May 3, 2010 

Office of Health Plan Standards and Compliance Assistance 

Employee Benefits Security Administration 

U.S. Department of Labor 

Room N-5653 

200 Constitution Ave., NW 

Washington, DC 20710 

Attention: RIN 1210-AB30 

Centers for Medicare & Medicaid Services 

Department of Health and Human Services 

Attention: CMS-1410-IFC 

P.O. Box 8016 

Baltimore, MD 21244-1850 

CC:PA:LPD:PR (REG-120892-09) 

Room 5203 

Internal Revenue Service 

P.O. Box 7604 

Ben Franklin Station 

Washington, DC 20044 

Re: Interim Final Rules Under the Paul Wellstone and Pete Domenici 

Mental Health Parity and Addiction Equity Act of 2008 

Submitted via the Federal eRulemaking Portal: www.regulations.gov 

Dear Sir/Madam: 

America’s Health Insurance Plans is writing to offer comments and recommendations regarding 

the Interim Final Rules (IFR) implementing the Mental Health Parity and Addiction Equity Act 

of 2008 (MHPAEA). The IFR was published in the Federal Register on February 2, 2010 (75 

Fed. Reg. 5410). 

AHIP is the national association representing nearly 1,300 health insurance plans providing 

coverage to more than 200 million Americans. Our members offer a broad 

range of products in the commercial marketplace and also have demonstrated a strong 

commitment to participation in Medicare, Medicaid, and other public programs. 

Our comments and recommendations address the following: 
May 3, 2010 

Page 2 

• Allowing employers and health insurance plans sufficient time to make the extensive 

changes that are required by the IFR in a manner that does not disadvantage consumers 

and is consistent with the on-going efforts to implement the recently enacted health care 

reform legislation. 

• Permitting existing plan designs, such as combined copayments and coinsurance, that are 

consistent with the parity requirements of the MHPAEA and do not disadvantage patients 

accessing mental health or substance use disorder services. 

• Allowing the use of health plan strategies to ensure patients receive appropriate medical 

care and treatment. 

AHIP strongly supported the MHPAEA and worked with a broad coalition of stakeholders in 

developing the legislation. We believe the changes we are recommending to the IFR are 

consistent with the MHPAEA provisions and will provide for more effective implementation of 

the law. AHIP and its members look forward to working with you on this important issue. 

Please feel free to contact me at (202) 778-3255 or twilder@ahip.org if you have any questions. 

Sincerely, 

Thomas J. Wilder 

Senior Regulatory Counsel 

Attachment: 
1 

America’s Health Insurance Plans 

Response to Interim Final Rule 

Implementing the Mental Health Parity and Addiction Equity Act 

May 3, 2010 

America’s Health Insurance Plans is writing to provide comments and recommendations 

in response to Interim Final Rules (IFR) implementing the Mental Health Parity and 

Addiction Equity Act of 2008 (MHPAEA). 

A. Streamlining Implementation of the MHPAEA 

Issue 1: Giving employers and health insurance plans sufficient time to make all of 

the necessary changes to implement the IFR. 

Recommendation

The compliance date of the rule should be extended to plan years on or after July 1, 2011. 

Discussion

Employers and health insurance plans face significant challenges in implementing the 

IFR. For example, parity must be calculated for each group health plan for each plan 

year based on the following factors: 

• Type of financial requirement (deductible, copayment and co-insurance). 

• Type of financial limitation (number of days or treatment sessions). 

• Category of benefits (e.g., out-patient/in-network). 

• Type of benefit design (e.g., HMO, PPO or POS plans). 

As a result, thousands of complicated calculations and benefit determinations must be 

made for each year to comply with the IFR and make any necessary changes to benefit 

designs. This process is even more complex in situations where the group plan must 

coordinate the parity determination between one or more medical/surgical payers and one 

or more vendors providing “carve-out” mental health or substance use disorder benefits. 

Any changes to financial requirements and treatment limits based on the parity 

determination will then need to be incorporated into provider and employer client 

contracts, submitted to state and federal regulators for approval, and communicated to 

plan beneficiaries and participants. 

The IFR was issued February 2, 2010 with full compliance required by July 1, 2010, 

giving employers, insurers, and plan administrators five months to implement the 

complicated parity calculations and benefit design changes required by the rule. While a 

majority of group plans have later plan years (typically December 1st or January 1st), 

considerable work must be done over the next few months to comply with the IFR given 
2 

that most employers, insurers, and plan administrators are already negotiating and 

establishing health plan designs for the 2011 plan year. 

Employers and health insurance plans are currently dedicating extensive resources to 

implement the recently enacted Patient Protection and Affordable Care Act in addition to 

the changes required by the IFR. We believe employers and health insurance plans and 

the employees and consumers they serve would be best served if the July 1 

implementation date is extended to give additional time to come into compliance. 

B. Establishing a Framework for MHPAEA Implementation 

 

Issue 2: Allowing payment of medical/surgical benefits in connection with mental 

health or substance use disorder treatment. 

Recommendation

Employers and health insurance plans should be permitted to continue reimbursing 

physicians and hospitals for medical services in connection with the treatment of a mental 

health or substance use disorder, rather than having to implement new and costly systems 

to track and classify claims and reimbursements. 

Discussion: 

The IFR definition of mental health benefits provides that “(a)ny condition defined by the 

plan as being or as not being a mental health condition 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 ICD, or State guidelines.)” (26 C.F.R. 

§54.9812(a), 29 C.F.R. §2590.712(a), and 45 C.F.R. §146.136(a)). A similar provision is 

included in the definition of substance use disorder benefits. According to the Preamble 

to the IFR, the requirement to define benefits based on the ICD or DSM classification, “is 

included to ensure that a plan does not misclassify a benefit in order to avoid complying 

with the parity requirements.” (75 Fed. Reg. 5412). 

Strictly defining claim reimbursement by the categories established in the ICD or DSM 

may have unintended negative consequences for consumers. In some cases, employers 

and health insurance plans may pay medical/surgical claims that include a mental health 

or substance use disorder component. The following examples illustrate situations that 

may arise: 

• A patient visiting his or her primary care physician (PCP) may complain of 

depression in addition to other physical symptoms. The PCP submits a 

diagnosis of depression and prescribes a prescription drug to treat depression in 

addition to other diagnoses and prescribed treatments. 

• A patient with a terminal illness is receiving care from an inpatient hospice 
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facility. In addition to treating the individual’s medical condition, the hospice 

provides counseling services for the patient and his or her family. 

• A patient is admitted to an emergency room and is subsequently admitted to the 

hospital as an inpatient for de-toxification treatment in connection with a 

substance use disorder. The hospital is paid for medical treatments provided in 

connection with the emergency care and inpatient services. 

If employers and health insurance plans are required to strictly segregate claims based on 

ICD or DSM classifications, extensive and costly administrative systems will need to be 

established to track and reimburse such claims. Additionally, it will be even more 

difficult to calculate parity and to allocate cost-sharing and treatment limits across 

benefits in situations where a primary care physician or hospital is providing medical 

services that have a mental health or substance use disorder component.1

 

We believe a more reasonable approach is to allow employers and health insurance plans 

to continue the current practice of reimbursing services for certain diagnoses or 

procedures that may be classified by the DSM or ICD as mental health conditions or 

substance use disorders as medical/surgical benefits, if the payments are made in the 

context of the overall medical care provided to the patient. 

Issue 3: Ensuring provision of outpatient medical/surgical benefits. 

Recommendation

Make clear that the MHPAEA allows employers and health insurance plans to provide 

inpatient or outpatient medical/surgical benefits if they do not provide similar coverage 

for mental health or substance use disorder benefits. 

Discussion

The IFR requires employers and health insurance plans to provide mental health and 

substance use disorder benefits in all benefit categories in which medical/surgical 

benefits are offered. As a result, employers and health insurance plans are not permitted 

to provide medical/surgical benefits in a care setting (e.g., outpatient or inpatient) if they 

do not provide such coverage for mental health or substance use disorders. 

The MHPAEA only addressed out-of-network care settings and did not address coverage 

for medical/surgical, mental health or substance use disorder benefits with respect to 

inpatient or outpatient benefits. 

The recently enacted health care legislation includes requirements for the HHS Secretary 

to develop standards for essential benefits including mental health and substance use 

 

1

 The same issue arises in the context of facilities providing medical care in connection with treatment of a 

mental health condition or substance use disorder. According to a strict interpretation of the IFR, payment 

to such facilities for medical care would be considered a medical/surgical benefit. 
4 

disorders. We believe the determination of the range of inpatient and outpatient 

medical/surgical, mental health, and substance use disorder benefits are best made by the 

HHS Secretary in the context of the essential benefits determination rather than through 

the IFR. 

C. Determining Parity with Respect to Financial Requirements 

Issue 4: Allowing use of “hybrid” plan designs combining copayments and 

coinsurance. 

Recommendation

Permit employers and health insurance plans to preserve consumers’ access to 

medical/surgical benefits by combining copayments and coinsurance for purposes of 

determining parity. 

Discussion:

As discussed above, the IFR requires parity to be determined separately with respect to 

each financial requirement. The first step is to determine if the financial requirement is 

applicable to substantially all (i.e., two-thirds) of all medical/surgical benefits. 

The substantially all test as set out in the IFR may disqualify certain hybrid plans 

combining copayments and coinsurance. Some employers and health insurance plans 

apply copayments or coinsurance based on the type of services. For example, 

copayments may be used in connection with physician office visits, and coinsurance may 

be applied to outpatient surgery or tests such as MRIs. If the parity determination is 

made separately for each financial requirement, it is possible neither copayments nor 

coinsurance will meet the substantially all threshold. As a result, no cost-sharing may be 

allowed for mental health or substance use disorder benefits. 

This result places consumers accessing medical/surgical services at a disadvantage 

because of the unequal cost-sharing requirements. The medical/surgical benefits should 

be preserved and the parity determination should allow the combining of copayments and 

coinsurance. 

Two approaches to hybrid plan designs should be permitted. First, employers and health 

insurance plans should be permitted to make reasonable parity comparisons for types of 

services within a category of benefits. For example, copayment levels for 

medical/surgical benefits and mental health and substance use disorder benefits could be 

compared for routine services such as physician office visits and visits to a social worker, 

therapist, or other mental health or substance use disorder provider. Additionally, 

comparisons of coinsurance levels between inpatient hospital stays and stays at an 

inpatient facility providing mental health or substance use disorder services should be 

allowed. We believe such comparisons are allowed by the MHPAEA and would not 

disadvantage patients accessing medical/surgical, mental health or substance use disorder 
5 

services. 

In addition, employers and health insurance should be allowed flexibility to determine the 

actuarial equivalent for cost sharing between medical/surgical benefits and mental health 

and substance use disorder benefits within a benefit category. Under this approach, a 

reasonable estimate could be determined for the overall level of cost-sharing individuals 

would be expected to pay during a plan year that combines the copayment and costsharing levels for medical/surgical benefits as compared to cost-sharing for mental health 

and substance use disorder benefits. 

There are a variety of approaches employers and health insurance plans may take to 

ensure that the financial requirements imposed on patients to access mental health and 

substance use disorder benefits are no more burdensome than the financial requirements 

applied to medical/surgical benefits. Plan designs that combine coinsurance and 

copayment features can be constructed to meet the requirements of the MHPAEA, and 

we believe such hybrid financial requirements should be allowed by the IFR. 

Issue 5: Permitting separate deductibles or out-of-pocket limitations for 

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

Recommendation

Allow employers and health insurance plans to impose separate accumulating financial 

requirements as long as patients accessing mental health or substance use disorder 

services do not have higher cost-sharing. 

Discussion

The IFR requires use of a single deductible or out-of-pocket expense limit for all 

medical/surgical, mental health, and substance use disorder benefits. According to the 

IFR Preamble, the agencies believe a single accumulating financial requirement is more 

consistent with the MHPAEA, although it is recognized separate limits are not prohibited 

by the law. 

We believe use of separate accumulating financial requirements for medical and surgical 

benefits and for mental health or substance use disorder services is consistent with 

MHPAEA policy goals, because it allows patients to more easily access mental health or 

substance use disorder benefits and may limit overall cost-sharing for such services. 

Two examples illustrate this point: 

• A plan has a $2,000 deductible for all benefits. As an alternative, the plan uses a 

$1000 deductible for medical and surgical services and a separate $1,000 

deductible for mental health or substance use disorder services. In the latter 

case, a patient who needs to access mental health services may access such 
6 

services sooner because of the lower, separate $1,000 deductible applied to those 

treatments. 

• A plan may have a $5,000 out-of-pocket limit for all benefits. As an alternative, 

the plan may choose to impose a $2,500 limit for medical/surgical benefits and a 

$2,500 limit for mental health and substance use disorder benefits. A patient 

needing mental health or substance use disorder services may have a lower costsharing responsibility over the course of a plan year because of the lower, 

separate out-of-pocket limit for those services. 

In addition, allowing separate accumulating financial requirements is easier and less 

costly to administer in the case of group plans that provide mental health or substance use 

disorder services through a third-party vendor. In many cases, the mental health or 

substance use disorder vendor does not coordinate claims reimbursement with payment 

of medical/surgical claims, and, as a result, it would be very difficult to determine when a 

patient has met a “global” deductible or out-of-pocket limit applicable to medical and 

surgical benefits and mental health or substance use disorder benefits. 

Using a single accumulating financial requirement also makes the pricing of such benefits 

more uncertain when mental health or substance use disorder services are “carved out.” 

For example, a payer providing medical/surgical benefits prices the coverage for 

employer clients based on the assumption that 100% of the cost-sharing under a 

deductible or below an out-of-pocket limit is allocated to medical/surgical costs. If there 

is a global deductible or out-of-pocket limit, it is less certain whether the cost-sharing 

will be applicable to benefits provided by a medical/surgical payer or a mental health or 

substance use disorder payer. As a result, each payer will have difficulty determining the 

cost of coverage provided. 

We believe the MHPAEA clearly permits the use of separate accumulating financial 

requirements, and that such an approach benefits consumers since the use of separate 

deductible or out-of-pocket limits may reduce the financial exposure for patients 

accessing mental health or substance use disorder benefits. Additionally, not permitting 

separate deductibles or out-of-pocket limitations may create a significant administrative 

burden for employers and health insurance plans that carve-out mental health benefits to 

a separate vendor. The IFR should be modified to allow separate accumulating financial 

requirements so long as patients accessing mental health or substance use disorder 

services do not have a greater cost-sharing responsibility. 

D. Determining Parity with Respect to Treatment Limitations 

Issue 6: Clarify how parity is determined with respect to treatment limits. 

Recommendation

Make clear that the MHPAEA governs limitations on the number or days of treatment 

and not plan requirements for the provision of appropriate medical care, provider 
7 

credentialing or reimbursement. 

Discussion

The IFR applies parity requirements to “nonquantitative” treatment limits, which are 

defined to include medical management standards, formulary design for prescription 

drugs, provider network standards (including reimbursement rates), plan methods for 

determining usual, customary, and reasonable charges, step therapies and “fail first” 

requirements, and exclusions based on failure to complete a course of treatment. 

Such plan provisions are intended to ensure patients receive appropriate medical care and 

to address provider credentialing standards or contracting provider reimbursements. The 

MHPAEA was intended to provide better access to benefits by requiring parity with 

respect to limits on the number or days or treatments. The law was never intended to 

require a balancing other plan design features between medical/surgical benefits and 

mental health and substance use disorder benefits. 

MHPAEA Definition of Treatment Limits 

The MHPAEA defines a “treatment limitation” as “limits on the frequency of treatment, 

number of visits, days of coverage, or other similar limits on the scope or duration of 

treatment.” (29 U.S.C. §1185a(a)(3)(B) and 42 U.S.C. §300gg-5(a)(3)(B), emphasis 

added). The MHPAEA further requires plans to ensure that: 

(T)he treatment limitations applicable to such 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) and there are no separate 

treatment limitations that are applicable only with respect to mental health 

or substance use disorder benefits. 

(26 U.S.C. §9812(a)(3)(A)(ii), 29 U.S.C. §1185a(a)(3)(A)(ii), and 42 U.S.C. §300gg5(a)(3)(A)(ii), emphasis added). It is clear from the wording of the MHAPEA that it is 

intended to address parity in the context of numerical limits on benefits such as costsharing requirements or day or treatment limitations. 

Application of Standards for Appropriate Care 

Health insurance plans use a variety of approaches to ensure patients receive appropriate 

care based on their health condition and recommendations from treating providers. The 

goal of these requirements is not to deny needed care or limit access, but rather to make 

sure the individual is receiving treatment and services appropriate to their condition and 

health needs. For example, an individual with a serious behavioral health condition may 

be paired with a case manager who is responsible for coordinating medical, behavioral 

health, and social services received by the patient. 
8 

Another medical management tool used to ensure appropriate care is creation of a plan by 

the patient’s health care provider that sets out goals and a strategy for treatment. 

Reimbursement is based on the services in the treatment plan so that the patient receives 

care from designated providers based on the needs and condition of the individual. 

Challenges in Applying the Parity Standards to Nonquantitative Limits 

The IFR requirements for determining parity in the context of nonquantitative treatment 

limits are not clearly defined and will be difficult to administer. The IFR states the 

following with respect to nonquantitative limitations: 

A group health plan (or health insurance coverage) may not impose a 

nonquantitative treatment limitation with respect to mental health or 

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 nonquantitative treatment limitation to mental health 

or 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 with 

respect to medical surgical/benefits in the classification, except to the 

extent that recognized clinically appropriate standards of care may permit 

a difference. 

(26 C.F.R. §54.9812(c)(4)(i), 29 C.F.R. §2590.712 (c)(4)(i), and 45 C.F.R. 

§146.136(c)(4)(i)). 

The IFR language raises a number of questions: 

• What does it mean to apply a nonquantitative limitation for mental health and 

substance use disorder benefits “no more stringently than” such a limitation for 

medical/surgical benefits? 

• How should these standards be made “comparable” between medical/surgical 

benefits and mental health and substance use disorder benefits? 

• What does the exception, “to the extent that recognized clinically appropriate 

standards of care may permit a difference,” mean in the context of nonquantitative 

limitations? 

Applying parity in the context of nonquantitative treatment limits is even more 

complicated for plans using separate vendors to provide medical/surgical benefits and 

mental health and substance use disorder benefits. Assuming the various payer vendors 

can agree on a parity definition for nonquantitative treatment limitations, the IFR may 

raise antitrust-related concerns by requiring the sharing of extensive information on 

policies and procedures, including proprietary data (e.g., provider reimbursement rates 

and prescription drug formula designs), to ensure compliance with the regulations. 
9 

We believe the MHPAEA was not intended to address plan standards to ensure 

appropriate medical care or provider credentialing or reimbursement. Even if 

such standards are governed by the MHPAEA, the IFR provides an unworkable 

and complicated framework that should be revised to more clearly explain how 

such parity determinations will be made by employers and health insurance plans. 

Issue 7: Issues related to “Scope of Services” 

Recommendation: 

Any discussion with respect to scope of services should be addressed in the context of the 

essential benefits process of the Patient Protection and Affordable Care Act. 

Discussion: 

The Preamble to the IFR requests public input on issues related to the types of treatments 

or services provided by employers and health insurance plans. We believe Congress did 

not intend the parity requirements to govern the types of services or settings of care that 

may be covered. Such discussion is more appropriately addressed by the process HHS 

will use to determine the essential benefits offered by qualified health benefit plans under 

the PPACA. 

The MHPAEA provides that nothing in the Act is intended to affect “the terms 

and conditions of the plan or coverage relating to such benefits . . . .” (26 U.S.C. 

9812(b), 29 U.S.C. §1185a(b), and 42 U.S.C. §300gg-5(b)). This provision 

makes clear Congressional intent that employers and health insurance plans may 

determine what conditions, treatments, services, or settings of care are covered 

under the terms and conditions of the plan or insurance policy. 

This view is supported by the legislative history of the MHPAEA. The Senate 

Committee Report includes the following statement with respect to the application 

of the parity requirements: 

The bill would not require plans to offer mental health benefits, nor would 

it require that those plans cover all types of mental health services or 

ailments if the plan covered any mental health services or ailments. 

(Sen. Rep. No. 110-53, 110th Cong., 1st Session (2007) at p. 7). The House Energy and 

Commerce Committee Report included similar language: 

In addition, this requirement does not change the current ability of an 

insurer or provider to determine medically necessary and appropriate care 

and treatment for their patients. It merely ensures that patients are not 

denied mental health coverage based on the specific disorder they have. 

For example, a person cannot be denied coverage by their health plan 

merely because they have autism. A plan may determine, however, 
10 

whether a treatment is medically necessary or appropriate for a given 

person at a given time based on their individual situation. 

(H. Rep. 110-374, Part 3, 110th Cong., 2nd Session (2008)). 

As discussed above, the PPACA establishes a process for the HHS Secretary to determine 

essential benefits offered by a qualified health benefits plan. We believe this process is a 

more appropriate venue to determine what types of services or care settings should be 

included.