facilities in their definition of “hospital” or “qualificd treatment facility.” Substance
abuse treatment facilities that are properly licensed for cach level of care they provide
are the equivalent of properly licensed hospitals on the medical/surgical side. This
treatment limitation, as contained in many insured plans, deprives members of the
ability to obtain covered treatment from those healthcare providers that specialize in,
and are specifically licensed to, render those services the member requires.

Similarly, some group health plans provide coverage for medical services rendered by
substantially all types of licensed professional clinicians such as physicians, nurses,
and physical rehabilitation therapists under the medical/surgical benefit. However,
the same plan might exclude coverage for substance use disorder services rendered by
substantially all types of licensed professional mental health/substance use disorder
providers such as psychiatrists, psychologists, mental health counselors, social
workers and certified addiction professionals under the mental health/substance use
disorder benefit. An insured plan should be required to eliminate such treatment
limitations in order to be in compliance with MHPAEA.

Comment 4: Non par Level of Care exclusions not permitted

1. Statutory Provision

ERISA §712(a) [29 USC 1185a] (3)(A)(ii) and (B)(ii) and (iii) were added to require
that in the case of a group health plan (or health insurance coverage offered in
connection with such a plan) that provides both medical and surgical benefits and
mental health or substance use disorder benefits, 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, and that there are no separate treatment limitations that
are applicable only with respect to mental health or substance use disorder bencfits. A
treatment limitation is considered to be predominant if it is the most common or
frequent of such type of limit. “The term ‘treatment limitation’ includes limits on the
frequency of treatment, number of visits, days of coverage, or other similar limits on
the scope or duration of treatment.” (Emphasis supplied.) ERISA §712(e)(5) was
added to define substance use disorder benefits as “benefits with respect to serviccs
for substance use disorders, as defined under the terms of the plan and in accordance
with applicable Federal and State law.”

2. Suggestion

It is requested that the implementing regulations clarify that MHPAEA does not
permit plans to contain treatment limitations on mental health/substance use disorder
benefits that exclude coverage for state licensed levels of care, or licensable
components, when such equivalent or analogous healthcare services are not excluded
under the medical/ surgical benefit. Such exclusions have the effect of limiting both
the scope and duration of treatment, creating an impermissible “treatment limitation”
in violation of MHPABA.


2.

Suggcstion

It is requested that the implementing regulations clarify that MHPAEA does not pre-
cmpt state parity and mandate laws to the extent that they do not prevent the
application of MHPAEA. Thus, provisions in state parity and mandate laws that are
more generous than parity required under MHPAEA are not impacted. However, it is
requested that the DOL/IRS clarify that provisions in stale parity and mandate laws
that are more restrictive than the parity that is required under MHPAEA, arc pre-
empted.

Explanation

As set forth in the legislative history for Economic Stabilization, Pub. 1.. No. 1 10-
343, House Report 110-374 (Part 1), pp.21, 23:

Since 1996, a key principle for Congress has been to
incrementally reform private health coverage by
establishing a federal floor of protections for workers and
their families. Through a federal standard that is a floor,
nol a ceiling, Congress has recognized that state
policymakers may determine that to protect patients in
state-regulated plans, a stronger set of standards are
necessary than those provided in federal law. In fact, many
states now require insurance companies to cover mental
health services.
* co *

The bill [ILR. 1424] generally would not preempt state
laws that do not “prevent the application” of federal mental
health parity standards... The bill also specifically docs not
intend to preempt state laws containing benefit mandates...

Thus, for example, licensure (hence geographic) and residency restrictions in state
law parity and mandate laws, creating treatment limitations that weaken the parity of
mental health and/or substance use disorder benefits required under MHPAEA, must
be eliminated from group plans in order for such plans to reach the federal parity
floor in compliance with MHPAEA.

Comment 9: Both Fully-funded and Self-insured plans are governed

1.

Statutory Provisions

MHPAEA governs “a group health plan (or health insurance coverage offered in
connection with such a plan) that provides both medical and surgical benefits and
mental health or substance use disorder benefits...” ERISA §712(a) [29 USC 1185a]
(3)(A). MHPAEA exempts from its governance small employer group plans for
employers who employed not more than 50 employees on business days during the


than the predominant financial requirements applied to substantially all medical and
surgical benefits covered by the plan, and that there are no scparate cost sharing
requirements that are applicable only with respect to mental health or substance use
disorder benefits. (Emphasis supplied). A financial requirement is considered to be
predominant if it is the most common or frequent of such type of requirement. “The
term ‘financial requirement’ includes deductibles, copayments, coinsurance, and out-
of-pocket expenses.” (Emphasis supplied). (Aggregate lifetime limits and annual
limits are addressed in §712(a) (1) and (2)).

Suggestion

Tt is requested that the implementing regulations clarify that MHPAEA does not
permit plans to impose a financial pre-authorization penalty when a healthcare
provider is unable, or otherwise fails, to obtain a pre-authorization for services prior
to admission under the mental health/substance use disorder benefit, when there is no
such financial pre-authorizalion penalty under the medical/surgical benefit. Such
imposition of pre-authorization penalties constitutes a more restrictive financial
requirement on the mental health/substance use disorder side than the predominant
financial requirements applied to substantially all medical/surgical benefits, thereby
prohibited by MIIPAEA.

Explanation

Many insured plans contain financial pre-authorization penalty provisions that apply
when a healthcare provider of substance use disorder treatment services is unable or
otherwise fails to obtain a pre-authorization to render services prior to the member’s
admission into treatment. Such financial penalties can range {rom $500 to complete
denial of coverage. Financial pre-authorization penalties exist with respect to the
mental health/substance use disorder benefit; however, not with respect to the
medical/ surgical benefit. These financial penalty provisions result in more restrictive
financial requirements on mental health/substance use disorder benefits than are
applicable to medical/surgical benefits, thereby violating the plain language and
intent of MHPAEA. An insured plan should be required to eliminate financial pre-
authorizations penalties that exist on the mental health/substance use disorder side,
and that do not exist on the medical/surgical side in order to be in compliance with
MHPAEA.

Comment 6: Non par Treatment Completion Requirements not permitted

1.

Statutory Provisions

ERISA §712(a) [29 USC 1185a] (3)(A)(i) and (B)(ii) and (iii) were added to require
that in the case of a group health plan (or health insurance coverage offered in
connection with such a plan) that provides both medical and surgical benefits and
mental health or substance use disorder benefits, the treatment limitations applicable
to mental health or substance use disorder benefits are no more restrictive than the


3. Explanation

Many insured plans providing both a medical/surgical and a mental health/substance
use disorder benefit, exclude from coverage the rehabilitation and/or residential levels
of care on the substance use disorder side, requiring patients to go straight from
detoxification into an outpatient setting. There exists no such corresponding exclusion
on the medical/surgical side. Residential treatment consists of a 24 hour structured
live-in environment with rehabilitative treatment services, and is an integral part of
the continuum of care for substance abuse treatment. While medical necessity
determinations need always be made, and are not at issue here, the exclusion from
coverage altogether of a state licensed rehabilitation or residential level of care, is a
treatment limitation that is more restrictive than predominant treatment limitations
placed on the medical/ surgical benefit.

To illustrate, a member obtaining substance abusc treatment may typically be
admitted to detoxification level of care, followed by intensive inpatient rehabilitation
and monitoring, followed by residential treatment, followed by outpatient day or
night treatment, followed by outpatient group therapy. To analogizc, a member
obtaining medical/surgical care typically will be admitted for surgery, followed by
intensive care in a monitoring unit, followed by continued hospitalization in a regular
patient room, followed by outpatient therapy. Every such level of medical/surgical
care is a covered benefit.

MHPAEA addresses substantially all medical/surgical benefits on the one hand, and
substantially all mental health/substance use disorder benefits on the other hand. To
permit plans to contain a significant treatment limitation on the number of visits, days
of coverage and scope and duration of treatment, such as an exclusion for residential
level of care on the mental health/subslance use disorder side, while providing a full
continuum of care on the medical/surgical side, would be contrary to the plain
language and intent of MHPABA.

An insured plan that excludes coverage for a level of care, such as residential
treatment, under the mental health/substance use disorder benefit that is not excluded
under the medical/surgical benefit, should be decmed in violation of MHPAEA, and
the plan should be required to provide corresponding levels of care as offered on the
medical/surgical side in order to be in compliance with MHPAEA.

Comment 5: Non Par Pre-authorization Penalties not permitted

1.

Statutory Provisions

ERISA §712(a) [29 USC 1185a] (3)(A)(i) and (B)(i) and (it) were added to require
that in the case of a group health plan (or health insurance coverage offered in
connection with such a plan) that provides both medical and surgical benefits and
mental health or substance use disorder benefits, the financial requirements
applicable to mental health or substance use disorder benefits are no more restrictive


benefits provided by out-of-network providers in a manner that is consistent with the
requirements of this section.”

2. Suggestion

3.

It is requested that the implementing regulations clarify that the MHPAEA parity be
applied equally to benefit coverage for out-of-network providers of mental health or
substance use services, as it is applied to benefit coverage for out-of-network
providers of medical and surgical services.

Explanation
As Congress expressed:

HR. 1424 makes clear that equity in financial
requirements, treatment limitations, and out of network
coverage is essential to a strong federal mental health
parity law. [Emphasis supplied]

Economic Stabilization, Pub, L. No. 110-343, House Report 110-374 (Part 1), p.23.
Thus, if an insured plan with medical and surgical and mental health or substance use
disorder benefits, provides out-of-network coverage on the medical/surgical side, it
must also provide on par out-of-network coverage on the mental health/substance use
disorder side.

Comment 8; More generous stale parity and mandate laws not pre-empted,

1.

More restrictive state parity and mandate laws pre-empted
Statutory Provision

ERISA §712(a) [29 USC 1185a] (3)(A)G@i) and (B)Gi) and (iii) were added to requitc
that in the case of a group health plan (or health insurance coverage offered in
connection with such a plan) that provides both medical and surgical benefits and
mental health or substance use disorder benefits, 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, and that there are no separate treatment limitations that
are applicable only with respect to mental health or substance use disorder benefits.
(Emphasis supplied). A treatment limitation is considered to be predominant if it is
the most common or frequent of such type of limit. “The term ‘treatment limitation’
includes limits on the frequency of treatment, number of visits, days of coverage, or
other similar limits on the scope or duration of treatment.” ERISA §712(e)(5) was
added to define substance use disorder benefits as “benefits with respect to services
for substance use disorders, as defined under the terms of the plan and in accordance
with applicable Federal and State law.”


Defending Liberty
Pursuing Justice

AMERICAN BAR ASSOCIATION Governmental Affairs Office
740 Fifteenth Street, NW
Washington, DC. 20005-1022
(202) 662-1760
FAX, (202) 662-1762

May 28, 2009

Alan D. Lebowitz

Deputy Assistant Secretary for Program Operations

US. Department of Labor

Office of Health Plan Standards and Compliance Assistance
Employee Benefits Security Administration

Room N-5653

200 Constitution Avenue, N.W.

Washington, DC 20210

RE: MHPAEFA Comments
Dear Mr. Lebowitz:
On behalf of the Amcrican Bar Association (ABA) and its more than 400,000 members, I
am pleased to present our enclosed comments in response to the Request for Information
regarding the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction
Equity Act of 2008 [See Notice of Request for Information, 74 Fed. Reg. 19155 (Apr. 28,
2009)].

Thank you for considering our views on this important matter.

Sincerely,

WAL

H. Robert Ficbach
Chair, ABA Standing Committee on Substance Abuse

/Enclosures
cc: Thomas Susman, Director, ABA Governmental Affairs Office

Lillian Gaskin, Senior Legislative Counsel, ABA Governmental Affairs Office
Jared Hess, Legislative Assistant, ABA Governmental Affairs Office


3, Explanation

The greatest out-of-pocket expense now incurred by members requiring mental health
and/or substance use disorder benefits, is the gap between what is covered and what is
not covered, in terms of the expenses incurred when accessing out-of-network
providers. Thus, the optimum way for membcrs requiring these services to reduce
that out-of-pocket exposure is to utilize an in-network provider. However, under
present pre-MIIPAEA plans, a great disparity cxists between the options available for
in-nctwork providers of medical/surgical services and the scarcity of in-network
providers of mental health and/or substance use disorder services. This disparity
needs to be addressed in the clarifications and regulations to be issued by the
Departments.

11


preceding year, and plans that qualify for the cost exemption in accordance with the
provisions of MHPAEA. Otherwise, both fully-insured and self-funded plans are
govemed by MHPAEA.

2. Suggestion

It is requested that the implementing regulations clarify that MHPAEA governs both
fully-funded plans that arc subject to state regulation and self-insured plans thal are
not subject to state parity and other state laws.

3. Explanation

Tt is apparent from the clear language of MIIPAEBA that, as opposcd to state
regulations that are limited in governance to fully-funded plans, MHPAEA governs
both fully-funded and self-insured plans, which do not otherwise fall within its
exemption provisions.

Comment 10: Parity Requirements apply equally to the Availability of In-network
providers

1. Statutory Provision

ERISA §712(a) [29 USC 1185a] (3)(A)(i) and (B)(i) and (ii) were added to require
that in the case of a group health plan (or health insurance coverage afforded in
connection with such a plan) that provides both medical and surgical benefits and
mental health or substance use disorder benefits, the financial requirements applicable
to mental health or substance use disorder benefits are no more restrictive than the
predominant financial requirements applied to substantially all medical and surgical
benefits covered by the plan, and if there are no separate cost sharing requirements
that arc applicable only with respect to mental health or substance usc disorder
benefits. A financial requirement is considered to be predominant if it is the most
common or frequent of such type of requirement. The term “financial treatment”
includes deductibles, co-payments, co-insurance and out of pocket expenses.

2. Suggestion

It is suggested that the implementing regulations clarify that in order to achieve
parity, a health insurance plan that contains both medical/surgical benefits as well as
mental health or substance use disorder benefits provide an in-network selection of
in-patient and out-patient providers that are comparable to the availability of in-
network providers for medical and surgical benefits.

10


predominant treatment limitations applicd to substantially all medical and surgical
benefits covered by the plan, and that there are no separate treatment limitations that
are applicable only with respect to mental health or substance use disorder benefits.
(Emphasis supplied). A treatment limitation is considered to be predominant if it is
the most common or frequent of such type of limit. “The term ‘treatment limitation’
includes limits on the frequency of treatment, number of visits, days of coverage, or
other similar limits on the scope or duration of treatment.” ERISA §712(e)(5) was
added to define substance use disorder benefits as “benefits with respect to services
for substance use disorders, as defined under the terms of the plan and in accordance
with applicable Federal and State law.”

2. Suggestion

It is requested thal the implementing regulations clarify that MHPABA docs not
permit plans to contain a separate treatment limitation under the mental
health/substance use disorder benefit that requires a member/patient to complete a
particular treatment program, as set forth in the plan, in order for the treatment to be
covered, when there is no such treatment program completion requirement for
coverage under the medical/surgical benefit.

3. Explanation

Many plans require that a member complete a treatment program as set forth in the
plan, (for example, a 28 day program), in order to be covered under their substance
use disorder benefit. There exists no such program completion requirement on the
medical/surgical side. To illustrate, under such a plan, a member could receive
detoxification, intensive inpatient and residential treatment for a total of 16 days, and
leave treatment against medical advice. Because the member did not complete a 28
day treatment program, none of the treatment would be covered. Conversely, under
the medical/surgical benefit, a member could be recovering from knee replacement
surgery and be prescribed a series of 28 therapy sessions, yet stop at the 16" session.
On the medical/surgical side, the 16 treatment sessions would, of course, be covered.
A separate treatment limitation that a member completes a treatment program set
forth in the plan, in order for any of the treatment services to be covered under the
mental health/ substance use disorder benefit is a separate treatment limitation that
does not exist under the medical/surgical benefit. An insured plan should be required
to eliminate such separate treatment limitations on the mental health/substance use
disorder side in order to be in compliance with MHPAEA.

Comment 7; Parity Requirements apply equally to Qut-of-Network providers
1. Statutory Provision
ERISA §712(a)(5) was added to require that “if the plan or coverage provides

coverage for medical or surgical benefits provided by out-of-network providers, the
plan or coverage shall provide coverage for mental health or substance use disorder


3. Explanation

For example, limits on number of visits under the medical/surgical benefit for
outpatient physical or occupational therapy visits, should not be compared with limits
on number of visits under the mental health/substance use disorder benefit for
inpatient psychotherapy, group therapy or other therapy-related sessions. MHPAEA
was intended to ensure parity in terms of treatment limitations with respect to the
comparable benefit. To permit outpatient treatment limitations to be applied to
components of inpatient care would violate the purpose and intent of MIIPAEA.

Comment 3: Facility type and Clinician type restrictions not permitted
1. Statutory Provision

ERISA §712(a) [29 USC 1185a] (3)(A)(ii) and (B)(ii) and (iii) were added to require
that in the case of a group health plan (or health insurance coverage offered in
connection with such a plan) that provides both medical and surgical benefits and
mental health or substance use disorder benefits, the treatment limitations applicable
to mental health or substance use disorder benefits are no more testrictive than the
predominant treatment limitations applied to substantially all medical and surgical
benefits covered by the plan, and that there are no scparate treatment limitations that
are applicable only with respect to mental health or substance use disorder benefits. A
treatment limitation is considered to be predominant if it is the most common or
frequent of such type of limit. “The term ‘treatment limitation’ includes limits on the
frequency of treatment, number of visits, days of coverage, or other similar limits on
the scope or duration of treatment.” (Emphasis supplied.)

2. Suggestion

It is requested that the implementing regulations clarify that MHPAEA does not
permit plans to limit covered treatment services for mental health/substance use
disorder benefits to those services rendered only by hospitals or facilities affiliated
with hospitals, as opposed to free-standing residential treatment facilities that are duly
licensed and accredited. Similarly, MHPAEA does not permit plans to limit covered
treatment services for mental health/substance use disorder benefits to those services
rendered by licensed psychologists, mental health counselors, social workers and
certified addiction professionals.

3. Explanation

Many insured plans, (and several state law mandates), providing for mental health/
substance use disorder benefits, restrict benctfits to services rendered only by hospitals
or facilities affiliated with hospitals, as defined by the plan. Many insured plans do
not include appropriately licensed and accredited free-standing residential treatment

we


must be equity between mental health coverage and all
comparable medical and surgical benefits that the plan
covers. H.R. 1424 makes clear that equity in financial
requirements, treatment limitations, and out of network
coverage is essential to a strong federal mental health parity
law.

MHPAEA does not separately address inpatient benefits versus outpatient bencfits,
nor were they intended to be addressed or treated separately. MHPAEA addresses
substantially all medical/surgical benefits on the one hand, and substantially all
mental health/substance use disorder benefits on the other hand. ‘To permit plans to
contain a significant limitation on the number of visits, days of coverage and scope
and duration of treatment, such as an vudpatient only benefit on the mental
health/substance use disorder side, while providing an inpatient and outpatient
benefit on the medical/surgical side, under the guise that MHPAEA does not mandate
a mental health/substance use disorder benefit, would be contrary to the plain
language and intent of MHPAEA.

Comment 2: Inpatient to Inpaticent/Outpatient to Outpatient comparison required
1. Statutory Provisions

ERISA §712(a) [29 USC 1185a] (3)(A)(ii) and (B)(ii) and (iii) were added to require
that in the case of a group health plan (or health insurance coverage offered in
connection with such a plan) that provides both medical and surgical benefits and
mental health or substance use disorder benefits, the treatment limitations applicable
to mental health or substance use disorder bencfits are no more restrictive than the
predominant treatment limitations applied to substantially all medical and surgical
benefits covered by the plan, and that there are no separate treatment limitations that
are applicable only with respect to mental health or substance use disorder bencfits. A
treatment limitation is considered to be predominant if it is the most common or
frequent of such type of limit. “The term “treatment limitation’ includes limits on the
frequency of treatment, number of visits, days of coverage, or other similar limits on
the scope or duration of treatment.” (Emphasis supplied.)

2. Suggestion

It is requested that the implementing regulations clarify that, in applying the parity
provisions of MHPAEA, inpatient benefits on the medical/surgical side are to be
compared with inpatient benefits on the mental health/substance use disorder side.
Likewise, outpatient benefits on the medical/surgical side are to be compared with
outpatient benefits on the mental health/substance use disorder side.


Comments on Paul Wellstone and Pete Domenici Mental Health Parity and

Addiction Equity Act of 2008 (“MHPAEA”)

Comment 1: Both Inpatient and Outpatient benefits are to be provided in parity

1. Statutory Provisions

ERISA §712(a) [29 USC 1185a] (3)(A)(ii) and (B)(ii) and (iii) were added to require
that in the case of a group health plan (or health insurance coverage offered in
connection with such a plan) that provides both medical and surgical benefits and
mental health or substance use disorder benefits, 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, and that there are no separate treatment limitations that
are applicable only with respect to mental health or substance use disorder benefits, A
treatment limitation is considered to be predominant if it is the most common or
frequent of such type of limit. “The term ‘treatment limitation’ includes limits on the
frequency of treatment, number of visits, days of coverage, or other similar limits on
the scope or duration of treatment.” (Emphasis supplied.)

2. Suggestion

It is requested that the implementing regulations clarify that an insured plan that
provides both an inpatient and outpatient benefit on the medical/surgical side; and
provides however, only an outpatient benefit on the mental health/substance use
disorder side, would be prohibited under MHPAEA as containing a predominant
treatment limitation on the scope or duration of mental hcalth/substance use disorder
benefits.

3. Explanation

Some have suggested that a plan providing an inpaticnt and outpatient benefit on the
medical/surgical side; and, only an outpatient benefit on the mental health/substance
use disorder side, and excluding an inpatient benefit, would be in compliance with
MHPABA. This is contrary to the language and intent of MHPAEA. While
MHPAEA does not mandate group health plans to provide a mental health and/or
substance use disorder benefit, if a plan does provide such a benefit, that benefit must
be on par with substantially all benefits provided on the medical/surgical side. The
legislative history for Emergency Economic Stabilization, Pub.L.No. 110-343, House
Report 110-374 (Part 1), II. Summary of the Bill, p. 24, speaks to the intent of
MIIPAEA:

The bill [H.R.1424] does not mandate group health plans to
provide any mental health coverage; however, if the group
health plan does offer mental health coverage then there