504 Lavaca, Ste 850 

Austin, TX 78701 

P: 512-406-7200 

F: 512-406-7217

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1

May 3, 2010 

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

Re: CMS–4140–IFC 

Interim Final Rules Under the Paul Wellstone and Pete Domenici Mental Health Parity 

and Addiction Equity Act of 2008

Dear Sir or Madame: 

Cenpatico Behavioral Health, LLC (Cenpatico) is writing to offer comments in response to the interim final 

rules ("IFRs") under the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act 

(MHPAEA) of 2008. Cenpatico is a managed behavioral health and wellness organization (MBHO) 

which contracts with Managed Care Plans (MCPs) in eight states. Cenpatico promotes integrated, 

evidence based behavioral health services and is committed to mental health parity. 

The IFRs were issued in the Federal Register on February 2, 2010, and are applicable to group health 

plans and group health insurance issuers for plan years beginning on or after July 1, 2010. Medicaid 

managed care plans offering substance abuse and mental health services must comply with the 

MHPAEA; however, the IFRs state that these regulations do not apply to MCPs and that additional 

guidance will be provided by the Centers for Medicare and Medicaid Services (CMS). 

We appreciate the guidance provided by the IFRs regarding financial requirements and quantitative 

treatment limitations. However, we have concerns that the IFRs exceed the scope of both MHPAEA's 

terms and Congressional intent and greatly undermine the very structures and procedures that have been 

successfully used in the management of public sector behavioral health services. 

In response to the IFRs, Cenpatico recommends the Agencies make the following important changes: 

1. Withdraw the IFRs and republish them as proposed regulations.

The IFRs require far-reaching changes in the way in which mental health and substance use disorder 

benefits are provided and managed. Most of these changes could not reasonably have been 

foreseen based on a reading of the statute. In similar situations, an industry being subjected to new 

and far-reaching rules would expect to be provided with the ability to review specific Agency 

proposals and to comment directly on the positions the Agency is proposing to take before those 

positions become final in any way. This notice and comment process, codified in the Administrative 

Procedure Act, provides the surest way to publication of final rules that equitably set standards for all 

persons affected by the regulations. 

Despite this, the Agencies have short-circuited the process in the present situation. Although the 

Agencies issued a Request for Information (RFI), this was merely an inquiry process designed to 

educate the agencies about this complex area. It was in no way a substitute for a real notice-andcomment process. This defective process has produced an IFR which, as detailed below, is 

confusing, ineffective and may actually inhibit rather than advance true parity. 
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P: 512-406-7200 

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Cenpatico believes that the only way to remedy this situation is for the Agencies to withdraw the IFRs 

and republish them in proposed form. Taking such a step would not work to the disadvantage of any 

group or individual affected by MHPAEA. The statute is self-executing, and the statutory mental 

health and substance abuse disorder standards do not require regulations to become effective. The 

Agencies themselves have recognized that compliance efforts by companies involved in the 

administration and management of the mental health and substance abuse disorder benefits are ongoing. Although the Agencies state that they issued an IFR due to the need for guidance, the 

Agencies’ rush to publication has produced a regulation that confuses rather than clarifies. Cenpatico 

urges the Agencies to take this reasonable step and reissue the regulation in proposed form so that 

all persons and entities affected by MHPAEA can be heard on an equitable basis. 

2. Alternatively, postpone the effective date of the IFRs until July 1, 2011.

The IFRs are comprehensive and complex regulations that require many changes in the way 

Cenpatico provides services. Congress recognized that MHPAEA would require significant changes 

and therefore delayed its effective date, presuming that the Agencies would use the one year delay to 

propose and finalize regulations and thereby give the industry both input into the regulatory process 

and time to adjust to any changes necessitated by the regulations. Despite this long time frame, the 

agencies did not issue any guidance at all until the issuance of the IFRs and then provided little or no 

time for the industry to begin efforts to comply with the new standards. Indeed, the Agencies 

recognize at many places in the preamble to the IFRs that they did not have sufficient information to 

provide detailed guidance or examples, or in some cases, to provide any guidance at all. 

Cenpatico believes that the Agencies should agree to a one year postponement of the applicability 

date of the IFRs, so that application of the standards in the IFR will begin for plan years beginning on 

or after July 1, 2011. This would have the dual benefit of providing adequate time for the industry as it 

develops its compliance mechanisms. The Agencies would also benefit from this extended timeline 

by allowing time for a thorough review of the comments received in response to the IFR. Ideally, such 

a postponement would also facilitate the issuance of a final regulation reflecting the comments from 

all interested parties before the IFR applicability date. 

3. Eliminate non-quantitative treatment limitations (NQTLs)

The general parity rule set forth in section (c)(2)(i) of the IFRs states that a plan that covers both 

medical/surgical and mental health/substance abuse care may not apply any financial requirement or 

treatment limitation for mental health/substance abuse care that is more restrictive than the 

predominant financial requirement or treatment limitation applied to substantially all medical/surgical 

benefits in the same classification. However, the Agencies diverged from the statutory approach by 

including a definition of "treatment limitations" through the use of the term "Non-quantitative 

Treatment Limitations" ("NQTLs"). This term is not fully defined, but instead is the subject of an 

"illustrative list" of practices provided in section (c)(4)(ii) of the IFRs. 

Cenpatico urges the Agencies to eliminate the NQTL category from the treatment limitations subject 

to the parity rule for the following reasons: 

(a) The inclusion of the NQTL category exceeds the statutory authority and legislative intent 

behind MHPAEA. By its terms and legislative history, MHPAEA is a statute with limits on the 

extent of the practices and procedures that it covers. By including NQTLs and subjecting 

them to parity analysis, the IFRs negate the language in MHPAEA and apply parity in ways 

never intended by Congress; 
504 Lavaca, Ste 850 

Austin, TX 78701 

P: 512-406-7200 

F: 512-406-7217

www.cenpatico.com 

3

(b) NQTL practices cannot be meaningfully assessed under the "substantially all" and 

"predominant" tests mandated by Congress. Several of the practices listed in the NQTL 

illustrative list (e.g., provider reimbursement, network credentialing, formulary development) 

are structural matters that apply to all activities of the behavioral health rather than limitations 

on treatment. Other practices (e.g., step therapies, requirement to finish a course of 

treatment) are individual therapeutic tools available for all patients but only used on a caseby-case basis, so they are difficult to assess as a numerical matter; 

(c) The inclusion of NQTL practices undermines the reasoning and financial analyses 

enumerated by the Agencies themselves in the preamble to the IFRs. The Agencies 

conclude that concurrent review of mental health/substance abuse benefits, although 

clinically justified in certain individual instances, cannot be applied generally because it is not 

comparable to retrospective review applied for medical/surgical benefits. In other words, the 

use of these tools — tools that have been instrumental in producing the favorable cost 

savings results on which the Agencies rely -- will be open to constant second-guessing, 

rendering their continued use problematic for Cenpatico. If implemented, the inclusion of 

NQTLs in the regulations will therefore markedly change the mental health and substance 

abuse care marketplace, rendering the Agencies' financial projections questionable at best 

and placing a significant cost burden associated the inclusion of NQTLs in the regulations on 

Cenpatico and other MBHOs; 

(d) The Agencies ignore the vast differences between mental health/substance abuse care and 

medical/surgical care by essentially forcing MBHOs to adopt incongruent standards from the 

medical/surgical industry. The Agencies recognize that "not all treatments or treatment 

settings for mental health conditions or substance abuse disorders correspond to those for 

medical/surgical settings." 75 Fed. Reg. at 5416. However, by requiring that the mental health 

and substance abuse NQTLs must be "comparable to" limitations in the medical/surgical 

area, the Agencies arbitrarily combine the two areas, ignoring the fact that (at least with 

respect to NQTLs) requiring comparability is an attempt at equating apples with oranges. 

Essentially, this is a mandate that only those care management processes and procedures 

used for medical/surgical benefits can be employed in the mental health and substance 

abuse area. Whereas quantitative limitations and financial requirements are easier to 

compare across the two types of benefits, NQTLs are not since they directly relate to the 

nature of the care provided. This lack of comparability means that, in most cases, the use of 

any NQTL with respect to mental health or substance abuse care will be suspect. Eliminating 

this inequity would resolve the issue of systemic lack of comparability between the treatment 

approaches and settings in the two benefit areas. 

To demonstrate this problem, consider that both major depression and diabetes are chronic 

illnesses and the treatment for both is similar up to a point. The care provider in both cases 

can prescribe appropriate medication, advocate for certain behavioral or lifestyle changes, 

and provide appropriate follow-up and evaluation. On-going treatment for diabetes, however, 

is relatively straightforward. Response to treatment is easy to measure and there is little or 

no care management involved besides follow-up office visits and laboratory work. By 

contrast, treatment for depression is more complex and requires on-going management. In 

addition to the treatment tools noted above for both diabetes and depression, treatment for 

depression involves the use of psychotherapy, which does not equate with any other type of 

medical intervention. The psychotherapy process varies based on the practitioner’s 

theoretical orientation (for example, cognitive behavioral, psychodynamic, family systems, 

etc.) and the presence of factors such life stressors and other conditions that can affect the 

patient’s progress. On-going, concurrent medical management is needed to discuss the 

treatment process and to ensure that the patient is responding. Without direct consultation 

with the treating psychiatrist (a process totally absent on the medical side), there is no way to 

assess the patient’s progress. Indeed, it is not unusual to find that a patient diagnosed with 
504 Lavaca, Ste 850 

Austin, TX 78701 

P: 512-406-7200 

F: 512-406-7217

www.cenpatico.com 

4

major depression will, even after six months of seeing a psychotherapist several times a 

week, show no response to treatment. In such a case, medical management is necessary in 

order to advocate for addition interventions and/or second opinions. 

The different ways in which mental health and substance abuse disorder care and benefits 

are provided must be respected if patients are to be well-served. Inclusion of NQTLs under 

the regulations provides a means by which use of these tools will be discouraged. The best 

way to preserve these salutary differences in approach is to eliminate NQTLs from coverage 

under the regulations; and, 

(e) The Agencies' approach is a detriment to Cenpatico’s patients because it deprives MBHOs of 

the discretion to assure that behavioral health patients receive optimal, cost effective care to 

the vulnerable population it serves. The Agencies have noted that "[a] shift in source of 

treatment from primary care physicians to mental health professionals could lead to more 

appropriate care, and thus, better health outcomes." 75 Fed. Reg. at 5423. Cenpatico agrees 

with this assessment, but only if the MBHOs are permitted to use their medical necessity 

criteria and management techniques to determine the best, most cost-effective care. The 

IFRs, if enforced as is, and finalized without change, would preclude the beneficial outcome 

the Agencies anticipate. As presently structured, the IFRs accord insurers and benefit 

managers dealing with medical/surgical care unfettered discretion to develop new structures 

and different approaches, thereby assuring the most appropriate level and quality of care for 

their patients. By contrast, the IFRs would have MBHOs and group health plans react to what 

is done on the medical/surgical area, searching for a comparability of approach rather than 

concentrating on the needs of the patient. 

4. Revise definitions for mental health and substance abuse disorder benefits

Cenpatico requests that the definitions of mental health benefits and substance abuse disorder 

benefits be revised to refer only to the terms of the plan and applicable state laws. The standard 

adopted by Congress does not permit the interpolation of any standards other than the relevant plan 

language and applicable Federal and state laws. Those are the only standards that would apply in the 

case of determination of whether a disorder was medical in nature. To achieve actual parity, the 

Agencies should allow the same standard to apply to the definitions of mental health and substance 

abuse disorders and benefits. 

5. Clarify inclusion of drugs for the treatment of mental health or substance abuse disorders

Cenpatico recommends the Agencies clarify that inclusion of drugs for the treatment of mental health 

or substance abuse disorders under a prescription drug plan does not constitute the provision of 

mental health or substance abuse disorder benefits for the purposes of applying the parity 

requirement. We believe that the six classifications contained in the regulation should be modified so 

that (1) prescription drug plans and emergency care are included under the parity requirement only 

when mental health and substance abuse disorders are covered under at least one other 

classification within the same group health plan and (2) the provision of medical treatment in 

connection with a mental health or substance abuse disorder will not have the effect of causing the 

plan to be covered by the parity requirement. 

6. Permit plans to impose either a unified or separate, but no more restrictive deductible

Since the primary goal of MHPAEA is parity, the best option for achieving this is to permit plans the 

ability to impose either a unified or no more restrictive deductible. This is the easiest and least 

invasive way to place both types of benefits on par with each other. 
504 Lavaca, Ste 850 

Austin, TX 78701 

P: 512-406-7200 

F: 512-406-7217

www.cenpatico.com 

5

If the IFR goes into effect without this change, many individuals would have to incur greater out of 

pocket expenses to access the same care. If unchanged, the IFRs would likely subject the vast 

majority of plan participants who never require mental health or substance abuse disorder benefits to 

a higher deductible. 

7. Amend the “Substantially All “ Test to Permit Combination of All Types of Cost-Sharing as a 

Single Financial Requirement.

As currently drafted, section (c)(3)(i)(A) of the IFRs states that if no single financial requirement 

applies to “substantially all” (i.e., two-thirds of) medical/surgical benefits, then no financial requirement 

of the same type may be applied to mental health and substance abuse disorder benefits. Because 

the regulation further provides for comparison only to the same “type” of financial requirement, copayments may only be compared to co-payments, deductibles to deductibles, etc. This approach 

creates the anomalous result that, on the medical/surgical side, all benefits could be subjected to 

some sort of financial requirement, while no financial requirements at all could be placed on mental 

health or substance abuse benefits. This would occur, for example, if 55 percent of the medical 

surgical benefits are the subject of co-payments, and another, different 45 percent to deductibles. In 

such a case, all of the medical/surgical benefits are the subject of some kind of cost-sharing. 

However, because no single type of cost sharing applies to two -thirds of the medical surgical 

benefits, no cost sharing at all would be permitted with respect to mental health and substance abuse 

disorder benefits. 

The Agencies can rectify this by allowing for the combination of all financial requirements in order to 

determine whether the substantially all standard has been met. Once the standard is met, the plan in 

question would then be able to satisfy the parity standard by adopting the same limitations for mental 

health and substance abuse disorder benefits as are applied in the medical/surgical arena. As stated 

previously in other comments included in this letter, parity entails equality of treatment. 

8. Consider the catastrophic effect the inclusion of NQTLs would have on Medicaid in terms of 

both cost and quality of care. 

The Centers for Medicare and Medicaid Services (CMS) has stated that, although MHPAEA does not 

apply directly to Medicare or Medicaid, the standards under MHPAEA will apply in the Medicaid 

context “insofar as a state’s Medicaid agency contracts with one or more managed care organizations 

(MCOs) or prepaid Inpatient health Plans (PIHPs) to provide medical/surgical benefits as well as 

mental health or substance abuse disorder benefits . . . .” (CMS Letter to State Health Officials 

(November 4, 2009) at http://www.cms.hhs.gov/SMDL/downloads/SHO110409.pdf). 

For many years, MBHOs like Cenpatico have been engaged under state Medicaid programs to 

assure the provision of appropriate, cost-effective mental health and substance abuse disorder 

benefits. These management activities have not only improved the quality of care for this population, 

but also enabled states to exercise crucial controls on the costs involved in providing this care. These 

advances have occurred while at the same time there has been little or no management of 

ambulatory medical/surgical benefits under Medicaid. 

Although the IFRs do not apply to Medicaid managed care organizations, Cenpatico believes that 

there is a significant likelihood that CMS, in adopting regulations for such organizations, will largely 

rely on the analysis performed by HHS and the other Agencies in issuing the IFRs. 

As a result, the inclusion of NQTLs in the IFR will provide a means for undoing all of this progress in 

realizing cost savings and high quality of care. The absence of medical/surgical ambulatory care 

management under Medicaid means that employment of managed care techniques for mental health 
504 Lavaca, Ste 850 

Austin, TX 78701 

P: 512-406-7200 

F: 512-406-7217

www.cenpatico.com 

6

or substance abuse disorder Medicaid benefits will be difficult at best under the approach taken in the 

IFRs. 

This highlights the differences between medical/surgical care and mental health and substance abuse 

disorder treatment in the starkest way possible. The lower income population covered by Medicaid is 

frequently the population most in need of the types of services provided by MBHOs, especially in 

terms of treatment design and follow-up. Such services are all implicated by the vague and 

expansive nature of the NQTLs covered by the IFRs, leading to the likelihood that use of such 

techniques will be greatly diminished. 

The disincentive to use managed care techniques also poses significant cost issues to state Medicaid 

programs. It is common knowledge that states are currently searching for options to control Medicaid 

costs in the current economy. As noted above, the application of managed care for mental health 

under Medicaid has achieved significant cost savings for the states. However, the mandated NQTLs, 

would include virtually all mental health care management techniques currently in use. 

The IFRs, if finalized without change, would negate the states of the ability to control the costs of 

mental health and substance abuse benefits in any meaningful way. In light of this, and especially 

because the Agencies have provided no cost estimates as to the effect of including NQTLs in the 

regulations, Cenpatico urges that the Agencies remove this category from the regulations. 

Cenpatico is pleased to have had the opportunity to provide the above comments on the IFRs. 

Please feel free to contact me at sdonaldson@centene.com or (512) 406-7200, extension 67515, if you 

have any questions. 

Thank you for consideration of our comments. 

Respectfully submitted, 

Sam Donaldson, Ph.D. 

Cenpatico 

President and CEO