations. Specifically, the

Departments are interested in feedback on

the approach under these proposed rules

for determining substantially all medical/

surgical benefits in a classification with

respect to certain NQTLs, including those

that are used to exclude benefits under

the plan or coverage (such as exclusions

for experimental or investigational treatment). The Departments also solicit comments on the interaction of this approach

with other statutory requirements for

plans and issuers prohibiting certain

NQTLs on medical/surgical benefits (such

as the prohibition on prior authorization

for any minimum hospital length of stay

after childbirth under the Newborns’ and

Mothers’ Health Protection Act122).

If an NQTL applies to substantially

all medical/surgical benefits in a classification, the third step would require plans

and issuers to determine the predominant

variation of the NQTL that is applied to

substantially all medical/surgical benefits

subject to the NQTL in the classification. The Departments propose that the

term “predominant” would, for this purpose, mean the most common or most

frequent variation of an NQTL within a

benefit classification. For example, if a

plan applies inpatient concurrent review

commencing 1 day, 3 days, or 7 days after

admission, depending on the reason for a

stay in a hospital or other inpatient facility, or the procedure performed during

such a stay, the plan imposes three different variations of the NQTL within the

benefit classification. Under this example,

to determine which variation is predominant, the plan would determine the portion of inpatient benefits subject to each

of the three different variations of the

NQTL based on the dollar amount of all

plan payments expected to be paid under

the plan or coverage for the plan year (or

the portion of the plan year after a change

in benefits that affects the applicability of

the NQTL). Similarly, if a plan applies

an NQTL such as prior authorization in

a manner that differs based on the manner of review (auto-adjudication vs. manual review) and the number of levels of

review (first-level review vs. first-level

review and peer-to-peer review), the plan

would regard each unique combination as

a separate variation. If the plan or issuer

imposes only one variation of an NQTL,

that variation is considered the predominant NQTL for purposes of the no more

restrictive requirement.

Variations of an NQTL for purposes of

the determination of which is “predominant” are different than levels of a type of

financial requirement or quantitative treatment limitation. Because of the nature of

NQTLs, the same mathematical principles

for combining plan payments to get to

more than one-half for a financial requirement or quantitative treatment limitation

may not always be transferrable when

determining which variation of an NQTL

is predominant. Therefore, for purposes

of NQTLs, the “predominant” variation

would be the most common or frequent

variation of the NQTL. The most common

or frequent variation would be the variation that applies to the highest portion

of all medical/surgical benefits within a

classification that are subject to the NQTL

based on expected plan payments. This

proposed definition mirrors the statutory

definition of the term “predominant” in

Code section 9812(a)(3)(B)(ii), ERISA

section 712(a)(3)(B)(ii), and PHS Act section 2726(a)(3)(B)(ii). However, it is different in some ways from the 2013 final

regulations for financial requirements and

quantitative treatment limitations, because

the distinct nature of NQTLs necessitates

looking to the most common or frequent

variation rather than comparing and combining numerical levels. Using the inpatient concurrent review example described

earlier in this section of the preamble, if

the plan had determined that applying

concurrent review 7 days after admission

Code section 9811, ERISA section 711, and PHS Act sections 2725 and 2751; 26 CFR 54.9811-1, 29 CFR 2590.711, and 45 CFR 146.130 and 148.170.

September 5, 2023

692

Bulletin No. 2023–36

was the predominant variation, the plan

would be prohibited from applying a more

restrictive variation of that NQTL to mental health or substance use disorder benefits in the classification.

The Departments request comment on

this approach and any additional clarifications or specificity that is necessary for

plans and issuers to determine the predominant NQTL that applies to substantially

all medical/surgical benefits in a classification, including what characteristics of

a particular NQTL should be considered

when determining the predominant variation when a plan or issuer imposes multiple variations, and how to distinguish

between what might be a single NQTL

without any variations versus what might

be variations of a single NQTL. The

Departments also request comment on

what should be considered the predominant variation of an NQTL when multiple variations are equally common or

frequent. Additionally, the Departments

are interested in alternative approaches

to determining the predominant variation

of an NQTL that would provide clarity

across a wide variety of NQTLs and ways

that plans and issuers design and apply

NQTLs to various types of benefits.

Fourth, under these proposed rules,

an NQTL applied to mental health or

substance use disorder benefits

This text is long and has been trimmed here. Open the source document for the complete record.