Enforcing Mental Health Parity: State Options to Improve Access to Care

Abstract

• Issue: The Mental Health Parity and Addiction Equity Act (MHPAEA) is the primary federal law that aims to safeguard access to behavioral health treatment for those with private health insurance. However, enforcing the legislation can be complex, and many health insurers have yet to fully comply with the law’s requirements.
• Goals: Identify challenges, effective regulatory tools, and considerations for policymakers looking to improve access to behavioral health care under the MHPAEA.
• Methods: We interviewed insurance regulators in 10 states and reviewed applicable federal and state law and reports documenting MHPAEA oversight.
• Key Findings and Conclusion: States rely on several approaches for MHPAEA oversight, including the collection of access and utilization data to identify treatment disparities and market conduct examinations to review claims for MHPAEA compliance. Regulators also evaluate insurers’ comparative analyses of how they determine behavioral health benefits as compared to medical benefits. Many states also have implemented consumer protections that, while not directly linked to the MHPAEA, advance the law’s goals and support regulators’ efforts to enforce it. Supplementing the law with strong standards to ensure adequate provider networks, combined with efforts to grow the behavioral health workforce, would further expand patient access to behavioral health treatment.

Introduction

High demand for behavioral health services, coupled with a shortage of providers and high out-of-pocket costs, has left many U.S. patients — including those with health insurance — struggling to access needed care.¹ One important safeguard for consumers is the 2008 Mental Health Parity and Addiction Equity Act (MHPAEA), which aims to ensure that patients do not face greater difficulty getting care for behavioral health conditions than they do for any other care.² This federal law requires health plans that cover treatment for mental health and substance use disorder conditions to do so on par with their coverage of other health conditions.³ However, enforcing this protection can be complex, in part because the law targets a broad range of potential barriers to care.

The federal government has provided guidance and tools to help insurers and group health plans meet their responsibilities under the law. But in most cases, state insurance regulators are responsible for monitoring insurer compliance with the MHPAEA within their state’s individual and group markets.⁴ This brief examines what 10 states (Arizona, Colorado, Georgia, Maryland, New Hampshire, New Mexico, Pennsylvania, Rhode Island, Washington, and West Virginia) are doing to ensure compliance with the MHPAEA and to help inform other states as they implement strategies to improve patient access to behavioral health care.⁵ (See “How We Conducted This Study” for more details.)

Findings

To ensure compliance with insurance standards, state regulators often rely on complaint data, form and rate reviews, and market conduct examinations. In overseeing MHPAEA compliance, regulators report leveraging these regulatory tools in combination with other approaches.

State Regulators Use Traditional Tools for MHPAEA Oversight While Recognizing Their Limits

Consumer and Provider Complaints

One tool regulators typically use, consumer complaints, provides limited help in flagging potential parity violations. Few consumers are aware of their protections, and fewer still will file a complaint with state regulators. Some states are leveraging providers, who may be in a better position to see barriers across insurers. For example, Colorado has a portal dedicated to taking provider complaints.

Rate and Form Reviews

States’ annual review of insurer rates and policy forms is an opportunity to see if insurers are meeting MHPAEA’s requirements at a high level. Treatment limits like caps on the number of doctor visits covered are relatively easy to spot in plan documents, and insurers can be required to use a template to “show their math” demonstrating compliance with cost-sharing requirements.⁶ Because these annual reviews must occur before insurance plans can be sold, some regulators said they can require changes to an insurer’s behavioral health benefits without having to do an in-depth MHPAEA analysis.

For example, Colorado won’t approve insurers’ rates if they can’t demonstrate that cost sharing for behavioral health services is on par with other care. But a close review of other potential barriers that are less easily measured — such as an insurer’s process for reviewing claims for payment — is not possible in the compressed time allowed for form review.

Market Conduct Exams

Many of the states in our study have incorporated one traditional tool — market conduct examinations — to enforce the MHPAEA. Market conduct exams allow regulators to closely review how insurers are processing and paying claims to assess MHPAEA compliance. Regulators may include a review of MHPAEA compliance in a broader exam that looks at all insurance laws, or target exams to review only for MHPAEA issues.

Pennsylvania performed baseline exams of each insurer to review for MHPAEA compliance and is now conducting another round of exams to follow up on problems identified in the initial exams. West Virginia has taken a similar approach.

States may also initiate a targeted market conduct exam in response to a potential MHPAEA violation, especially if the violation is indicative of a systemic issue. However, market conduct exams require significant time and resources and offer only a retrospective look at compliance. As such, regulators that find a parity violation may require insurers to return money to consumers who overpaid for services, but they cannot undo harm to patients whose care was denied or delayed.

States Embrace a New Oversight Tool: NQTL Comparative Analyses

A 2021 federal law requires insurers to perform and document an analysis that compares their process for determining behavioral health benefits, cost sharing, plan rules, and provider networks to the process used for other medical services, and to provide these analyses to state and federal regulators upon request.⁷

States can and do require that insurers provide these comparative analyses on a regular basis. However, states differ in their approaches to reviewing comparative analyses. West Virginia, for example, requires regular reporting on all NQTLs, while other states require analyses only in specified areas, such as utilization management and network development.⁸

All study states expressed that most or all comparative analyses they have received thus far are insufficient to assess MHPAEA compliance.⁹ Regulators noted that reviewing comparative analyses can be a complex process, especially when an insurer opts to “throw the kitchen sink” at their analysis, rather than providing a clear explanation of its approach to plan design and rules. Regulators expected the analyses to be done as part of insurers’ internal compliance processes, but, as one official said, some insurers seem to be “playing catch-up.” One regulator said it would be helpful to have clearer federal guidance on what constitutes a sufficient comparative analysis. However, regulators in a few states — mainly those who have used this process for several years — have seen improvement in recent insurer submissions.

States Use Outcomes Data to Identify Behavioral Health Treatment Disparities

States utilize outcomes data to identify areas where an insurer’s coverage of behavioral health may be more limited than it is for other services.¹⁰ Although federal parity rules say outcome disparities don’t prove that an insurer has failed to meet parity for behavioral health, they may indicate a potential violation.

State regulators said data revealing differences in coverage can “show the magnitude of the problem” of inferior access and suggest areas for further scrutiny. For example, if the share of behavioral health visits that take place out-of-network is greater than it is for other medical services, that may indicate that an insurer hasn’t provided adequate access to in-network behavioral health providers. If a disparity suggests a potential MHPAEA violation, regulators can request more information from the insurer. If the insurer cannot demonstrate compliance, regulators may have grounds to take an enforcement action, including levying penalties. In other cases, regulators may use data to prompt insurers to take corrective action, including reprocessing claims or updating utilization management policies.

Complementary Protections Can Reduce Barriers to Care and Simplify Oversight

Many states have built additional consumer protections into their insurance laws that, while not directly linked to the MHPAEA, advance the law’s goals and can support regulators’ efforts to enforce it (Exhibit 1).¹¹

Regulators expressed that these statutory requirements help “clarify expectations” for insurers and simplify the enforcement process by making it “a whole lot easier” to check for compliance with a particular requirement, compared with doing a full MHPAEA analysis that evaluates every possible limitation on behavioral health services. State laws that establish specific standards for how an insurer must cover behavioral health services, on top of the MHPAEA’s requirements, can also increase access to care for consumers. For example, one state regulator reported seeing an “upward curve” in patients using their benefits to get care after the state instituted several consumer protections, including removing cost sharing for certain services.

Discussion

States are refining their approaches to assessing MHPAEA compliance, combining longstanding tools for enforcing coverage standards with newer strategies tailored to the law itself. To help identify potentially unlawful barriers to obtaining behavioral health services, many states are turning to outcomes data to determine whether and how behavioral health claims are being paid. A proposed update to federal rules would take a similar approach, requiring insurers to provide outcomes data in addition to their comparative analyses.¹² Our study states are also requiring insurers to provide regulators with analyses documenting their compliance with parity standards.

Our study states agreed that the MHPAEA is a strong foundation for improving access to behavioral health services. At its core, the parity law doesn’t require robust coverage of behavioral health; it merely requires that coverage be no worse than coverage for other care. But it targets one of the greatest challenges in providing equal access to behavioral health care by telling insurers how to cover that care, in addition to what to cover.

Regulators also view the law as an important tool to use with other measures that more directly affect access to behavioral health services, including strong network adequacy standards and efforts to grow the behavioral health workforce to meet provider shortages.¹³ Looking forward, outcomes data used for MHPAEA oversight could help state regulators as they explore complementary protections that reduce barriers to behavioral health care.