FAQS ABOUT AFFORDABLE CARE ACT 
IMPLEMENTATION (PART XVII) AND  
MENTAL HEALTH PARITY IMPLEMENTATION 
November 8, 2013 
 
Set out below are additional Frequently Asked Questions (FAQs) regarding implementation of 
the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 
(MHPAEA), as amended by the Affordable Care Act.  These FAQs have been prepared jointly 
by the Departments of Labor, Health and Human Services (HHS), and the Treasury (collectively, 
the Departments).  Like previously issued FAQs (available at 
http://www.dol.gov/ebsa/healthreform/ and http://www.cms.gov/cciio/resources/fact-sheets-and-
faqs/index.html), these FAQs answer questions from stakeholders to help people understand the 
law and benefit from it, as intended. 
 
The Mental Health Parity and Addiction Equity Act of 2008 
 
MHPAEA1 amended the Public Health Service Act (PHS Act), the Employee Retirement 
Income Security Act (ERISA) and the Internal Revenue Code (the Code) to provide increased 
parity between mental health and substance use disorder benefits and medical/surgical benefits.  
In general, MHPAEA requires that the financial requirements (such as coinsurance) and 
treatment limitations (such as visit limits) imposed on mental health and substance use disorder 
benefits cannot be more restrictive than the predominant financial requirements and treatment 
limitations that apply to substantially all medical/surgical benefits.2  Today, the Departments 
issued final rules on MHPAEA, which contain some clarifications regarding the statutes 
protections.   
 
Q1:  When are the final rules effective for group coverage? 
 
MHPAEAs statutory provisions generally became effective for plan years beginning after 
October 3, 2009.  Interim final rules under MHPAEA generally became applicable for plan years 
beginning on or after July 1, 2010.  
 
The final rules generally apply to group health plans and health insurance issuers offering group 
health insurance coverage for plan years beginning on or after July 1, 2014.  Until the 
applicability date of the final rules, plans and issuers subject to MHPAEA must continue to 
comply with the interim final rules.3 
 
                                                             
1 MHPAEA amended and supplemented the Mental Health Parity Act of 1996. 
2 MHPAEA does not mandate that plans and issuers cover mental health and substance use disorder benefits.  It 
applies only if a plan or issuer provides those benefits. 
3 The final rules do not apply by their terms to Medicaid managed care organizations, alternative benefits plans, or 
the Childrens Health Insurance Program.  However, MHPAEA requirements are incorporated by reference into 
statutory provisions that do apply to these entities. See Centers for Medicare & Medicaid Services State Health 
Official Letter (January 16, 2013), available at http://www.medicaid.gov/Federal-Policy-Guidance/downloads/SHO-
13-001.pdf.   
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Q2:  When do the final rules apply to individual health insurance coverage? 
 
The Affordable Care Act amended the PHS Act to apply MHPAEA to health insurance issuers 
offering individual health insurance coverage (both through the Health Insurance Marketplaces, 
also known as Exchanges, and outside the Marketplaces).  These changes are effective for policy 
years beginning on or after January 1, 2014.  The final rules apply to individual health insurance 
coverage for policy years beginning on or after July 1, 2014 and apply to both grandfathered and 
non-grandfathered plans.   
 
Q3:  What new protections do the final rules provide for individuals? 
 
The interim final rules contained an exception for differences in nonquantitative treatment 
limitations between medical/surgical benefits and mental health or substance use disorder 
benefits based on clinically appropriate standards of care.  This exception has been determined 
to be confusing, unnecessary, and subject to potential abuse.  The underlying requirements 
regarding nonquantitative treatment limitations (even without this exception) are sufficiently 
flexible to allow plans and issuers to take into account clinical and other appropriate standards 
when applying nonquantitative treatment limitations such as medical management techniques to 
medical/surgical benefits and mental health or substance use disorder benefits.  Thus, the final 
rules have eliminated this exception. 
 
The final rules also apply parity requirements to benefits for intermediate levels of care for 
mental health conditions and substance use disorders. The final rules accomplish this by 
providing that plans and issuers first identify what is meant by an intermediate service for mental 
health and substance use disorder care and medical/surgical care and requiring that such 
intermediate level services be treated comparably within the structure of plan benefits. Under the 
final rules, parity requirements for nonquantitative treatment limitations also apply to restrictions 
based on geographic location, facility type, provider specialty, and other criteria that limit the 
scope or duration of benefits for services (including access to intermediate level services).  
 
Finally, the final rules clarify the disclosure rights of plan participants with respect to both 
mental health and substance use disorder benefits and medical/surgical benefits.  See Q8 
regarding the type of information that individuals can receive from their plans and issuers under 
Federal law. 
 
Q4:  What are the Departments doing to promote compliance? 
 
The Departments are working with plans, issuers, and their service providers to help them 
understand and come into compliance with MHPAEA and to ensure that individuals receive the 
benefits they are entitled to under the law.  The Departments also coordinate with State 
regulators both individually and through the National Association of Insurance Commissioners 
to ensure compliance and issue guidance to address frequently asked questions from 
stakeholders.  Compliance assistance is a high priority and the Departments approach to 
implementation is marked by an emphasis on assisting plans and issuers that are working 
diligently and in good faith to comply with the requirements of the law.  The Departments 
receive complaints from group health plan participants and beneficiaries, enrollees in individual 
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market health coverage, providers, and other stakeholders and work with these individuals and 
the regulated community to correct violations. 
 
The Departments also engage in extensive outreach and compliance assistance activities 
throughout the year on MHPAEA.  For a copy of MHPAEA outreach publications, and to get 
information on upcoming events, see http://www.dol.gov/ebsa/mentalhealthparity/ and 
http://www.cms.gov/CCIIO/Programs-and-Initiatives/Other-Insurance-
Protections/mhpaea_factsheet.html. 
 
Q5: Do the final rules address multiple provider network tiers? 
  
Yes.  The final rules permit plans and issuers to use multiple provider network tiers, provided 
they are consistent with the parity requirements.  
 
Q6:  Are there plans that are exempt from MHPAEA? 
 
Yes.  MHPAEA applies to most employment-based group health coverage, but there are a few 
exceptions.  MHPAEA contains an exemption for a group health plan of a small employer.4  
Nevertheless, under HHS final rules governing the Affordable Care Act requirement to provide 
essential health benefits (EHBs), non-grandfathered health insurance coverage in the individual 
and small group markets must provide all categories of EHBs, including mental health and 
substance use disorder benefits. The final EHB rules require that such benefits be provided in 
compliance with the requirements of the MHPAEA rules.5   
 
MHPAEA also contains an increased cost exemption available to plans that meet the 
requirements for the exemption.  The final rules establish standards and procedures for claiming 
an increased cost exemption under MHPAEA. Additionally, plans for State and local 
government employees that are self-insured may opt-out of MHPAEAs requirements if certain 
administrative steps are taken.6  Finally, MHPAEA does not apply to retiree-only plans. 
 
   
                                                             
4 A small employer is generally defined as one that has 50 or fewer employees under ERISA and the Code, and one 
with 100 or fewer employees under the PHS Act. 
5 45 CFR 156.115. 
6 The procedure for plans to file a MHPAEA opt-out election with CMS is explained at 
http://www.cms.gov/CCIIO/Programs-and-Initiatives/Health-Insurance-Market-Reforms/nonfedgovplans.html.  If 
you are an employee of a State or local government and would like to know if your employment-based plan has 
elected to opt out, see the public list of non-Federal governmental employers that have opted out of MHPAEA at 
http://www.cms.gov/CCIIO/Resources/Files/Downloads/hipaa-nfgp-list-7-9-2013.pdf. 
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Q7:  For a plan or issuer claiming the increased cost exemption, where should the plan or 
issuer send its notice to the Departments? 
 
The increased cost exemption is not effective until 30 days after notice has been sent to group 
health plan participants and beneficiaries, enrollees in individual market health coverage, and to 
the appropriate Federal agency.  For notice to the Federal Government:  
 
  An ERISA plan, or a health insurance issuer offering coverage in connection with such 
plan, must notify the Department of Labor at:  
 
Office of Health Plan Standards and Compliance Assistance  
Employee Benefits Security Administration 
U.S. Department of Labor 
ATTN: Increased Cost Exemption for MHPAEA 
200 Constitution Avenue, N.W. 
Suite N-5653 
Washington, DC 20210 
 
  A group health plan that is a non-Federal governmental plan (or a health insurance issuer 
offering coverage in connection with such plan) or a health insurance issuer offering 
health insurance coverage in the individual market must notify HHS at:  
 
Centers for Medicare & Medicaid Services (CMS) 
Center for Consumer Information and Insurance Oversight (CCIIO) 
ATTN: Increased Cost Exemption for MHPAEA 
200 Independence Avenue, SW 
Room 737F 
Washington, DC 20201 
 
Or via facsimile to 301-492-4462 or via e-mail to marketreform@cms.hhs.gov. 
 
  A group health plan that is a church plan (as defined in section 414(e) of the Code), or a 
health insurance issuer offering coverage in connection with such plan, must notify the 
Department of the Treasury.  Notice should be sent to:  
 
MHPAEA Increased Cost Exemption Notice 
Office of Division Counsel/Associate Chief Counsel (TEGE) 
CC:TEGE 
Room 4300 
1111 Constitution Avenue, NW 
Washington, DC 20224 
 
 
 
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Q8: My plan uses medical management techniques (such as preauthorization) to manage 
care for mental health and substance use disorder services, and my mental health benefits 
were denied.  What information am I entitled to receive from my plan? 
 
MHPAEA provides that the criteria for medical necessity determinations with respect to mental 
health or substance use disorder benefits must be made available by the plan administrator or the 
health insurance issuer to any current or potential participant, beneficiary, or contracting provider 
upon request.  In addition, under MHPAEA, the reason for any denial of reimbursement or 
payment for services with respect to mental health or substance use disorder benefits must be 
made available to participants and beneficiaries. 
 
Furthermore, under the internal appeals and external review requirements added by the 
Affordable Care Act, non-grandfathered group health plans and health insurance issuers must 
provide to an individual (or a provider or other individual acting as a patients authorized 
representative), upon request and free of charge, reasonable access to and copies of all 
documents, records, and other information relevant to the individuals claim for benefits 
consistent with the Department of Labor claims procedure regulation.7 This includes documents 
of a comparable nature with information on medical necessity criteria for both medical/surgical 
benefits and mental health and substance use disorder benefits, as well as the processes, 
strategies, evidentiary standards, and other factors used to apply a nonquantitative treatment 
limitation with respect to medical/surgical benefits and mental health or substance use disorder 
benefits under the plan.  In addition, the plan or issuer must provide the claimant with any new or 
additional evidence considered, relied upon, or generated by the plan or issuer (or at the direction 
of the plan or issuer) in connection with a claim.  If the plan or issuer is issuing an adverse 
benefit determination on review based on a new or additional rationale, the claimant must be 
provided, free of charge, with the rationale. 
 
Additionally, under ERISA, documents with information on medical necessity criteria for both 
medical/surgical and mental health or substance use disorder benefits, as well as the processes, 
strategies, evidentiary standards, and other factors used to apply a nonquantitative treatment 
limitation, are instruments under which the plan is established or operated, and copies must be 
furnished to a participant8 within 30 days of request.9 
 
Q9:  How can I obtain more information about my health plan benefits and MHPAEA? 
 
As stated in Q8, the final rules clarify that participants and beneficiaries in ERISA group health 
plans are entitled to request certain specific information with respect to both mental health and 
                                                             
7 See 29 CFR 2560.503-1 and 2590.715-2719; 45 CFR 147.136. See also www.dol.gov/ebsa/healthreform and 
https://www.healthcare.gov/how-does-the-health-care-law-protect-me/#part=11 for consumer information on 
internal claims and appeals, external review of health plan decisions, and grandfathered health plans under the 
Affordable Care Act. 
8 ERISA section 3(7) defines the term participant to include any employee or former employee who is or may 
become eligible to receive a benefit of any type from an employee benefit plan or whose beneficiaries may become 
eligible to receive any such benefit. Accordingly, employees who are not enrolled but are, for example, in a waiting 
period for coverage, or who are otherwise shopping amongst benefit package options at open season, generally are 
considered plan participants for this purpose. 
9 See 29 U.S.C.  1024(b)(4), 1132(c)(1) and 29 CFR 2520.104b-1. 
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substance use disorder benefits and medical/surgical benefits, which may be helpful in 
determining whether or not a plan is complying with MHPAEA.  Additional information and 
FAQs regarding MHPAEA are available on the Department of Labors MHPAEA webpage at 
www.dol.gov/ebsa/mentalhealthparity and the Department of Health and Human Services 
webpage at http://www.cms.gov/CCIIO/Programs-and-Initiatives/Other-Insurance-
Protections/mhpaea_factsheet.html.  
 
If you have additional questions regarding compliance with MHPAEA, you may contact HHS by 
calling toll free at 1-877-267-2323 extension 6-1565 or emailing phig@cms.hhs.gov, or you may 
contact a benefit advisor in one of the Department of Labors regional offices at 
www.askebsa.dol.gov or by calling toll free at 1-866-444-3272.  Regardless of which number 
you call, the Federal Departments will work together and with the States, as appropriate, to 
ensure MHPAEA violations are addressed. 
 
The Departments request comments on what additional steps, consistent with the statute, should 
be taken to ensure compliance with MHPAEA through health plan transparency, including what 
other disclosure requirements would provide more transparency to participants, beneficiaries, 
enrollees, and providers, especially with respect to individual market insurance, non-Federal 
governmental plans, and church plans.  
 
Please send comments by January 8, 2014 to E-OHPSCA-FAQ.ebsa@dol.gov.  
 
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